Spain's Robin Hood - Businessweek

Spain's Robin Hood - Businessweek

In the farming village of Jódar in southern Spain, 2,000 demonstrators march down the heat-buckled tarmac toward a police checkpoint at the edge of town where, they’ve just heard via megaphone, their hero has been detained. In front stride men in green T-shirts printed with the letters SAT, the Spanish acronym for the 40,000-strong Workers Syndicate of Andalusia, a leftist trade union building a network abroad. 

When an economy turns to Roy Bi unions can become Ro gangs or demonstrators, because they are a component of the O police if O are biased to Oy criminals then they lose strength. For example a right wing Roy economy might have O policed biased to Oy corruption, allowing criminals to rob if they pay bribes. This can cause Ro demonstration, this can also happen with Oy conmen in finance in the GFC.  

It’s Oct. 4, a strike is on, no shops are open, and the sidewalks are lined with hulking members of Spain’s Guardia Civil and the local police force, clean-shaven and dressed in black. The demonstrators’ chants resound, rhythmic and rhyming, in Spanish, punctuated by clenched fists raised high. “¡Que no! ¡Que no! ¡No queremos pagar la deuda con la salud y educación!” (“No! No! We do not want to pay off debt with health care and education!”) and “¡El pueblo unido jamás será vencido!” (“The people united will never be defeated!”)

Ro cooperation can be against Oy individuals. 

 Half of Jódar’s 12,000 residents, who are mostly jornaleros, or day laborers, are out of work and receive no unemployment benefits. “The government is answering our demands for jobs with repression,” says one marcher. “And now they’re holding our leader.”

A Roy economy can do better by nationalizing property as G then employing people by the state, better than having them do nothing. This also happens in thrid world economies where scarce resources cause high unemployment because any businesses get trampled and robbed like a tree in the savannah by animals.

Immigration: Giant low-hanging fruit | The Economist

Immigration: Giant low-hanging fruit | The Economist

Giant low-hanging fruit

Nov 15th 2012, 20:19 by R.A. | WASHINGTON

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THIS week's Free exchange column takes a look at the case for more immigration into the rich world—a lot more:

The economic case for migration is similar to that for free trade. Trade benefits countries by letting workers specialise in activities in which they are relatively more productive, raising output. And the larger market created by trade spreads the fixed costs of innovation more thinly, encouraging the development of new goods and ideas. Governments began the long march towards trade liberalisation after grasping that its upsides outweigh its costs, leaving a surplus large enough to compensate the losers.

This can work in Biv societies trading with each other because they have plentiful Gb resources, this makes trade a positive sum game where each side benefits. Some might gain less than others but they can usually profit elsewhere in a rich resource economy. However this fails in a Roy society where they have a negative sum game, the idea is to minimize losses. Adding immigrants is like adding more R animals to an area with not enough food, it becomes necessary for each to minimize costs to survive. Instead of free trade causing specialization and growth it might cause the losers to not survive at all, this can create areas of poverty and unemployment. There is no surplus but a deficit being created, the objective is to minimize the deficit from it.  

Immigration is an afterthought, in both practice and theory. In traditional trade models wages converge across trading partners with similar technologies even without migration, a phenomenon winningly branded “factor-price equalisation”. Sadly, factor-price equalisation is a real-world rarity. As of 2000, for instance, a worker in Mexico earned a wage 40% that of a Mexican-born worker of similar education and experience working in America.

Most of this wage gap is down to productivity differences, stemming from disparities in the quality of infrastructure, institutions and skills. An individual worker, however talented, cannot hope to replicate the fertile environment of a rich economy all on his own. But transplanting a worker into rich soil can supercharge his productivity. A Mexican worker earns more in the United States than in Mexico because he can produce more, thanks to the quality of US technology and institutions.

If there are unused Gb resources then adding more B workers can in effect be like planting more trees, more businesses grow from them. However Mexico is more Roy and the negative sum game of minimizing costs dominates there.

The upshot is that advanced economies could take an an awful lot of new immigrants without much hurting native wages.

This situation can be viewed with future robot workers, they act like real workers in that they consume goods for fuel like food and need to be housed and looked after like housing and health care. If they can work for cheaper than humans then this only produces extra wealth in Gb abundance, they might however consume much of these resources without benefiting anyone but themselves.

But the huge gains in productivity enjoyed by the migrants themselves add up to a substantial impact. Economist John Kennan reckons that the average migrant could expect a rise in income of perhaps $13,000, well more than 100% of what they would earn in their home country. And when you begin to add up all those higher incomes you get some really enormous numbers:

In a recent report Sharun Mukand of the University of Warwick calculates the effect of movement by half of the developing world’s workforce to the rich world. Such a vast migration could never happen in practice, of course, but as a thought exercise it is instructive. If migration closes a quarter of the migrants’ productivity gap with the rich world, their average income would rise by $7,000. That would be enough to raise global output by 30%, or about $21 trillion. Other studies find even bigger effects. A 2007 paper by Paul Klein, now at Simon Fraser University, and Gustavo Ventura, now at Arizona State University, reckons that full labour mobility could raise global output by up to 122%. Such gains swamp the benefits of eliminating remaining barriers to trade, which amount to just 1.8-2.8% of GDP, reckons Mr Mukand.

It could also be argued that if many American moved to Africa that the GNP would rise there as well, however in many cases the superior training of Americans would just put others out of work.

The most striking thing about the $21 trillion estimate is that it is really quite conservative by the standards of such computations. And yet that's equal to the combined annual output of America and Japan!

The piece discusses common economic criticisms of open immigration—that native wages would be harmed, that rich-world government budgets would suffer, and that brain drain would leave those left behind without hope—and generally finds them wanting. It does not deal with issues of assimilation or the cultural complications of mass migration. My feeling is that those concerns are also very likely to be overstated by critics, but I also think the main takeaway from the column ought to be the sheer size of the potential here.

This potential can only be estimated by looking at what Gb resources are available for them.

Austerity Italian Style - YouTube

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Austerity Italian Style - YouTube





BLACK: Well, I just got back from Reggio di Calabria in Italy, which is that toe part

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that looks like it's kicking Sicily, and a conference on modern monetary theory. I have

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a prop on all of this. And we were talking about austerity, Italian style, and some remarkable

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things.

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The first, while we concentrated on Spain and Greece and their Great Depression levels

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of unemployment, unemployment is very high and rising in Italy. But the real story is

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among young adults. And the unemployment rate among young adults is surging, and it's already

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in the--closely approaching 40 percent, which is to say, it's nearly at the levels of young

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adult unemployment in Spain, and in Greece as well.


When an economy is iv-B it is like a weed, it can grow quickly with resources even if a stimulus. It can also collapse even more quickly with austerity. A V-Bi economy can handle austerity better because it averages out good times and bad with savings and insurance. Iv-B is highly innovative and can mutate to new conditions, it can grow to an economic stimulus but then just collapse. It is like a weed that only grows with a particular fertilizer but had adapted to only that. Germs as R might adapt to a particular host and die out without being able to jump to another species.

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And so you have this paradox of Italy, where, you know, in the variant of the old joke that

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there are three things that are important in terms of real estate, location, location,

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location, there are three things important to Italians, it's always said: family, family,

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family. But Italians are--first, they don't have a lot of kids. Their fertility rate is

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1.3, so way below replacement rate. And second, they are increasingly causing their kids to

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emigrate, because there is absolutely no prospect of a good job in Italy for younger people.

Younger people are often at the base of the plant, they can have support from Bi families but need to find their own resources to grow like a plant does. For example they might need to find a job to get a car, a house, furniture, spouse, etc. In Roy they still need to do this but they are more often the focus of Oy conmen and crooks on G public land. 

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And, you know, in the old days, this was typically peasants who were leaving, but nowadays it's

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their most educated folks. You get your university degree--which you're going to essentially

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do for free, still, in Italy, minus some fees--and then you have to emigrate because there are

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no positions.

When an economy turns Roy people can become nomadic on this G public or abandoned land or opportunities looking for GB greener pastures to settle on as private property. 

And those problems that I talked about are vastly worse in the south of Italy.

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These are where the really poor places were.

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So we were talking about that and the insanity of an austerity principle that is tearing

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Italy apart and destroying family, left right and center.

Stronger austerity drains the V-Bi savings so people end up fighting for survival on their own, they need to maintain insurance to quench the chaos or the system can go into free fall to a floor in areas.

I mean, nowadays the only good

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news is with modern technology you might be able to talk to your kids more cheaply when

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they're 5,000 miles away.

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JAY: How much of this is recent, in the sense these new austerity measures that have kicked

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in over the last couple of years?

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BLACK: Well, it's not entirely recent. In other words, it's a trend that's gotten much

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worse. But that trend had existed for much of this century, because Italy was simply

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not producing new high-tech jobs very well.

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But for us the craziness was that we were talking with Italian professors of economics,

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you know, perfectly intelligent people, but often big believers in austerity, even though

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they said, yes, austerity is causing greater unemployment, yes, it's causing the kids to

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emigrate, yes, we have no answer other than austerity, right, there is no alternative,

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which is precisely what we then went down to say--well, in fact, there are excellent

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alternatives; you shouldn't be doing this.

 Austerity can be bad but just adding resource can cause Iv-B like weeds to just mutate and waste them, the need is to build stable and strong Biv businesses that last not zombie color disconnects.

What Can Obama Do for the Labor Movement? : The New Yorker

What Can Obama Do for the Labor Movement? : The New Yorker

Steven Greenhouse, the labor reporter for the Times, has a fascinating piece in Thursday’s paper about the fact that union membership, as a proportion of the work force, has fallen to the lowest level since 1916.

An Iv-B economy tends to break up both V management and Bi unions so people are more competitive and deceptive.

While the article focusses on the challenges facing the labor movement, it also involves larger political and economic issues. In particular, it raises the question of what, if anything, President Obama can do to help unions reverse decades of decline. And if the Republicans’ control of the House means he can’t do anything much, what does that mean for his pledge to increase the living standards of middle-class Americans?

The union-membership figures are stark and getting starker. Sixty years ago, about one in three workers were union members. Today, it’s one in nine. Last year, the economy as a whole added about 2.4 million jobs, but union membership fell by 400,000. As a proportion of the labor force, the number of union members fell from 11.8 per cent in 2011 to 11.3 per cent in 2012. Outside of the government sector, where more than a third of employees are union members, the unions have even less sway. Just 6.6 per cent of the private-sector labor force is unionized, which means that fourteen out of fifteen workers aren’t union members. Most of them have never had anything to do with the labor movement and never will.

Workers can be B or Bi, B workers compete with each other to get better wages while Bi workers cooperate with each other to use their numbers for higher wages. V management has been weakened for decades as well, for example antitrust legislation and price collusion being illegal. So companies are more Iv now which means they compete more on price, with weaker I-O regulators they look for B workers who are cheaper in the short term to help competition. For Bi unionism to grow it needs stable V management to collude more in prices with other companies, just like Bi unions collude with workers in other companies to raise. Iv-B can increase innovation to counter lower wages, however workers are more vulnerable to companies collapsing. 

Fired America | The Economic Populist

Fired America | The Economic Populist


There is a complete disconnect in Washington from the quiet desperation of American lives.   While politicians chatter talking points and claim lobbyists' agendas are somehow sane economic and labor policy, a full 23% of Americans have been fired in the last four years.   That is disposable work syndrome and that is the crisis of our time, not the rhetorical fictional spin spewing from the mouths of politicians.

This can be a disconnect between V-Bi and Iv-B. The Iv-B economy grows and then collapses like weeds run out of nutrients, then the economy is stagnant V-Bi where Iv and B people can be left to sink or swim on their own. V companies can be bailed out by the government which acts like an insurance company, many Bi workers use union pressure and connections to get their own kind of insurance against collapse. 

 
Of the people fired who managed to get another job,  a full 48% took a step down in position with 46% taking a job below their skill or education level.    A whopping 54% reported their new job pays less.  A third took over a 30% pay cut to get a new job.  Another third got hit with a 11-30% cut in pay.    That's economic devestation for millions of Americans, even while working.
The economic impact is permanent to most families.  The majority of Americans, 56%, now have less in savings than before 2008.   Thirty-eight percent reported they are tapped out financially.  Even those with jobs lost savings as over one third saw their nest egg shrink.  
Over half of people said they were running through their savings just to get by and 30% said they were borrowing money.

This causes more chaotic collapses as people have to sell assets to survive, V-Bi savings are dropping because the weak I-O policing of the economy caused the market to separate into inefficient booms and busts or stagnation.