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Web Letters | The Nation

Web Letter

The true unemployment rate is far greater than 5% if you consider those people who are considered "outside of the labor force" such as those who:

-are incarcerated
-have lost their jobs and have become discouraged over time from actively looking for work
-are self-employed or wish to become self-employed
-have retired before the official retirement age but would still like to work (involuntary early retirees)

Also, anyone whose unemployment benefits have expired before finding work are not included in unemployment statistics.

Those interested in learning more about creating an economy based on sustainability might be interested in reading Small Is Beautiful: Economics As If People Mattered, by E.F. Schumacher.

Daniel Cohen

San Francisco, CA

Jan 13 2008 - 12:32am

Web Letter

Without Barbara Ehrenreich, The Nation would have very little spine. She and Naomi Klein seem to do more than their share of the dirty work around here. Bravo to both of them.

S. Debs

San Diego, CA

Jan 10 2008 - 6:15pm

Web Letter

GDP measures the amount of money that changes hands. So if less money changes hands, that is negative growth.

But what if an important commodity, like, oh, let’s say oil for instance, skyrockets in price, so twice as much money changes hands when the same amount of oil is used for fuel? If inflation is not measured correctly, the fall in the value of the currency is not figured in properly; everyone can be starving and living in a culvert and paying millions for a slice of bread, but GDP will still grow.

People are no warmer in their homes and they have less money for anything else, but GDP stays up because of all the extra money changing hands for the same amount of oil. Since lots of less valuable money is changing hands there is no recession--people are just poorer.

And if you remove food, oil and housing from the basket of items used to calculate inflation (yes, that was done years ago--those items are not used to calculate inflation figures), we don’t have inflation either--we just have higher prices!

Welcome to the Brave New World.

Paul Fretheim

Independence, CA

Jan 10 2008 - 5:56pm

Web Letter

The outsourcing of jobs, industries and services, and the insourcing of guest workers for middle-class jobs as well as "undocumented" workers and guest workers for low-wage jobs, along with open borders, will drive down the wages of all workers in every country. The American market is about to disappear, because, as this piece noted, disposable income will be driven down by low wages.

In fact, open borders will drive down the wages of American as well as "undocumented" workers. A recent article by the New York Times Service and report on CCN chronicled a California grower with a $50 million agribusiness being "forced" to go to Mexico because he couldn't get enough workers in the United States. In the US, he paid his workers $9 an hour, and in Mexico, he was paying them $11 a day. Because of the lower wages in Mexico, he had already recovered his start-up costs. Does anyone think that with open borders, no tariffs and NAFTA, he will return to the US to pay $9 an hour?

Fleetwood trailers recently moved from Rialto, California, to Mexicali, Mexico. In California, they paid American workers, many of whom were of Mexican descent, $20 an hour, and just across the border, paid Mexican workers $3 an hour. Does anyone think that with open borders and no tariffs the jobs and industries will return to the US? If these industries and agribusiness do return to the US, it would be because American workers were working for $3 an hour in industries, or being paid $11 a day for agricultural work.

Pervis J. Casey

Riverside, CA

Jan 10 2008 - 4:34pm

Web Letter

Great article! If only there were more journalists covering this glaring issue, we might get somewhere. Sure, CNN has their "war on the middle class" segments, but why is the population so willing to live in slums and to work horrible jobs for nothing? It's as if high fructose corn syrup contains some sort of numbing agent. I can't understand how anyone would ever think that the economy is good. You would have to be Pollyanna's aerobics instructor to be anymore irrationally exuberant.

What does a college education get you these days? What are the jobs out there and what do they pay? What does suitable housing cost compared to the current stagnant wages? What are the conditions people are living in? How are the schools and hospitals? Our economic model is broken and the economists are focusing on benign, ridiculous and highly insulting statistics that don't mean anything to anybody unless they are trying to get elected.

The average household, in 1970:
-One paycheck
-Saved 11% of it
-Had zero debt

...Today
-Two paychecks
-Save 0%
-Have 20% debt

Josh Hiken

San Francisco, Ca

Jan 10 2008 - 2:45pm

Web Letter

Ehrenreich is on point and exactly right, as usual. There has been no real growth in incomes here in Pennsylvania for ten years or more (but Walmart has been expanding by leaps and bounds). The Clinton/Bush trade policies (and they are identical, make no mistake about it) have gutted industrial production base to the point where our very security is subject to the whims and craven goals of foreign producers and foreign investors.

If any candidate besides Edwards has even noticed this all-too-obvious economic quagmire, they haven't seen fit to talk about it. I'm just not going to vote for any Democratic presidential candidate that quacks like a Republican on issues of economic fairness, or is--worse yet--silent on them.

Stephen J. Duskin

Audubon, PA

Jan 10 2008 - 1:31pm

Web Letter

We are indeed in the midst of a recession, as Barbara Ehrenreich argues. What could be more convincing that something is pinching family budgets than people buying less food or seeking lower food prices. Here's an AP report about Supervalu Inc's growth problems that shows this to be the case.

Ron Salzberger

St. Paul, MN

Jan 10 2008 - 9:21am

Web Letter

The simple fact is that the world can't afford our standard of living, and neither can we. It all stems from the idea that more is more regardless of the costs to the environment, society or even the individual. We can no longer operate under the assumption that resources are limitless and their extraction, manufacture, use and disposal are devoid of very real and threatening consequences to our existence.

We need a New Economic Model. Of course, Ehrenreich is talking about our existing economy which, we know, will be obsolete. The question is what will replace it.

What is growth? Currently, growth is measured in money. The current model is based on goods and services but does not take into account external costs. External costs are those that are detrimental to the environment, society or the individual. Smoke from a factory causing asthma in children, mine runoff that pollutes biosystems and drinking water downstream or toxic materials from our refuse that we export to other countries. Society suffers crime, disease, mental illlness and other maladies very often caused by the neglect of resourses for personal well being or education. Growth has to be measured by the degree of benefit measured against the price of external costs for the environment and everything in it, including ourselves and those who folllow.

Japan proves to be an interesting case. Ehrenreich and the Wall Street Journal get it wrong. Japan is in perpetual stagnation because the population is declining and its markets are being contested. Consumer capitalism needs more and more consumers and more and more markets to perpetuate itself or it withers and dies.

And therein lies the problem. Consumer Capitalism's dirty little secret is that unless it constantly expands it dies, and that is antithetical to what we have discovered about the environment and the atmosphere--that they are finite, and that mining, forestry, manufacturing and refuse cannot be forever thrust upon them without dire consequences to the economy and the very survival of civilization itself.

We need an economy based on sustainability. Without it the human population will be "right-sized" through warfare, starvation, disease, pestulence or a combination thereof. It is only a matter of time and time is getting short. Which road do we take, ever more consumption or sustainability?

Michael McKinlay

Hercules, CA

Jan 10 2008 - 5:31am

Web Letter

Someone should tell Ehrenreich that the reason the economy needs to grow is that--in the immortal words of Kaspar Guttman in "The Maltese Falcon--"There are more of us to be taken care of now." In other words, the population is growing. If the economy doesn't grow, then lots of people can't find jobs, can't make money, can't live in their own homes and generally can't maintain our current standard of living.

Most of what she says is right on, but attacking economists for being fixated on growth is as wrong as attacking mothers for being fixated on their children's nutrition and health.

Robert Moskowitz

Santa Monica, CA

Jan 9 2008 - 5:48pm

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