June 9, 2008
THE CURIOUS THING ABOUT THE DECLINISTS...:
Why the Economy Is Better Than You Think (James Pethokoukis, June 09, 2008, US News)
1) Fewer than 8 percent of private-sector workers are covered by unions. That's way down from the 1970s and means that the transfer mechanism of higher food and energy inflation into cost-of-living wage adjustments—collective bargaining—has been severed.2) A more service-oriented U.S. economy is far more resilient to energy shocks than it was in the 1970s. Tech helps, too, allowing folks to work at home or videoconference instead of flying to a meeting.
3) Not only does the rise of global capitalism and trade help keep costs here low but provides a source of growth, through exports, for the currently anemic U.S. economy. Yet according to Gross, we should be bummed out by Rising Asia.
4) Although beset by an oil spike and a housing plunge, the core U.S. economy is in far better shape than it was in the 1970s. Productivity, the key measure of an economy's strength, consistently grew at less than 2 percent in the 1970s and stayed weak until the tax cuts, deregulation, inflation fighting, and corporate restructuring of the 1980s blossomed into the tech and productivity boom on the 1990s and beyond. Productivity has averaged about 2 ½ percent since 1995 and is now running closer to 3 percent. Recently, the World Economic Forum rated the competitiveness of the major economies, and America's came out on top.
I like to think of it this way: If you could swap the American economy for someone else's long term—China's, India's, the EU's—would you?
...is that they all prefer to sink with us, rather than head off to the greener pastures they claim are all around us.
the transfer mechanism of higher food and energy inflation into cost-of-living wage adjustments—collective bargaining—has been severed.
Wait till the union "card check" law is in place. The only piece of legislation introduced by Senator Obama to 'change' his America.
Posted by: ic at June 9, 2008 12:29 PMCollective bargaining—has been severed. This means the worker can't bargain for a raise, even though his productivity has increased. The owner doesn't have to share his extra profits. Maybe that's why 90% of the public thinks we're in a recession but the "experts" don't.
Also, wouldn't money in the worker's pocket, also known as "demand" be a better indicator of economic strength?
Since when did collective bargaining have anything to do with productivity?
Posted by: Jorge Curioso at June 9, 2008 3:08 PMActually, "the worker" CAN "bargain for a raise." It's called asking your boss for raise. And if your boss says no, you can go find another boss who is willing to "share his extra [what does that even mean?] profits" with you, if you're worth it.
Posted by: b at June 9, 2008 3:34 PMProductivity in the sense of a worker increasing the bottom line, as opposed to being replaced by a cheaper machine. That worker is deserving, but has no bargaining power without a collective.
Posted by: Billb at June 9, 2008 3:41 PMThere's a determinative link to productivity--it reduces it.
Posted by: oj at June 9, 2008 3:56 PMSo, once I hire someone, I can't replace them with a better mode of production? I'm stuck with them? Sounds like France.
Orrin's right, there is a relationship. It's strictly negative.
Posted by: Jorge Curioso at June 9, 2008 9:45 PMAs Glenn Reynolds has said - I will believe it is a crisis when those saying it is a crisis start acting like it is a crisis.
Posted by: Mikey at June 9, 2008 10:41 PM