• Steve H. Hanke
    05/04/2016 - 08:00
    Authored by Steve H. Hanke of The Johns Hopkins University. Follow him on Twitter @Steve_Hanke. A few weeks ago, the Monetary Authority of Singapore (MAS) sprang a surprise. It announced that a...

With Ohio This Election's Deciding State, Here Is The Truth Behind Its "Jobs Miracle"

Tyler Durden's picture




 

Forget Florida. This election it is all about Ohio: without Ohio, Romney's winning chances plummet (as can be observed at the following interactive chart), even if one ignores history which is that since 1862 no Republican has won the presidency without winning Ohio. This is a fact well-known to the Obama administration, which explains why the incumbent has spent so much time in the ravaged state, where he has spent so much time ruminating on the the Ohio "unemployment rate miracle." Sure enough, in September, the Ohio unemployment dipped to 7.0%, the lowest since September 2008! On the surface, a tremendous metric and great improvement for a state that would have certainly been firmly in the pro-GOP camp had Obama not been able to hammer on this statistic time and time again. Yet, as always, the unemployment rate is only part of the story. The bigger question is whether or not another data set is being fudged to make the Ohio jobs situation appear better than it is in real life. The answer is, predictably, yes.

As the chart below shows, even as the unemployment rate was declining, the labor force participation rate for this most critical of states plunged to 63.6%: the lowest since the "end of the recession" (even as the national LFP rate saw a modest uptick in the past two months), but more importantly is the lowest for Ohio since 1984. Which means one simple thing, a thing which can be inferred by looking at the historical convergence of the two data sets (participation rate is shown on the left inverted axis): once the pre-election "data nudging" ends, and the LFP is allowed to reflect reality, watch as the Ohio unemployment rate explodes to over 10%, which is what its fair value is according at least to the participation rate. But by then the game of pre-election optics will be over, and Ohioans will realize that promises, propaganda and reality never, ever coexist peacefully.

BloombergBriefs confirms this observation:

The state of Ohio is seen as pivotal in the election. The size of the labor force in Ohio, which once was home to a vibrant manufacturing industry, has declined by about 85,000 workers over the past four years. The unemployment rate of 7 percent is below the national rate of 7.9 percent, probably because some people stopped looking for work and are not counted as unemployed. The labor force participation rate is 63.6 percent in both the U.S. and Ohio, indicating a “real unemployment rate” of something closer to 10 percent.

Q.E.D.

Finally, for those who say the drop in the participation rate is due to a demographic shift of the population, this is and has been a dead wrong statement. As we showed in the past week, virtually all job gains at the national level since Obama took power have occurred in the 55-69 age group, which has risen by about 4 million workers, even as those in the prime demographic of 25-54 have lost over 2 million jobs, for one simple reason: the elderly are forced to return to the labor force in droves because under ZIRP their saving have zero purchasing power, which in turn skews the hirings toward those who have little wage negotiating leverage and substantially more job experience than their younger, inexperienced job hunting competition.

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Tue, 11/06/2012 - 10:12 | 2951477 RacerX
RacerX's picture

I live in Ohio and can confirm there is no miracle here.

Tue, 11/06/2012 - 10:14 | 2951485 Orly
Orly's picture

People on the ground might actually resent having blue smoke blown up their ass.

Jus' sayin'.

:D

Tue, 11/06/2012 - 10:16 | 2951492 economics9698
economics9698's picture

Governor Scott in Florida is doing the same crap, dropping people off the unemployment rolls for the slightest clerical error to make his ass look good.  The job growth in Florida is pathetic when compared to the population growth rate.  Same shit, different state.

Tue, 11/06/2012 - 10:21 | 2951504 francis_sawyer
francis_sawyer's picture

I'm taking my talents to South Beach...

Tue, 11/06/2012 - 10:25 | 2951517 gmrpeabody
gmrpeabody's picture

You'll do well in South Beach...

Tue, 11/06/2012 - 10:30 | 2951532 Bicycle Repairman
Bicycle Repairman's picture

If ex-President 'W' made made public appearances in OH on behalf of Romney, this election would be over.

Tue, 11/06/2012 - 10:44 | 2951561 hedgeless_horseman
hedgeless_horseman's picture

 

 

A vote for Gary Johnson is not a vote for Obama, nor a vote for Romney, it is a vote for Gary Johnson.

A is A.  A is not B.

Tue, 11/06/2012 - 10:45 | 2951570 francis_sawyer
francis_sawyer's picture

Like trying to run a triple reverse 'Statue of Liberty' play on 4th & goal at the one foot line... Me?... I think I'll punt...

Tue, 11/06/2012 - 11:27 | 2951762 TruthInSunshine
TruthInSunshine's picture

I was again pondering the issue as to how the BLS measures unemployment last night, spurred on by an encounter with this explanation as to how the economist John Williams (of Shadow Government Statistics) compiles his SGS Alternate Alternate Unemployment Rate:

The seasonally-adjusted SGS Alternate Unemployment Rate reflects current unemployment reporting methodology adjusted for SGS-estimated long-term discouraged workers, who were defined out of official existence in 1994. That estimate is added to the BLS estimate of U-6 unemployment, which includes short-term discouraged workers.

So while the media pretty much only touts a very misleading U3 number in their headlines and the "official" (although, again, rarely if ever actively 'spoken of' by main stream stream media outlets nor agencies of government) U6 is approximately 15%, Williams, using the methodology that was used prior to 1994 (i.e. also including "long-term discouraged workers") to calculate U6, demonstrates that under the pre-1994 formula, U6 would actually currently be close to 24%.

How or why would any sensible and objective person (considering things like the basic rules of arithmetic, logical & scrutiny of BLS methodology) not conclude that the "official" unemployment rate that is tabulated by the BLS understates the actual rate of unemployment in the U.S. by such a massive percentage as to render U3 a meaningless data point, arguably constituting official government propaganda?

Maybe it's time for a complete revision of the method by which the unemployment rate is calculated, in an effort to actually allow more people knowledge of the true rate of unemployment and labor rate participation.

I would love to see a graph and/or chart that plots the correlation between both U6 and the SGS Alternate Unemployment Rate versus the % change in participation in certain governmental subsidy programs, such as SNAP & Social Security Disability Insurance, as well as participation rates in certain entitlement programs, particularly the subset of individuals eligible to access Social Security and Medicare earlier than is typical, and have chosen to do so.

Tue, 11/06/2012 - 14:48 | 2952107 crusty curmudgeon
crusty curmudgeon's picture

Quoting Aristotle is way too advanced for most voters.  I think you need to ratchet it down a bit.  Try this...

"Hewwo" -Elmer Fudd

 

Tue, 11/06/2012 - 10:42 | 2951562 Dr. Richard Head
Dr. Richard Head's picture

For Obama I assume?  Actually, people have such short term memories.  They probably remember how Bush followed his campaign promises of no nation building and a more humble foreign policy.  They would also forget his administration's creation of the TARP program, as well as stimulus checks being sent out to citizen of Amerika. 

Fuch the elephants and fuck the donkeys. https://twitter.com/FamilyRotten/status/265814196166483969/photo/1

Tue, 11/06/2012 - 11:17 | 2951721 Bicycle Repairman
Bicycle Repairman's picture

LOL.  I believe you are correct, sir.  'W' has destroyed the Republican party.  When commentators mention that Romney has to be elected or "traditional Americans" are doomed, I have to laugh.  That horse has left the barn and the man holding the door was named George Walker Bush.

Come on 'W' (or 'HW') pop your head out of your gopher hole and publicly endorse Mitt Romney.  We all could use a laugh.

Tue, 11/06/2012 - 11:32 | 2951784 Dr. Richard Head
Dr. Richard Head's picture

I do like using facts to debunk neocons...I mean republicans.  Like this, for instance, from Lew Rockwell yesterday -

Writes Jim Fedako:

FYI. Roe v. Wade was decided 7–2 by a court that was 6–3, Republican appointees v. Democrat appointees. One of the dissents was a Democrat. That means 5 of the 6 Republican agreed with the decision. This alone exposes the canard that is now the talking point: the next president decides the court. While the statement is prima facie true, its implication, that only Democratic appointees are evil, is false. From Roe v. Wade (a small, but high-profile sample), we see that only 67% of the Democrats are evil (with regard to the sanctity of life), while 84% of the Republicans are. Another reason that voting is useless.

And of course, there is the "conservative" John Roberts appointed by Bush who upheld Obamacare.

Tue, 11/06/2012 - 11:40 | 2951817 Bicycle Repairman
Bicycle Repairman's picture

Yeah, I suppose if you're gonna start in with facts and stuff, you might be right.  But you've got to admit the Republicans have gotten a lot of mileage out of the abortion issue.

Tue, 11/06/2012 - 15:42 | 2952787 Cathartes Aura
Cathartes Aura's picture

particularly when you include the skidmarks.

Tue, 11/06/2012 - 11:54 | 2951854 Acet
Acet's picture

OMG, not the whole Abortion debate as way of gauging the evilness of the Court's judges!

Don't you guys have anything more important to worry about than a derivative of the Monty Pythons "Every sperm is sacred" sketch or if a man will stick his willy up another men's bottom (or a woman will muff-dive on another woman)? You know, things like two wars and likelly an upcoming third one, the erosion of personal rights (indefinite arrest without warrants, wiretaping without warrants, police abuses), the takeover of government by corporate interests and, oh I don't know, THE FUCKING ECONOMY!???

The US is sinking and some people only care about playing the harp in the orchestra while it goes down.

Tue, 11/06/2012 - 12:22 | 2951962 Dr. Richard Head
Dr. Richard Head's picture

I am just simply pointing out to the evangelical right that their beloved Republican party is not their savior.  Now, I want to talk to you about our lord and savior Jesus Christ.

Tue, 11/06/2012 - 14:09 | 2952423 TruthInSunshine
TruthInSunshine's picture

There was no "Romney Girl" on youtube (at least that I noticed, even though I wouldn't and couldn't be bothered to look for such triviality).

That must mean Obamney is going to be President of Idiocracy.

Tue, 11/06/2012 - 11:34 | 2951788 Dr. Richard Head
Dr. Richard Head's picture

I do like using facts to debunk neocons...I mean republicans.  Like this, for instance, from Lew Rockwell yesterday -

Writes Jim Fedako:

FYI. Roe v. Wade was decided 7–2 by a court that was 6–3, Republican appointees v. Democrat appointees. One of the dissents was a Democrat. That means 5 of the 6 Republican agreed with the decision. This alone exposes the canard that is now the talking point: the next president decides the court. While the statement is prima facie true, its implication, that only Democratic appointees are evil, is false. From Roe v. Wade (a small, but high-profile sample), we see that only 67% of the Democrats are evil (with regard to the sanctity of life), while 84% of the Republicans are. Another reason that voting is useless.

And of course, there is the "conservative" John Roberts appointed by Bush who upheld Obamacare.

Tue, 11/06/2012 - 11:53 | 2951855 TheProphet
TheProphet's picture

Neither side will EVER do anything to meaningfully resolve the abortion issue.

What more polarizing, motivating, distracting issue could they ever find to replace it?

And, you can talk about Republicans getting mileage out of the issue, but it is the Democrats who use it daily in their fear-mongering. The Obama campaign is running ads in swing states talking about it. Joe Biden huffed about the Supreme Court at the end of the debate.

 

Tue, 11/06/2012 - 10:54 | 2951615 firstdivision
firstdivision's picture

Over for Romney.  Bush isn't liked very well by OH voters much.  In reality though, I think Dubya has become disenfranchised with politics.

Tue, 11/06/2012 - 11:31 | 2951778 ONO47
ONO47's picture

Dubya's disenfranchisement is about 12 years too late.

Tue, 11/06/2012 - 11:42 | 2951825 Bicycle Repairman
Bicycle Repairman's picture

I might have said 66 years too late.  But I won't.

Tue, 11/06/2012 - 11:34 | 2951727 TruthInSunshine
TruthInSunshine's picture

Who is reporting it's over for Romney and why?

Is it more than wild speculation?

(I detest deeply captured Obamney, otherwise known as each deeply captured "candidate" of each deeply captured "party" equally, but was just curious).

Tue, 11/06/2012 - 11:49 | 2951838 Bicycle Repairman
Bicycle Repairman's picture

LOL. I'm not saying it's over for Romney.  I'm just saying if a couple of very senior, elderly Republican statesmen took to the stump in OH today, we'd get a "November Surprise".  Why have they been holding back?  Why hasn't Romney invoked the spirit of their leadership?

LOL.

Tue, 11/06/2012 - 13:35 | 2952225 Ludwig Van
Ludwig Van's picture

 

 

A challenger from Mass. goes up against the incumbent, makes the fight look good, i.e. convincing, but is inevitably doomed to lose: The forfeit is foregone from the first.

But what a man! -- to take one for the team, his valor not to go unrewarded.

It is 2004. Again.

 

 

Tue, 11/06/2012 - 14:16 | 2952450 Bicycle Repairman
Bicycle Repairman's picture

Win or lose, let's just face the facts: the most vulnerable President since Hoover has battled Romney right down to the wire (at least).  The Republicans could have chosen from dozens of alternative candidates (not any of the bozos from the primary season) and Romney was their choice.

Tue, 11/06/2012 - 12:17 | 2951938 Mad Mohel
Mad Mohel's picture

Yeah the market for gigolos and male prostitues seems to have picked up ever since the RNC was down there.

Tue, 11/06/2012 - 11:28 | 2951755 Jumbotron
Jumbotron's picture

To economics9698.........

 

Ditto that from North Central and North East Florida.  Scott may be good on paper in terms of his "Libertarian" credentials.....but he is engagiing in the same "CYA" tactics as all politicians of both stripes...liberal or conservative.  He has not kept his promises of spectacular job growth.  His downsizing....or attempts...at downsizing Floridian government has not benefited the state at large....but does allow him some wiggle room to spin.

Now we have this crazy plan going through the halls of power to lower tuitions for students who pursue majors that the state deems worthy enough....such as math, engineering and technology.  While these are worthy majors for attention in the 21st century......how can a Libertarian / Conservative administration and state congress even look at themselves in the mirror when they now want to dictate what any individual can pursue in college?

Seems the antithesis of libertarianism.  But as a Libertarian myself and who tries to do the moronic thing that George Carlin said he always tried to do....namely think......I have seen that a lot of Libertarians are simply fascists of another stripe.

Tue, 11/06/2012 - 11:42 | 2951823 FrankDrakman
FrankDrakman's picture

I have seen that a lot of professed Libertarians are simply fascists of another stripe.

There, fixed that for you.

Tue, 11/06/2012 - 15:53 | 2952846 Cathartes Aura
Cathartes Aura's picture

like any popular label, the definition varies with the user.

which is why label-wearers are often lumped together. . . useful.

Tue, 11/06/2012 - 16:10 | 2952938 Jumbotron
Jumbotron's picture

No snark....mea culpa....thanks for the clarification....should have known better and wrote better.

Tue, 11/06/2012 - 11:26 | 2951758 Winston Churchill
Winston Churchill's picture

As an employer in Florida I take exception to your comment.

Sorry to have to say that most of Florida's UE is made up of

shiftless .lazy people, scrounging on the dole.

You need to suffer the frustration of trying to employ them,

to understand.Gone thru' 3000+ to get 15 that were worth employing.

Sorry if you are UE, but theres plenty of work out there,if you look.

Tue, 11/06/2012 - 10:18 | 2951495 Eireann go Brach
Eireann go Brach's picture

Shocker, Obama talking out his ass! According to some, he shits roses and daffodils!

Tue, 11/06/2012 - 10:20 | 2951501 vast-dom
vast-dom's picture

one more reason this election to JUST SAY NO TO VOTING

Tue, 11/06/2012 - 10:45 | 2951577 pods
pods's picture

Easy vast, let them have their day.  The general attitude I have seen so far today is that the hopium partaking started bright and early.  The hangover will be tomorrow.

Today will be one long orgasm of pride and patriotism.  Tomorrow will be back to rowing.

The idiots on my local radio show wanted callers to call in who were going to hire people if Romney got elected.  Yep, partaking early everyone was.

pods

Tue, 11/06/2012 - 10:51 | 2951601 odatruf
odatruf's picture

I voted at 8:30am in my swing state.  There were long lines out the door into the parking lot.  Not as many candidates as normal standing near the door and not too many people registering same day (we can do that in NH).

 

Tue, 11/06/2012 - 11:21 | 2951732 pods
pods's picture

The one polling place I drove by seemed to have a decent crowd first thing in the morning.  

Speaking of candidates, my wife took my kids to a local festival the past Saturday. One candidate handed my young daughter a card with his schtick, but first the fucker signed it. Gave her his autograph!

That is what this place has become.  A guy wanting to become MY public servant is now giving autographs to my kids?

I did get a chuckle out of it because someone gave them a couple little R&R stickers.  I put one on a guys car I work with, right next to his obama sticker. 

Gotta have fun in life!

pods

Tue, 11/06/2012 - 11:31 | 2951772 Jumbotron
Jumbotron's picture

That is what this place has become.  A guy wanting to become MY public servant is now giving autographs to my kids?

 

We're all American Idol now.

 

By the way....nice touch on the bumper sticker....LOL !!

Tue, 11/06/2012 - 10:58 | 2951635 Incubus
Incubus's picture

voting... 

Hopeless naivety is a great substitute for wisdom & experience.

Wide-eyed masses high on the bullshit being peddled. 

 

Just be wary, because these people won't let go of their delusions until they're ready for violence. 

 

 

Tue, 11/06/2012 - 10:22 | 2951506 LongSoupLine
LongSoupLine's picture

...and I live in America and can confirm the Obamedia is not exposing the above charts.  Hence, the reality is what the sheep herding MSM says.

 

However, good work once again ZH!

Tue, 11/06/2012 - 10:50 | 2951594 MachoMan
MachoMan's picture

What no one wants to talk about is that social security and other retirement benefits are now a complete and total drag on wages.  If I'm in the 55+ category, my cost of employment can be considerably lower than the 25-54 bracket simply because I have so many supplements to my income.  Moreover, I have no student loan debt, de minimis credit card debt, and I have a bit of assets squirreled away if things become too desperate.  Bottom line, I can work cheaper than my younger counterparts, at least for a while.  Until the cost of living increases so much that it completely and totally eclipses wages (probably not too far, realistically), retirementish age folks returning to the work force is an incredible drag on wage rates.  [aside from simply increasing supply of labor]. 

Tue, 11/06/2012 - 10:56 | 2951625 odatruf
odatruf's picture

Actually, the highest level of debt is held by those aged 50 to 54. See http://media.marketwire.com/attachments/201112/37349_CreditKarmaImage.jpg

It isn't until the over 70 age group that the total debt held amount drops below that of somewhat younger people.

And since you can't get any earlier than 62 (not 55), there isn't much in the way of income support that those people didn't create / save themselves.

Plus, price a health insurance policy for some aged 55 compared to 25 and you'll reason number 1 why it is much much cheaper to hire the younger person.

Tue, 11/06/2012 - 11:09 | 2951679 MachoMan
MachoMan's picture

Actually, the highest level of debt is held by those aged 50 to 54. See http://media.marketwire.com/attachments/201112/37349_CreditKarmaImage.jpg

It isn't until the over 70 age group that the total debt held amount drops below that of somewhat younger people.

Even if tied in total debt, that still doesn't disprove the point that supplemental income in the 55-69 bracket creates downward pressure on wages and that these people can work for less.  Further, the graph doesn't really break down debt service costs, but it should be heavily noted that supplemental/retirement income is largely protected from creditor attachment.

And since you can't get any earlier than 62 (not 55), there isn't much in the way of income support that those people didn't create / save themselves.

Wild speculation.  If true, then I fail to see why there would be any issue with the solvency of the social security trust fund...

Plus, price a health insurance policy for some aged 55 compared to 25 and you'll reason number 1 why it is much much cheaper to hire the younger person.

We're not talking about salaried high paying jobs here...  these are the JOBS ADDED in the present economy...  they're basically minimum wage/part time jobs.  Why do you think that health insurance would even be considered?

Tue, 11/06/2012 - 11:21 | 2951733 odatruf
odatruf's picture

MachoMan - if we are talking about SS payments, then it is not wild speculation that 62 is the earliest it can be had; it's the law of the program. The reason there is a solvency problem is because benefits paid out out pace the taxes paid in, when factored across the actuarial tables.

The reason health care matters is because as a result of the ACA, business with more than 50 employees MUST either buy the employees coverage or pay a penalty.  And while the penalty is less expensive than the health policy, it isn't a cheap as the penalty an individual will face and it is scheduled to ramp up quickly so that it will matter.

As for the supplemental income of the plus 55 set, if it isn't SS, then it must be income from savings or other investments.  If that is the case, then ZIRP has seen to it that you must have significant resources to generate any stable and appreciable income.  The people with those resources are not working into their old age.

I appreciate your response to my comment, but you could not be more wrong about almost all of it. But, you remain one of my favorite wrestlers, Randy. RIP.

Tue, 11/06/2012 - 11:27 | 2951766 MachoMan
MachoMan's picture

Here is your comment: And since you can't get any earlier than 62 (not 55), there isn't much in the way of income support that those people didn't create / save themselves.

Again, if everyone pays for everything they get out, then please explain to me the solvency problem.

The reason health care matters is because as a result of the ACA, business with more than 50 employees MUST either buy the employees coverage or pay a penalty.  And while the penalty is less expensive than the health policy, it isn't a cheap as the penalty an individual will face and it is scheduled to ramp up quickly so that it will matter.

We're talking about current data...  not pontificating upon the ramifications of a 2700 page document no one bothered to read and that may or may not get trashed post election.  Please stay on topic.

As for the supplemental income of the plus 55 set, if it isn't SS, then it must be income from savings or other investments.  If that is the case, then ZIRP has seen to it that you must have significant resources to generate any stable and appreciable income.  The people with those resources are not working into their old age.

Moving the goal posts.  No one is claiming that they can live off of the income...  this is why they're going back to work in the first place...  however, that doesn't change the fact that some (for the 55+ bracket) is more than none (everyone younger).

Tue, 11/06/2012 - 13:50 | 2952349 odatruf
odatruf's picture

Macho - everyone does not pay for everything they get out of SS.  It's a ponzi scheme that used to roughly link what you paid in with what you paid out, on average and with some accounting that tilted the payout toward the lower earners. But that isn't true anymore. The demographics and promises made out strip the income stream. Within the next ten years, SS will run through the money it takes in from FICA payments, exhaust the trust fund surplus (meaning the general fund writes those checks) plus all due interest. When that happens, either SS will be forced to reduce payments by about 1/3rd or the general tax base will be forced to make up the difference or people will have to pay more into the fund.

As for health care, this isn't a "pontificating upon the ramifications of a 2700 page document". This is the law of the land, which has been upheld by the SCOTUS. This will happen on Jan 1, 2014. Any change to that would now need an act of Congress, including the Senate overcoming the 60 vote filibuster. So, I'd say this is backed into the cake. Even a Romney win isn't enough. Nor is winning Senate control. You simply must understand the inertia of the status quo in this case.

In any case, Macho, I have no problem agreeing to disagree.  The older people being forced back into the workforce do not have any assets that kick of income for them. And, they are more in debt than those just starting out. Plus, because of their age and experience, they normally demand higher wages.  I don't see why this is so unbelievable to you.

At best, we can agree that the presence of more workers - of any age cohort - should keep wage pressure under control.  That is a simple S and D curve.

 

Tue, 11/06/2012 - 15:02 | 2952641 MachoMan
MachoMan's picture

Macho - everyone does not pay for everything they get out of SS.  It's a ponzi scheme that used to roughly link what you paid in with what you paid out, on average and with some accounting that tilted the payout toward the lower earners. But that isn't true anymore. The demographics and promises made out strip the income stream. Within the next ten years, SS will run through the money it takes in from FICA payments, exhaust the trust fund surplus (meaning the general fund writes those checks) plus all due interest. When that happens, either SS will be forced to reduce payments by about 1/3rd or the general tax base will be forced to make up the difference or people will have to pay more into the fund.

No problem with this, but for the fact that it isn't what you wrote earlier.  I'll consider the bout face a victory on this point.

As for health care, this isn't a "pontificating upon the ramifications of a 2700 page document". This is the law of the land, which has been upheld by the SCOTUS. This will happen on Jan 1, 2014. Any change to that would now need an act of Congress, including the Senate overcoming the 60 vote filibuster. So, I'd say this is backed into the cake. Even a Romney win isn't enough. Nor is winning Senate control. You simply must understand the inertia of the status quo in this case.

Well...  if we're talking about something that is to happen in 2014, then we're _________________________.  Again, it has nothing to do with a graph of TODAY's issues.  Sure, the trends might change later, but that's not what we're talking about.  Please do not move the goal posts.

In any case, Macho, I have no problem agreeing to disagree.  The older people being forced back into the workforce do not have any assets that kick of income for them. And, they are more in debt than those just starting out. Plus, because of their age and experience, they normally demand higher wages.  I don't see why this is so unbelievable to you.

This might come as a shock to you, but labor does not dictate wages.  Labor has long since lost the war with capital.  The jobs that are being added to the economy (at present) are menial, low paying jobs.  Older people coming back into the workforce are getting minimum wage/low paying jobs.  They do not get to dictate anything about the terms of their employment, regardless of the amount of experience they may have. 

The simple issue is that everyone is in debt up to their eyeballs.  The only difference being some of these folks get creditor protected payments for retirement, etc.  This (at present) allows them to work cheaper.  If trends continue, then this is purely academic because their living expenses will eclipse their wages combined with their supplemental payments.  However, again, we are talking about the present.

 

Tue, 11/06/2012 - 14:55 | 2952614 rwe2late
rwe2late's picture

Macho,

Cause of “solvency problem“?

1 payroll taxes collected diverted (now and for decades) to wars and bankster bailouts

2 spiraling costs to subsidize “for profit” health care rackets

3 To avoid the economics of confronting these issues, social costs from “war on drugs”, militarism, factory food production, and environmental pollution handed off to SS and medicare. In particular, SS was intended and funded to be a retirement program , not a substitute (especially) for a runaway disability program.

Tue, 11/06/2012 - 15:06 | 2952654 MachoMan
MachoMan's picture

If you think that SS was ever intended to be anything than it has become, then you are missing the forest for the trees.  But at least acknowledging the solvency problem puts you ahead of 95% of the rest of folks.  Please do not expect that your government has your best interest in mind...  it will lead to all sorts of perverted theories.

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