CBO estimate on additional unemployment from raising minimum wage is probably wrong

The announcement by the bipartisan Congressional Budget Office (CBO) that raising the minimum wage to $10.10 an hour will lead to 500,000 jobs disappearing is just wrong. Now I’m not saying that the report’s authors are lying or stupid, just that they are making the wrong assumptions or looking at the numbers in the wrong way.

The CBO admits that its numbers are a guess at best, but that admission is buried in the fine print.  In Appendix A to its report, CBO says that it reviewed a large body of research on what it calls “employment elasticity.”  In economics, elasticity is how sensitive one economic variable is to another. A simple example of elasticity is price and demand: If we double the price of a product, how many fewer people will buy it? Clearly, doubling the price of something that people need or want very badly such as milk or a college education will have less impact on demand than doubling the price of a luxury, such as a meal at a fancy restaurant or jet skis. Or consider what would happen if twice as many people suddenly wanted something of which there was a finite amount, like gold in times of economic turmoil. But twice as many people wanting Doritos might not lead to such a dramatic rise in the price of each box, because, as the man says, “We’ll make more.” Many factors go into creating a relationship between two economic variables.

One truism of economics is that the higher the price the lower the demand. Economists accept it as a given, much as mathematicians accept as a given that the shortest distance between two points is a straight line. But in some cases, demand is more elastic (stays the same or close to the same unless there is a steep price increase), as college education has proven to be.

“Employment elasticity” measures how the market will respond when the minimum wage is raised (or lowered).  But all the measurements use methodologies, each of which employs a different series of variables and makes a different set of assumptions. Appendix B of The CBO’s report lists dozens of methodologies and studies of methodologies that it considered. Some concluded that raising the minimum wage would have a negligible effect on unemployment; some said as many as a million jobs would be lost.  Instead of weighing the relative merits of each methodology, the CBO took an average. That’s what the 500,000 is—the midpoint in a bunch of numbers generated by a  bunch of different methodologies. And the methodologies only measure teen unemployment! CBO uses another set of methodologies to infer the effect of raising the minimum wage for the entire economy based on what happens to teens, our most inexperienced and unskilled workers.

I’m inclined to believe the studies that show a minimal impact on unemployment by raising the minimum wage to $10.10 and seven Nobel prize-winning economists, four former presidents of the American Economic Association and more than 600 other economists agree with me.  The Nobel laureates and professors are going to give you their mathematically based models. Let me tell you what happens in the real world.

In the real world, a business increases its profit by either growing its market or lowering costs. Every successful company is constantly looking at both. Part of cost-cutting is to make sure your labor costs are as low as possible. So in theory—let’s call it the efficient company theory—no business ever hires someone they don’t need and can’t make money from because it would unduly raise costs.  In a like manner, no business ever lets someone go just because they cost too much without replacing that person because they need someone to do the job (having not hired too many to begin with).

Now the real world is a little messier, as the following examples suggest: A large business may reevaluate labor needs every six months (or two years) and within the six month period have too many (or too few) employees but hasn’t gotten around to making the routine adjustment. A small business owner may have lost a large share of her business, but is reluctant to lay off people in case business turns around in a month or two. A new labor-saving technology is on the market and a business is evaluating it.  A company has decided not to refill a position once someone retires in three months. Or how about all the employees of residential real estate companies at the very end of the bubble that was destined to end? In all these cases, companies are carrying excess labor, and a rise in the cost of labor may make them change their minds quickly.  These job losses aren’t caused by the increase in wages. The job loss was activated before the increase in wages. They were going to happen no matter what.

I would consider these job losses to be noise or leakage in the economic system, similar to the concept of the natural rate of unemployment, which is the unemployment rate that occurs with full employment, stemming from the fact that there are always people looking for jobs and employers looking for workers. I’ve read that the natural rate of unemployment used to be 4% but is now higher.

What I’m saying is that any increase in unemployment because of an increase in the minimum wage is nothing more than noise (or friction as Milton Friedman and others called it). I’m not saying that the noise or friction that prevents companies from being one hundred percent labor efficient is that same 4+% as the friction that explains why unemployment never falls below a certain floor. But even if it were only one tenth as much, that would still compute to hundreds of thousands of jobs that these methodologies may be counting as losses because of a rise in the minimum wage to $10.10. The noise factor almost certainly explains why some estimates are so much lower than others.

The 500,000 who CBO is predicting will lose their jobs if the minimum wage reaches $10.10 would raise unemployment by three tenths of a percent. That’s 500,000 out of more than 166 million jobs. So even if CBO is right, it sounds like they are measuring noise for the most part, which in this case means the number of jobs that would have been lost no matter what.

Conservatives play Limbo Rock with proposals to lower minimum wage

You can almost hear Chubby Checker intoning “How low can you go?” in the lowest register he could hit.

What made me think of Chubby’s hit, “Limbo Rock” is the limbo dancing that conservatives are doing with the minimum wage. It seems as if right-wingers are falling over themselves in advocating for a new minimum wage—that’s lower than the current paltry $7.25 an hour.  They want to reduce the incomes of our poorest workers as if the hourly wage were a Limbo bar and the object of the game was to lower it as much as possible.

In all cases, the right-wing Limbo-ists (or perhaps I should call them Limbaugh-ists) fervently declare that the lower minimum wage will benefit workers because it will enable businesses to hire more employees. The assumption—which common sense tells us is completely false—is that an employer will hire people they don’t need just because they can get them cheaply and that when wages rise, employers will fire workers whom they still need to operate their business.

How low can you go?

How about $5.00 an hour, which is what retired public relations executive Robert G. Strayton thinks the minimum wage should be. His expertise, which he touts in an article titled “A Minimum Wage that Can Work” in the Wall Street Journal, is as a volunteer interviewer of the poor at a religious charitable organization in southwest Florida. Strayton pulls the $5 an hour number out of the air, just as he pulls out $3 as the future price of the McDonald’s $1 menu if the nation adopted the modest $10.10 an hour minimum wage that President Obama has imposed on government contractors for future contracts. Strayton’s math is shoddy: wages are one part of McDonald’s costs, which also include rent, utilities, raw materials and marketing. By increasing this one factor by 40% ($7.25 an hour to $10.10 an hour), he thinks the final cost will triple. I hope Strayton gets help with his taxes. If labor accounted for 75% of the cost of a $1 item (it doesn’t) and McDonald’s raised salaries 40%, then to maintain the same profit (not profit margin) would require Mickey D to sell the items for $1.30.

Strayton provides no basis for his economic argument except a tired old theory that was disproven years ago. He does give an ethical basis for lowering the minimum wage, which is as insultingly condescending to the poor as it is self-serving for employers: You’d think no one can value making $5 an hour. But for those in poverty, a primal need is immediate and reliable access to an income of one’s own. When one has nothing, anything becomes priceless. Watch the expression on the face of a poor person when you provide him or her with $2, $3 or $5 to put gas in a neighbor’s borrowed car so he can bring free groceries, clothing, linens, housewares or furnishings from our organization back home. You’ll see then the value of such a ‘trivial’ wage.”  That smile of a grateful poor person must make Strayton feel warm and fuzzy inside as he pours French Bordeaux into Baccarat glasses while enjoying the sunset from the deck of his yacht.

How low can you go?

How about $4 an hour, which is what Michael R. Strain is proposing in an article titled “A $4 Minimum Wage Can Get People Back to Work” published by Bloomberg News.”  Strain, a researcher at the notoriously anti-labor American Enterprise Institute, begins by bemoaning how little is being done by “our leaders in Washington” to address long-term unemployment in the United States, what he calls “the most immediate social and economic challenge facing the U.S. today.”

Strain strains to show how much he cares about the unemployed. “Society owes these workers better — creative public policies to help increase their chance of staying in the labor force. They want to work; they want to earn their own successes, to help the economy grow, and to support themselves and their families. But they can’t, in large part because they happen to be alive and working during a once-in-a-generation economic downturn.”

His answer is to reduce the risk to employers of spending $7.25 an hour for someone who has been out of a job for months or years, thus making employers more likely to hire the long-term unemployed. Strain couples this lower minimum wage with expanded earned-income tax credit or wage subsidies—federal transfer programs that supplement a worker’s wages with tax dollars.

In other words, Strain wants the government to subsidize businesses by allowing them to pay their workers even less than they do now. Strain is certain that employers will increase hiring, but why would they? If a company didn’t need the additional workers before, why would they need them now? What is more likely is that wages will go down and more employees of Wal-Mart, MacDonald’s and other low-wage companies will receive government assistance.  Right now 52% of fast food workers are using Medicaid, food stamps or the Earned Income Tax Credit programs. Do what Strain wants and that number will increase.

Strain calls it public policy, but I call it welfare for the wealthy, the only kind of economic stimulus program that conservatives like.

Shoddy math, false assumptions and a smug, self-serving moral tone always characterize these arguments against the minimum wage, extended unemployment benefits and food stamps.  All of it so they can steal more money from the poor. It’s pretty low, if you ask me. And just when you think that a right-winger has debased logic, reasoning and common sense as much as possible, another one emerges to lower the bar even more.

How low can they go?

Mattel buys cover of Sports Illustrated in campaign to congratulate itself for the image of women it sells

Sports Illustrated and Mattel have entered into a relationship based on the exchange of money and sex. For those who haven’t figured it out yet, the whore is Sports Illustrated.

The transaction is what in advertising is called a “pay-for-play.” Mattel has bought four pages of advertising in the annual Sports Illustrated swimsuit edition and Sports Illustrated has inserted Mattel into the editorial content by putting Mattel’s popular Barbie doll on the cover of the issue, dressed in an updated version of the original swimsuit Barbie wore when the doll first hit toy stores in 1959.

News reports call the relationship between Mattel and Sports Illustrated a partnership, but it’s a partnership only in the sense that every commercial transaction is a partnership between buyer and seller. The buyer in this case is Mattel. The seller is Sports Illustrated, which has sold not only its cover, but also its journalistic ethics—if I can apply such a term to a parade of partially naked young women—for the proverbial thirty pieces of silver.  It makes me want to investigate the backgrounds of the live swimsuit models to see if perhaps one has rich parents who gave her a graduation present by buying into the issue.

Feminists have long campaigned against both Barbie and the annual Sports Illustrated swimsuit issue. The short form of the argument made by many feminists (and I include myself in this group) finds that both objectify women into nothing more than bodies for display while creating an image of feminine beauty difficult if not impossible to attain for most women.

In Sports Illustrated, the objectification is explicit: no matter how accomplished the models are, they are on the cover or in the issue for one reason only—because they conform to the editors’ image of beauty.

Barbie dolls do their damage in a much more subtle way by presenting a woman in many guises—girlfriend, beach beauty, princess, model and stewardess to be sure, but also businessperson, teacher and scientist—yet always in a physical form that is virtually impossible to attain. There is nothing inherently wrong with a girl (or boy) having a doll that it dresses and takes to imaginary beaches or tea parties. The various incarnations of Barbies may skew towards the sexist, but they include the possibility of non-sexist female roles. The problem is that the doll represents and is sold as an ideal female form that is in fact impossible to attain because of the unnatural proportions of Barbie’s dimensions.

The other concern parents should have with Barbie is that this little doll with the enormous bosom—like all branded series of toys—trains children to become mindless consumers: to go for brands and brand extensions; to collect variations of manufactured sameness; to consider objects in everyday life as manifestations of fashion; to discard last year’s fashions; to express relationships through buying and consuming things. Barbie is all about buying stuff. A girl may not be able to achieve Barbie’s top-heavy figure, but she can buy the clothes, jewelries and other artifacts of the glamorous Barbie lifestyle.

By buying the cover of Sports Illustrated, Mattel’s strategy is an old one that usually fails: conduct a PR campaign about an advertising campaign.  Mattel bought the ads and cover in Sports Illustrated solely to talk about it to the news media and public. Here’s why I know it: there is hardly any market among readers of Sports Illustrated for Barbie dolls. Men mostly read it, not children, and certainly not girls of the age of maximum Barbie interest. Moreover, for both men and women readers, they are reading the magazine in a “sports” mindset; they’re not thinking about what to get their children for their birthday as they might in a TV ad during a House rerun.  All toy companies including Mattel tend to place virtually all their ads in media children use. In a sense, Mattel created a special event that nobody attends but all the news media covers.

Through the years, I have heard several hare-brained ad guys tell me they think a new advertising or marketing campaign is newsworthy and that it will get a lot of coverage in the mass media.  They are almost always wrong, but in this case, Mattel figured right, because it shaped the ad campaign for the sole purpose of getting publicity. Barbie on the cover of Sports Illustrated is the kind of bizarre pop culture story that few in the mass media can resist.  Once the PR campaign is established, the subsequent ads—all in the right places—should prove to be more effective because people will be familiar with the news story.

Symbolically Barbie as the Sports Illustrated swimsuit model takes objectification of women to a new level.  It’s not a young woman corresponding to the current ideal of feminine form promulgated by the fashion industry on the cover. It’s a plastic doll version of a woman.

For women, the message is that you can never reach this ideal. Losing weight, changing your hair and cosmetics, getting a little plastic surgery and wearing the right clothes could get you close to a human swimsuit model, but no one can attain Barbie’s dimensions and still be able to stand without tipping over.

For men, however, the message is just as pernicious: The swimsuit model defines what men should be pursuing, not only in looks, but in dress, demeanor and aspirations. The subtle message with Barbie is that you can not only have what the mass media tells you is a beautiful woman, but you can control her, too, just like humans control Barbies during play. The swimsuit model is at least a human being. Barbie is around for play purposes only.

More proof that adults are maintaining habits of childhood: adult fans of My Little Pony & Lego

For 30 years, children, primarily girls before their teen years, have played with plastic dolls called My Little Pony. The first My Little Pony hit the toy stores in 1983 as a single doll. Now manufacturer Hasbro sells dozens of models, each with its own name and distinct look; plus My Little Pony doll houses, board games, video games, movies, a TV series, live shows, apps, coloring books, stickers, ear buds, jewelry, calendars, party supplies, clothing, blankets, trading cards, sippy cups, toy cars and a series of female dolls called Equestria Girls. The movies and other narratives involving the little plastic equines take place in Dream Valley, an imaginary land of ghosts, witches and fairies. In these stories love and friendship conquer all and the good always win.

Every detail of every My Little Pony branded product is artfully designed to appeal to the traditional image of girls aged 4-11: the subject matter, the colors, the story lines in the narratives and every other element plays to the frilly and gentle conformist image of the traditional middle class American elementary school-aged girl.  Like Disney princesses, My Little Pony gives girls outlets for expressing and exploring the sexist values of traditional society while enforcing those values. More importantly, My Little Pony (and Disney Princesses) train young girls how to be brand-loyal consumers—they can practice their good consumer skills by collecting the myriad of My Little Pony products on sale once hooked on the brand.

What a bizarre variation on the theme of adult infantilization is the growing number of adult men who collect My Little Pony products. These men are called Bronies and evidently there are enough of them to form fan clubs and to mob Brony conventions in Baltimore and California last year. The Baltimore convention was called BronyCon and attracted thousands of adult males dedicated to the conventionally sentimental plastic horse culture. A news report quoted one avid fan as saying “It’s fun and it’s sweet, and it’s a strong moral thing.”

Yes, My Little Pony presents a sweet moral universe, but it’s an uncomplicated one in which there are only good guys and bad guys and strict rules of conduct that leave no room for the ambiguity that haunts the adult world and propels adult entertainment. The morality is what we want little girls to believe before they grow up into young women. That adult men feel free to cross traditional gender boundaries and enjoy entertainment once thought of as only for females is a good thing. But unfortunately, we’re not talking about reading Doris Lessing or doing needlepoint.  We’re talking about a series of branded products focused entirely on the mentality and emotional level of girls before puberty.

It’s another example of adults who haven’t grown up, what I have been calling the infantilization of American adults.

And here’s one more example of adult infantilization in the news: AFOLs, or adult followers of Legos.   Inputting “AFOL” into my Google Search engine yields 1.6 million results; “Adult followers of Lego” (without quotation marks) yields 106 million!  These references send us to articles about AFOLs, AFOL fan clubs and chat rooms and even documentaries about the AFOL phenomenon. AFOLs certainly must have contributed to the amazing first week success of the Lego movie.

Unlike My Little Pony, which I believe is a tool to indoctrinate young girls into being quiet and happy participants in the Great American Consumption machine, Lego is a great toy. It gives children the opportunity to build things and to follow printed directions, but also the opportunity to explore the processes of putting things together to create their own constructions. I have fond memories of my son loving Legos as a child; he was able to build the most sophisticated and expensive Lego sets so quickly that I figured out that this first use of the sets cost me about $60 an hour. Luckily, he also liked to build his own buildings, ships and cities using the tens of thousands of little Lego pieces we accumulated over the five or six years he played with Legos, so I feel we got good value out of the toys.

That was then and this is now—and in his case, now means conducting original research in the science of earth-quaking buildings en route to a PhD from Stanford. It’s obvious that his time with Legos helped him develop the intellectual skills he employs every day. I would, however, be concerned if he were still playing with Legos, went to Lego conventions or wanted to see the Lego movie.

Lego helped my son and many other boys and girls develop both intellectually and emotionally. It was the perfect toy for a pre-teen’s mentality and intellectual level. But it was and is a toy.  It frightens me to think that so many adults without children of their own are still fascinated by Legos.

Like the Brony, the AFOL reflects the infantilization of American adults. By keeping their old entertainment habits, infantilized adults remain in the intellectual and emotional world of the child.  It’s a trend that must warm the hearts of retailers, especially those of branded products. Whether it’s reading comic books, playing shoot-‘em-up video games, visiting Disney theme parks or playing with Legos or My Little Ponies, the infantilized adult is operating on the level of a child, and it’s far easier to manipulate a child into buying or doing something than to do so to an adult.

Joe Queenan’s narcissistic verbal selfie symbolizes what’s wrong with contemporary feature writing

How soon would you get bored if every other song on the radio station included the exact same guitar riff, usually at the beginning of the tune? Not long I imagine. Nothing to fear: music producers and musicians would figure it out pretty quickly and come up with new riffs and other ways to make their songs interesting. Too bad that contemporary writers of features for newspapers, magazines and Internet media haven’t figure out yet that if you use the same verbal trick in every article, you’re going to end up with something bland and boring.

The trick is using an anecdote from the writer’s own life to begin or advance the text. Writer after writer persists on injecting an anecdote about themselves into articles. Are these writers so uncreative that they can’t figure out another way to start or move a piece along? I’ve said for years that it’s easy to write about oneself, but the professional writer can also write about other people and other things.  Far too many prose writers today feel compelled—no, obsessed—with throwing a verbal selfie into the article.

Here are some recent examples:

If you think I’m creating a storm from a few raindrops, consider that of the 20 non-editorials in the New York Times “Week in Review” section of February 9, 2014, nine included anecdotes from the lives of the writers.  One writer remembers his experiences skiing as a child in article about the scarcity of snow in traditional winter resorts because of global warming. Another writer remembers an ugly incident from her childhood in a discussion of the purported lack of multiracial characters on TV. A writer who’s a nurse mentions her own experience in an article about poor communication between physicians and their patients.  And on and on… Some of these “verbal selfies” are appropriate to the article, but many just slow things down or serve in place of what could have been a more apt or illuminating example.

There are many rhetorical devices that writers can employ to make their case or tell their story. Why do so many stick to this one tired trope? Some thoughts:

  • The writers are lazy or so overwhelmed with work that they look into their own often paltry experience instead of taking the time to do actual research and reporting.
  • College journalism professors have stressed this one technique of writing a feature article to the detriment of all others, and mediocre writers are unable to discover other techniques on their own (Hint: read Dante, Dickenson, Shui Hu Zhuan and other great writers).
  • The prevalence of injecting the self into reporting has increased in tandem with the growing selfishness of all of society and with the growing prevalence of adults continuing to enjoy childhood pleasures well into adulthood. The narcissism at the heart of the verbal or the photographic selfie also can explain the politics of selfishness and the desire of grown people to visit Disney theme parks and read Harry Potter fiction.

At least in all the articles I have referenced so far, the selfie that each writer throws into his or her piece advances the topic of the article.  But in Joe Queenan’s stunning display of narcissism in a Wall Street Journal article titled, “A Word to the Wise,” the selfie constitutes the entire article.

In “A Word of Advice…on Advice,” Queenan proposes that Americans love to get advice—from books, from newspaper columns, from the Internet, from experts, from other people—but that the advice often doesn’t help.  Queenan starts with three anecdotes of advice he did not take, followed by a glib anecdote of the last time he remembers taking advice: when he was hitchhiking at night and a trucker told him not to accept hitchhiking rides from truckers at night. Finally we get to an expert—the only expert he quotes in the article. The expert says that most people don’t take advice because they feel that the person giving it is acting superior or being high-handed. No studies, no reference to years of clinical cases. Just the statement. Of course, Queenan does qualify the expert for us: he’s psychologist who played guitar in a failed rock-and-roll band 43 years ago—with Queenan! I guess if he’s FOJQ (friend of Joe Queenan), he must know his stuff.

The remainder of the article drones on in the same vein: anecdotes from Queenan’s experience, advice Queenan has given others and glib statements that mostly support the conservative status quo that the Journal loves so much such as “At some level people know that, unless the good word comes from McKinsey or Warren Buffet, most off-the-cuff advice is useless.”  Queenan presents no reality on this issue outside of his own admittedly glib imagination. No studies. No textual analysis. No comparisons. No real world-renown expert. In fact, there is absolutely no content in the article. It’s a 2,329-word verbal selfie of Queenan.

After turning the article into his editor, I wonder if Queenan bought a pie from his local bakery, stuck his thumb through the crust, pulled out a plum and grinned broadly as he snapped a selfie with his smart phone.

Republicans are right when they say ACA will ruin their economy, but it will improve the economy of the 99%

If a business owner has three job openings and 10 people apply, she can pay less than if only two apply. It’s one of the most simple examples of the law of supply and demand—the less the supply or the greater the demand, the higher the price.

The law of supply and demand is a basic principle of western economic theory and explains why Republicans and right-wingers are sincere when they say that it’s an economic disaster that 2.5 million job-holders will probably retire from the work world when they have secure and inexpensive health care insurance under the Patient Protection and Affordable Care Act (ACA). It’s an economic disaster, but only for rich folk who do most of the hiring.

Certainly, the Republicans and other right-wingers lie when they say that 2.5 million jobs will be lost, but they are lying out of a sincere motive: they fear the impact of that many people exiting the job market on the economy. They don’t care about the size of the economy. They care about their cut. And with fewer people seeking or wanting to hold jobs, businesses will have to pay more to replace the 2.5 million who bid Sayonara to the rat race, but also to attract other workers.

Maybe I missed it, but I don’t think anyone has mentioned that the net effect of 2.5 million people leaving the workforce will be a decline in unemployment. It has to be, because employers will most definitely hire another 2.5 million to replace the ones going on permanent vacation. They’ll hire them because no matter what any right-winger tells you, very few if any businesses that last beyond a few months will ever hire an employee they don’t believe they need, unless it’s a relative. I think we can assume that the sibling, children, nieces and nephews are mostly already hired and that employers will replace most of the 2.5 million who quit their jobs or went part time.

A lower employment rate also leads to a higher price on the labor of one worker. Because 2.5 million now feel secure enough to retire from working a job, the people who keep working will see their wages and benefits increase. The decision of these workers to exit the workforce thus results in a profound redistribution of wealth.

It’s not that Republicans don’t like government to redistribute wealth. They understand that on the economic level, it’s the function of government—take money from some people and give it others. Unless a government is controlled by a dictator or King/Queen (who can funnel taxes to private accounts), it will eventually always spend every penny it takes in (and more). So every government is going to redistribute.

But the right is used to government redistribution taking money from the poor and middle class and giving it to the wealthy and very wealthy. That’s the flow of the cash for the past 30 some odd years. Financing the lowering of taxes on the wealthy by cutting programs redistributes wealth upwards. Privatizing government functions—the polite term for “crony capitalism”—redistributes wealth upwards. Passing legislation that hurts unionization efforts or takes jobs from union members redistributes wealth upwards. Deficit spending financed by bonds bought primarily by rich folk redistributes wealth upwards, especially when it’s done in lieu of raising taxes.  In short the entire right-wing program for government since the Reagan years distributes wealth upwards.

The ACA gets the money flowing in the other direction, from wealthy and upper middle class to the poor and lower middle class. That benefit to the lives of 99% of all Americans may be as important as the fact that the new law will extend healthcare insurance to 30 or 40 million people who couldn’t previously afford it.

It also explains why the Republicans are correct when they say the economy will suffer. They mean their economy—the economy for the one percent.

New book by G. William Domhoff traces control of country by corporate elite since 1930’s

Here is an abridged version of my review of G. William Domhoff’s new book, The Myth of Liberal Acendancy: Corporate Domination from the Great Depression to the Great Recession, which appears in the Winter 2014 issue of Jewish CurrentsCheck out the longer version online and buy the issue, which has a lot of other interesting articles in it!

Many contemporary progressives look back at the 1960s and early ’70s as a golden age when the United States was supposedly a much more politically liberal land. Sometime in the mid-’70s, the commonly believed story goes, corporations started working together to move our nation. After thirty years of union-busting, elimination or privatization of government functions, and lower taxes on the wealthy, we have devolved into a society of rich and poor with a shrunken middle class, inadequate tax revenues, a frayed social safety net, and the most inequitable distribution of wealth since the Gilded Age.

Many progressive writers and pundits, including myself, have recently taken to reciting this brief history of class warfare in America with some frequency. But as G. William Domhoff reminds us in his latest masterpiece, The Myth of Liberal Ascendancy, the class war perpetrated by corporations and their owners against the rest of America predates the Reagan Era and, in fact runs all the way back to the New Deal and earlier. In his new book, Domhoff establishes the peak of liberal-progressive influence in the United States not in the 1960s and early ’70s, but during the last two years of Franklin Roosevelt’s first term, 1935-1937.

Domhoff, Distinguished Professor Emeritus at the University of California-Santa Barbara, is one of the most important sociologists and progressive thinkers of the past hundred years. His specialty is the sociology of power: who has it in America, how they got it, how they keep it and how they use it. His seminal Who Rules America Now?, now in its seventh edition, builds on and broadens the scope of C. Wright Mill’s classic, The Power Elite, in its analysis of the power structure in America. Domhoff and his collaborators keep the world updated on new research on who has power and wealth in America on his website, WhorulesAmerica.net.

In The Myth of Liberal Ascendancy, Domhoff tells a stirring tale of class struggle between four power groups:

  1. The liberal-labor coalition of lefties and labor unions, formed during the early part of the New Deal years.
  2. Corporate moderates, from the New Deal to the oil shocks of the 1970s, believed in using Keynesian techniques to combat recessions, and recognized the value of full employment.
  3. Ultraconservatives comprised two groups that always planned and voted together: the rightwing ultra free-marketers, and the Southern, primarily agrarian, racists who were opposed to any kind of desegregation or granting of voting or workplace rights to African-Americans.

In Domhoff’s telling, these three groups have been the major power players on the national level since the mid-1930s. On the local level, however, he points to a fourth group, real estate and development interests, which dominated regional policy decisions and often made deals on a national level with any and all of the three primarily national power players.

Domhoff’s history runs through the formation and passage or failure of major legislation from Roosevelt’s second term until the Reagan years and beyond. He inspects how these three and sometimes four power centers viewed each piece of legislation, and how the legislation developed or stalled based on their push-and-pull.

In the end, the corporate moderates win — every battle, all the time. Gradually and inexorably, the power of unions is weakened, taxes on the wealthy decrease, the purchasing power of the minimum wage declines, and the wealthy control a greater share of income, wealth and power. The story of each policy decision comes down to the policy groups, experts and lobbyists who define and discuss the issues, promulgate the solutions and help create the laws. Corporate moderates spend far and away the most money forming these groups and supporting economists and other scholars who formulate the policy and advise the various presidents.

Domhoff makes a very convincing case that the liberal-labor coalition reached a pinnacle of power in the mid-1930s and has been losing ground ever since. The high-water mark came in 1935, after Democrats had swept the midterm elections. After about 1937, even when the liberal-labor coalition got an occasional win, it was incomplete or tainted. Take Medicare: Despite the protests of labor unions, private insurers were allowed to have a large role administering the program. This led to rampant medical-cost inflation, as predicted beforehand by labor experts. If the corporate moderates were going to let taxes pay for medical care for senior citizens, however, they insisted that the private sector be able to enrich itself in the process.

Two dynamics seem to predict and direct the move rightward that corporate moderates took in the 1970s: First, they have always hated unions as much as the ultraconservatives have, and always have had curtailing the power of unions high on the policy agenda. Second, unions were too often unsupportive of the efforts of minorities to gain civil and workplace rights, and, in fact feared and distrusted minorities and the organizations representing them. Anti-unionism thus drove conservative moderates into the arms of the ultraconservatives, while racism fractured the liberal-labor coalition.  Tragically, the left contributed to its own demise.

After chewing my way lately through the annoying personal anecdotes and trivializing analogies that clutter many other recent books of social science and science, I found The Myth of Liberal Ascendancy refreshing for its sustained focus on the subject, and its breezy and direct but non-patronizing style. I found no jargon and little if any academic circumlocution.

As an electorate, we currently stand at the dawn of what progressives hope is a new day for the United States. Voters seem sick of Tea Party nihilism and understand that the government must get involved to jump-start our economy, provide medical care to all, educate our young and protect our environment. Domhoff’s book is a prescient reminder, however, not to become too enthusiastic about a Democratic sweep in 2014 and 2016 if the Democrats elected are centrists and look to the corporate moderates for legislative direction.

This year, Super Bowl ads went to the dogs, like much of the rest of the country

Most media critics are calling the Super Bowl ads tame and sweet compared to past years, then declare unofficial commercial winners based on how much online activity each ad drew.

Virtually ignored is a trend that has been building gradually but inexorably over the past few decades. The trend has encompassed all of public life—from movies to ads to discretionary purchases. And in this year’s Super Bowl we may have seen it reach a new peak.

I’m talking about the current emphasis in our culture on dogs. It seems nowadays that every other ad has a dog in it, and it wasn’t always the case.

Thirty years ago very few ads featured dogs, but our canine friends play an important role in at least five 2014 Super Bowl and a major role in two others.

First the five which feature dogs, but are not about dogs:

  • Doritos has an ad in which a boy around 8 or 9 rides a very large dog as if it were a horse to the sound of the “William Tell Overture,” AKA the Lone Ranger’s theme.  At one point, the dog rears back like Silver, the Lone Ranger’s horse.
  • In the controversial interracial Cheerios spot, the daughter—again around 8 or 9—refuses to agree to have a baby brother unless they also get a puppy.
  • A dog sits atop the carriage being pulled by the Clydesdales in the Budweiser commercial about welcoming home a soldier from an unstated war.
  • Most prominent among the many “Peanuts” characters in the MetLife spot is Snoopy.
  • Toyota has a bunch of Muppets driving and riding in its cars, including Rowlf, the Muppet that is supposed to be a dog.

The two Super Bowl advertisements focused primarily on dogs belong in a Victor Hugo novel because together they represent the terrifying and the sentimental, much like a Hugo novel does.

The terrifying comes from an Audi commercial based on the conceit of a Doberman pincer mating with a Chihuahua, creating a monstrosity that has a huge Doberman head on a small Chihuahua body, kind of like placing Sarah Jessica’s head on a pooch body in Mars Attacks! This ugly freak of a dog rages for most of the rest of the spot, causing all kinds of havoc and damage. Horror movies always walk the line between evoking reactions of camp or terror. We are conditioned to look at evocations of terror in commercials only with an ironic, comic eye, but in the right context—large screen, lights off, surrounded by others—the horrible abomination of the Doberman head grafted onto a Chihuahua body would likely frighten.

As hideously off-putting as this commercial is, so is the overly sentimental Budweiser spot in which a puppy and a Clydesdale form a bond of friendship or love that is so strong that the dog escapes his home and the horse with Clydesdale pals rescues it. The two are reunited and happy at the end in a moment as maudlin as only cheaply manufactured anthropomorphic sentiment can be.

The companies advertising in the Super Bowl and their advertising agencies are not making the dog trend—they are just riding on what has become a long-lasting wave.

Just short of 57% of all U.S. household now own dogs (far more than the 45% owning cats). There are 83.3 million dogs owned in all in the country and owners spend an average of $1,650 a year on each. We have seen a proliferation of luxury and designer products for dogs. Advertisements exhort us to buy Christmas presents for dogs. There is even a satellite TV station for dogs to watch—not their owners, but the dogs themselves! A survey a few years back found that a large number of women prefer their dog to their husband.

One can only speculate as to why the past 20-30 years has seen such a large growth not just in dog ownership and products for dogs, but also in the prominence of dogs in the mass media, especially commercials.  To be sure, there has been a great resurgence of the ideal of the American family, even as that ideal has fragmented into dozens of different versions in the real world.  A dog is a key icon in the American dream, right next to the house in the suburbs and the two cars.

There has also been an increase in single households. Pets in general and dogs in particular can serve the place of children, spouses and close friends. So can cats, but humans tend to co-exist with cats, since they are mostly untrainable. We control dogs and can make dogs an extension of our personalities and our values in a way it is hard to do with cats, birds, fish and most other common pets. One can look at the growing popularity of dog ownership as a humanistic response to the growing isolation of contemporary society. We could flip the script, though, and say it reflects the growing narcissism of the politics of selfishness: instead of putting time and money into other humans, we spend it on dogs that appear to agree with our every word and do whatever we say.

I’m just thinking out loud. I really have no idea why dogs have become so popular in our homes and in the media.  I will say however, that it does not speak well of the human race in the United States of American that in the same year that spending on pets increased once again, we cut food stamp and unemployment benefits, forcing hundreds of thousands of families into lives we wouldn’t wish on a dog.

The future of eating out: microwaved frozen food served by robots

The dining experience of most Americans is beginning to resemble how the agricultural industry prefers to raise cattle and chickens: an impersonal industrialized process.

Unbeknownst to many, most of the food eaten in casual dining restaurants comes to the restaurant already prepared and partially cooked, often frozen, ready to be popped in the microwave or plunged in the deep fryer for a little finishing. As it turns out a very small number of companies manufactures these mostly finished dinners.

While diners might not know that their restaurant night out is little more than microwaved frozen food, they can’t help but notice automation beginning to take over the service part of the dining experience. Some restaurants have now started placing order tablets in their outlets. A few years back, McDonald’s announced that it was replacing human cashiers with touch-screens at more than 7,000 European locations.

Right-wing ideologues such as Michael Saltsman, research director at the Employment Policies Institute, use service industry automation as a stick to beat back the beasts of the minimum wage, mandatory sick leave and employer-sponsored health care. Saltsman, who never saw an employee benefit or government program he liked, writes that raising the minimum wage will make employers in the fast food, casual dining and retail industries seek to automate as many parts of the food delivery process as possible as quickly as possible.

Saltsman’s reasoning is specious: The large retail, fast food and casual dining chains are already galloping towards greater automation as fast as they can. If we lowered the minimum wage, the manufacturers would still seek to automate. The top 1% of the country—the people who own and run the large retail corporations that are automating—has consumed virtually all of the economic gains we have made in recent decades. And yet this outsized explosion in their slice of the pie has not prevented major employers from continuing to look for whatever way possible to cut more of their employees…and automation does just that!

Standard economic theory states that automation frees labor to do other things: new needs are created, such as designing and building the machines and computers that have taken away so many jobs. Educating workers for the new jobs is the key according to this standard version of the creative destruction of capitalism.

Unfortunately, it may not work this time. A recent Economist article reports that a 2013 paper by two Oxford professors theorizes that jobs are at high risk of being automated in 47% of all occupational categories, including such “brain-work” service professions as accountancy, the law and technical writing. Employment caused by the coming blitzkrieg of automation may permanently disrupt the economy. There is no way that training and retraining will enable us to fit all the workers that future automation will replace in the next few decades.

Economic right-wingers don’t like to hear it, but for our economy to perform its basic function of providing goods and services to people, the distribution of the wealth will have to become far more equitable. We will need to implement higher minimum wages and cut the number of hours that constitute full-time work, to spread the work that does exist around to more people. With so many people out of jobs, the safety net will have to be expanded—more unemployment and food stamp benefits. It would help if our population falls, so that our automated economy has fewer people chasing after jobs.

We will also have to consider how much automation is really good for society. Having waiters serve meals that are prepared on the premises by individual chefs expressing their creativity is a pleasure that more people could enjoy if salaries were high enough to enable people to afford something other than Mickey D’s. Organic agriculture and animal husbandry are more labor intensive than the industrialized agriculture that developed in the 20th century. Requiring greater environmental regulations on coal and natural gas production and electricity generation creates more jobs as well.

But it’s not just a matter of seeing where it makes more sense to have humans do the work, even if it costs more money. We also have to raise wages, benefits and the government safety net—change the split between labor and capital—so that the other 99% can afford to enjoy the benefits of human intervention in the delivery of goods and services.

Grading Obama’s State of the Union address: was it well-written?

Obama was Obama in his 2014 State of the Union address.

He set an agenda that will help staunch the bleeding from more than 30 years of class warfare by the wealthy on the rest of us. But that’s all it will do—staunch the bleeding.

As usual, the President didn’t go far enough. He asked for tax reform that would close loopholes for businesses, but not for any increase in taxes for the wealthy. He gets on the universal pre-K bandwagon, but he doesn’t say anything about more teachers and returning government support of public schools and universities to pre-Reagan levels.  He raises the minimum wage for employees of government contractors for new contracts, but only to a paltry $10.10.

Did anyone expect anything else from Obama, who always talks progressive and acts centrist? Except, of course, in matters involving national security, in which he is a neo-con’s dream, even if they won’t admit it.

As far as his boldness in using executive orders to accomplish what Congress in unwilling to do, many will share my perceptions that it’s about time and he could have done more.

From the standpoint of writing, the speech was fascinating. He opened by cataloguing hypothetical vignettes of a country on the right track. He didn’t bother to introduce the subject, but went straight to these imagined mini case histories, following Horace’s dictum to “begin in the middle” (in media res).

In presenting these vignettes, Obama used the same sentence structure in each case. Repetition of a phrase, rhythm or sentence structure to start each of a series of sentences is one of the most well-used and successful rhetorical devices in speeches (and poetry). Repeating “I have a dream…” gave Dr. Martin Luther King’s speech of that name its eternal power. The accumulation of the same phrases—or the same sentence rhythm in the case of Obama’s 2014 State of the Union address—mesmerizes people. People also delight in the musicality of the repetition, as the speech suddenly turns into a variation on theme.

These two techniques—opening with an anecdote and using repetition—are standard among professional speechwriters. I teach both techniques to young writers who work for me or in seminars.

All very clever, but it doesn’t make it a great speech. To attain the immortality of Dr. King would require vivid images, and in almost every case, the President and his speechwriters settled for the most general statement one could imagine. Instead of creating a vivid image, they merely made points.

For example, Obama starts with “Today in America, a teacher spent extra time with a student who needed it, and did her part to lift America’s graduation rate to its highest level in more than three decades.”  “Spent extra time” is very general. Why not, “spent extra time to explain the Electoral College”?

Next sentence: “An entrepreneur flipped on the lights in her tech startup, and did her part to add to the more than eight million new jobs our businesses have created over the past four years.” The overly general “flipped on the lights in her tech startup” could be “hired 10 people to work for her automation software company,” which is still general but more specific than “her tech startup.”

Next sentence: “An autoworker fine-tuned some of the best, most fuel-efficient cars in the world, and did his part to help America wean itself off foreign oil.”  The speechwriters were reaching for the broadest of generalities with “fine-tuned.” Are they so lazy that they can’t find an article on the Internet about jobs in auto factories?  It took me a few minutes to find the information that led to this alternative: “programmed an automated machine that fabricated an engine part.”

And on and on he went, piling generality on top of generality: “A farmer prepares for the spring…” Finally his fifth example paints a picture, creating what Carson McCullers called piquancy: “A rural doctor gave a young child the first prescription to treat asthma that his mother could afford.” But then he turns general again when he talks of a father on a bus ride home from work “dreaming big dreams for his son…”

Typically, a variation on theme in poetry or a speech ends with the longest variation, as a way to unwind, change subjects or convey a sense of completion. It is only in the last long variation of Obama’s address that he presents a vivid image: “And in tight-knit communities across America, fathers and mothers will tuck in their kids, put an arm around their spouse, remember fallen comrades, and give thanks for being home from a war that, after twelve long years, is finally coming to an end.” Note that Obama saves the creativity for the part in which he tells a half-truth: “the war is coming to an end,” also means that the war is not yet over. I remember that the Viet War was “coming to an end” for about half a decade.

The remainder of the President’s address is quite conventional. Like every State of the Union since Ronald Reagan, Obama peppers the speech with mentions of people who serve as symbols for successful or failed policies. Some examples:

  • “Andra Rush opened up a manufacturing firm in Detroit. She knew that Ford needed parts for the best-selling truck in America…”
  • “Misty DeMars is a mother of two young boys. She’d been steadily employed since she was a teenager. She put herself through college. She’d never collected unemployment benefits. In May, she and her husband used their life savings to buy their first home. A week later, budget cuts claimed the job she loved. Last month, when their unemployment insurance was cut off…”
  • “Estiven Rodriguez couldn’t speak a word of English when he moved to New York City at age nine. But last month, thanks to the support of great teachers and an innovative tutoring program, he led a march of his classmates – through a crowd of cheering parents and neighbors – from their high school to the post office, where they mailed off their college applications.”

Andra, Misty, Estiven and the others mentioned serve in place of facts and figures.

I call this rhetorical device “arguing by anecdote.” Writers love it, especially when they have the facts against them, as research by Daniel Kahneman and others demonstrates that most people will trust one anecdote over substantial facts and figures that prove the opposite, especially when the anecdote supports what they already believe.

Reagan was the first President to mention real people in anecdotes in the State of the Union, often having the person there to receive a brief spotlight and applause.  These in-person call-outs always lend an element of sentimentality to the address and every State of the Union since Reagan has had them. It would be refreshing to hear a State of a Union without the ritual of the in-person call-outs. Obama had three in the 2014 State of the Union.

At least Obama makes good use of his arguments by anecdote because in every case, the anecdote is used to make a point that is based in reality, unlike Reagan, whose anecdotes too often supported untrue statements or gave a distorted impression of what the facts really were.

While it dominated the news for the 24 hours leading up to the speech and the 24 hours after it, Obama’s speech will not be remembered.  State of the Union addresses rarely are, probably because the President has to talk about every aspect of his agenda—to stuff 10 pounds of ideas into the proverbial five-pound bag.