Thursday, September 9, 2010
Your Wages Are Still Too High
I've been working on a post regarding why the economic "recovery" hasn't occurred, focusing on the fact that the Way Things Are is Policy and that Changes Underway are Strategic and Structural.
Well, Meteor Blades over at dKos has beat me to the punch. Perhaps he's not as distracted as I have been lately. Whatever the case, his post touches on, but doesn't really get into the fact that a great deal of deliberation has obviously gone into the ongoing unemployment crisis.
After all, if there had been any real jobs programs implemented years ago -- or even months ago -- the army of unemployed would have been reduced, conceivably even eliminated. But no. There were no jobs programs at the outset of this Endless Recession and there are none now.
The reason? Simple. American wages are "too high."
Many working Americans have already taken huge pay cuts -- 10%, 15%, 25% is routine if you want to keep your job; 50% pay cut is not unusual any more. But as President Obama has said many times, he wants American companies to be able to compete globally "on a level playing field." He never quite says what he means by that -- though it is widely interpreted to mean raising global standards to American ones. But I submit that's not what he means at all; what he means -- which should be obvious from the economic policies out of the White House -- is that he intends to reduce American standards (wage standards at the very least) to global standards.
50% pay cut apparently isn't enough.
I don't know what would be enough. Since wages in China, India, and even Vietnam are rising, perhaps there is a Global Median that could be reached, let's say $10-15 a day for an average American worker, about the same as in Russia today.
As the AEI flack cited by MB proposes, with an "appropriate" wage scale, American employers would be hiring again, but damn if there aren't all these impediments, like minimum wage laws and overtime and other nuisances that get in the way.
No, the Market Must Rule.
And that means you are being paid too much. Give it up. Now.