The Coming of the Red State Apocalypse

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Gov. Rick Perry, the champion of smaller federal government, elimination of Social Security, and all sorts of other fun things is complaining that the federal government is slow in responding to Texas’ fire problem. Maybe he should complain to Eric Cantor, or to to John Boehner…. or to himself:

Perry and other Republican lawmakers have recently argued that federal disaster relief — such as aid for states hit by tornadoes and hurricanes — must be offset by federal spending cuts, but they have yet to make that argument in fire-ravaged Texas. The state recently cut funding for volunteer fire departments by 75% as a cost-saving measure.

FEMA’s budget got chopped by budget negotiations, and by debt ceiling wrangling. And then along came tornadoes, and Irene, and more rain and flooding and natural disasters, and some fires in Texas that budget-reduced firefighters couldn’t control. And now Perry is trying to turn the Texas fires into a Katrina moment for Obama.

Good luck with that, Rick.

In fact, good luck to everyone. Because since state and local governments across the country are on the precipice thanks to the recession and aided by a decade of fighting wars while cutting taxes, the whole country is running the risk of looking like the South Bronx circa 1982. No wonder fundamentalists keep talking about the Rapture– they’re ready to get the hell out of here before what was sowed by right-wing ideology is reaped.

Employment

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Yesterday, I gave two week’s notice, with no full-time job offer in hand, the economy roiling, and people screaming about the debt ceiling. And I have not felt so relieved in many years.

For various reasons, I had ignored my instincts in taking this job for many of the reasons I’ve just mentioned: the economy sucks. I had been laid off about a year and a half ago, and had been working freelance; parts of me were unhappy with the instability. So when I was aggressively recruited by a certain company in DC, I eventually succumbed to the hard sell and took the job. The salary ended up being somewhat less than I had hoped for, the benefits insignificant, but it was steady W-2 employment with paid vacation and a paycheck every two weeks instead of Net-whenever. So who was I to complain?

It’s been 4 months since I started. And it’s grown steadily more like freelance, only without the benefits of freelance. I’ve worked 10, 12, 14, and even 16 hour days, 6 at a time. While I’ve done this as a freelancer, there was always a much higher reward; instead, there was just another unreachable goal laid before me with insufficient tools and emails from co-workers doing the “weekend grind” on their projects intended to inspire me as my family life slipped into oblivion.

After a particularly frustrating day last week, I did some math, and realized that on an hourly basis, I had made more in my first job out of the Navy in 1990.

I realize that my frustration is born of my self-reliant nature, thanks to years of freelancing and telecommuting. I have become entrepreneurial, which inherently makes me a bad employee for companies who treat employment traditionally (“do what you’re told, as you’re told, for what we pay you and be happy about it”). If I don’t have skin in the game, a stake in the success that goes beyond a paycheck, then the salary quickly feels more like a leash than a wage. I could see the flaws in the system, but the boss knows how he wants things. I understand the business model of the company in detail, and rather than being given room to expand on it I am constrained by it. I understand what it was about me that just did not fit, and had no way to apply my talents in ways that would fix that.

Then there’s the difference between the job market and the freelance market. I am highly aware of what I am worth on the market, and of what the best use of my skills is; I track the value of my words like some track their company’s stock. I know what my knowledge is worth. While others in this economy cling to their jobs like a liferaft, I began to see mine for what it was: an anchor pulling me down.

So, I am re-entering the world of self-employment in one of the most uncertain economic times in decades. And I am smiling, because I am in control of my destiny.

Doing the math on economic recovery

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Job growth is slow.  And in some quarters, they’re blaming (1) high taxes, (2) the deficit, or (3) a socialist conspiracy.  But if you look at the numbers, it isn’t taxes or federal spending that’s keeping job growth low. Taxes are at their lowest since 1992 for the top bracket, and are pretty close to where they were in the Reagan years.  But during the economic boom of the 199os, taxes were higher for the top bracket earners, and there was much higher overall employment.

The deficit certainly is an issue for long-term economic stability. And yes, US government borrowing does soak up capital. But the bond rates that the US pays on debt are minuscule, and, in a perfect neoliberal capitalist world, investors would make capital available for businesses looking to grow from a position of strength because of the potential return on investment. Right?

Yeah, I know. Theory is boring, facts are boring.  And we still have 9% unemployment.   Why is that, if it isn’t because the government is weighing down business with taxes and its bloated debt?

Here’s why:

1) Higher labor productivity means that companies can make big profits off of smaller revenues, so there’s not as much incentive to grow them.  Take a look at the Bureau of Labor and Statistics‘ numbers on productivity, and you’ll see that productivity has grown in some sectors by more than 100% over the last 5 years (and is starting to reach a plateau).  The cost of labor has trailed productivity during that time, and real wages have dropped on average — because of the larger pool of unemployed, salary cuts and other factors.  So, companies can make more with fewer workers.  That would theoretically lead to profits that fuel big growth, but…

2) Energy costs are high because of speculation and huge demand from China and India, who have economies that are rapidly growing. So the non-labor costs of production, which are largely based on energy and other commodity costs, have gone up.  So instead of ramping up production, companies have found that they can produce the same or less, with fewer employees, and rake in profits while holding production costs down.  And if they do ramp up their production…

3) Manufacturing has been shifted overseas, so the increased production has a lesser impact on US hiring. So job growth remains low. Job growth could take off if companies in emerging areas were hiring here, but…

4) Congress cut funding of green tech.  And there could be big gains in efficiency in healthcare and a significant reduction in the financial burden on companies from health insurance premiums, but…

5) The Republicans want to rescind the Affordable Healthcare Act and kill Medicare just as they’re starting to pressure a change in the business model of healthcare that will shift to value versus volume.  And of course,  we bailed out the banks, but…

6) The glut of foreclosed housing from the mortgage disaster and other factors have depressed housing prices, and the construction industry, which was a major employer of semi-skilled labor, is still recovering. And it’s been living on corporate welfare life support for the last decade, at least.