Tag Archives: Jobs

Arthur Brooks: why is the American public shifting from optimism to envy?

Labor Force Participation down to 62.8%
Labor Force Participation down to 62.8%

An editorial by Arthur Brooks appeared today in the leftist New York Times. His topic is the shift from optimism to envy, why it is happening, and whether envy makes us happier than optimism.

Excerpt: (links removed)

The Irish singer Bono once described a difference between America and his native land. “In the United States,” he explained, “you look at the guy that lives in the mansion on the hill, and you think, you know, one day, if I work really hard, I could live in that mansion. In Ireland, people look up at the guy in the mansion on the hill and go, one day, I’m going to get that bastard.”

[…]Unsurprisingly, psychologists have found that envy pushes down life satisfaction and depresses well-being. Envy is positively correlated with depression and neuroticism, and the hostility it breeds may actually make us sick. Recent work suggests that envy can help explain our complicated relationship with social media: it often leads to destructive “social comparison,” which decreases happiness. To understand this, just picture yourself scrolling through your ex’s wedding photos.

My own data analysis confirms a strong link between economic envy and unhappiness. In 2008, Gallup asked a large sample of Americans whether they were “angry that others have more than they deserve.” People who strongly disagreed with that statement — who were not envious, in other words — were almost five times more likely to say they were “very happy” about their lives than people who strongly agreed. Even after I controlled for income, education, age, family status, religion and politics, this pattern persisted.

It’s safe to conclude that a national shift toward envy would be toxic for American culture.

Unfortunately, in the wake of the Great Recession, such a shift may well be underway, given the increasing anxiety about income inequality and rising sympathy for income redistribution. According to data from the General Social Survey, the percentage of Americans who feel strongly that “government ought to reduce the income differences between the rich and the poor” is at its highest since the 1970s. In January, 43 percent of Americans told the Pew Research Center that government should do “a lot” to “reduce the gap between the rich and everyone else.”

Why the shift? The root cause of increasing envy is a belief that opportunity is in decline. According to a 2007 poll on inequality and civic engagement by the Maxwell School of Citizenship and Public Affairs at Syracuse University, just 30 percent of people who believe that everyone has the opportunity to succeed describe income inequality as “a serious problem.” But among people who feel that “only some” Americans have a shot at success, fully 70 percent say inequality is a major concern.

People who believe that hard work brings success do not begrudge others their prosperity. But if the game looks rigged, envy and a desire for redistribution will follow.

This is the direction we’re heading. According to Pew, the percentage of Americans who feel that “most people who want to get ahead” can do so through hard work has dropped by 14 points since about 2000. As recently as 2007, Gallup found that 70 percent were satisfied with their opportunities to get ahead by working hard; only 29 percent were dissatisfied. Today, that gap has shrunk to 54 percent satisfied, and 45 percent dissatisfied. In just a few years, we have gone from seeing our economy as a real meritocracy to viewing it as something closer to a coin flip.

There is a good lesson in this for people who want what is best for the poor. Simply receiving money from others is not going to make poor people happy. What we need to focus on is providing the poorest people with opportunities.

One way to help the poor is by giving poor children a better education. Conservatives support school choice, which takes money away from government and puts it back in the hands of parents, letting them choose the best school for their child. Schools have to produce good outcomes in order to earn the money, just like private businesses have to compete for customers. But Democrats oppose school choice, as when they killed the D.C. voucher program that helped poor black students. Less school choice helps public schools to be insulated from competition, which provides worse outcomes to students, especially poor minority students. If we really cared about poor, minority students, we would put pressure on public schools to compete with private schools. But the Democrats don’t want that, they prefer to give favors to their teacher union allies.

Democrats also want to punish job creators with high taxes and burdensome regulations. Democrats passed Obamacare, which punishes businesses with taxes if they allow part-time workers to work for more than 30 hours a week. Many jobs were lost because of this, and many people are now struggling to pay higher premiums for plans with higher deductibles and co-pays. Obamacare is a nightmare of intrusive regulations, too. Now the Democrats are talking about raising the minimum wage, which is going to put even more pressure on employers to lay off workers, because they can’t afford to pay them more money for the same work. For Democrats, this is all to the good, though. Because if the poor don’t have jobs, or can’t work enough hours, they start to see the economic game as “rigged” and they are more responsive to “envy rhetoric”. They start to look to big government for handouts, rather than trying to prevent the government from taxing and regulating job creators.

What we need to see is that it’s not the Democrats’ objective to help people find jobs. They gain when people become more envious, like in European countries, and start to vote to grow the size and power of government to redistribute wealth. Speeches about income inequality never have the goal of giving people jobs. None of Obama’s policies aim to do that. That’s why he won’t build the Keystone XL pipeline, or boost domestic energy development here at home. Instead, they want to extend unemployment benefits and pass the costs on to the next generation. Their goal is to get you unemployed or on disability or on welfare, so that you will vote for the government to continue to take your neighbor’s money to give it to you. That manufactured envy is what keeps the Democrats in power.

This plan to borrow from young people to buy the votes of old people today works for a while, until the money runs out. But by then, the politicians who put in place the redistribution programs are usually long gone .

Republican governor of blue state gets 70% of welfare recipients back to work

Michigan Governor Rick Snyder (R)
Michigan Governor Rick Snyder (R)

This article is from the Daily Signal, and it clearly explains what happens when a blue state hits rock bottom and has to elect a Republican governor to clean up the mess left by a Democrat. In this case, it’s Republican governor Rick Snyder who had to come in and clean up the mess left by Democrat Jennifer Granholm.

Excerpt:

Since Michigan Gov. Rick Snyder assumed office, the number of welfare recipients in the state has declined by a staggering 70 percent, according to a news report.

A total of 64,492 individuals received cash assistance from the state this past August, down from 227,490 in 2011. Snyder, a Republican, took office in January 2011 and was re-elected in November 2014.

Michigan Capitol Confidential, a news site, reported that the decline in welfare recipients could be due to new enforcement of limits on cash benefits. The state has begun enforcing a 48-month lifetime limit for its cash assistance program and a 60-month federal time limit.

The spokesman for the state Department of Health and Human Services, Bob Wheaton, partially credited the drop in welfare recipients to the state’s improving economy.

In an email to Capitol Confidential, Wheaton said: “As the governor said at the time of the decision to enforce time limits, this was returning cash assistance to its original intent—a transitional program to help families as they work toward self-sufficiency while preserving the safety net for families most in need.”

Wheaton also said the program Michigan Works has helped recipients find jobs.

During Snyder’s time in office, the state’s economy has improved, and unemployment has decreased. The unemployment rate in Michigan dropped from 11.2 percent in December 2010 to 5 percent in September 2015.

Honestly, I don’t even think there should be such a thing as welfare. People should be able to put a voluntary contribution into an emergency account, and the government can match that, and if they ever lose their job, they can run their lives off their account. That’s fair. But instead, you have people going on welfare for well over a year, since Obama undid the Welfare Reform bill of 1996.

Maybe that’s why our labor force participation rate is at a 38-year low:

Labor Force Participation 2015
Labor Force Participation 2015

But in Michigan, things are much better. Because they have a Republican running the show. Republicans are not for welfare, they are for helping people back into the workforce. A hand up, not a hand out.

Pre-marriage counseling is good, and pre-engagement counseling is even better

 

Painting: "Courtship", by Edmund Blair Leighton (1888)
Painting: “Courtship”, by Edmund Blair Leighton (1888)

OK, I was chatting with my friend McKenzie who recently got married to an amazing Christian man. She and I are both big believers in asking questions during the courtship. She sent me this article from Verily magazine that has a nice story, and lots of questions.

The article starts like this:

When you know, you know. And with Zach, I knew. Just eleven months into dating, I knew this was the man I wanted to marry. Zach felt the same about me. But instead of putting a ring on it then and there, we decided to seek out a pastor for pre-engagement counseling. You read it right, pre-engagement.

It might sound intense or premature at first, but I am here to tell you that it has been an awesome experience. Sure, the deal isn’t sealed until you say “I do,” but engagement is a huge decision, too. I don’t want to get engaged and then deal with our baggage. When Zach proposes marriage to me, I want my “Yes!” to be with eyes wide open, and pre-engagement counseling has really helped us move in that direction.

What has been so great about pre-marriage preparation? It’s a structured way for us to explore the most important ideas that will be the foundation of our marriage. We have a session once every two weeks for about an hour and a half, during which we’re working through the book Preparing for Marriage by Dennis Rainey with our pastor through homework assignments and discussing together. Of course, pre-marriage counseling can take many forms, but no matter where you might go to get pre-marriage counseling, there are certain things I think any couple should consider before truly committing. Whether you work through them pre-marriage or pre-engagement, like us, is up to you.

She has 4 sections and here they are:

  1. PERSONAL HISTORY
  2. FAMILY
  3. EXPECTATIONS
  4. MONEY MATTERS

The whole essay is very practical, but let me just quote the one that stood out to me:

Few people enjoy talking about money, and Zach certainly did not look forward to this conversation. But money, how we think about it and what we do with it, plays a big part in marital happiness. In our pre-engagement sessions we were posed with great questions when talking about finances. Here are a few of the important questions to cover in a conversation about money:

  • Who will be the primary financial provider in the family?
  • How will you decide on major purchases?
  • Who will pay the bills, balance the checkbook, and keep track of expenses?
  • What is your philosophy of giving (charitable donations to your church or other organizations), and how will you make decisions about giving?
  • What is your conviction about debt and the use of credit cards?

These were just a handful of the financial questions we were asked to think about. We also discussed how we want to handle our finances as a couple and individually (joint or separate bank accounts). It’s a lot to think about, but the goal was to get on the same page.

What I am seeing a lot of these days – I am literally seeing this everywhere – is when older women prefer to date and marry younger men who do not have jobs and who either never did some sort of post-high-school job training or are still students into their mid-20s. And I know why they do that. Younger men who are not serious about providing are very, very easy for older women to manipulate. She can throw out pretty much any crazy plan she wants – and maybe say “God told me” – and he will have no authority from his own life experiences to second guess her. Because he is not responsible or disciplined himself. Young women not only struggle enormously with respecting men, they also prefer men who they do not have to respect, so they can run the relationship based on their own feelings and intuitions.

I have also encountered a very strange attitude among young women where they think that hard work in an area that doesn’t pay is as “promising” as hard work in an area that does. Actually, this isn’t true. Some people work very hard at things that don’t pay, and some people just choose things that do pay and don’t work as hard at them. What matters is not how hard you work, it’s what is in demand. An engineer working a 40 hour week is probably going to make a lot more than a graduate student working 80 hour weeks. Or an assistant professor working 80 hour weeks. The important thing is not to just be busy and organized. It’s much safer to choose a field where you can earn a good salary without killing yourself. Work stress is a stress on the marriage, especially if both spouses have to work because the male provider isn’t making enough.

There is no substitute for earning and saving money. You can’t run a marriage without money – somebody has to pay the bills. Pre-engagement counseling is useful to find out whether one or both people has a proven record of being able to earn, save, and invest. If both people have never earned, saved, or invested, that’s a pretty bad sign. Especially the way things are going with the economy and the national debt. Marriage poses serious financial challenges, and they cannot be wished away. If your plan for prosperity is to discern God’s mysterious will through your feelings and intuitions, then you should make a new plan.

Democrat policies hurt the poor, and actually increase income inequality

Two articles from Investors Business Daily. The first discusses how big government tax policies actually encourage poor people not to work. The second one looks at major cities, and finds that 9 out of the top 10 cities with the most “inequality” are run by Democrats.

Let’s start with the first article.

It says:

The nonpartisan Tax Foundation has put out a new report titled “Income Tax Illustrated .” OK, cue the jokes. But it isn’t boring. Really.

[…]”As low-income households earn more money, not only do their tax burdens grow rapidly, but they also receive fewer benefits from federal social assistance programs,” the report said. “In fact, individuals who move to higher-paying jobs sometimes end up with less overall disposable income, after taxes and transfers.”

The report uses two examples, as noted by the Washington Beacon. In one, a single parent earns $4,800 in salary before taxes. That’s not much, but because of entitlements such as Medicaid, Temporary Assistance for Needy Families, the Children’s Health Insurance Program, food stamps, and Housing Choice Vouchers, that person’s take-home pay for the year jumps to $22,090 — not a lot, granted, but it’s more than 4-1/2 times greater than what that person actually earned working.

That compares to someone who earns $21,000 before taxes but, because of taxes and entitlements, takes home $24,057 for the year.

Yes, that person earns $16,200 more from work, but takes home just $1,967 more, thanks to the tax code and generous benefits to those with less income.

“As low-income households earn more money, not only do their tax burdens grow rapidly, but they also receive fewer benefits from federal social assistance programs,” the report said.

“In fact, individuals who move to higher-paying jobs sometimes end up with less overall disposable income, after taxes and transfers.”

[…]Believe it or not, this bizarre distortion gets worse when you consider a married couple with two kids.

Because the Earned Income Tax Credit is phased out at higher incomes, a family of four making $48,000 faces a marginal tax burden of 43.7% — an absurd disincentive to work harder and earn more for families.

When Republican presidential candidates like Jindal, Cruz and Rubio talk about simplifying the tax code, their intent is to solve these perverse incentives that keep poor people dependent on government. We have make changes to the tax code so that people who are able to work can do better by working, rather than by not working. Republicans are in favor of encourage people to work, marry and have kids. Democrats… just want them to keep voting for dependence on big government.

On to the second article.

Which states have the most income inequality?

The Washington Post looked into the numbers and found that 5 of the top 7 states are decidedly blue — New York, Connecticut, California, Massachusetts and Rhode Island.

And Washington, D.C., which is ground zero of big government liberalism, has the highest level of income inequality of all.

At the other end of the spectrum, the three states with the lowest levels of income inequality are solid red: Utah, Wyoming and Alaska. Nebraska comes in fifth and Nevada ninth.

And what about down at the city level?

The liberal-leaning Brookings Institution looked at inequality by city, and the results show that 9 of the top 10 are run by Democratic mayors — including San Francisco, Boston, D.C., New York, Chicago, Los Angeles and Baltimore.

In contrast, 7 of the 10 least unequal cities are run by Republican mayors, and 9 of 10 are in red states.

And what about Obama, has he helped to reduce income inequality, or has it increased under his watch?

Now take a look at the national level. As the chart above shows, income inequality as measured by the Census Bureau was flat over the course of the George W. Bush years. But under President Obama, it’s been on the rise.

Under Obama, the poor have gotten poorer and the rich richer. Incomes for the bottom 20% have fallen in each of the past four years and are now 8% below where they stood when Obama took office. Meanwhile, incomes of the wealthiest 5% have climbed under Obama, after adjusting for inflation.

IBD had a nice graph for that last point:

The Gini index measures income inequality
The Gini index measures income inequality

So, why is this happening? Why does taking money from “the rich” and giving it to “the poor” makes income inequality worse?

IBD explains:

As we’ve seen over the past seven years, higher taxes, vast new regulations and sharp increases in spending primarily benefit a relatively small number of well-connected people and those companies that can afford an army of lobbyists. In other words, the rich.

At the same time, higher taxes, more mandates and onerous new regulations stifle innovation and make it harder to start up new companies — the sort of companies that create new jobs and new opportunities. The Kauffman Index of business startups, for example, has been below average since 2011.

Incomes are down, because there aren’t enough job creators. We have a 38-year LOW in labor force participation. People rise when there are lots of job offers from job creators. The more people looking to hire, the more people can shop around and get the most salary and benefits for their labor. But wages have not gone up under Obama. He punished job creators with taxes and regulations, so they are creating fewer jobs. Fewer jobs means less competition. Less competition means lower wages and fewer worker benefits.

Wage gap: are women paid less than men because of discrimination?

Hillary Clinton look bored about the deaths of 4 Americans who asked for her help
Hillary Clinton thinks that women are not paid fairly compared to men: is it true?

Liberal feminist Hanna Rosin takes a look at this question in the far-left Slate, of all places.

Excerpt:

The official Bureau of Labor Department statistics show that the median earnings of full-time female workers is 77 percent of the median earnings of full-time male workers. But that is very different than “77 cents on the dollar for doing the same work as men.” The latter gives the impression that a man and a woman standing next to each other doing the same job for the same number of hours get paid different salaries. That’s not at all the case. “Full time” officially means 35 hours, but men work more hours than women. That’s the first problem: We could be comparing men working 40 hours to women working 35.

How to get a more accurate measure? First, instead of comparing annual wages, start by comparing average weekly wages. This is considered a slightly more accurate measure because it eliminates variables like time off during the year or annual bonuses (and yes, men get higher bonuses, but let’s shelve that for a moment in our quest for a pure wage gap number). By this measure, women earn 81 percent of what men earn, although it varies widely by race. African-American women, for example, earn 94 percent of what African-American men earn in a typical week. Then, when you restrict the comparison to men and women working 40 hours a week, the gap narrows to 87 percent.

But we’re still not close to measuring women “doing the same work as men.” For that, we’d have to adjust for many other factors that go into determining salary. Economists Francine Blau and Lawrence Kahn did that in a recent paper, “The Gender Pay Gap.”.”They first accounted for education and experience. That didn’t shift the gap very much, because women generally have at least as much and usually more education than men, and since the 1980s they have been gaining the experience. The fact that men are more likely to be in unions and have their salaries protected accounts for about 4 percent of the gap. The big differences are in occupation and industry. Women congregate in different professions than men do, and the largely male professions tend to be higher-paying. If you account for those differences, and then compare a woman and a man doing the same job, the pay gap narrows to 91 percent. So, you could accurately say in that Obama ad that, “women get paid 91 cents on the dollar for doing the same work as men.”

I believe that the remainder of the gap can be accounted for by looking at other voluntary factors that differentiate men and women.

The Heritage Foundation says that a recent study puts the number at 95 cents per dollar.

Excerpt:

Women are more likely than men to work in industries with more flexible schedules. Women are also more likely to spend time outside the labor force to care for children. These choices have benefits, but they also reduce pay—for both men and women. When economists control for such factors, they find the gender gap largely disappears.

A 2009 study commissioned by the Department of Labor found that after controlling for occupation, experience, and other choices, women earn 95 percent as much as men do. In 2005, June O’Neil, the former director of the Congressional Budget Office, found that “There is no gender gap in wages among men and women with similar family roles.” Different choices—not discrimination—account for different employment and wage outcomes.

A popular article by Carrie Lukas in the Wall Street Journal agrees.

Excerpt:

The Department of Labor’s Time Use survey shows that full-time working women spend an average of 8.01 hours per day on the job, compared to 8.75 hours for full-time working men. One would expect that someone who works 9% more would also earn more. This one fact alone accounts for more than a third of the wage gap.

[…]Recent studies have shown that the wage gap shrinks—or even reverses—when relevant factors are taken into account and comparisons are made between men and women in similar circumstances. In a 2010 study of single, childless urban workers between the ages of 22 and 30, the research firm Reach Advisors found that women earned an average of 8% more than their male counterparts. Given that women are outpacing men in educational attainment, and that our economy is increasingly geared toward knowledge-based jobs, it makes sense that women’s earnings are going up compared to men’s.

When women make different choices about education and labor that are more like what men choose, they earn just as much or more than men.

Now back to Hillary Clinton. How much does she pay the women on her staff?

The Washington Times reports:

During her time as senator of New York, Hillary Rodham Clinton paid her female staffers 72 cents for every dollar she paid men, according to a new Washington Free Beacon report.

From 2002 to 2008, the median annual salary for Mrs. Clinton’s female staffers was $15,708.38 less than what was paid to men, the report said. Women earned a slightly higher median salary than men in 2005, coming in at $1.04. But in 2006, they earned 65 cents for each dollar men earned, and in 2008, they earned only 63 cents on the dollar, The Free Beacon reported.

[…]Mrs. Clinton has spoken against wage inequality in the past. In April, she ironically tweeted that “20 years ago, women made 72 cents on the dollar to men. Today it’s still just 77 cents. More work to do. #EqualPay #NoCeilings.”

Think of this next time Hillary Clinton talks about “the wage gap”. She is talking about the women on her staff, and no one else.