US Poverty Data Tells Only Half the Story...

[Panaconda]

US Poverty Data Tells Only Half the Story...

by Ananya Mukherjee-Reed

In April this year, Fortune magazine published an insightful analytical piece Fortune 500: Profits bounce back. Two days ago as I went back to the Fortune website to read the piece again, I found something very interesting: sitting right next to it was the story Poverty in the US Spikes. I took a screen-shot right away. The picture is worth much more than a mere thousand words: I think its worth 391 billion dollars (2009 the Fortune 500 earnings) or the 14.9 million Americans without jobs. You choose.



Some excerpts from Profits Bounce Back:

Amazingly, as consumers struggle, U.S. corporations are staging a nearly unprecedented comeback that's largely escaping notice. The gargantuan, dispiriting job cuts that seem to dominate the news have also been the spur for an epic resurgence in profits. For 2009, the Fortune 500 lifted earnings 335%, to $391 billion, a $301 billion jump that's the second largest in the list's 56-year history, approaching the increase in the robust recovery of 2003.

The crucial reductions came in the item accounting for two-thirds of their costs: labor. In 2009, the Fortune 500 shed 821,000 jobs, the biggest loss in its history -- almost 3.2% of its payroll. ... ... The result was a wondrous surge in productivity, defined as the hours needed to make a bicycle, a PC, or a ton of insulation (emphasis mine)

...

http://www.commondreams.org/view/2010/09/23-4

[Bitwit1234]

1. Poverty in America brings this to mine.

The republicans pulled the silly ass PR stunt of going to a lumber yard in shirt sleeves trying to pretend they were every day people.

I would like to see the Democrats get a group of real unemployed every day people together. Put patches on their clothes let them tell the public how hard it is to make ends meet after the republicans allowed their jobs to be outsourced. Show that all over the news. I bet one thing CNN and fox wouldn't even show it. Republicans would say that we are mocking them. Well we would be and they deserve it.

[leveymg]

2. You are correct. There's a direct correlation between record job losses and record "earnings"

Here's another side to it: record U.S. layoffs and retained earnings = record offshoring of jobs by U.S.-based Multinational Corporations (MNCs).

In 2009, the Fortune 500 eliminated 821,000 U.S. jobs. Let's look at how this translates into corporate profits. At @$50,000 per each job eliminated = $410 billion in "earnings" for these giant Fortune 500 companies. Out of this, the Fortune 500 companies reported a retained earnings jump of $301 billion.

Here's another set of numbers: the Commerce Dept. reports that in 2008 U.S.-based multinationals shed jobs at a rate twice that of other companies in this country. For every position they eliminated in the U.S. (according to the Commerce Dept. Bureau of Economic Analysis (BEA), Summary Estimates for Multinational Corporations), the MNCs created 1.3 lower-wage positions offshore: http://www.bea.gov/newsreleases/international/mnc/2010/mnc2008.htm

Employment in the United States by U.S. parent companies decreased 1.3 percent, to 22.9 million workers. On a comparable basis, total private-industry employment in the United States decreased 0.7 percent in 2008. The employment by U.S. parents accounted for almost one-fifth of total U.S. employment in private industries. Abroad, employment by the majority-owned foreign affiliates of U.S. MNCs increased 1.7 percent, to 10.5 million workers.

That's a clear enough correlation so that even a Ph.D economist can't deny it. The shift to offshore operations by these U.S.-based companies is the principal cause of private-sector unemployment and de-industrialization in America. These corporations are taking their record retained earnings -- largely from layoffs and gov't bailouts -- and transferring them abroad. While this has been going on for three decades, now we are seeing full-fledged disinvestment in the U.S., a process subsidized by the U.S. Treasury. Why do we hear so little about how this game works? Why is there seemingly so little interest in this here at DU? Why do so many prefer to simply hate immigrants and foreign guest workers, when the unemployment and de-industrialization problems are created by CEOs of U.S.-based multinationals and a bunch of global investment bankers on Wall Street?

[Hannah Bell]

3. their gain is our loss. it *is* a zero-sum game in some very real senses.

our wages = their costs.

and jobs = a loss for finance capital, because they make their money on the churn -- by constantly keeping assets in motion.

[Starry Messenger]

4. k & r