Thom Hartmann goes after CNN and Fortune who are claiming Americans are overpaid?

[Bozita]

Run time: 07:16 https://www.youtube.com/watch?v=EALJV4HoYzg   Posted on YouTube: November 18, 2009 By YouTube Member: Views on YouTube: 0   Posted on DU: November 18, 2009 By DU Member: Bozita Views on DU: 1206

 

[MUAD_DIB]

1. If that is what they believe then when are the good people of

CNN and Fortune going to cut their salaries by 50-60%?

:eyes:

[jobycom]

2. I can't watch that long a clip here at work, but in general the claim could have merit.

From a pure economic standpoint, money has to be based on the value of labor. Since our nation is creating less and less, we are basically buying more than we are selling, meaning that our wages are adjusting to the prices of the rest of the world, and may be higher than the value of our production. There are several ways to fix that. That the least effective would be to lower our wages. The easiest is with tariffs, but they have long term consequences. The best way is to begin making products here again so that our internal economy is more self-sustaining. Combining the second and third of these would probably be the best for us, but it would also cut off some of the world market, as it would drive other nations' wages lower.

That's one reason NAFTA wasn't a liberal versus conservative issue. There were liberals and conservatives who wanted to protect our short term wages and production, and they opposed it. There were liberals who wanted to improve the living standards of the rest of the world while long-term increasing our customer base by increasing wages in other nations. More than liberal versus conservative it was a local versus global issue. The idea has worked beautifully in Europe.

The problem is that when conservatives get their hands on anything, they screw it up. Small and mid-size businesses aren't going to outsource to another nation, but large corporations will, so when you have a supply-sided mentality like Bush's (and sadly Obama's), corporations grow and become too large a part of our economy, and everything goes to hell. But it goes to hell with or without NAFTA. With a more balanced economic plan--like Clinton's, which raised taxes on the wealthiest and invested in the infrastructure and labor training while reducing our deficit and strengthening the dollar--the economy shifts to small businesses, and then NAFTA is a boon. That's a large part of why everything flourished under Clinton and crashed under Bush. Tax shifts are the quickest way to affect the economy.

[zeos3]

5. Here's a link to the article Thom reads from

http://money.cnn.com/2009/11/11/news/international/global_american_wages.breakingviews/index.htm?section=money_topstories


Americans are overpaid
For the global economy to rebalance, the pay gap between Americans and the rest of the world must shrink.

By Martin Hutchinson and Edward Hadas, breakingviews.com
November 11, 2009: 3:17 PM ET

"The global wage gap has been narrowing, but recent U.S. labor market statistics suggest the adjustment has not gone far enough.

One indicator is unemployment, which has risen unexpectedly rapidly in this downturn. The 7.3 million jobs lost are more than treble the 2 million of the next worst post-war recession, in 1980-82. Some of that huge increase reflects the turbulence of an unusually sharp decline in GDP, but there could be another factor: the recession has revealed many workers are paid more than they are worth."

[jobycom]

7. That's one of those articles where a valid observation leads to a dumb-ass conclusion.

The first part I have no problem with--it's just a summary of what the numbers show. The solution is short-sighted. Forcibly lowering wages would have negative affects and not really solve the problem, since money is just a sliding scale, anyway--you lower the dollar amount of wages, then the value shifts to accomodate for the change, and youu still have the same buying power. Manipulating inflation or forcing the dollar lower compared to other countries would also have other consequences. Inflation and dollar value are always affected by policy, but the policy's goal shouldn't just be to lower wages.

Any way it goes, they are just manipulating symptoms. The real cause is the nature of the economy. We need to shift back to a self-sustaining economy comprising smaller businesses, more local resources, and more technological innovation, combined with a healthy (and necessary) international market. We should buy things from other nations at cheap prices--it helps there economy, and it gives us affordable products. We aren't going to get rich producing stuff that the rest of the world buys more cheaply from Malaysia, or whereever. We will get rich producing stuff that people can't buy anywhere else. But corporations are geared towards producing what is already selling, whereas small businesses are geared towards innovation. That's what we need to focus on. Not manipulating the current situation.

They are rearranging deck chairs rather than fixing the leak in the hull, or trying to cure the flu with a cough suppresant. Even those are bad analogies, because they sound like there's a healthy state for the economy that we have to get back to. The economy isn't healthy or sick, it just responds to what we do and operates at whatever level it does, and it won't get "better" without us changing it, it will just keep operating where it is. We need to shift it back to a productive, innovative economy. We've always been at our most prosperous in those times. People act like Clinton got lucky because of the Internet boom, but Clinton created the economic conditions that caused that boom. We could do that now with the green boom, but we are too short-sighted. Half the people want to just give workers more money for the same work, half want to lower their wages so corporate execs can make more money. Both miss the overall problem. And Obama doesn't understand it, and none of the people he surrounds himself with do, either. (Not condemning Obama, but it's one thing he hasn't been good at).

Anyway, that's my short answer. :)

[JDPriestly]

9. Last Saturday, my congressman told me that Congress is going to

try to change the tax code. In the so-called "global economy," the wealthy can buy more and more of their trinkets and junk outside the U.S., but the poor and middle class who mostly spend money on necessities and things they need struggle to pay the high wages here. Personally, I think the only solution that will work for average Americans is to go back to import taxes.
Europe disguises its import taxes as value added or sales taxes. We should also raise the sales taxes on non-necessities. No sales taxes should be imposed on necessities like food or children's shoes or medical costs. We should not pay sales taxes on prescription drugs. We should pay them on cosmetics, etc. That would give tax relief to the poor, encourage home industry (food) and prevent corporations from producing goods overseas in order to avoid paying taxes on their profits. The taxes would be paid at the consumer end. That's tough too, but I haven't thought of any other way prevent manufacturers from avoiding taxes (payroll taxes and corporate taxes) on goods they produce overseas but for American consumption. It's the loss of those taxes on American manufacturing that is bankrupting our government. Condi Rice, for example, should pay a hefty sales tax on those imported shoes she loves to buy. Can she buy them while traveling? Yes. But then she should pay tax on her airline ticket.

[Go2Peace]

10. Simple economic: We are stupidly trying to "compete" with 2.5 Billion people with avg wage of $300

This is all perfectly predictable.

The wise answer would be to open "gradually", or to decide to protect some industries to keep a competitive internal wage. But what do you do, even many on our side would prefer to believe the propaganda than learn economics.

[zeos3]

3. This is the 3rd worldization of the US

Economics 101: Supply and Demand.

"Demand is people having money in their pockets to buy stuff." Way to go Thom.

[Overseas]

4. K&R. I thought it was an excellent segment.

I was stunned when I heard the original news as well.

When friends more radical than I predicted this trend decades ago, I thought they were being too extreme.

[sasquatch]

6. Give'em hell Thom!

[Larkspur]

8. American Executives are overpaid but not ordinary workers

Our CEO's make more money then their counterparts in other nations and they get it whether or not the company goes out of business.

[Go2Peace]

11. You are when you are competing against people making 20% of our wages. Our wages will fall