The Unemployment Rate Drops From 8.2% To 8.1%, Helping To Obscure The Jobless Recovery
The Labor Department released its employment numbers today, and in keeping with the recent trend, the results appear positive, down slightly from the previous month’s results.
With a net gain of 115,000 jobs, the unemployment rate dropped from 8.2% to 8.1%.
But behind those numbers lurks a far gloomier picture. That 115,000 net gain is due, in part, to the government no longer counting as “unemployed” 103,000 people who became reclassified as “discouraged,” and yet remain unable to find work. Because in America, if there are no employment opportunities, and your plight goes on for too long, the government is permitted to ignore you completely (so that they can clean up their economic numbers for political purposes).
This helps to give Americans the impression that the economy is slowly, but surely, chugging along.
As reported in the New York Times:
The unemployment rate ticked down to 8.1 percent in April, from 8.2 percent, but that was not because more unemployed workers found jobs; it was because workers dropped out of the labor force.
The share of working-age Americans who are in the labor force, meaning they are either working or actively looking for a job, is now at its lowest level since 1981 — when far fewer women were doing paid work. The share of men taking part in the labor force fell to 70 percent, the lowest number since the Labor Department began collecting these data in 1948.
And yet, despite these five long years of economic misery, austerity measures continue unabated, as 15,000 government employees were laid off in April.
The American Left Awakens: As The Middle Class Goes, So Goes The Political Middle
It could be said that a democracy’s chosen economic model lives and dies by the prosperity of the majority. A thriving middle class has been the key stabilizing factor in American politics for generations. As such, systematic change in the United States has traditionally come slowly and incrementally.
But after a decade of zero job growth, while millions more Americans have continued to enter the labor market, they have witnessed unemployment rates rise and become fixed at levels rarely seen before. They have watched their wages drop, their cost of living rise (due in large part to high energy prices, high education costs, and runaway health care costs), and correspondingly, their quality of life erode.
The middle class is gradually disappearing from the U.S. landscape, and the ‘American dream’ is transforming into a fiction in the minds of millions.
This dream is based on an implicit agreement between the establishment and the masses, and is crucial for America’s brand of hyper-Capitalism to remain a viable economic model. It goes something like this:
If Americans work hard, and invest in a decent education, at worst they should expect a comfortable middle class existence, with prospects for future upward mobility based on merit and perseverance.
As long as this dream is deemed achievable in the minds of the majority, the political status-quo remains all-but a certainty. But the moment people stop believing it, the calls for serious systematic change begin to bubble up to the surface. And this is when the political middle dissipates.
Many economists hold that the dream actually vanished many years ago, but the establishment extended exorbitant lines of credit to Americans, which allowed them to enjoy a mirage of prosperity. In other words, a once prosperous nation on the decline became transformed into a debtor nation. But in doing so, the ‘American dream’ lived on in the minds of millions.
All it took was the massive financial meltdown of 2008, brought on by years of deregulation in the financial and mortgage industries, to pull the curtain wide open on the American dream. The collapse of the U.S. banking industry — which exposed a band of corrupted, highly-leveraged casinos masquerading as banks — rudely awakened Americans to their true state of affairs.
Twelve trillion dollars in ‘perceived’ wealth, mostly in home values, vanished into thin air. Many of those lucky enough to remain employed, found themselves under water with their mortgages. No longer able to sustain their middle class lifestyles with easy credit, consumer spending continued to dry up, and the economy spiraled even further into the doldrums.
The rationale George W. Bush and Treasury Secretary Hank Paulson used to sell the Troubled Asset Relief Program (TARP) to the American public was that if taxpayers bailed out these banks, they would in turn ‘loosen’ the credit markets by lending again to businesses and consumers, which would help to stimulate investment and demand.
Instead, the banks did just about everything, BUT resume lending. Having received amazing terms from the government, they invested in no-risk, interest-bearing Treasuries — to profit off the spreads and transaction fees. They paid themselves billions of dollars in the form of bonuses. In addition, these ‘Too Big to Fail’ banks used taxpayer money to buy-out struggling competitor banks, thereby growing even bigger.
Neither TARP, nor the $16 trillion in secret Fed loans to banks (both here and abroad), loosened the credit markets. Nor did they help millions of struggling Americans to stay in their bank-foreclosed homes. What the bail-outs accomplished was to send a powerful message to Wall Street: as long as these institutions remained ‘Too Big To Fail’ they could continue to take obscene risks, because the government could be counted on to cover their losses.
The effort was branded by most to be a colossal failure — a massive transfer of wealth from the ninety-nine percent to the one percent.
As the status-quo became untenable, many Americans began to abandon the political middle — once a seemingly ‘mainstream’ place to be — and split towards each end of the political spectrum.
Exiled from government, Republicans recast themselves as Tea Partiers — an ‘AstroTurfed movement’ that blamed ‘government’ for all the country’s woes. In particular, they blamed the new Democratic-controlled government, who’d been elected to clean up their mess. These right-wingers embraced pure unadulterated corporatocracy as the solution to problems created, ironically enough, by deregulated banks and corporations.
Democratic constituents felt relieved, having ushered Barack Obama into the White House on a populist progressive ‘CHANGE’ platform, along with Democratic majorities in both houses of Congress. The Left continued to place its faith in democracy — i.e. the ‘ballot box’ — as the appropriate venue for delivering change.
But once sworn in, Obama’s call for ‘Change’ insidiously shifted to a new call for ‘Bipartisanship’. He proceeded to prioritize ‘harmony’ between two diametrically-opposed parties over championing the progressive promises that got him elected.
Of course, this new ‘priority’ was merely a cover for appeasing the entrenched corporate interests. His largely-symbolic legislative victories were so watered down and corporate-friendly that they were routinely castigated by the Left. His advisers would complain bitterly how no one outside the White House would give Obama his due-credit for his ‘achievements’.
He governed like a pre-Tea Party Republican as he broke promise after promise. He proposed cuts to social security, Medicare, and Medicaid. He pushed the Bush-signed, NAFTA-like (job-exporting) trade deals which Congressional Democrats had defeated years before, and he even pressured Congressional Democrats to extend Bush tax cuts for the wealthiest 2%. In doing so, he grossly underestimated the populist angst that had swept him into office.
Obama’s duplicity led many of his once-energized supporters to conclude that America’s entire political process was something of a sham — that they’d once again been had.
And so they gave up waiting around for the Democratic Party to walk their talk, and took to the streets themselves in masses. On September 17, Occupy Wall Street began peacefully protesting in downtown Manhattan, and it has since spread like a forest fire into a nation-wide movement.
This huge, non-partisan, populist ground-swell blasts the Washington establishment for systematically exploiting and subjugating ninety-nine percent of Americans to appease the wealthy and powerful one-percent. The protesters demand an end to the corrupt and insidious relationship between government and corporations which perverts the very fabric of democracy.
“My biggest fear was that the Obama presidency was going to lead this generation of young people into political cynicism and political apathy,” Klein says. “But instead, they are going to where the power is. They are realizing the change is not coming in Washington because politicians are so controlled by corporate interest, and that that is the fundamental crisis in this country.”
It would appear the power-elite’s greed, corruption, and hubris has finally awakened a sleeping populist giant in the American people. And the longer the Democratic Party continues to promote policies right of center, the more those left-of-center will continue to detach from the party and the entire democratic process.
A new Washington Post/Bloomberg News Poll reveals that 44% of Democrats don’t believe the economy would get any worse should President Obama lose in 2012 to a Republican. Blue Texan from Firedoglake sums up this startling revelation:
“Let that sink in for a minute. The economy will be the number one issue in 2012 — and nearly half of the President’s own party doesn’t think it matters if he’s re-elected.”
Clearly, today’s definition of the political middle — which is where Obama loyalists contend he governs — has come to represent the painful and untenable status-quo to traditional Democratic supporters.
Washington Post Now Hiring: Unpaid ‘Non-Employees’ To Produce Content
In April of this year, the New York Times reported a new rising trend where for-profit companies have been taking advantage of the downtrodden labor market by using unpaid internships as a source of free labor. The paper reported that it had both federal and state regulators worried that labor laws were being violated:
The Labor Department says it is cracking down on firms that fail to pay interns properly and expanding efforts to educate companies, colleges and students on the law regarding internships.
“If you’re a for-profit employer or you want to pursue an internship with a for-profit employer, there aren’t going to be many circumstances where you can have an internship and not be paid and still be in compliance with the law,” said Nancy J. Leppink, the acting director of the department’s wage and hour division.
The Times found, for example, that “employers posted 643 unpaid internships on Stanford’s job board this academic year, more than triple the 174 posted two years ago.” This led the U.S. Department of Labor to create a new set of six guidelines for companies to use in “determining whether interns must be paid the minimum wage with overtime under the Fair Labor Standards Act for the services that they provide to ‘for-profit’ private sector employers.” They include:
1. The internship, even though it includes actual operation of the facilities of the employer, is similar to training which would be given in an educational environment;
2. The internship experience is for the benefit of the intern;
3. The intern does not displace regular employees, but works under close supervision of existing staff;
4. The employer that provides the training derives no immediate advantage from the activities of the intern; and on occasion its operations may actually be impeded;
5. The intern is not necessarily entitled to a job at the conclusion of the internship; and
6. The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.
Which brings me to the Washington Post, and their new “Fan Blog” program. Here is a new opportunity they are offering for Washington, DC sports fans to apply for writer positions to cover each of the Washington, DC teams: Two writers for The Wizards, two for the Redskins, two for the Capitals, two for the Nationals, two for the United, and two for the Terps. Only, they have no intentions of paying them even a minimum wage for their work.
On the Post’s “Fan Blog” FAQ page, they announce their guidelines for these writer positions they are trying to fill. Here were two which happened to catch my eye:
2. Some commenters have asked if the new fan blog will replace content on our current staff-written blogs, or other Post-produced content. The answer is an unqualified “no.” We are doing this to supplement our current coverage, because it’s obvious that we have a lot of smart fans who use the web site and might like a bigger platform than the current format allows.
3. Other commenters have asked if we will pay fan bloggers. Sadly, the answer is no. We hope that for some people, the large audience a site like washingtonpost.com could provide is enough motivation to post here, but we understand that may not work for everyone.
Now I know some out there are going to protest my concerns and state that newspapers today are losing money — that they are barely scraping by and need to do whatever they can to provide content in a way that reduces their costs. Well, on the contrary, the Washington Post Co. recently announced their second quarter earnings have gone gangbusters:
Second-quarter earnings at The Washington Post Co. rose nearly eightfold, compared with the same period of 2009, as profits soared at the company’s education division and advertising rebounded at The Post Co.’s six television stations.
The company earned $91.9 million ($10 a share) on $1.2 billion in second-quarter revenue this year, compared with $12.2 million ($1.30) in profit on $1.1 billion in revenue in the second quarter of 2009. […]
The company reported that “although print ad revenue at The Post was down 6 percent, online newspaper ad revenue was up 14 percent.” This led to a total 2% increase in revenues for the Newspaper division for this second quarter.
As a Washington Wizards fan who checks in daily at the Post for team news, I’ve noticed that one of the biggest gripes from some of the regulars who flood the comment section is that the paper never delivers enough Wizards content, and doesn’t ever seem to ‘break news’ on the team. They’re always late, and seemingly out of touch with team insiders. Other Wizards-devoted blogs such as BulletsForever seem to do a far better job at reporting on the team, and keeping fans abreast of things like player injury status, player progression, etc. than the Washington Post does.
I’ll go as far as to say that I learn more about the happenings within the Wizards organization from the Washington Post comment section — there are some exceptionally well-informed commenters there — than from the Post’s Michael Lee, who actually covers the Wizards for the paper. So what better way for the editorial staff to address those Wizards’ fans concerns than to expand the paper’s coverage by hiring some of these well-informed, seemingly well-connected commenters to expand the Post’s Wizards coverage — without pay!
Well, consider this, the US Department of Labor, in addition to providing the list of six guidelines outlined above, goes even further into detail to clarify when someone qualifies as a paid employee:
If an employer uses interns as substitutes for regular workers or to augment its existing workforce during specific time periods, these interns should be paid at least the minimum wage and overtime compensation for hours worked over forty in a workweek. If the employer would have hired additional employees or required existing staff to work additional hours had the interns not performed the work, then the interns will be viewed as employees and entitled compensation under the FLSA.
And once again, looking back at the Washington Post’s description for these ‘positions for hire’ they state: “We are doing this to supplement our current coverage”. And the formal definition of “supplement”:
sup·ple·ment (spl-mnt): Something added to complete a thing, make up for a deficiency, or extend or strengthen the whole.
Clearly the Washington Post is augmenting its existing workforce with free labor to produce content on pages to sell advertising — did I mention their online advertising revenues were up 14% this quarter?
The USDL further states:
Under these circumstances the intern does not perform the routine work of the business on a regular and recurring basis, and the business is not dependent upon the work of the intern. On the other hand, if the interns are engaged in the operations of the employer or are performing productive work (for example, filing, performing other clerical work, or assisting customers), then the fact that they may be receiving some benefits in the form of a new skill or improved work habits will not exclude them from the FLSA’s minimum wage and overtime requirements because the employer benefits from the interns’ work.
And yet, Jon Denunzio, Sports Editor for the Washington Post, in answering one of the commenters questions (in the comment section) on that same “Fan Blog” FAQ page stated (Posted by: Jon DeNunzio | August 22, 2010 11:02 AM):
Q: “Is this going to be individual fanblogs for the major sports teams, or a ‘mash-up’ of all sports into a single fanblog?” (from BinM)
A: The latter. Because we plan some moderation of the posts (not too heavy-handed, we promise), we had to limit the scope of this blog. We’ll try to make it easy for you to find all the posts about a single team by categorizing each post, and we’re discussing having some set scheduling (a Caps post every Tuesday afternoon, etc). And as we said in a previous post, nothing is set in stone — we’ll see how it goes.
Did you get that? The Post’s Sports Editor states they are discussing scheduling writing assignments from these hired ‘non-employees’ — which would clearly be in violation of US Labor Laws. And seriously, just because they have strategically given this unpaid position the name “fan blogger” it in no way deflects from what the position actually is — an unpaid employee, whom they hope to generate revenue from.
To see a huge, corporate behemoth like the Washington Post Co. — just after announcing huge profits — actually trying to circumvent the labor laws by hiring ‘non-employees’ to create their content, upon which they will sell advertising, is simply disgraceful!
If this kind of practice — ‘for-profit’ private companies hiring ‘non employee writers’ — were to catch on amongst other media giants, well … there’s going to be even less opportunities for aspiring writers out there who are struggling to make a living.