Thursday, January 19, 2012


In his book "Cracks in the Pavement: Social Change and Resilience in Poor Neighborhoods", professor Martín Sánchez-Jankowski -- who spent 9 years on the ground observing the goings in 5 ghetto neighborhoods in NYC and LA -- concludes that ghetto schools don't work because there is so little waiting for graduates (or non-graduates) in the American labor market that working at getting a good education often isn't considered worth the bother.

Look up president LBJ's 1968, $1.60/hr minimum wage on the BLS inflation calculator (which uses CPI-U -- the most broadly accepted inflation index) and you get just short of $10.50/hr -- in 1968! Look up senate majority leader LBJ's 1956 minimum wage (he snuck it through the chamber when the opposition was out -- senator Hubert Humphrey wanted $1.25/hr -- in 1956!) and you get just over $8.25/hr!

Look up Census historical income tables (historical > people > all races) and you get $15,000 per capita income in 1968 -- $28,500 in 2006 (before the bottom fell out). 2012's federal minimum wage is over $3/hr lower -- almost double the average income later.

Before the "big" Democratic increase in 2007 the federal minimum wage in 2011 dollars was $5.60/hr -- dropped almost in half since 1968.

The annual US median wage is $26,363 -- as reported by Harold Myerson -- which if you divide by 2080 working hours (you would probably need to factor in how many full or part time jobs was average, etc. -- this is the best my non-expert self can figure), today's US median wage comes in at $12.68/hr -- about where it probably was in 1968! The US median wage is reported at about $14/hr in 1973 -- the year wages stopped keeping up with productivity increases; or regressing -- in the book "The State of Working America 2008/2009", p. 134, table 3.5.

The answer to all this is legally mandated, sector wide labor agreements, the only labor market setup that produces both a fair labor market -- and fair political forum because labor is effectively organized -- everywhere it is used world-wide in the decades since WWII -- back when it was instituted to avoid an organized labor "race to the top" in Europe so more money could go to rebuilding -- prevents the race to the bottom just as well (Wal-Mart closed 88 big boxes in Germany where it could not compete paying the same as everyone else). If you want to read more about sector-wide Google it -- it's mostly my (frantic) posts; nobody else discusses it (most economists not being as poor as retired cab drivers).
Today, 9:59:20 AM
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annie nymess
Min. wage is def. a culprit. The unemployment of teens, part. of AAs, has grown over the past 60 years. Now in alot of cities, the only opportunities for some folks is drug dealing which produces about $3.50/hr. of income (Freakonomics).
Today, 10:17:07 AM
What's really a lost opportunity is that doubling the minimum wage would add only 3.5% direct inflation -- giving half the country a raise. As in the Crips and the Bloods couldn't whip a decent paying Ronald McDonald -- and presumably wouldn't want to.

To wit:
Jumping to a federal minimum wage to $15 would add about 3% direct inflation – easily computed: 70 million (half the workforce – at very most; many positions not hourly or salaried) X $3.25 average raise (close enough) X 2000 hours (work year) + 3.5 million* more half raises for those at or below the minimum (in 2009) X $3.25 X 2000 hours = $477.75 billion altogether -- out of a GDP of $14 trillion = 3.4% direct inflation.

Today, 11:30:49 AM
There you go using liberal facts and context.

The reason the rich have gotten so much richer is because the poor and middle class have gotten so much poorer. The economy was much more evenly spread out back then, back in the days that conservatives claim to long for, yet they completely and willfully ignore the rest of what it was like back then.
Today, 11:03:17 AM
Right; basically, if you squeeze a toothpaste tube at the bottom it will all come out the top. The first baseman who recently got a contract big enough to buy half the stadium ($245 million over 10 years!) is not out to exploit anyone. Ditto for TV anchors and CEOs for that matter -- they are just taking what is available given no resistance. Who wouldn't?

Without organizing labor effectively -- and sector wide is the only proven way -- there will never again be resistance at the political lever in America either. My unfavorite example of no political resistance is what happened in my old Bronx neighborhood over the last 10 years.

First, Mad King (Mayor) Bloomberg closed two of the (legitimately) most beautiful courthouses in New York City -- one was brand new when I was going there with kids back in the 70s (sparkling new marble) -- after building a $500 million replacement (in today's money) -- after the bottom had dropped out of crime.

Second, over this hill, blocks away, a new Yankee Stadium was built over a track and field used by 39 Bronx schools (including my grammar school a mile north and my high school a mile south) so 43 more millionaires could be glassed in. When the Yankees moved into the new stadium did the city tear down the old one and replace the track and field? Too bad kids; it just left the old one there. (As yuppies move in in the future I am sure a much more beautiful new park than the old will be built.)

Could the proposition to leave 3 more derelict structures in the architectural center of gravity of the Bronx -- at the cost of $500 million and for 43 more millionaires -- have survived the outrage of the middle classes when I was growing up there? Not a howling chance; but now there is no opposition to anything anyone does to us.

Got to get organized again. Google "sector-wide labor agreements" to find out how.
Today, 11:48:38 AM

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