Saturday, September 22, 2018

Where Did All The Jobs Go?

by Lumiere (writer), NYC, August 30, 2009


Brands You Trust: How Globalization Creates Unemployment and Economic Poverty.

              Take a road trip through America and like me, you might wonder when the weeds of poverty began to rapidly take root in the beloved and once prosperous communities, towns and cities of the United States. When our country does well economically, 155.1 million people are employed at any given time.  Unfortunately, the lives and homes of every day people, have been drastically altered by our 9.7% unemployment rate. Over a million people are currently unemployed. On the news we are only given statistics and data in order to distance ourselves from the truth. When the weight of reality is a somber picture painted in flesh and blood, in real people and real suffering. Across the country, store fronts sit vacant, houses abandoned, neighborhoods decaying, businesses closing. People who have been unemployed for over a year will now begin to fall into the welfare system.

Your neighbors. Your friends. Your family. Your community. Your nation.

Communities once prosperous when our country was the manufacturing capital of a variety of international products, now look like bad scenes out of the film Roger and Me. Instead of being the breast of labor which produces and exports the American breast milk. We are now more like a co-dependent child, suckling at the foreign breast for the milk of consumerism.  Importing our products and the majority of our food because we have all but evaporated the blue collar, all American worker. We are now beginning to see in real time, from community to community across America, not just the cost of war, or the damaging financial effects on the economy but the cost of Corporate Globalization and the outsourcing of our labor. There is a powerful emergence of Transcontinental Corporations eroding our labor force by moving American jobs outside the country so they can retain a higher profit margin and disregard labor laws which safe guard employees.  

Once upon a time, long ago, you could buy a Coke product at a store and maybe someone in your family actually worked for their Corporation. You consumed the Coke product, the Coke company made money, and your cousin had a job. It was a win-win situation for you and your family. Now when you buy your every day food, car or household products, the company you and your family have been brand loyal to for centuries has moved their manufacturing plants and labor force overseas to India or to South America.
Your family still consumes the product regardless, but pays more. While the company manufacturing your favorite product in South America pockets the difference between paying your cousin minimum wage to produce the product or an unprotected worker .5 cents an hour.

Workers are not protected by strict labor laws in other countries like they are in the United States. If I were an immigrant working for a major American beverage company in South America (true story), where the American company paid the government to have the military murder several Union leaders fighting for fare wages and decent working conditions. I too, would risk my life to cross the border into America for better wages, working and living conditions.

People talk so much crap about immigrants stealing our labor but we cannot continue to place blame on a class of citizens for wanting a better quality of life when we, the American consumers are adding fuel to the fire by consuming the products manufactured by unethical, transcontinental corporations who are moving our labor outside of our country to theirs. Before you buy, read the label.

Moving labor from the United States to overseas: 

According to the bureau of labor statistics Mass Layoff Data, there is a direct correlation between mass layoff and labor moved beyond our borders via outsourcing and offshoring by corporations. In June 2009, 144 metropolitan areas reported jobless rates of at least 10.0 percent, half of this percentage is due to the redistribution of labor moved from the United States to other countries. For the sixth consecutive month, all 372 metropolitan areas of the United States had over-the-year unemployment rate increases.  

How lack of employment affects the American people:

Unemployment leads to financial crisis and reduces the overall purchasing capacity of a nation. This in turn results in poverty followed by increasing burden of debt. Because most people rely on their income to maintain their standard of living, the loss of a job will often directly threaten to reduce that standard of living. Poverty, according to the World Bank definition is "poverty implies a financial condition where people are unable to maintain the minimum standard of living."  Unemployed workers represent wasted production capability. This means that the economy is putting out less goods and services than it could be producing. It also means that there is less money being spent by consumers, which has the potential to lead to more unemployment, beginning a cycle. When a capitalist economy undergoes some dynamic changes in its organizational structure, it results in structural unemployment. This type of unemployment may also emerge if the lack of aggregate demand continues for a substantially long period of time. Due to the recent global economic recessions, the developed economies are also facing these challenges. The United States subprime crisis and its wide spread impacts have also played a major role in worsening the situation. 

Statistics based on American Unemployment versus Quality of Life:

According to the US Census Bureau, 35.9 million people in the United States live below the poverty line in America, 12.9 million of them are children.  The poverty threshold in the United States is adjusted based on inflation using the consumer price index:

  • Between 12% to 17% of the US population live below the federal poverty line at any given point in time.
  • Within a 10 year time span, 40% of the population will fall below the poverty line.
  • 40% of the population is 121,623,889 million people.
  • 58.5% will spend at least one year below the poverty line at some point between ages 25 and 75. 
  • America ranks 10th in International Poverty.
  • According to the Bread for the World Institute 3.5 percent of U.S. households experience hunger. Some people in these households frequently skip meals or eat too little, sometimes going without food for a whole day.
  • 9.6 million people, including 3 million children, live in these homes.

The relationship between unemployment and national output (GDP):

The GDP is a large component of the National Income and Product Accounts (NIPA), representing "the output of goods and services produced by labor and property in the United States. My grandparents have often spoken to to me about a time when America's GDP was doing well, that as the GDP increased, the labor wages increased too and the American people reaped some of the financial rewards of our countries success. 

Which causes me to question why from 1929-1997 the United States real year-to-year GDP growth has gone unrevised for 50 out of 67 years.

Recent information from the Bureau of Economic Analysis states from 1929-2008 the 'estimated' average annual rate of growth of real GDP is 3.4 percent.  Compared to what, 1928? We should all be asking why the data has been neglected for so long.

If our countries labor wages once increased according to the nations GDP growth, we should seriously be questioning and investigating all the secrecy dealing with our countries GDP. We should receive an annual report on the United States GDP and an overview of our countries essential economic information, just like an investor receives as a stockholder of a company. It is our country, our labor and quality of life on the line.

We should be probing into our government officials to discover exactly whose pockets are lined with the interests of transcontinental corporations. Questioning the connections between war profits of transcontinental corporations and their paid political interest of Government officials protecting the profitable businesses of military defense, while the rest of the nation goes bankrupt. Halliburton. KBR. Blackwater.  Making billions off of war contracts, while the average American citizen struggles to make more than minimum wage.

If the GDP goes unmeasured, and the country is prosperous but your wages remain the same or decline, there is a major problem. The median wage in the United States is between $35,102 and $45,113.  According to the same Bureau, revisions to wage and salary disbursements are small and downward for 1998-2000; they are upward and larger for 2001-2007, and for 2008, the revision is small and downward. (Table 1B.)
Based on wages, remember 12% to 17% of the United States 304,059,724 population falls below poverty level at any given time. The poverty guidelines based on income are as follows:

The 2009 Poverty Guidelines for the
48 Contiguous States and the District of Columbia
Persons in familyPoverty guideline 1 $10,830 2 14,570 3 18,310 4 22,050

An economist named Arthur Okun looked at the relationship between unemployment and national output over the past 50 years. He noticed a general pattern, creating an equation to explain it. His equation, Okun's Law, relates the percentage change in real GDP to changes in the unemployment rate. In particular, the equation states:

% change in real GDP = 3% - 2 x (change in unemployment rate)

This equation basically says that real GDP grows at about 3% per year when unemployment is normal. For every point above normal that unemployment moves, GDP growth falls by 2%. Similarly, for every point below normal that unemployment moves, GDP growth rises by 2%. This equation, while not exact, provides a good estimate of the effects of unemployment upon output. Our unemployment rate is currently 9.7%

Protecting the United States Labor Force:

If we want to get "unemployment normal," we should consider new legislation requiring corporations founded within the United States to have an ethical responsibility to keep work and manufacturing facilities within US borders. Encouraging generation of employment opportunities, manufacturing possibilities, release of freeze hires and equality in income distribution. These are four key factors in dealing with the dual problem of unemployment and poverty.

When you compare your wages to other occupations, consider whether or not you are paid as much as you're State Senator, your Mayor, favorite Athlete or Entertainer? Most of our politicians only work half of the year, take the Albany political fiasco for example. The average corporate employee would get fired for such behavior, for failing to perform duties for which they have been hired or in this case, elected.  Is their work value really more important than yours? No, it is not. Some are worth their station, but not all have a great sense of responsibility for the greater good. Capitalism is not the enemy but selfish greed is. If you genuinely believe someone who makes a living chasing after balls, is more important than a surgeon whose skills can save lives, or the nations teachers that educate our children and ensure our future, or even the local garbage collector who keeps our streets clean from debris and disease. Then don't bother fighting for a better quality of life. Even ants get fair trade for their labor, do you? Transnational Corporations will ensure the highest profit margin for themselves and the lowest quality of life for you and your family.
Be an educated consumer. Buy products made in America. Protect the United States labor force.

If you want our jobs to remain in the United States, then you need to write to your State Senator and Representatives and DEMAND that every corporation incorporated within the United States be required to maintain 60% of their labor force and physical manufacturing facilities on United States soil or the corporation will be dissolved within 365 days. Request for the 'Made in America' labels to be placed on products we manufacture.

Your neighbors. Your friends. Your family. Your community. Your nation.

Join together. Become a team. Anger well directed can create lasting change.

Recommended Reading:

Dangerous Business: The Risks of Globalization for America  by Pat Chaote.

Recommended Watching:

The Corporation

About the Writer

Native Texan full of Southern Charm, ;) Art Director and Fashion Photographer with a background in Luxury Apparel. Producer of a Television show called " Art4Charity " that spotlights Philanthropists, non-profits, volunteers, and companies doing positive deeds around the world. Volunteer Art Therapy teacher to homeless children and activist.
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5 comments on Where Did All The Jobs Go?

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By Lumiere on August 31, 2009 at 10:26 am

Julian, your viewpoint of New York and mine are quite similar; I find people in NY to be very competitive here, guarded and emotionally distant. It is not the most friendly community compared to the south and you would think with a ride on the nearest subway that it is illegal to smile lest someone think you are going to steal their wallet.

Smile anyway. I do.  

It is easy to be swallowed up by the negativity, by thinking people do not care. Yes, people can be selfish but there is generosity here. Sometimes disguised, it hides in the kindness of the volunteers at the food pantries, at the meals passed out to the homeless at the park in East Village at Avenue A and St. Markes every Saturday- when the volunteers could be doing something else. Generosity is there when you see someone drop a dollar in the beggars cup. Kindness is in the work of the social workers of this city who work daily with the unemployed and under privileged. It is in the hearts of the people who reach into their pantries, closets and hearts to SHARE and to donate a little of what they have so many do not go without. I met a gentlemen from Ireland the other day who said he had signed up on New York Cares because he was looking to volunteer but the volunteer slots were always filled every week.  Hope, is there in the unseen silver lining. 

Every day people doing a little, can make a difference.

I think our mentality of 'scarcity' and 'me,me,me' has to shift. Just because others are successful in life and in business, does not mean we fail or arrive in second place. It is
really about creating a 'win-win' situation for everyone on the team. And although somewhat unrealized, American citizens are one big team....just operating rather independently.

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By fashionista on August 31, 2009 at 11:03 am

Sometimes I think that the issue isn't so much that people don't care; rather people are drowning in debt, trying to pay their bills, keep their children fed, and their mortgage paid while working 2 jobs. I think it's really being so caught up in their own desperation that the bigger picture is missed. If we all took out 10 minutes of our time to write a letter to the government, and to really push this issue, then perhaps more people would be able to look at the bigger picture, and try to force a better hand...

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By Lady D on September 01, 2009 at 09:50 am

Good article. Trying to stay positive as I  seach for work. Begging in the streets is illegal and can get you arrested, which will give you food and shelter. How did we humans ever think that that one up.

Gov't agencies designed to give you help maybe, but not till your homeless. And then the people who work there treat you as if your some kind of virus. These people are so afraid they will be you soon.

Corporations have fostered fear to keep us in line and yet we continue to work for them and keep ourselves in this mess. Unfortunatly I propose no solution.

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By Neon on September 24, 2009 at 01:29 pm

It’s not news when the wealthy of this country embarrass themselves. But lately, a lot of folks in the upper classes have been doing exceptional work in this area, and it’s worth noting.

It’s a bit tiresome to hear many of the rich whine, bleat and moan about the doom that will befall them and, of course, the country, should (a) they be taxed a bit to help cover the costs of a new national health program, and/or (b) they have to suffer the savagely unfair return of tax rates that would be equal to those found back in those frightfully hostile Clinton years, when loads of rich folk were regularly locked in stocks and pelted with rotten pickles. Well, before they swamp sewage treatment plants throughout the country with their torrents of tears, the fearful among the wealthy ought to refresh their memories.

That is to say, it has never … never … been a better time to be a fat cat in this country. I’m making this wild-eyed statement after looking up the tax rates imposed upon Americans in the last 60 years. Beginning with today, when we see that, thanks to W., a married couple with a gross income of $320,000 will be taxed at the top rate of 35 percent. That same married couple making 320k would have been nicked at a 39.1 percent rate in 2001. Going back to the heart of the Clinton reign, had our couple reported an income of $256,000 in ’95, they would have been tagged at the highest rate, a not particularly brutal 39.6 percent. In 1983, that couple making a mere 110 grand would have been nailed by the highest rate, and they would have seen 50 percent of their money go to Uncle Sam—assuming they didn’t set up some dummy corporation in the Caymans. In 1964, our young couple, should they have been fortunate enough to have earned 400,000 bucks that year, would have again incurred the top tax, which would have meant forking over a cool 77 percent to the feds. My. How positively Swiss. And in 1957, our sample Ozzie and Harriet would have seen a jaw-dropping 91 percent of their $400,000 income toodle right on over to the government coffers. 91 percent. That’s a rate that would make even the tax-tolerant Swedes fire up some torches, march on Parliament, and eviscerate at least three or four lawmakers in the street. And yet, that was the rate all the fat cats paid right here in the U.S.A. 52 years ago.

Now, granted, back in the ’50s and ’60s, there were many more deductions that could have helped the wealthy soften the sting of those lofty taxes, but still, those deductions certainly were not gonna chop that 77 percent rate down into anything approaching our current top rate of 35 percent. So, in the final analysis, this would appear to be an excellent time for those in the upper realms of the well-to-do to (1) suck it up and (2) shut up. And make sure the motor for the gated fence is properly lubed.

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By Mike Tyson on June 11, 2010 at 08:24 am

I agree (sorry to be so milquetoast). People talk about the wonders of access to cheap capital, but it ain't so wonderful if mostly what it's used for is anti-competitive consolidation. Now if somebody actually used that cheap capital to acquire productive capacity or fund innovation in the real economy, it would be a different story of resume examples.

A lot of the mergers and acquisition business is smoke and mirrors anyway. Hype it, play pump and dump on the stock, pay enormous fees for all the brilliant consulting and underwriting. Does everything except make a company more efficient. No problem - after playing the game with merger and acquisition, you wait a few years and break up the combined company in favor of each pursuing its fabled "core business".

Lots of money to be made playing Tetris with companies.

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