05.27.11

Our economy hates you — but not if you’re in the war business

Posted in Bombing Moe, Permanent Fail, Predator State at 6:49 am by George Smith

Our leaders, notably Congress and the administration, are increasingly desperate to rationalize reasons for little recovery in the middle class and high unemployment. So they look to Wall Street, which is doing fine, and economists to tell them it’s all the little people’s fault.

Structural unemployment is what it’s called. It’s an argument that makes the case that rotten is the new good, that nothing can be done because the country has moved on and the unemployed are so because they lack what the country needs for the future. So corporate America has decided to discard them.

They lack the necessary skills.

Except the American middle is not lacking in skills. Working for the census last year made this abundantly clear. The census’ labor, taking a great deal from those knocked into unemployment by the Great Recession, had all kinds of skills and varied training. And they were largely educated. You could not characterize them narrowly — as flawed in their education and training — which is what structural unemployment arguments always try to do.

Today’s news — from this article — delivers all the rancid goods needed to justify walking away from the national mess in the three minutes time it takes to read it.

For example: “Swonk believes that one of the lasting outcomes of the recession will be a skills shortage driven by educational inequality.”

Which, from experience, is rubbish.

The very next graf has one source disputing it, a position also taken by Paul Krugman:

Bart Hobijn, an economist at the San Francisco Federal Reserve, argues against the skills mismatch theory for driving up natural unemployment. Hobijn recently studied the unemployment rate among recent college graduates — who are theoretically resistant to the effects of a skills shortage — and found that they were faring just as poorly in the labor market as others, implying that skills mismatch isn’t having much of an effect on the natural unemployment rate.

Then the man finds a different reason to explain recalcitrant hiring. It’s the extended unemployment benefits, he reasons. The implication that it made people to lazy too find minimum wage work compounded by the fact that employers don’t like hiring low wage workers because, wait for it … they are lazy crap. Although the words “lazy” and “crap” don’t enter the discussion.

This article from US News — on a college-educated 24-year-old girl who fell into homelessness — reveals there’s absolutely nothing going in this country right now to fight the problem.

It’s a story of totally wasted human capital, people discarded not because of failure and incapability on their part, but because inequality in this country has led to inefficiency.

The US is great at making weapons and parasite economy stuff — financial services and monetized networked circle jerks (Facebook, Twitter, etc) — and virtually nothing else. And these industries don’t broadly spread their riches to the overall populace. The good fortune comes only to those directly connected to them — a feature of countries which are either saddled with or adopt rising levels of inequality.

One can marvel at the stubborn optimism of the 24-year old, of the ability to get a book contract, and the revelation of information that it’s important to hold onto your laptop. Or you’ll really be in a world of hurt.

Read it. It’s one example of a nation that’s given up on its people.

On the other hand, if you’re in arms manufacturing, things are jolly good.

Weeks ago I predicted Raytheon and others would get great numbers from our Bombing Moe adventure, even once we abandoned the job. Others, like Little Tommy Atkins, for instance, would shoot off all their nice American-made smart bombs and missiles. But Mo would still stubbornly refuse to die or run away, presenting them with the need to order even more from America’s armorers.

And such has been the case. Business at Raytheon has been wunderbar.

From a press release:

Raytheon Company (NYSE:RTN – News) announced today that its Board of Directors has declared a quarterly cash dividend of $0.43 cents per outstanding share of common stock. The cash dividend is payable on August 11, 2011 to shareholders of record as of the close of business on July 6, 2011.

Raytheon Company, with 2010 sales of $25 billion, is a technology and innovation leader specializing in defense, homeland security and other
government markets throughout the world. With a history of innovation spanning 89 years, Raytheon provides state-of-the-art [missiles] and [war] support services. With headquarters in Waltham, Mass., Raytheon employs 72,000 people worldwide.

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