Why would professional liars and criminals in the government and private business do anything that would impede their quest for more power and financial gain, often only attainable at the expense of others and the truth? Come on, propaganda and lies and barriers to entry (e.g.,, nepotism and cronyism ensure no one that might be too honest or too bright gets into the private party to spoil the fun) are there for a reason. There's a reason the common man and woman aren't sitting in on job plan discussions with lobbyists, on private jets with CNBC's Bartiromo and Citi execs, in IMF meetings, at DC lunches, CEO salary discussions (compare the truth re: Vikram Pandit's compensation vs. the true state of overqualified and unemployed Americans - overqualified go homeless while idiot banksters get richer for nothing). Truth, what the Hell is that? This is 2012, truth is what the 1% and their puppets in the media and government tell us it is, and if someone's unwilling to accept that because "green shoots" and benevolent CEOs aren't paying the average person's winter heating bills, then they can simply be ignored and disappear from any labor pool anywhere. Gone. Remember all those angry unemployed Greeks that wanted to meet and greet Merkel? The police kept them away and made them temporarily disappear so Merkel could enjoy a nice stroll without getting teargassed or meeting those great unwashed massed. Gone. Just like that. So whether it's stats or actual police force, nothing is above these folks to make us disappear.
Just think about recent history in the region, along with current economic conditions, and the importance of national rights in the East China Sea and South China Sea carry great weight, for countries from India all the way to Malaysia, the Philippines, Vietnam, PRChina, Taiwan, Japan, the Koreas, etc. Currently, these countries desperately need oil and gas to fuel their economies, and vast fields are believed to be under those waters. Also minerals present. Couple that with the Middle East perpetual turbulence, Japan's nuclear disaster (that forces Japan to look outside nuclear and sends warnings to other nations that need as much energy as possible from sources that won't cause such mayhem) Iran nuclear program issue, Syria civil war making everyone choose sides, and oil much closer and more reliable to the Asian nations is something they will certainly be willing to fight for. Fisheries to feed their people, also critically important. Then you throw in recent history of Japan's military starting in the late 1800s showing its might against Russia and exerting itself over the Korean Peninsula, taking part in the colonial carving up of China, and on to Manchuria and Japan's puppet regime there, the Rape of Nanking, the use of "comfort women," WWII, and that's just Japan. Throw in all the other countries, their own histories, views of oppression and other regional + international powers' opinions of them (e.g., Taiwan vs. PRC) and of course they'll take things there very seriously and fight for what they believe are their territories to ensure they aren't the subject of any encroachment by other countries they have historic and current rivalries/issues with.
Should Romney be elected president it has been suggested he may start a trade war with China. Hence if China limits their purchase of US treasuries it could tank the dollar, thus spurring US exports. I think China would have to be pushed far to do that because they would be debasing their own dollar reserves. But as the recent conflict with Japan over a meaningless island shows, these things can get out of hand.
It would be interesting to know the pros and cons of an all out trade war with China.
I often wonder how many solid graduate students are denied a PhD or even a Masters due to them not "touting the party line" per their adviser's "agenda". I've seen many a white paper with unbelievable "bad math", ridiculous assumptions, all to basically "make work" whatever they want to believe or their agenda.
I find this despicable and a real violation of scientific methods, objectivity. Seriously I've seen so called "Academic research" that I have to wonder how in God's name it was allowed, it wouldn't past mustard in econ 101.
Frank, consider getting an account on this site. You won't go into the moderation queue and can then use full HTML.
It's kind of frightening to think about what this comment means. Although this sounds like someone who spends his days watching business programs on Fox News and listening to Rush Limbaugh and Sean Hannity, entertainment programs where upward redistributive campaign slogans are assembled and thought of as an economic theory, there are actually economists, academics, who are paid big bucks to come up with economic theories to support the Neoliberal political project, and this is what is being taught in our business schools.
I know a woman who has a degree in Economics from a major US university and I asked her how much time they had spent on Marx. "None," she said.
We don't allow links in anonymous comment due to spammers, so here is the link to your article over on Economy in Crisis. The above mentions similar things but didn't put the emotional impact you are.
I should say our site is officially nonpartisan, but we do Populist rants on policy positions, detail out Congressional hearings, anything to do with our $$ is fair game.
Romney clearly has a chance to win and if that happens, where I would be very surprised, we'll see if another campaign promise is thrown on the dust heap, but it's surprising and refreshing to see this as a major campaign issue. Seems almost out of character.
You're right that corporate controlled politics are the reason nothing has happened, and I think Geithner/Obama have no spine. Someone has given them some doomsday drama scenario and they bought in, which is pretty ridiculous considering the might and power of the United States. I think it is true that the G-20 and the U.S. to act in concert would have even more powerful and less chance of retaliation. That said, we've seen this before and it looks like simply a political blow off tactic, to make the issue get off of the press front pages and from the Congressional floor. "Hush up, please" I think is their motive, but what do we know, we're not in the halls.
Also, the fact China must buy up U.S. Treasuries and our massive debt might also be a motivator to not call the kettle black.
You forgot to mention a VAT as another effective tool to help balance the trade deficit and a VAT can be dynamic, finely tuned even on a daily basis and is also legal under the WTO.
The links in this article are loaded with detail and check out our overview on the trade deficit. We have graphs and details on the China-U.S. goods trade deficit.
We just went through the reasons why personal income taxes have nothing to do with hiring and here you are touting the GOP pundits ramblings where history and statistics show nothing of the kind.
It's like automatons just spewing nonsense and neither a statistic of fact shall enter thy brain and not one line of this post was understood.
There is no "cost of labor after taxes" because labor is a TAX DEDUCTION. You will not pay taxes on employees. Profits are net, that is after taxes, which means that employee deduction just significantly lowered the the net amount that is subject to taxes.
Taxes, whether corporate or on personal income, are net profits from a business, not gross receipts.
Additionally, you completely ignore the point of this post, personal income taxes have nothing to do with running a business and business taxes.
Then, speaking of lies, Obama is not paying people not to work, that's ridiculous. If you think $200 dollars for food stamps to keep from starving is paying someone not to work, you're not in the real world here.
Reaganomics or supply side has been routinely shown to not be effective and again, that is confusing business taxes with personal taxes. A quick look at even wikipedia shows there was inflation which bumped up more income levels to be taxed, a huge social security tax increase and finally deficits, which under Reagan were large, do have a stimulative effect on the economy. Tax collections were actually higher than previously.
More relevant, the Bush tax cuts were not effective.
Again, the personal income tax code is not the business tax code and that is the lie that is spun, including your comment.
When you hear people complain about China’s “currency manipulation,” remember that everyone making money on U.S. imports, which totaled $238.6 billion in March alone — beginning with the multinational corporations and banks that control our politics and media — makes more money when China keeps the US$ high. China accomplishes this largely by purchasing our Treasury securities — so we can add “American Politicians” to our eye-opening list of China currency manipulation fans.
Even American consumers, it should now be evident, are bewitched, if unknowingly, by China’s currency manipulation: overpriced real estate and underpriced consumer goods.
The well-intentioned patriots lobbying against China’s clearly criminal currency manipulation have less chance of succeeding than I do of winning this November’s election; but I admire their efforts, if misapplied (they should focus on tariffs). . . .
Every time we buy something made or grown in a foreign country, we support that country of origin and deprive our own United States. We serve their culture, their values, and we neglect our own. It’s a form of treason: a way of saying we want the foreign country to succeed and America to fail.
We also forget, sole proprietors pay their own payroll taxes and get to deduct half of SS from income, so its a net sum gain from tax of law changes of almost zero.
Lie is too strong a word here please. This is economic theory. This GOP theory may be dubious or a fallacy, but not a lie.
And, I think you are wrong wyas two different ways.
First, Economics 101, a business or individual considers various projects by their ROI. Two factors among others involved are the cost of labor and the AFTER-TAXES profit. It does the projects that are most profitable until it reaches the break even level (including a discount quantifying risk). So regardless of the expensing if employees, if the tax rate on profits is 25% instead of 40%, that is a major influence on which projects get done (and thus how many people are hired). According to this hypothetical, 60% more projects and for the sake of argument presuming a proportionate labor/project ratio 60% more people will be hired with the lower taxes (40-25/25). I included the cost of labor here because that's realy the problem today I think. This is a jobless recovery because in so many ways, Obama and the Democrats since 01-2007 have raised the cost of labor, both the actual cost and the opportunity cost. First, there is the 35% increase in the national minimum wage. Then there are the legal costs associated with potential lawsuits. Then there are the administrative, etc. costs of this medical bureaucratic maze. Then there is the competition with civil service unions - private employers must compete with what NYC pays its civil service employees, for example, and that is sykrocketing each year. Then there is the opportunity cost of leisure. If one can kind of make $25,000/year sitting at home through food stamps, welfare, disability, savings, whatever else, even illegal activity, why work for IBM, for example.
Second, is kind of that last point from a labor perspective. Obama is doing what cities did in the 70s and 80s, i.e., paying people not to work. Look at labor participation. So if it pays to not work, why be employeed? And that totally affects aggregate demand and productivity. Why work if you can live well not working?
Reaganomics was masterful and proves you are wrong. He cut taxes overall 25% (he never really raised taxes - while lowering rates he "raised" some taxes via ending tax deductions) and captial expenditures boomed. Those crazy schemes like Microsoft and Dell became profitable on the drawing board whereas when tax rates were 70% (they were with Carter) they might not have been for either initial venture capital investors or later merely stock purchasers.
"One thing that gets lost in the rancor are business tax deductions. An employee's salary and most benefits are a business deduction. The business owner would not pay taxes on the costs of hiring a new employee beyond the payroll taxes associated with hiring, about 6.2% of salary. The most important element to hiring is demand for goods and services provided by the business, not taxes."
A 6.2 % payroll tax would also be a business deduction, no?
Anyway, I used to work for people who said that expenses that were tax deductible were "a wash," in that they lowered their tax burden the same amount as the expense. Perhaps this was more true under the old graduated income tax, but even now it would mean you could hire people at a discount, i.e., salaries will actually cost the business less than what it pays the employee.
Also, demand should be considered the only element that affects hiring, because taxes is one burden that is the same for everyone. To blame anything on taxes is like a cab driver saying he shouldn't have to buy a cab just to go into the cab business. Everyone in the cab business has to buy a cab, and pay taxes, so those kinds of things are "a wash."
Hi everyone. Maybe I didn't amplify enough in the first paragraphs that this post drills down deeply into small businesses, the size of their employment and their revenues....and the personal tax code.
I dug around so deeply to show we have a major, major lie going on from the GOP generally on small business, the personal tax code and jobs.
I hope you all share this one, I honestly do not believe anyone has graphed up or really dug into these particular statistics.
The most absurd HR ploy yet is to claim anyone unemployed need not apply but I think that has more to do with this "survivor game" mentality of work, falsely believing those who have jobs were deemed "too critical to the business", but that's a false assumption. Corporations fire critical personnel everyday with nary a thought on how that will affect later products and services.
Others only want "young" people, clear age discrimination and beyond they believe "young" are cheaper, they also believe "young" are more naive and thus won't realize the harsh work environment and bad treatment they are in, more pliable.
Back to initial claims, I do believe it's possible we saw a large drop, not 30k but a significant decrease for it does seem that businesses have stopped firing people, starting in September. So, I wouldn't claim the entire drop is a technical glitch due to at least one "large state" not getting their emergency and extended benefit "bookkeeping" in on time.
Ok, I went and looked at particular at California on the 1st week of new quarters and it looks like, generally, they are late in their reports by two weeks. So, I'm going to guess that initial claims will be revised up by 10k and if that doesn't happen, in two more weeks we'll see a "pop up" in initial claims..
all of this shows again how volatile the weekly really is and the only number to really watch is the pattern of the four week moving average.
Also, in the September CPS, we noticed that layoffs and firings looked much much less, so it could also, at the same time as this "funky 1st quarter, later reportings" issue, initial claims really is dropping.
Agreed, HFTs are ridiculous. Plenty in hedge funds and pension administration are also ridiculous. The media, the government, well, why repeat myself. Watch the coverage of the Eurozone "crisis", etc. The "public servants" dressed in designer fashions and flying private jets, along with the media, are also laughable. The thing is the people propagating the lies and topsy-turvy world have jobs in which they'll never want for anything. The rest of us sit in squalor. The thing is there are people out there making $100,000 - $50,000,000/yr. to repeat lies, disavow the obvious, or spin their wheels day-in, day-out, while people with more integrity and brains are begging for jobs stocking shelves or trying to feed themselves. Everyone with a brain knows HFT are ridiculous. And the SEC and everyone else turns a blind eye to that and theft, insider trading, pension fund shenanigans, etc. Everyone with a brain knows the Euro is kaput, how many limousines and Michelin five star dinners and 6,000 cops guarding Merkel does it take to figure out Germany can't fully support the entire Eurozone by itself. Even if it could, should it be expected to? Germany's debt is 80%+ of its GDP, how's that for a booming economy before Germany's recession is officially announced within a few months? But these truths are repeated time and time again by hundreds of thousands of us, but hey, we scratch for food and housing because the insiders know damn well we won't toe the line, and thus, are "overqualified." We're turds in the punch bowl, as the saying goes.
I thought about the unemployment crisis in the US and why the unemployed are treated like lepers. And then it was obvious - it's just like "The Matrix." Once you don't have a job and remain outside "the system" for too long, you start to see how screwed up everything is. They aren't worried that the unemployed are lazy or stupid. Come on, they were the ones doing the firing, of course they knew they were firing people with great experience, the ones that had the most time in, etc. No, they knew once the unemployed were out there, looking, reading, figuring out why they got canned and visas were being filled, the "skills gap" lie was repeated daily 50 times on TV, etc., they could never go back to accepting the lies. And the longer the person was out there without a boss breathing down their neck, the more time they had to see what was going on. And with that knowledge, how troublesome would a great worker with years of experience be? DEVASTATING, and they deserve to be.
It's not the DOL's fault traders blow billions on this weekly report. If they are so ignorant and stupid of labor economics and macro economics to base an algorithm on this report, it's just more evidence that HFT is a big fat casino, divorced from the real economy and reality.
I've got issue with initial claims but way more issues with people paying attention to initial claims, as if it means something it really doesn't.
Wait a minute and I'll give you a number I think this week will be revised up by. I bet I can do a good guestimate.
Seriously though, every time I dig around in initial claims, the more disgusted I become by traders, Wall Street, HFT for putting so much emphasis on the report that should not be traded on. Not the initial number, or the weekly number, no way.
I could understand the lack of clarity on the weekly reports, that's fine. But the revisions are almost always up, and as people especially on zerohedge note, the initial claims are what the HFT machines read and act on, not the revisions a week later. The week after, any revisions are a week too late for full media megaphone coverage, and they are almost always up (i.e., worse news, but 7 days too late to make a difference in the media spin and HFT). Kind of like the media covering someone, blaming her for every crime known to man, and then when someone else is arrested and convicted, the media forgets to apologize to the 1st person. It's the initial news and reports everyone focuses on. I would expect a 50/50 revision up/down, even a 55/45 revision one way might be acceptable, but anything beyond that, highly dubious. If one can bet money on the fact that the revisions are going to be revised up from the previous week, and win 6 to 9 times out of 10, it's not looking good.
Awesome and truly unbelievable news, initial claims dive the most in 4 1/2 years right in time for VP debate. No, I'm not going conspiracy on this, but come on, these numbers will be revised up from 339,000 up to 370,000-380,000 next week. But no one looks at the revisions, except blogs and those who read them (guilty). What was last week's number, 367,000? Anyway, keep on popping the champagne govt. and Wall Street (actually, Wall Street's government), because even if these numbers were accurate in any way, the JOLTS numbers, jobs created (what was that, 119,000?), and miserable part-time, no benefits explosion is just more evidence we are suffering. 2012 and companies still find 300,000+ people somewhere to kick to the curb every week - that's brutal. So as Ayn Rand Fanboy and Joe "Wow, I'm a VP, look at me" Biden carry on and on about which one loves America more and who really looks out for the middle class while accepting donations from fat cat donors, we continue to witness our economic decline daily. When we see jobs that don't have 100+ applicants per opening, use a person's skills, experience, and degrees, and that could actually buy a house when combined with a spouse's income, then pop the Dom.
People keep calling statistics from the CPS "jobs". They are not "jobs", they are people. So it's not "part-time jobs" it's people who worked part time hours. It's not "jobs", it is "people who are employed" and so on. Payrolls, or CES are jobs, the Household survey or CPS are people.
Why would professional liars and criminals in the government and private business do anything that would impede their quest for more power and financial gain, often only attainable at the expense of others and the truth? Come on, propaganda and lies and barriers to entry (e.g.,, nepotism and cronyism ensure no one that might be too honest or too bright gets into the private party to spoil the fun) are there for a reason. There's a reason the common man and woman aren't sitting in on job plan discussions with lobbyists, on private jets with CNBC's Bartiromo and Citi execs, in IMF meetings, at DC lunches, CEO salary discussions (compare the truth re: Vikram Pandit's compensation vs. the true state of overqualified and unemployed Americans - overqualified go homeless while idiot banksters get richer for nothing). Truth, what the Hell is that? This is 2012, truth is what the 1% and their puppets in the media and government tell us it is, and if someone's unwilling to accept that because "green shoots" and benevolent CEOs aren't paying the average person's winter heating bills, then they can simply be ignored and disappear from any labor pool anywhere. Gone. Remember all those angry unemployed Greeks that wanted to meet and greet Merkel? The police kept them away and made them temporarily disappear so Merkel could enjoy a nice stroll without getting teargassed or meeting those great unwashed massed. Gone. Just like that. So whether it's stats or actual police force, nothing is above these folks to make us disappear.
Just think about recent history in the region, along with current economic conditions, and the importance of national rights in the East China Sea and South China Sea carry great weight, for countries from India all the way to Malaysia, the Philippines, Vietnam, PRChina, Taiwan, Japan, the Koreas, etc. Currently, these countries desperately need oil and gas to fuel their economies, and vast fields are believed to be under those waters. Also minerals present. Couple that with the Middle East perpetual turbulence, Japan's nuclear disaster (that forces Japan to look outside nuclear and sends warnings to other nations that need as much energy as possible from sources that won't cause such mayhem) Iran nuclear program issue, Syria civil war making everyone choose sides, and oil much closer and more reliable to the Asian nations is something they will certainly be willing to fight for. Fisheries to feed their people, also critically important. Then you throw in recent history of Japan's military starting in the late 1800s showing its might against Russia and exerting itself over the Korean Peninsula, taking part in the colonial carving up of China, and on to Manchuria and Japan's puppet regime there, the Rape of Nanking, the use of "comfort women," WWII, and that's just Japan. Throw in all the other countries, their own histories, views of oppression and other regional + international powers' opinions of them (e.g., Taiwan vs. PRC) and of course they'll take things there very seriously and fight for what they believe are their territories to ensure they aren't the subject of any encroachment by other countries they have historic and current rivalries/issues with.
Should Romney be elected president it has been suggested he may start a trade war with China. Hence if China limits their purchase of US treasuries it could tank the dollar, thus spurring US exports. I think China would have to be pushed far to do that because they would be debasing their own dollar reserves. But as the recent conflict with Japan over a meaningless island shows, these things can get out of hand.
It would be interesting to know the pros and cons of an all out trade war with China.
I often wonder how many solid graduate students are denied a PhD or even a Masters due to them not "touting the party line" per their adviser's "agenda". I've seen many a white paper with unbelievable "bad math", ridiculous assumptions, all to basically "make work" whatever they want to believe or their agenda.
I find this despicable and a real violation of scientific methods, objectivity. Seriously I've seen so called "Academic research" that I have to wonder how in God's name it was allowed, it wouldn't past mustard in econ 101.
Frank, consider getting an account on this site. You won't go into the moderation queue and can then use full HTML.
It's kind of frightening to think about what this comment means. Although this sounds like someone who spends his days watching business programs on Fox News and listening to Rush Limbaugh and Sean Hannity, entertainment programs where upward redistributive campaign slogans are assembled and thought of as an economic theory, there are actually economists, academics, who are paid big bucks to come up with economic theories to support the Neoliberal political project, and this is what is being taught in our business schools.
I know a woman who has a degree in Economics from a major US university and I asked her how much time they had spent on Marx. "None," she said.
We don't allow links in anonymous comment due to spammers, so here is the link to your article over on Economy in Crisis. The above mentions similar things but didn't put the emotional impact you are.
I should say our site is officially nonpartisan, but we do Populist rants on policy positions, detail out Congressional hearings, anything to do with our $$ is fair game.
Romney clearly has a chance to win and if that happens, where I would be very surprised, we'll see if another campaign promise is thrown on the dust heap, but it's surprising and refreshing to see this as a major campaign issue. Seems almost out of character.
You're right that corporate controlled politics are the reason nothing has happened, and I think Geithner/Obama have no spine. Someone has given them some doomsday drama scenario and they bought in, which is pretty ridiculous considering the might and power of the United States. I think it is true that the G-20 and the U.S. to act in concert would have even more powerful and less chance of retaliation. That said, we've seen this before and it looks like simply a political blow off tactic, to make the issue get off of the press front pages and from the Congressional floor. "Hush up, please" I think is their motive, but what do we know, we're not in the halls.
Also, the fact China must buy up U.S. Treasuries and our massive debt might also be a motivator to not call the kettle black.
You forgot to mention a VAT as another effective tool to help balance the trade deficit and a VAT can be dynamic, finely tuned even on a daily basis and is also legal under the WTO.
The links in this article are loaded with detail and check out our overview on the trade deficit. We have graphs and details on the China-U.S. goods trade deficit.
We just went through the reasons why personal income taxes have nothing to do with hiring and here you are touting the GOP pundits ramblings where history and statistics show nothing of the kind.
It's like automatons just spewing nonsense and neither a statistic of fact shall enter thy brain and not one line of this post was understood.
There is no "cost of labor after taxes" because labor is a TAX DEDUCTION. You will not pay taxes on employees. Profits are net, that is after taxes, which means that employee deduction just significantly lowered the the net amount that is subject to taxes.
Taxes, whether corporate or on personal income, are net profits from a business, not gross receipts.
Additionally, you completely ignore the point of this post, personal income taxes have nothing to do with running a business and business taxes.
Then, speaking of lies, Obama is not paying people not to work, that's ridiculous. If you think $200 dollars for food stamps to keep from starving is paying someone not to work, you're not in the real world here.
Reaganomics or supply side has been routinely shown to not be effective and again, that is confusing business taxes with personal taxes. A quick look at even wikipedia shows there was inflation which bumped up more income levels to be taxed, a huge social security tax increase and finally deficits, which under Reagan were large, do have a stimulative effect on the economy. Tax collections were actually higher than previously.
More relevant, the Bush tax cuts were not effective.
Again, the personal income tax code is not the business tax code and that is the lie that is spun, including your comment.
From my essay "Learn about life in China before you choose it for your children" -- Economy In Crisis, 18 June 2012:
http://economyincrisis.org/content/learn-about-life-in-china-before-you-...
When you hear people complain about China’s “currency manipulation,” remember that everyone making money on U.S. imports, which totaled $238.6 billion in March alone — beginning with the multinational corporations and banks that control our politics and media — makes more money when China keeps the US$ high. China accomplishes this largely by purchasing our Treasury securities — so we can add “American Politicians” to our eye-opening list of China currency manipulation fans.
Even American consumers, it should now be evident, are bewitched, if unknowingly, by China’s currency manipulation: overpriced real estate and underpriced consumer goods.
The well-intentioned patriots lobbying against China’s clearly criminal currency manipulation have less chance of succeeding than I do of winning this November’s election; but I admire their efforts, if misapplied (they should focus on tariffs). . . .
Every time we buy something made or grown in a foreign country, we support that country of origin and deprive our own United States. We serve their culture, their values, and we neglect our own. It’s a form of treason: a way of saying we want the foreign country to succeed and America to fail.
We also forget, sole proprietors pay their own payroll taxes and get to deduct half of SS from income, so its a net sum gain from tax of law changes of almost zero.
Greetings,
Lie is too strong a word here please. This is economic theory. This GOP theory may be dubious or a fallacy, but not a lie.
And, I think you are wrong wyas two different ways.
First, Economics 101, a business or individual considers various projects by their ROI. Two factors among others involved are the cost of labor and the AFTER-TAXES profit. It does the projects that are most profitable until it reaches the break even level (including a discount quantifying risk). So regardless of the expensing if employees, if the tax rate on profits is 25% instead of 40%, that is a major influence on which projects get done (and thus how many people are hired). According to this hypothetical, 60% more projects and for the sake of argument presuming a proportionate labor/project ratio 60% more people will be hired with the lower taxes (40-25/25). I included the cost of labor here because that's realy the problem today I think. This is a jobless recovery because in so many ways, Obama and the Democrats since 01-2007 have raised the cost of labor, both the actual cost and the opportunity cost. First, there is the 35% increase in the national minimum wage. Then there are the legal costs associated with potential lawsuits. Then there are the administrative, etc. costs of this medical bureaucratic maze. Then there is the competition with civil service unions - private employers must compete with what NYC pays its civil service employees, for example, and that is sykrocketing each year. Then there is the opportunity cost of leisure. If one can kind of make $25,000/year sitting at home through food stamps, welfare, disability, savings, whatever else, even illegal activity, why work for IBM, for example.
Second, is kind of that last point from a labor perspective. Obama is doing what cities did in the 70s and 80s, i.e., paying people not to work. Look at labor participation. So if it pays to not work, why be employeed? And that totally affects aggregate demand and productivity. Why work if you can live well not working?
Reaganomics was masterful and proves you are wrong. He cut taxes overall 25% (he never really raised taxes - while lowering rates he "raised" some taxes via ending tax deductions) and captial expenditures boomed. Those crazy schemes like Microsoft and Dell became profitable on the drawing board whereas when tax rates were 70% (they were with Carter) they might not have been for either initial venture capital investors or later merely stock purchasers.
Thoughts?
Re:
"One thing that gets lost in the rancor are business tax deductions. An employee's salary and most benefits are a business deduction. The business owner would not pay taxes on the costs of hiring a new employee beyond the payroll taxes associated with hiring, about 6.2% of salary. The most important element to hiring is demand for goods and services provided by the business, not taxes."
A 6.2 % payroll tax would also be a business deduction, no?
Anyway, I used to work for people who said that expenses that were tax deductible were "a wash," in that they lowered their tax burden the same amount as the expense. Perhaps this was more true under the old graduated income tax, but even now it would mean you could hire people at a discount, i.e., salaries will actually cost the business less than what it pays the employee.
Also, demand should be considered the only element that affects hiring, because taxes is one burden that is the same for everyone. To blame anything on taxes is like a cab driver saying he shouldn't have to buy a cab just to go into the cab business. Everyone in the cab business has to buy a cab, and pay taxes, so those kinds of things are "a wash."
Hi everyone. Maybe I didn't amplify enough in the first paragraphs that this post drills down deeply into small businesses, the size of their employment and their revenues....and the personal tax code.
I dug around so deeply to show we have a major, major lie going on from the GOP generally on small business, the personal tax code and jobs.
I hope you all share this one, I honestly do not believe anyone has graphed up or really dug into these particular statistics.
The most absurd HR ploy yet is to claim anyone unemployed need not apply but I think that has more to do with this "survivor game" mentality of work, falsely believing those who have jobs were deemed "too critical to the business", but that's a false assumption. Corporations fire critical personnel everyday with nary a thought on how that will affect later products and services.
Others only want "young" people, clear age discrimination and beyond they believe "young" are cheaper, they also believe "young" are more naive and thus won't realize the harsh work environment and bad treatment they are in, more pliable.
Back to initial claims, I do believe it's possible we saw a large drop, not 30k but a significant decrease for it does seem that businesses have stopped firing people, starting in September. So, I wouldn't claim the entire drop is a technical glitch due to at least one "large state" not getting their emergency and extended benefit "bookkeeping" in on time.
Ok, I went and looked at particular at California on the 1st week of new quarters and it looks like, generally, they are late in their reports by two weeks. So, I'm going to guess that initial claims will be revised up by 10k and if that doesn't happen, in two more weeks we'll see a "pop up" in initial claims..
all of this shows again how volatile the weekly really is and the only number to really watch is the pattern of the four week moving average.
Also, in the September CPS, we noticed that layoffs and firings looked much much less, so it could also, at the same time as this "funky 1st quarter, later reportings" issue, initial claims really is dropping.
Agreed, HFTs are ridiculous. Plenty in hedge funds and pension administration are also ridiculous. The media, the government, well, why repeat myself. Watch the coverage of the Eurozone "crisis", etc. The "public servants" dressed in designer fashions and flying private jets, along with the media, are also laughable. The thing is the people propagating the lies and topsy-turvy world have jobs in which they'll never want for anything. The rest of us sit in squalor. The thing is there are people out there making $100,000 - $50,000,000/yr. to repeat lies, disavow the obvious, or spin their wheels day-in, day-out, while people with more integrity and brains are begging for jobs stocking shelves or trying to feed themselves. Everyone with a brain knows HFT are ridiculous. And the SEC and everyone else turns a blind eye to that and theft, insider trading, pension fund shenanigans, etc. Everyone with a brain knows the Euro is kaput, how many limousines and Michelin five star dinners and 6,000 cops guarding Merkel does it take to figure out Germany can't fully support the entire Eurozone by itself. Even if it could, should it be expected to? Germany's debt is 80%+ of its GDP, how's that for a booming economy before Germany's recession is officially announced within a few months? But these truths are repeated time and time again by hundreds of thousands of us, but hey, we scratch for food and housing because the insiders know damn well we won't toe the line, and thus, are "overqualified." We're turds in the punch bowl, as the saying goes.
I thought about the unemployment crisis in the US and why the unemployed are treated like lepers. And then it was obvious - it's just like "The Matrix." Once you don't have a job and remain outside "the system" for too long, you start to see how screwed up everything is. They aren't worried that the unemployed are lazy or stupid. Come on, they were the ones doing the firing, of course they knew they were firing people with great experience, the ones that had the most time in, etc. No, they knew once the unemployed were out there, looking, reading, figuring out why they got canned and visas were being filled, the "skills gap" lie was repeated daily 50 times on TV, etc., they could never go back to accepting the lies. And the longer the person was out there without a boss breathing down their neck, the more time they had to see what was going on. And with that knowledge, how troublesome would a great worker with years of experience be? DEVASTATING, and they deserve to be.
It's not the DOL's fault traders blow billions on this weekly report. If they are so ignorant and stupid of labor economics and macro economics to base an algorithm on this report, it's just more evidence that HFT is a big fat casino, divorced from the real economy and reality.
I've got issue with initial claims but way more issues with people paying attention to initial claims, as if it means something it really doesn't.
Wait a minute and I'll give you a number I think this week will be revised up by. I bet I can do a good guestimate.
Seriously though, every time I dig around in initial claims, the more disgusted I become by traders, Wall Street, HFT for putting so much emphasis on the report that should not be traded on. Not the initial number, or the weekly number, no way.
I could understand the lack of clarity on the weekly reports, that's fine. But the revisions are almost always up, and as people especially on zerohedge note, the initial claims are what the HFT machines read and act on, not the revisions a week later. The week after, any revisions are a week too late for full media megaphone coverage, and they are almost always up (i.e., worse news, but 7 days too late to make a difference in the media spin and HFT). Kind of like the media covering someone, blaming her for every crime known to man, and then when someone else is arrested and convicted, the media forgets to apologize to the 1st person. It's the initial news and reports everyone focuses on. I would expect a 50/50 revision up/down, even a 55/45 revision one way might be acceptable, but anything beyond that, highly dubious. If one can bet money on the fact that the revisions are going to be revised up from the previous week, and win 6 to 9 times out of 10, it's not looking good.
I wasn't planning on overviewing initial claims but looks good to write up something. It's volatile.
Awesome and truly unbelievable news, initial claims dive the most in 4 1/2 years right in time for VP debate. No, I'm not going conspiracy on this, but come on, these numbers will be revised up from 339,000 up to 370,000-380,000 next week. But no one looks at the revisions, except blogs and those who read them (guilty). What was last week's number, 367,000? Anyway, keep on popping the champagne govt. and Wall Street (actually, Wall Street's government), because even if these numbers were accurate in any way, the JOLTS numbers, jobs created (what was that, 119,000?), and miserable part-time, no benefits explosion is just more evidence we are suffering. 2012 and companies still find 300,000+ people somewhere to kick to the curb every week - that's brutal. So as Ayn Rand Fanboy and Joe "Wow, I'm a VP, look at me" Biden carry on and on about which one loves America more and who really looks out for the middle class while accepting donations from fat cat donors, we continue to witness our economic decline daily. When we see jobs that don't have 100+ applicants per opening, use a person's skills, experience, and degrees, and that could actually buy a house when combined with a spouse's income, then pop the Dom.
People keep calling statistics from the CPS "jobs". They are not "jobs", they are people. So it's not "part-time jobs" it's people who worked part time hours. It's not "jobs", it is "people who are employed" and so on. Payrolls, or CES are jobs, the Household survey or CPS are people.
Pages