November 11, 2015 – Arsenal For Democracy 150

Posted by Bill on behalf of the team.


Topics: Big Ideas for Reforming American and Global Governance — Health Care Reform and Economic Orthodoxy. People: Bill, Kelley, Nate, Greg. Produced: November 8th, 2015.

Episode 150 (56 min):
AFD 150

Discussion Points:

– What’s next in U.S. health reform?
– Are the orthodoxies of mid-century economics trapping us on 21st century problems?

Related Links

Last week’s episode on state single-payer campaigns
AFD, July 2014: Wall Street wants to make money off “urgent care”
Compare Your Country Health Care Spending
“Kaiser Report finds state budget savings in some Medicaid expansion states”
Washington Post: “US once again has most expensive, least effective health care system in survey”
Naked Capitalism: “Wait: Maybe Europeans are as Rich as Americans”


RSS Feed: Arsenal for Democracy Feedburner
iTunes Store Link: “Arsenal for Democracy by Bill Humphrey”

And don’t forget to check out The Digitized Ramblings of an 8-Bit Animal, the video game blog of our announcer, Justin.

AFD Micron #22

Beliefs on the origin of jobs break down along the same political lines as beliefs on the origin of life. Most people think jobs emerge from a complex, organic process, involving demand, supply, and capital, but some on the far right ascribe their creation to an intelligent designer: an all-mighty, mostly mythical “job creator” who must receive regular tribute.


U.S. homeownership in 2015 (in a global context)


Statistics and analysis compiled for and by The Globalist Research Center.

In the second quarter of 2015, the homeownership rate among U.S. households reached a new recent low of 63.4%, according to the U.S. Census Bureau. This was the lowest reported rate since 1967!

Homeownership in the United States had reached an all-time high of 69.2% in 2005, two years before the housing bubble burst in late 2007. Following the recession, prospective buyers shifted instead into renting. Growth in the rental market — approaching record occupancy levels in many areas of the country — is one of the factors driving down the share of homeowners in the overall pool of households.

At the same time, U.S. home buying and home prices have actually increased recently. But that demand has largely come from institutional investors, speculators, and foreign buyers. This makes it harder for ordinary homebuyers, especially in the youngest generation of would-be first-time buyers, to break into the market.

For comparison to some other major economies’ homeownership rates, about 53% of German households own their homes, 73% of Italian households own their homes, and 90% of Chinese households own their homes. The global average, however, is slightly below the latest U.S. homeownership rate.

But not all homeowners are created equal. In Romania, 95.6% of households own their own homes as of 2013 — the highest ownership rate of any EU country. And eight of the ten EU member countries with the highest rates of homeownership are all former Warsaw Pact or Soviet states. (Another is ex-Yugoslavian.) The ownership level is similar in Russia itself, where 84% of housing was owner-occupied as of 2010. All of this is at least partially related to rapid housing privatizations in the early 1990s. However, there are concerns that many of the homes in those countries, constructed in the suburbs and countryside during the Communist era, might not hold up much longer. Little new construction occurred in the decade after 1991. This could potentially put much of the housing stock in jeopardy and add major stress to those already relatively poor European nations.

Homeownership promotion has long been a goal of U.S. public policy — maybe because of its cultural association with early American colonists, homesteading pioneers, and the American Dream. Today its promoters seek to encourage building up equity and to ensure a steady need for jobs in the construction industry. The George W. Bush Administration, for example, promoted what it called an “ownership society.”

The general idea (in theory, at least) is that when people living in a home-owning household reach retirement age, the equity they have in their residence can provide a major source of funds to finance their retirement.

Home-owning households are generally wealthier, as least on paper, because a residence is often their largest asset. However, that asset is usually not a readily accessible source of cash.

Moreover, more than two-thirds of American homeowners in 2014 had mortgages on their homes. Homeownership is far less associated with debt in China, for example, than it is in the United States. Taking out a mortgage to buy a property is very uncommon in that country, barely reaching double-digits as a percentage share of homeowners in 2010.

May 20, 2015 – Arsenal For Democracy 128

Posted by Bill on behalf of the team.


Big Ideas for Reforming American Governance (and Economics): The Baja wage subsidy experiment, Expanding the House of Representatives. People: Bill, Nate. Produced: May 19th, 2015.

Correction: The number of residents in the UK was significantly misstated during this episode. The correct number is 64.5 million. We apologize for misspeaking.

Discussion Points:

– Should governments subsidize the difference between the minimum wage and a livable wage?
– Should the U.S. House be expanded to make districts smaller? What would happen if the there were 3,000 U.S. Representatives representing 106,000 people each?

Episode 128 (48 min):
AFD 128
(If you are unable to stream it in your browser on this page, try one of the subscription links below.)

Related Links/Stats

AFD: “Mexican state of Baja California to test government wage support”
Democracy Journal: House of Representatives ratios, 2008
London School of Economics: UK House of Commons ratios, 2011


RSS Feed: Arsenal for Democracy Feedburner
iTunes Store Link: “Arsenal for Democracy by Bill Humphrey”

And don’t forget to check out The Digitized Ramblings of an 8-Bit Animal, the video blog of our announcer, Justin.

Linking U.S. wages to productivity (it might take a while)

Former U.S. deputy assistant Treasury Secretary and economist George R. Tyler, writing for The Globalist, argues that it may take a generation to rally the American people to reorganize corporate governance laws toward a profit model that takes worker pay into account like many other advanced economies do (which has created an international wage gap):

However, ensuring that real U.S. wages rise steadily year after year will require more, including legally linking wages and productivity growth. If a company does very well for itself, some percentage of those profits must be translated into higher wages for employees, rather than merely being plowed into stock buybacks, dividends and executive compensation packages.
Making that case, however, will be a generational challenge for wage advocates, including Democratic lawmakers. Why generational? The Reaganesque division of gains from growth since the 1980s featuring a war on wages has become institutionalized. American history has shown that once a damaging economic arrangement has been established, it is extraordinarily difficult to uproot.

I highly recommend everyone read the full article from Tyler (and not just because I worked closely on the edits for it). This is an important topic for the future of the U.S. economy, workers, and wages.


Big Business is now creating chronic U.S. underemployment

One of the perennial problems in accurately measuring the U.S. labor market is how to handle “underemployment” or involuntary part-time employment by people who want to be working full time. The official Bureau of Labor Statistics defines this category as follows:

Persons employed part time for economic reasons are those who want and are available for full-time work but have had to settle for a part-time schedule.

Those people, whether working 30 hours a week or 10 hours a week, even at or near minimum wage, are ineligible for unemployment insurance benefits or virtually any other program that would help someone who was completely jobless. Any paying work at all, even when it’s not enough to make ends meet, usually kicks people out of eligibility for such programs.

More than five years after the peak of the 2007 U.S. recession, many Americans find themselves in this category of being “employed part time for economic reasons.” The U6 measure of unemployment, which factors these people into the official rate, stood at 12.1% in June 2014 — just shy of being double the official unemployment rate. Almost 7 in 10 part-time workers right now would like to work full-time.

The decision to leave underemployed people out of the official unemployment figures, as I’ve been arguing for five years, has probably been a major factor in not recognizing the severity of many of the emerging structural problems in the part-time work arena that ripple back into the wider consumer economy negatively. Instead, we were busy congratulating ourselves for two decades on supposedly having much “lower” unemployment than Western European economies.

Those economies, which generally use comprehensive definitions of unemployment much closer to our U6 metric, were rarely substantially higher than our U6 rate of unemployed plus involuntarily underemployed persons. Moreover, their “unemployed” people were, in fact, often working part-time (legally or illegally) at rates the same as or higher than our labor force was. So their unemployed/underemployed populations were in far less dire straits than ours during the same period, even without getting into the differences in social safety nets.

Let’s examine one of the big emerging problems that such measurement definitions helped obscure: Involuntary part-time employment for corporate profit reasons, rather than genuine economic reasons.

Often, at least in the past, the “economic reasons” for the lack of full hours came in the form of hours cutbacks (in place of mass layoffs) or general economic belt-tightening, during economic contractions/slowdowns/recessions, by those in positions to be hiring. That’s especially true at the small-to-medium business level.

But a far more insidious and damaging trend has exploded on to the scene from the Big Business end of the spectrum, as huge American corporations not only decline to hire more and more of their hourly wage workforce for full workweeks but then demand these part-time workers be “on-call,” without compensation, to work at virtually any hour, day or night, seven days a week. The schedule changes from week to week and from day to day, at the discretion of the corporate managers.

Almost half of all part-time workers, according to the Times, now have one week or less of advanced notice on their schedule. Among 26-32 year olds working part time, that figure is 47%. Beyond young workers, this problem disproportionately affects women and non-white workers.

In an ongoing series of articles from the New York Times examining the prevalence and consequences of this pernicious staffing practice, we can read example after example of people being forced not only to work part-time but to be available full-time without pay to work the paid hours, which prevents workers from taking second jobs to supplement their hours or finding a better/full-time job or completing their education. Here is one testimonial:

“You had to be available every minute of every day, knowing you would be scheduled for no more than 29 hours per week and knowing there would be no normalcy to your schedule,” he wrote. “I told the person I would like to be scheduled for the same days every week so I could try to get another job to try to make ends meet. She immediately said, ‘Well, that will end our conversation right here. You have to be available every day for us.’

“I asked, ‘Even though I’m trying to get another job?’ ‘Yes.’ Then she just stared at me and asked me to leave. What kind of company does this? What kind of company will not even let you get another job?”

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