In this issue, the jobs recovery debate, why the poor don't grasp for power, feminism's working class problem, and a new video series on poverty.
In the New York Times, David Leonhardt offers up some charts based on research from the 2012 book, "The Epic of America," which examines what the American Dream looks like for different age groups and socio-economic statuses, and asks what will revive it:
One way to think about inequality’s role is to remember that the American economy is far larger and more productive than in 1980, even if it isn’t growing as rapidly. Per-capita G.D.P. is almost twice as high now. By itself, that increase should allow most children to live better than their parents.
They don’t, however, because the fruits of growth have gone disproportionately to the affluent. The researchers ran a clever simulation recreating the last several decades with the same G.D.P. growth but without the post-1970 rise in inequality. When they did, the share of 1980 babies who grew up to out-earn their parents jumped to 80 percent, from 50 percent. The rise was considerably smaller (to 62 percent) in the simulation that kept inequality constant but imagined that growth returned to its old, faster path.
As with most presidencies, there are dueling narratives about President Obama has stewarded the economy during his time at the helm. Here are two competing views of the Obama economy. Over at the New York Times, Patricia Cohen says that President Obama is handing his successor a pretty good one but acknowledges that the gains were not equally shared:
[A]ccording to the government’s report on Friday, Donald J. Trump can expect to inherit an economy that has added private sector jobs for 80 months, put another 178,000 people on payrolls last month and pushed the unemployment rate down to 4.6 percent today from 4.9 percent the previous month. Wage growth, though slower, is still running ahead of inflation, and consumers are expressing the highest levels of confidence in nearly a decade…
For all the improvements, tens of millions of Americans understandably feel that the recovery has passed them by. Those without skills are relegated to low-paying positions without steady schedules, security and benefits. Breadwinners who once held well-compensated manufacturing jobs are angry about being forced to settle for lower-wage service jobs — or no jobs at all.
Profound anxiety, particularly among the white working class, about the ability to reach or comfortably remain in the middle class is one of the factors that helped propel Mr. Trump to the White House.
In Investor Business Daily, Terry Jones looks at research from the Gallup and the Council on Competitiveness, which argues Obama’s economic recovery was a myth, but also that something larger than the president also is afoot:
In an executive summary, the report's authors note the economy's problems didn't start with President Obama, but they didn't end with him, either, as the media and White House frequently suggest. The study makes a devastating case that something has gone very wrong with the U.S. economy in the past 20 years or so.
"For decades, the nation's income, measured as GDP, has barely grown overall; on a per capita basis median household income peaked in 1999; the subjective general health status of Americans has declined, even adjusting for the aging population; disability rates are higher; learning has stagnated; fewer new businesses are being launched; more workers are involuntarily stuck in part-time jobs or out of the labor force entirely; and the income ranks of grown children are no less tied to the income ranks of their parents," the report said, listing a litany of woes that now bedevil the economy.
In the New York Times Dealbook, Andrew Ross Sorkin says if folks want to know how to bring back manufacturing jobs, they should call Telsa founder Elon Musk:
In the last decade, Mr. Musk has created nearly 35,000 jobs among his various enterprises — and most of those jobs are classic manufacturing ones. His Tesla Gigafactory, a 5.5-million-square-foot battery factory under construction outside Reno, Nev., is expected to employ 6,500 people in manufacturing jobs by 2020.
Apparently Musk has been in a pitched battle over the subsidies he receives, but his reply has been a call that fossil fuel folks also stop receiving subsidies and see how they compete.
And the jobs news isn't all bad. Companies such as Amazon are having trouble filling positions, reports business strategist Daniel Gross:
[T]he company is making the seasonal work more attractive by offering more people the potential to transition to full-time positions. Last year, the Journal reports, about 14 percent of those who signed on for several-week stints became full-time employees, attracted by “perks such as prepaid tuition for warehouse workers who remain on the job for at least a year.”
Paying more, making work more attractive, and offering perks is one tried and tested way of meeting the need for labor when labor markets are tight...
Amazon thus encapsulates one of the dichotomies of the U.S. economy at this stage of the economic cycle. The demand for labor, which is somewhat expensive and growing more so, is high because economic activity continues to rise. And while technology can in some instances obliterate classes of human jobs (e.g., stenographers), it doesn’t do so across the board. Not by a long shot. Machines are expensive to build, program, and maintain, they can’t come close to performing the full range of human activity, and many customers explicitly prefer to deal with humans rather than machines. All of which is pushing companies to think imaginatively about how to make jobs more appealing, pleasant, and satisfying. And at the same time, companies — sometimes even the same companies — are deploying capital expertise to figure out how to get more work done with fewer humans.
Is it time to speak to women about the class divide? Over at TalkPoverty Cara Matteson discusses why mainstream feminism should spend more time thinking about the working class:
Women make up two-thirds of the low-wage workforce—and almost half of those workers are women of color. These women often find themselves doing care work or working jobs in the service or retail industries that require emotional labor. With wages below $10 an hour, they barely scrape by. But these are the jobs we carve out for women, in part because women are still predominantly characterized as caregivers. If feminists are serious about supporting all women, one of the steps we need to take is to open up opportunities for the women we have left behind—opportunities that are historically dominated by men.
The Institute for Women’s Policy Research found that one leading cause of the gender wage gap is that women work in segregated occupations. For example, 88% of home health aides and 63% of food servers are women. In contrast, men have a near-monopoly on “middle skill” jobs, like transportation or information technology, which offer greater job security and tend to pay higher wages without requiring a full college degree. In the next decade, there will be more than two million job openings in these “middle skill” occupations. Recruiting more women is not only strategic for employers—many of whom report that it’s difficult to find new employees—but it’s also a necessary step towards economic security for working-class women.
Heron is releasing a series of videos on poverty and reimagining paths to prosperity. This video features Linda Tirado, author of “Living Hand to Mouth: Living Bootstrap in America.” She provides a glimpse of the many difficult choices facing poor people and why being at the table matters.
Also released is this video on one family's struggle with poverty.
Conservatives have succeeded in sweeping many state houses, governorships as well as both houses of Congress and the presidency—leaving some to wonder what's next for issues like poverty. In the New Yorker, Jennifer Gonnerman profiles Ritchie Torres, who contemplates whether his attempts to fight for the poor, especially in his Bronx constituency, just got harder. Highlighting an upcoming summit with organization Opportunity America and attempting to assuage fears, Tamara Jacoby asks if the time is ripe for center-right conservatives to lead the fight on poverty:
Participants will include House Speaker Paul Ryan, bestselling author J.D. Vance, former governor and welfare-reform pioneer John Engler, public intellectuals Charles Murray and Arthur Brooks, plus several dozen other policy experts and on-the-ground practitioners— people working in church basements, state welfare offices and forward-thinking C-suites, among other places, to help people escape poverty and move up the economic ladder. The summit will feature sessions on a broad range of issues that matter to poor and working families: from single-parent families and criminal justice reform to school choice, college affordability and how to help people learn the skills they need to make a decent living in the postindustrial economy.
Meanwhile over at Vox, Julia Belluz looks at one of America’s sickest counties, Concordia Parish, La. Belluz writes, “Concordia regularly features at or near the bottom of the list of Louisiana parishes for health outcomes, according to the County Health Rankings, a collaboration between the Robert Wood Johnson Foundation and the University of Wisconsin Population Health Institute.” Belluz offers a vision of what may be seen in other places from conservative policy by focusing on what happened to state health under Gov. Bobby Jindal:
As governor, between 2008 and 2016, Jindal cut 30,000 jobs from the state’s workforce. When Holcombe took his post, in 2006, he had 121 employees for central Louisiana’s public health units, which act as safety nets for people who don’t have health insurance or money to pay for care. He’s now down to 83, after being forced to lay off nurses who cared for the poor patients…
Jindal did other things to tear up Louisiana’s health safety net. He closed down the state-run hospital system for the poor, and replaced it with public-private partnerships, which have increased hospital costs for Louisiana. Since 2008, he nearly halved the staff of the Department of Children and Family Services and slashed funding for higher education by 44 percent. An outspoken critic of Obamacare, Jindal refused funding to expand Medicaid in his state… Jindal also declined nearly $100 million in federal government stimulus spending for the state’s unemployed residents.
In the Boston Globe, Matthew Hudson features research examining how class affects “the desire for power”:
In studies, people lower on the socioeconomic spectrum tend to express greater concern than those higher up about community needs rather than individual ones. For example, they’re more likely to react to chaos by volunteering for a community-building project. New research suggests that this desire for harmony reduces their wish to obtain power — at least as it’s normally understood.
Promoting greater social mobility, then, might rely on casting power as a tool for the greater good, so that those who don’t have it actually want it. When some people are reluctant to schmooze and scheme their way to the top, does that mean they lack drive — or is there a problem with how we conceive of advancement?
… When students thought of power as benefiting only themselves, lower-class participants had less desire for it, and less comfort with politicking to get it. But when power was considered as something that could help others, class made no difference. To encourage people at the bottom of the hierarchy to move up, Belmi says, organizations should foster competition based on prestige or merit. Otherwise, he says, “you only have people remaining in the game who are willing to play in the game.”
You know who might be on Santa's naughty list? Trustees of the Milton Hershey School, which the Philadelphia Inquirer's Bob Fernandez reports seems unable to dole out enough of its $12 billion endowment to uphold its mandate of educating poor children in Pennsylvania:
Today millions of American children, boys and girls of any race, can qualify for admission. But the boarding-school business has flattened and is not as popular as it once was. Many children get homesick, leading to dropping out, or don't want to leave their families in the first place.
Hershey trustees continue to cite two deed restrictions that handcuff growth: a requirement that the school be solely based in Hershey (an Orphans' Court judge disagreed in 1999) and a provision that trustees spend only the "income" of the school's core assets...
"They're hoarding their assets locally," said Ric Fouad, an activist alum who is president of the nonprofit group Protect the Hershey's Children Inc. "They haven't opened a single satellite campus. They have not funded a single program outside of Hershey. And the status quo is reinforced by an almost-perfect patronage delivery system that rewards Democrats and Republicans alike. Neither party has an interest in upsetting the gravy train."
And let’s see whos else is vying for Santa’s corporate naughty list: Harbor Portfolio is being sued by the Consumer Financial Protection Bureau, which is still going after possible bad behavior despite being in jeopardy of having its teeth yanked in the new year. The lawsuit would require the investment firm, which is “a major player in the market for high-interest installment contracts for buying homes — called contracts for deed — to comply with an earlier demand for documents.” The New York Times report goes on to say:
Harbour Portfolio bought more than 6,700 single-family homes after the financial crisis of 2008, most of them from Fannie Mae, a government-controlled mortgage finance firm, in bulk sales. Harbour paid $10,000 or less for most of the homes, which were foreclosed on during the financial crisis, and has sold them “as is” to consumers through long-term, high-interest installment contracts
And then we have Wells Fargo returning to the news for forcing consumers who had fraudulent accounts to settle under arbitration contracts they agreed to in their original contract with the company. Also apparently some big banks are also aiding deforestation in South Asia:
Fingers pointed to the Rajawali Group, a sprawling local conglomerate known for its ties to powerful politicians like Malaysia’s scandal-plagued prime minister. But lesser known is how some of the world’s largest banks have helped Rajawali — and other global agricultural powerhouses — expand their plantation empires.
The year before the clearing of trees in West Kalimantan, Rajawali’s plantation arm secured $235 million in loans — funds that the Indonesian company used to buy out a partner and bolster its landholdings — from banks including Credit Suisse and Bank of America, according to an examination of lending data by The New York Times.