Author
|
Topic: Walmart equals higher poverty rates
|
RANGER
rabble-rouser
Babbler # 7667
|
posted 21 May 2006 03:40 PM
Contact: Jill Yablonski [email protected] 781-388-8448 Blackwell Publishing Ltd.Wal-Mart equals higher poverty rates A study published in the latest issue of Social Science Quarterly is the first to examine the effect of Wal-Mart stores on poverty rates. The study found that nationwide an estimated 20,000 families have fallen below the official poverty line as a result of the chain's expansion. During the last decade, dependence on the food stamp program nationwide increased by 8 percent while in counties with Wal-Mart stores, the increase was almost twice as large at15.3 percent. "After controlling for other factors determining changes in the poverty rate over time, we find that both counties with more initial Wal-Mart stores and with more additions of stores between 1987 and 1998 experienced greater increases (or smaller decreases) in family poverty rates during the 1990's economic boom period," Stephan Goetz a Professor of Agricultural and Regional Economics at The Pennsylvania State University states. Although Wal-Mart employs many people living in its communities, for most, the hours worked and the wages paid do not help these families transition out of poverty. Another effect is that the closing of "mom and pop" stores following the appearance of a store leads to the closing of local businesses that previously supplied those stores including: wholesalers, transporters, logistics providers, accountants, lawyers and others. The authors state that "by displacing the local class of entrepreneurs, the Wal-Mart chain also destroys local leadership capacity." They encourage community leaders to think about programs and policies in anticipation of helping those displaced by the arrival of the chain. ### This study is published in the June issue of Social Science Quarterly. Media wishing to receive a PDF of this article please contact [email protected]. Connecting the Social Sciences, Social Science Quarterly is nationally recognized as one of the top journals in the field. It is published on behalf of the Southwestern Social Science Association. Dr. Stephan J. Goetz is a Professor of Agricultural and Regional Economics at The Pennsylvania State University. Before coming to Penn State in 1999, he served on the faculty at the University of Kentucky for nine years with research and teaching responsibilities in economic development. Dr. Goetz is available for questions and interviews. Blackwell Publishing is the world's leading society publisher, partnering with 665 academic and professional societies. Blackwell publishes over 800 journals and, to date, has published more than 6,000 books, across a wide range of academic, medical, and professional subjects.
From: sunshine coast | Registered: Dec 2004
| IP: Logged
|
|
|
Stargazer
rabble-rouser
Babbler # 6061
|
posted 22 May 2006 04:26 PM
I just watched the movie Walmart: The High Cost of Low Prices and it was a real eye opener on so many levels. Do you know this company actually gets government subsidies? How disgusting is that? A mega rich corporation that blackmails towns, cities and people in order to destroy the town they set up shop in. You'd be shown this normal town, with a lot of mom and pop stores, then all the sudden the giant Walmart and then nothing but barren shops and a whole shit load of companies and people out of work. On top of that this company has been sued so many times for environmental breaches, labour and human rights breaches - yet nothing happens. The worst part is that despite knowing all of this, people will still shop there.
From: Inside every cynical person, there is a disappointed idealist. | Registered: Jun 2004
| IP: Logged
|
|
|
|
|
|
|
Fidel
rabble-rouser
Babbler # 5594
|
posted 28 May 2006 11:51 AM
Walmart owns shares in Corrections Corporation of America, one of the fastest growing industries in America. The last I'd read, there were over 80 thousand U.S. prisoners producing everything from clothing to electronic and car parts for American corporations, like GM and IBM. Both IBM and General Motors were but two corporations that showed some interest in a European regime whose ultimate goals included global slave labour in the 1940's. So it seems that Walmart not only treats its regular employees poorly, it also contributes to the undermining of American unionism by supporting prison labour. Slavery was once justified American slavermasters because coloured people were illiterate, or badly clothed and "immoral" because their ways were not the ways of white slavemasters. If they protested their enslavement, they were labelled troublemakers. All of their alleged flaws were said to make them inferior. These flaws were blown way out of proportion then and could not be used to justify slavery today. And so today, African-American's are imprisoned and basic human rights revoked for selling drugs, petty crimes amd misdemeanors. This happens regularly, even though the current president is an admitted drug abuser and recovering alcoholic himself. And voting is one of the rights people in prison or on probation or parole lose. Voting is considered a basic human right for all citizens in about 80 countries. Black people in the U.S. are imprisoned at six times the rate of the most openly racist nation of the last century, South Africa. It seems that slavery in the states is not altogether illegal still. Walmart is part of a powerful union of corporations attempting to revive slave labour in the United States and working closely with government to achieve it. [ 28 May 2006: Message edited by: Fidel ]
From: Viva La Revolución | Registered: Apr 2004
| IP: Logged
|
|
slimpikins
rabble-rouser
Babbler # 9261
|
posted 28 May 2006 12:26 PM
The town that I live in now, I grew up in. I moved away about 10 years ago, and back about 6 months ago. At the time I left, there were mom and pops, and a few of the bigger stores around too. While I was gone, a walmart moved in. Now, it is almost the only place here to shop. I, however, refuse to go in there and support them in any way, shape, or form. If I can't find what I need in one of the few remaining stores that are still kicking it here, I will wait until I can make it to Calgary or even Medicine Hat.The sad thing is that the town that I moved here from just did the same thing, even going so far as to 'lure' walmart to thier town rather than see it go to a nearby small town. Now, the hardware store, the paint store, most of the drugstores, the clothes stores, and the one kids store there have closed, and the workers from those stores (and in a couple of cases, the owners too) are working at walmart for a lot less than they were making before, and no benefits on top of that. If you live in a town that walmart is targeting, fight it hard and fight it early. I tried in my last town, and failed. The only support that I could get was from some wealthier people who were concerned that walmart would bring low income families to thier expensive bedroom community, and I just couldn't bring myself to work with them. If I could do it again, I would do it different.
From: Alberta | Registered: May 2005
| IP: Logged
|
|
M. Spector
rabble-rouser
Babbler # 8273
|
posted 19 July 2008 03:43 PM
quote: Katherine Kersten tries to represent Wal-Mart as a hero of working families. But what Wal-Mart has saved poor and middle-income Americans -- and there's reason to doubt the depth and durability of the discounts Kersten cites -- it has taken that and more from them in diminished job opportunities and reduced income.It's not just Wal-Mart. Rather, it's the economic model that Wal-Mart perfected and that others, including Home Depot and Target, also follow. The rise of these powerful retailers over the past 20 years has decimated two long-standing pillars of the American middle class. One consists of small business owners, tens of thousands of whom, along with their employees, have lost their livelihoods as the big boxes have taken over. Manufacturing workers are the other. Since 1990, the United States has lost some 3 million manufacturing jobs. Many of these losses can be traced to big-box retailers and the relentless pressure they have placed on companies to cut costs by moving to countries with low wages and lax labor laws. Starting a small business or getting a union-wage production job provided a path out of poverty for generations of American families. No other company has done more to close these avenues to a middle-class life than Wal-Mart. Indeed, U.S. Census data show that the middle class has lost substantial ground over the past 20 years. The share of the nation's income flowing to families in the middle 60 percent of the income distribution fell nearly 12 percent. The share flowing to the bottom 20 percent fell even faster, while the ranks of the working poor -- people who work full time but cannot afford the basics -- swelled. Kersten points out that new Wal-Mart and Target stores often attract legions of job applicants. But this is less a sign of the desirability of these jobs than it is of widespread economic desperation.
Continued here
From: One millihelen: The amount of beauty required to launch one ship. | Registered: Feb 2005
| IP: Logged
|
|
|
|
|
|
|
Robespierre
rabble-rouser
Babbler # 15340
|
posted 20 July 2008 01:05 AM
quote: Despite the fact that we live in the age of reason I guess no one pays attention to the nanny state. Average wage in Canada is about $20 while minimum wage is $8 and eveyone pays taxes. Even if taxes are flat the minimum wage earner doesn't pay as much as the average wage earner, this is simple enough...[/QB]
Are we living in an age of reason? Some would argue that we are not. Your theory above is very confusing. You say "even if taxes are flat". Well, are they flat or not in this hypothetical explanation of yours? Also, please define what exactly "heavily subsidized" means. Low-wage workers have their trash collected same as higher-wage earners, both pay a fare to ride the subway, the cops will shoot you in a poor neighborhood or a middle-class one with the same bullet. You are confusing. If you are going to cite economic data but provide nothing specific to prove your assertions, we can't discuss anything. In fact, I'd rather spend the time debating whether Santa Claus exists, would be much more fun.
From: Raccoons at my door! | Registered: Jul 2008
| IP: Logged
|
|
bruce_the_vii
rabble-rouser
Babbler # 13710
|
posted 20 July 2008 03:03 AM
I read one study by the Canadian Center for Policy Alternatives that put taxes on the bottom at 30%, on the middle class at 35% and on the better off at 30%. So if you earn a minimum wage of $9 an hour for $18k annually your taxes are $5.4 k. While if you are a fourth year auto mechanic apprentice and earn the average $21 an hour your income is $42 k while your taxes are $14.7 k. The difference is $9.3 k. As you suggest the government has a myriad of responsibilities and the costs and benefits average out. The fact low wage earners are net subsidized is not much discussed in economics. Economists tend to try and calculate what direct transfers are; which is only half the picture. Don’t get mad at me, tax calculations are not very accurate as there are so many taxes and so many hidden taxes that can’t be figured out. I think it’s useful to eyeball in the taxes at the bottom. If you are making $9 an hour and taxes as a percent of gdp are 40% you might be taxed 35% at the bottom for a total tax of $6.3k. Officially Walmart employees a lot of people as do the other franchisers such as Tim Hortons but what it does is employ a lot of subsizied people. They are actually a bad not a good. I keep my posts short because people only skim them anyway. [ 20 July 2008: Message edited by: bruce_the_vii ] [ 20 July 2008: Message edited by: bruce_the_vii ] [ 20 July 2008: Message edited by: bruce_the_vii ]
From: Toronto | Registered: Dec 2006
| IP: Logged
|
|
|
|
|
|
Michelle
Moderator
Babbler # 560
|
posted 20 July 2008 05:33 AM
quote: Originally posted by Stargazer: The worst part is that despite knowing all of this, people will still shop there.
Well, the problem is, as you say, by the time Walmart moves into a smaller town and they've put everyone else out of business, then the low-income people in the town generally don't have any other place they can afford to shop. So once they're in, the choice goes down and that's what people are stuck with in order to buy the goods they need. It's a vicious cycle for the poor. As for the middle class, who also bring their SUVs to the oversized parking lots to worship at the altar of plastic crap consumerism, well, they just don't give a shit about the effect they're having on the poverty and underclass. They don't have to depend on retail jobs to earn their wages, or welfare because most of the other retail jobs in town are gone, so they're okay, Jack. Time to pick up some more plastic sweatshop crap we don't need! Pack up the kiddies. We'll make a morning of it and have lunch at the McDonald's there. [ 20 July 2008: Message edited by: Michelle ]
From: I've got a fever, and the only prescription is more cowbell. | Registered: May 2001
| IP: Logged
|
|
bruce_the_vii
rabble-rouser
Babbler # 13710
|
posted 20 July 2008 10:48 AM
quote: Originally posted by RANGER:
Wal-Mart equals higher poverty rates During the last decade, dependence on the food stamp program nationwide increased by 8 percent while in counties with Wal-Mart stores, the increase was almost twice as large at15.3 percent. "After controlling for other factors determining changes in the poverty rate over time, we find that both counties with more initial Wal-Mart stores and with more additions of stores between 1987 and 1998 experienced greater increases (or smaller decreases) in family poverty rates during the 1990's economic boom period,"
The idea that the poverty level in an entire county could be affected by the operation of a single brand of retail stores doesn't make much sense. The Social Sciences are troubled by no good data and little funding but the need to Publish or Parish. So simple correlations are tooted as having cause and effect. The idea that they controlled for other factors in this case is outright silly as all the parameters in the economy are the other factors. This is a typical Social Science study and a good example of just why we never hear from the PhD's in the field. In Canada there are some 8000 PhDs in the Social Sciences but you'll read about them very rarley. Economics is a Social Science. I used to assume there was some econometrics at root that would be hard to understand. This is not the case. Many economic studies are jump to conclusion from isolated statistics. The practitioners are socialized into working in this fashion to keep their job. There's really a facade of empiricism that they maintain. It behoves the public to vet these studies with some common sense. That Walmart workers live in poverty is pretty clear. To say that there are 20,000 families in the USA in poverty because of Walmart does seem reasonable given the size of the company. [ 20 July 2008: Message edited by: bruce_the_vii ] [ 20 July 2008: Message edited by: bruce_the_vii ] [ 20 July 2008: Message edited by: bruce_the_vii ] [ 20 July 2008: Message edited by: bruce_the_vii ]
From: Toronto | Registered: Dec 2006
| IP: Logged
|
|
Fidel
rabble-rouser
Babbler # 5594
|
posted 20 July 2008 11:13 AM
quote: Originally posted by bruce_the_vii: Median wage is lower by a couple of dollars. Still a lot more than I make.
I lost the source link to statistics based on declared incomes, but median earned income across Canada in 2004, for example, was $25,500. That's $12.75 an hour for 2000 hours - quite a bit lower than your $20/hr average. Half of Canadians of job age were earning anywhere less than ~$12.75/hr in 2004. Median income for all Canadians in 2004 including pensioners was $24,500. CCPA economists have stated that real median earned income hasn't changed in Canada since something like 1982. [ 20 July 2008: Message edited by: Fidel ]
From: Viva La Revolución | Registered: Apr 2004
| IP: Logged
|
|
bruce_the_vii
rabble-rouser
Babbler # 13710
|
posted 20 July 2008 12:58 PM
You've posted that statistic and apology before but I believe you've got the definition wrong. You may have the per capita. The data for the Greater Toronto Area is average wage is $22.46 while the median is $19.44 per hour. Toronto is no longer richer than the rest of the country. Here's the link: http://www.toronto.ca/business_publications/indicators.htm
I believe you are closer on the mark on the wage improvement over the last two decades although I cannot recall the figures I've read. [ 20 July 2008: Message edited by: bruce_the_vii ] [ 20 July 2008: Message edited by: bruce_the_vii ]
From: Toronto | Registered: Dec 2006
| IP: Logged
|
|
Fidel
rabble-rouser
Babbler # 5594
|
posted 20 July 2008 02:17 PM
Anti-poverty groups have said one in four jobs across Canada don't pay $10 dollars an hour. What would you imagine that does to your bogus average wage?I think this is helpful. I don't believe the overall shape of the income distribution has changed all that much since 1996 except for maybe some increases to the top percentiles.
[ 20 July 2008: Message edited by: Fidel ]
From: Viva La Revolución | Registered: Apr 2004
| IP: Logged
|
|
|
|
|
|
|
|
|
|
|
bruce_the_vii
rabble-rouser
Babbler # 13710
|
posted 20 July 2008 04:14 PM
quote: Originally posted by Michelle:
As for the middle class, who also bring their SUVs to the oversized parking lots to worship at the altar of plastic crap consumerism, well, they just don't give a shit about the effect they're having on the poverty and underclass. They don't have to depend on retail jobs to earn their wages, or welfare because most of the other retail jobs in town are gone, so they're okay.
The thing of it is the middle class does have to worry. This is as low wages are so pervasive in Canada and the USA it tends to affect family. In particular it affects woman who are still the child rearers and don't go through lengthy training to become professionals. So the modern politically correct attitude is "how many in your family".
[ 20 July 2008: Message edited by: bruce_the_vii ]
From: Toronto | Registered: Dec 2006
| IP: Logged
|
|
Frustrated Mess
rabble-rouser
Babbler # 8312
|
posted 20 July 2008 04:39 PM
quote: For one they may be going the way of agriculture jobs, being replaced by machines. Also the third world is taking over manufacturing. However it needs to be kept in mind these export giants like China are also import giants. China imports $1 trillion every 15 months. Economics 101 tells us that imports and exports are connected throught the exchange rate, they will equilibriate, so export giants are not a problem.
Actually, they're going the way of investors. Investors have discovered that jobs, pollution, and investment can be exported to developing nations and consumers in developing nations will go into debt to buy the plastic crap the TV keeps telling them they need.The manufacturing sector hardest hit by the rise in the dollar is the auto-sector which, so it seems, is harder hit by high fuel prices than a higher dollar as sales of big, gas guzzling behemoths were mostly NA anyway. For years, most consumer purchases from appliances to electronics are from offshore. And that was before the increase in the dollar. Economics 101 is based on all things being equal. But not all things are equal.
From: doom without the gloom | Registered: Feb 2005
| IP: Logged
|
|
|
|
Sean in Ottawa
rabble-rouser
Babbler # 4173
|
posted 21 July 2008 10:15 AM
I just want to attempt to clear up one huge misunderstanding Bruce.If I had the time I would be able to back up with the stats but will have to leave that to others. There have been studies on this and I have read them but these are not at my fingertips. Some of this is logic however. There was an assumption that people on social assistance received so much money that wealth was being directed to them from others. Economists tried to quantify this. It did not work out that way. First, those on social assistance were found to be contributing to the economy. Quite a few were volunteering, many were spending time in unpaid work with families, all were creating economic activity as consumers. Most were more efficient consumers creating more employment close to home on necessities and spending less on far away sourced items. Most used public rather than private transportation and had a smaller environmental footprint. All were less able to take advantage of government-subsidized expenses they did not have the money to participate in. Even with free medicare, they went to the doctor less when they were sick (maybe because they could not fill a prescription if they needed one), they did not use the highways, the parks, the airports, the public spaces as much as wealthier people. They did not need the security to the same degree with less to protect and when crimes against them happen the public invests less. The study I remember reading concluded that those on social assistance get far less per person from government (including their social assistance payments) than did wealthier people (even though what they recieved was more visible). Social assistance, it was discovered, was a poor consolation price for being left out of the economic benefits of the country. For the working poor the same disadvantage in taking advantage of all that government has to offer applies- perhaps to a slightly lesser extent but the working poor do not receive social assistance. They instead work at low wages to be exploited by those wealthier than they. They work at low wages in order for their employers to make more money. They work at low wages to serve and supply those who earn more while they cannot afford to take part in as much of the activity they create. I am offended by the idea that anyone could think that those earning barely enough to survive (or less if you consider part-time workers and where the poverty line is), could possibly be doing anything other than subsidize the rest of the country rather than the other way around. Please Bruce, spend a bit more time looking into how economic systems work and read about labour economics because, as well-intentioned as you may be, you are spreading some serious disinformation of the sort used to build regressive right-wing economic policies designed to exploit those who are not as well off. I make a good wage now and am aware that those who are earning a low wage who serve me in a restaurant or a store are in fact subsidizing me not the other way around. [ 21 July 2008: Message edited by: Sean in Ottawa ]
From: Ottawa | Registered: Jun 2003
| IP: Logged
|
|
bruce_the_vii
rabble-rouser
Babbler # 13710
|
posted 21 July 2008 03:33 PM
Well the less well paid benefit from all the intangibles of government spending same as everyone. That would be things like defense, police, our plague free environment and infrastructure. So we are all consumers of these government provided intangibles. The original point of the universal social programs was to insure family but also to subsidize the worst off. That's the whole idea but it seems to have been forgotten. In addition the heavy subsidy of worst off workers is an arguement to pay better. The growth in McLabour has lead to higher government costs and this is not popular with people in higher tax brackets. It's true that exploitative wages provide cheap and cheerful goods and services for the middleclasses, a subsidy. Low wages are both subsidized and a subsidy. However pervasive low wages like we have in Canada affect middle class through family and people are better off without the cheap and cheerful stuff. You argue there is study that people on social assistance are better consumers in a social sense. They may be. I live a middle class life and consider social assistance a pretty mean existance. I'm sypathetic to them personnally. Finally, the low wages in our society are universally unpopular. Everybody harkens back to the 1960's when good jobs were available. When the economy improves wages at the bottom should tighten and this will inflate but be popular. [ 21 July 2008: Message edited by: bruce_the_vii ]
From: Toronto | Registered: Dec 2006
| IP: Logged
|
|
bruce_the_vii
rabble-rouser
Babbler # 13710
|
posted 21 July 2008 03:35 PM
quote: Originally posted by jas: I'm a bit confused by your posts, Bruce. Canadian car manufacturing has been in decline for, I think, 30 years. And NAFTA has just helped speed that up. The effects you're describing are those generally of trade deregulation and globalization. The Canadian dollar will be affected by this, but does not cause these conditions.
Well, no. Before there was NAFTA there was the Autopact. This rationalized car production for the Big Three which was characterized by final assembly in Canada prior to that. The Big Three auto companies in the USA have been in decline for 30 years because of the Japanese but they boomed in Canada. Up until a few years ago Canada was exporting to the USA as fast as the Japanese. The cheap dollar and fact that health care costs are on the governments books made Canada competative. I saw a CAW report that mentioned how many cars Canada was making as opposed to consumming. It was something like a million in surplus. Manufacturing is been hit and will continue to be hit by the emerging nations. However the dollar would decline, not increase, if a manufacturing decline was driving things. I believe it's the price of commodities that keep the Canadian dollar up. [ 21 July 2008: Message edited by: bruce_the_vii ]
From: Toronto | Registered: Dec 2006
| IP: Logged
|
|
|
|
|
Sean in Ottawa
rabble-rouser
Babbler # 4173
|
posted 22 July 2008 07:03 AM
quote: Originally posted by bruce_the_vii: Well the less well paid benefit from all the intangibles of government spending same as everyone. That would be things like defense, police, our plague free environment and infrastructure. So we are all consumers of these government provided intangibles. [ 21 July 2008: Message edited by: bruce_the_vii ]
My point, again, is that this is simply not true. On the police issue alone: A disproportionate amount of police services are spent protecting assets of those wealthy enough to have more valuable ones and events wealthier people participate in. Shall we go on? Education-- higher education is a subsidy for those with the means to go on in school. Wealthier people tend to go further. I already mentioned transportation infrastructure. Heritage and arts funding benefits the better off disproportionately. The list is endless. I am not saying this spending is bad, or bad for the country, but to suggest that all people regardless of income benefit equally in the initiatives of government is pure fantasy. An important point in social thought is that there are public goods owned by the public and paid through taxes. Contributions are based on ability to pay. This is not unfair because people do not get equal access to these public goods either.
From: Ottawa | Registered: Jun 2003
| IP: Logged
|
|
bruce_the_vii
rabble-rouser
Babbler # 13710
|
posted 22 July 2008 05:00 PM
Your point is simple and a good one. However we all have a list of government programs that we don't benefit by. Childless people often complain about having to pay school taxes. To suggest there is no net transfers in the vaunted nanny system does not make sense to me. Generally the government pays for essential common goods and the people have to pay for them. They have the responsiblity to carry the load, just what you consume may not be the issue. So you can reword the issue and spin the nature of the problem. I argue that the high subsidy on the poor makes McLabour expensive to tax payers. In a country such as the USA where there is a lot of low wages you cannot afford proper social support. You're arguing that the poor have a certain moral authority. [ 23 July 2008: Message edited by: bruce_the_vii ] [ 23 July 2008: Message edited by: bruce_the_vii ]
From: Toronto | Registered: Dec 2006
| IP: Logged
|
|
Sean in Ottawa
rabble-rouser
Babbler # 4173
|
posted 23 July 2008 06:15 AM
No I am just pissed at the poor bashing that goes on elsewhere and seems to infect your arguments-- even though there is no shred of economic evidence to support it. And, while you go on like that you seem quite reluctant to acknowledge the government subsidies to the wealthy of which there are many direct ones along with their ability to obtain more than their share of many of the benefits of government supported activity. You don't refer to tax loopholes, you don't refer to grants to business. Instead you want to look at the poor shmuck making $10 an hour and try to make a case that they get more out of the government than anyone else. I have been polite up to this point but perhaps I need to be more direct-- your statements are firmly founded in ignorance perhaps with a dash of prejudice- get some facts before continuing the conversation if you want respect. According to Stats Canada the poorest Canadians (bottom 20% receiving an average $11,500 income receive $11,100 in government transfers- this is an average of the lowest income level including those on social assistance and those earning minimum wage. The next level averaging $31,900 in market income receive only 1,100 less at $10,000. That drops to $4,500 for the highest income earners. This is the share of government transfers. As you can see it does not tail off as quickly as you might expect. http://www.statcan.ca/english/freepub/75-202-XIE/2003000/part3.htm Taxation also does not tail off in the other direction as you would expect. Read this as a start: http://www.policyalternatives.ca/Reports/2007/11/ReportsStudies1752/ Eroding Tax Fairness: Tax Incidence in Canada 1990 to 2005. There you will see that those with annual incomes of more than $265,000, saw their tax rate decline dramatically between 1990 and 2005 by nearly 4 percentage points to 30.5 per cent. Those in the bottom 10 per cent of income earners – with earnings of $13,500 or less had their tax rate go up by 5 percentage points to 30.7 per cent. When it comes to wages themselves these are not set by wealth creation or the value of work. They are set by the distribution of power. Lower wage people are getting shortchanged in their wages due to lower power levels in society. As a result, while they may have receive some government transfers, the wealth they create is re-distributed to wealthier people due to their lower wages. Simplistically: Wealthy people hire poorer people to work for them because it is profitable to do so-- because they derive benefits that exceed the wages they pay. Otherwise they would not hire them. If you do not understand this economic fact then your pronouncements on economics will remain ignorant. Those earning low income wages subsidize the wealthier people by more than they receive in any transfers back from government. You need to begin by realizing that wage rates are not set by the value of work but by a series of profitable transactions where lower wage income provides profits at each stage of the rung in the economic ladder their work goes-- on the bottom rung where they live, they get damn little of what they produce. It is therefore extremely offensive to suggest that lower wage people are subsidized in any way by higher income earners. And this is before you start to list the government services that lower income Canadians cannot participate in. Consider those people who inherit wealth from one generation to the other without paying any tax on it-- the same families rich in the 19th century retain the advantages into the 21st. As Canada is one of the only Western countries without an inheritance tax this bears some scrutiny. there are a lot of places to look for misdirected government money and unfair tax benefits before you get to those earning $10 an hour. On a related point many of those people today are immigrants who worked to earn an education in their home countries and were convinced to come here because Canada said we wanted their skills only to exclude them from their professions allowing them only minimum wage work. [ 23 July 2008: Message edited by: Sean in Ottawa ]
From: Ottawa | Registered: Jun 2003
| IP: Logged
|
|
|
Sean in Ottawa
rabble-rouser
Babbler # 4173
|
posted 23 July 2008 04:11 PM
quote: Originally posted by bruce_the_vii: That a boy, I'm bad mouthing the workers now. I work for $10.25 a hour presently and have worked for minimum wage or $1 more for 23 years now - despite have a degree in computer science.
The level of your pay or the nature of your interest in the discussion is not a guarantee of your knowledge. I was a supervisor at a place where people were making low incomes and half the people there had right wing politics and voted for the Conservatives who campaigned on rolling back the tax reduction on their income level to finance a tax reduction on higher income people. They voted against their own interests and based on prejudices caused by what they learned from others- even though they were misinformed. The fact that you are one of those people making ten bucks an hour doesn't mean your analysis is correct - this is not a situation where having a current experience helps understanding. You might have a better current understanding of the hardship of working for that wage (although I have lived on very low incomes for long periods myself) but you do not necessarily have a better understanding of social economics with respect to low income earners. That you were bashing people with the same income level as yourself does not change the fact that what you were saying was founded in ignorance and prejudice-- prejudice that people earning $10 an hour are only worth that much and that they somehow have either greater benefits from government or make lower valued contributions. Given what you have said, I do hope you will go back and review my posts including the references so that you can get a better understanding of this. This is not particularly controversial either-- there is nothing new or especially original about anything I have said so you can investigate this in many places. The CCPA is a good source for some of this.
From: Ottawa | Registered: Jun 2003
| IP: Logged
|
|
|
|
|
|
|
|
|
Stephen Gordon
rabble-rouser
Babbler # 4600
|
posted 24 July 2008 04:56 PM
I finally got around to reading the study in the OP: it's a steaming turd. It focuses attention on one aspect of the effects of Wal-Mart, and pretends that the other aspects don't exist. For example, we have from the Goetz et al paper: quote: [I]f Wal-Mart raises poverty rates, it also lowers prices to consumers (at least in the short run), thereby in effect lowering the real poverty threshold. It should be noted, however, that the poverty rate is inflation adjusted, so this beneficial effect of the chain is already reflected in the poverty rate measured at any point in time. If the winners can compensate the losers, then the presence of a Wal-Mart store is still Pareto optimal. We are not able to address this question in the present study.
Emphasis added. This is an appalling error of omission, especially since there are quite a few studies that address this issue. Worse, it simply ignores the relevant literature. From Wal-mart: A Progressive Success Story: quote: There is little dispute that Wal-Mart’s price reductions have benefited the 120 million American workers employed outside of the retail sector. Plausible estimates of the magnitude of the savings from Wal-Mart are enormous – a total of $263 billion in 2004, or $2,329 per household. Even if you grant that Wal-Mart hurts workers in the retail sector – and the evidence for this is far from clear – the magnitude of any potential harm is small in comparison. One study, for example, found that the “Wal-Mart effect” lowered retail wages by $4.7 billion in 2000.
So the gains ignored by Goetz are something like fifty times the losses with which he is preoccupied. And it's worth noting that the methodology used in the Goetz et al paper could also be used to demonstrate that the arrival of a Neiman-Marcus store causes wealth. Bleah.
From: . | Registered: Oct 2003
| IP: Logged
|
|
|
|
|
M. Spector
rabble-rouser
Babbler # 8273
|
posted 26 July 2008 04:52 PM
quote: Originally posted by Stephen Gordon, quoting Jason Furman: There is little dispute that Wal-Mart’s price reductions have benefited the 120 million American workers employed outside of the retail sector. Plausible estimates of the magnitude of the savings from Wal-Mart are enormous – a total of $263 billion in 2004, or $2,329 per household. Even if you grant that Wal-Mart hurts workers in the retail sector – and the evidence for this is far from clear – the magnitude of any potential harm is small in comparison. One study, for example, found that the “Wal-Mart effect” lowered retail wages by $4.7 billion in 2000.
The author, Jason Furman, is now Barack Obama's top economic advisor. quote: Officials from several labor organizations phoned the Obama campaign to complain about the appointment and circulated e-mail messages containing quotes from some of Furman’s work....Furman, 37, is linked closely to Robert Rubin, a Wall Street insider and Clinton economics aide who eventually became Treasury secretary. Rubin’s views on global trade and deficit reduction riled liberal economists and labor activists, though his presence gave the Clinton administration valuable credibility in the business and financial communities. “We are very much taken aback that Furman has been put at the head of this team,” said Marco Trbovich, a senior aide to United Steelworkers President Leo W. Gerard, whose support is considered crucial to Obama’s success in heavily unionized areas of Pennsylvania, Ohio, Minnesota and other battleground states. Trbovich worked with Furman during Kerry’s presidential campaign, in which Furman was also an economic advisor. “He is a very bright fellow, but he is an unalloyed cheerleader for the trade policies that have been very destructive to manufacturing jobs in this country,” Trbovich said. “There are very serious concerns” about his appointment. Perhaps the most enraging part of the record, according to Trbovich and others, were comments attributed to Furman on Wal-Mart. In a paper presented in Washington, he suggested that there were some economic benefits from the company’s low prices and other policies at a time when major labor unions had launched an anti-Wal-Mart campaign. Furman worked most recently as a budget expert at the Brookings Institution in Washington heading the Hamilton Project, an economic policy research group. It was founded by Rubin, who now chairs the executive committee of Citigroup Inc. Lori Wallach, a lawyer and leading opponent of free-trade policies, said the appointment was jarring from a policy and a political perspective. “Furman seems like a liability, given his anti-worker writings and statements about Wal-Mart, fair trade and other middle-class issues,” said Wallach, director of Public Citizen’s global trade watch division.... [Furman] was also quoted in a transcript from a CNBC interview in 2006 as suggesting openness to changes in Social Security that might include private accounts and benefit cuts. The approach he described sounded similar in some ways to that proposed at the time by President Bush. The Bush private accounts idea was anathema to labor activists, who successfully challenged the president’s initiative.... Although Furman has directed think-tank work on some controversial topics, Bernstein said he would be an effective campaign staff member. “If you look at his body of work, it’s quite clear that the ultimate goal is very much the same as Obama’s,” he said.
From: One millihelen: The amount of beauty required to launch one ship. | Registered: Feb 2005
| IP: Logged
|
|
|
|
|
|