That's not what happens. It is the opposite. One would get a massive flood of labor and turn the U.S. into a 50%+ unemployment rate. Outsourcing and immigration are about the same thing. It doesn't matter where the worker is sitting, that's a job not going to a U.S. citizen worker.
Look at the reunification of Germany and what that did to their economy for over a decade.
Generally speaking the labor economics, national economies (economies are buiit on nation-states), is much more complex, but what would seem the intuitive thing, the humane thing is actually the inhumane thing in this case.
Solution is simple. Make the USA open border. Think about it. The Corps couldn't play labor group off of one another. You put together ipads? You'll be paid the same everywhere.
The status quo will never admit this inconvenient truth of how they herd labor. They'll scream nationallism, terrorism and act like jobs will be stolen, when they are stealing (outsourcing ) them now!
these annual reports & forecasts are mandated by congress and in their hubris they believe their own propaganda...once a year they're treated as gospel, and quoted the remainder of the year till the next report. for a random check: here's the 2010 report: http://www.cbo.gov/sites/default/files/cbofiles/ftpdocs/108xx/doc10871/0... (182 pages) how did their forecasts 4 years ago work out? they forecast GDP growing at a 4.4% rate over the 2012 to 2014 period...
In addition to lowering wages, big corporations also prefer to have H-1Bs because it allows them to create a sort of modern-day indentured servitude. H1-B visa holders in the U.S. must continue to work at the company that sponsors their visas (or leave the U.S.). They can’t quit and get another job in the U.S. Most Americans may still be under the impression that indentured servitude ended in America sometime around 1865. But it has been revived by the H1-B visa program and big companies love it because of the social control it gives them over workers. I have contacted many elected official over the years, urging them to abolish the H-1B program altogether, but in today's Washington, money speaks louder than words.
yet the pols, on both sides, continue to point to the CBO as the non-partisan info god on which all should rely...when it's convenient, of course. and you wonder why no one believes anyone else's numbers.
We're an economics site and you will read many articles on this site ripping to shreds legislation and policies from both political parties. The site is non-partisan.
May I remind you that we've had five years of Mr. Obama's fantastic financial policies, two of those years he had a fully Democrat-controlled Congress.
No American should "find themselves" in any dire or desperate financial situation - not according to the unemployment numbers, not according to the trillions of dollars of stimulus spending, not according to the NYT and the DNC.
To say that any American isn't leading the most ideal life after all this time of Progressive fiscal meddling is to admit utter failure.
This is simply fiction and may I suggest, "there for the grace of God go I" when contemplating the dire and desperate financial situation most people in America find themselves in.
NYTimes and the DNC say unemployment is a good thing, thanks to Obamacare. So, these long term unemployed should be happy! They're "free" of the burdens of the rat race. They get to tuck their (hungry) kids in at night. And, on the 1st and the 15th, they get their checks for doing... NOTHING.
You cannot have it both ways. You cannot condemn companies for hoarding cash to weather the storm we all see coming and not hiring people, and turn around and say, "6% unemployment! Better than 5 years ago! And Obamacare will free people from having to work! Weeee!"
Krugman is not thinking, he's reacting to posts from the right...or he's thinking like an economist, where workers reactions marginal tax rates are assumed...i'd bet the average worker wont even consider the effects on his ACA subsidy when making a job choice...
say a guy is working 35 hours a week at a $15 / hour job, kids want to go to college, wife works part time at $12 / hour to make ends meet...boss comes to him and says we have more work for you, start working an extra hour a day...can you imagine someone telling the boss cant do that, my ACA subsidy would be lower? can you even imagine the typical worker even having that thought process? i cant even imagiine myself working through all that when making such a decision..
If Obama didn't want me to offshore jobs, he wouldn't punish me with the device tax . It's necessary to offshore the jobs to compensate for the tax and remain viable as a small company. Sad but it's government policy. At least some of the work/money goes to friends like Ireland instead of the foreign aid money going to our enemies.
as a follow up article, that is an excellent idea to research the statistics and patterns of social services benefits as a behavior pattern when one is capable, able to work and work is actually available. We do have plenty of data to number crunch.
From Economist Jared Bernstein: There’s a difference between workers (labor supply) and jobs (labor demand). The budget office bent over backward to make this distinction, claiming that employers’ demands for workers will not change much at all because of the health care law... There is thus no support in the Congressional Budget Office report for the claim that the health care act kills jobs. As the report put it, the estimated reduction in hours of work “stems almost entirely from a net decline in the amount of labor that workers choose to supply, rather than from a net drop in businesses’ demand for labor.”
From the New York Times editorial board: Republicans immediately tried to brand the findings as “devastating” and stark evidence of President Obama’s health care reform as a failure and a job killer. It is no such thing. ... The report clearly stated that health reform would not produce an increase in unemployment (workers unable to find jobs) or underemployment (part-time workers who would prefer to work more hours per week). It also found “no compelling evidence” that, as of now, part-time employment has increased as a result of the reform law, a frequent claim of critics.
From the Washington Post: "Some people might decide to work part-time, not full time, in order to keep getting health-care subsidies. Thus, they are reducing their supply of labor to the market. Other people near retirement age might decide they no longer need to hold onto their job just because it provides health insurance, and they also leave the work force." (Scroll down to "The Facts" in the Washington Post article.)
"CBO estimates that the ACA will reduce the total number of hours worked, on net, by about 1.5 percent to 2.0 percent during the period from 2017 to 2024, almost entirely because workers will choose to supply less labor—given the new taxes and other incentives they will face and the financial benefits some will receive."
do we have evidence of the poor remaining poor and refusing to take a job so they could remain eligible for Medicaid? unless we’ve seen that, it’s hard to imagine anyone making that choice to keep their subsides for an ACA health care plan…
furthermore, just because a percentage of workers might decide to work less hours does not mean that hours worked in the aggregate will fall…if someone quits their extra job, whoever they had been working for will just hire someone else…the only way ACA could cause a reduction in hours would be if there were a labor shortage…if that's what they’re forecasting, we should welcome it, as it would raise wages..
dont put too much stake in such pronouncements from the CBO...Elmendorf has long had a bone to pick with welfare programs..
The farm bill will expand subsidies for crop insurance, handing over virtually the same amount of taxpayer money to giant agribusiness (large and wealthy corporations) as the old direct payment program. What’s more, the shift from direct payments to crop insurance ensures that those handouts can be distributed in a hidden, more politically palatable way, making it more difficult to ever dislodge them.
There is a petition to stop this at http://wh.gov/lnnDb
That's not what happens. It is the opposite. One would get a massive flood of labor and turn the U.S. into a 50%+ unemployment rate. Outsourcing and immigration are about the same thing. It doesn't matter where the worker is sitting, that's a job not going to a U.S. citizen worker.
Look at the reunification of Germany and what that did to their economy for over a decade.
Generally speaking the labor economics, national economies (economies are buiit on nation-states), is much more complex, but what would seem the intuitive thing, the humane thing is actually the inhumane thing in this case.
Solution is simple. Make the USA open border. Think about it. The Corps couldn't play labor group off of one another. You put together ipads? You'll be paid the same everywhere.
The status quo will never admit this inconvenient truth of how they herd labor. They'll scream nationallism, terrorism and act like jobs will be stolen, when they are stealing (outsourcing ) them now!
One would have to be to think anything about what has happened has anything to do with Progressivism from Corporate-Obama.
These policies are nothing but Ronald Reagan leftovers.
And that's why we are still circling the drain...
these annual reports & forecasts are mandated by congress and in their hubris they believe their own propaganda...once a year they're treated as gospel, and quoted the remainder of the year till the next report. for a random check: here's the 2010 report:
http://www.cbo.gov/sites/default/files/cbofiles/ftpdocs/108xx/doc10871/0... (182 pages) how did their forecasts 4 years ago work out? they forecast GDP growing at a 4.4% rate over the 2012 to 2014 period...
In addition to lowering wages, big corporations also prefer to have H-1Bs because it allows them to create a sort of modern-day indentured servitude. H1-B visa holders in the U.S. must continue to work at the company that sponsors their visas (or leave the U.S.). They can’t quit and get another job in the U.S. Most Americans may still be under the impression that indentured servitude ended in America sometime around 1865. But it has been revived by the H1-B visa program and big companies love it because of the social control it gives them over workers. I have contacted many elected official over the years, urging them to abolish the H-1B program altogether, but in today's Washington, money speaks louder than words.
yet the pols, on both sides, continue to point to the CBO as the non-partisan info god on which all should rely...when it's convenient, of course. and you wonder why no one believes anyone else's numbers.
We're an economics site and you will read many articles on this site ripping to shreds legislation and policies from both political parties. The site is non-partisan.
May I remind you that we've had five years of Mr. Obama's fantastic financial policies, two of those years he had a fully Democrat-controlled Congress.
No American should "find themselves" in any dire or desperate financial situation - not according to the unemployment numbers, not according to the trillions of dollars of stimulus spending, not according to the NYT and the DNC.
To say that any American isn't leading the most ideal life after all this time of Progressive fiscal meddling is to admit utter failure.
This is simply fiction and may I suggest, "there for the grace of God go I" when contemplating the dire and desperate financial situation most people in America find themselves in.
NYTimes and the DNC say unemployment is a good thing, thanks to Obamacare. So, these long term unemployed should be happy! They're "free" of the burdens of the rat race. They get to tuck their (hungry) kids in at night. And, on the 1st and the 15th, they get their checks for doing... NOTHING.
You cannot have it both ways. You cannot condemn companies for hoarding cash to weather the storm we all see coming and not hiring people, and turn around and say, "6% unemployment! Better than 5 years ago! And Obamacare will free people from having to work! Weeee!"
Krugman is not thinking, he's reacting to posts from the right...or he's thinking like an economist, where workers reactions marginal tax rates are assumed...i'd bet the average worker wont even consider the effects on his ACA subsidy when making a job choice...
say a guy is working 35 hours a week at a $15 / hour job, kids want to go to college, wife works part time at $12 / hour to make ends meet...boss comes to him and says we have more work for you, start working an extra hour a day...can you imagine someone telling the boss cant do that, my ACA subsidy would be lower? can you even imagine the typical worker even having that thought process? i cant even imagiine myself working through all that when making such a decision..
If Obama didn't want me to offshore jobs, he wouldn't punish me with the device tax . It's necessary to offshore the jobs to compensate for the tax and remain viable as a small company. Sad but it's government policy. At least some of the work/money goes to friends like Ireland instead of the foreign aid money going to our enemies.
So Krugman's point is right, with weak demand for labor and labor oversupply for available jobs, there is no doubt others will take up the slack.
But our argument is the assumptions themselves, that people would not take work for more income due to ACA are in strong doubt.
as a follow up article, that is an excellent idea to research the statistics and patterns of social services benefits as a behavior pattern when one is capable, able to work and work is actually available. We do have plenty of data to number crunch.
Paul Krugman notes (that because with so many currently unemployed), "Reduced work by some will open up job opportunities for others."
http://krugman.blogs.nytimes.com/2014/02/06/labor-supply-and-the-meaning...
From Economist Jared Bernstein: There’s a difference between workers (labor supply) and jobs (labor demand). The budget office bent over backward to make this distinction, claiming that employers’ demands for workers will not change much at all because of the health care law... There is thus no support in the Congressional Budget Office report for the claim that the health care act kills jobs. As the report put it, the estimated reduction in hours of work “stems almost entirely from a net decline in the amount of labor that workers choose to supply, rather than from a net drop in businesses’ demand for labor.”
http://economix.blogs.nytimes.com/2014/02/05/a-reports-real-message-it-w...
From the New York Times editorial board: Republicans immediately tried to brand the findings as “devastating” and stark evidence of President Obama’s health care reform as a failure and a job killer. It is no such thing. ... The report clearly stated that health reform would not produce an increase in unemployment (workers unable to find jobs) or underemployment (part-time workers who would prefer to work more hours per week). It also found “no compelling evidence” that, as of now, part-time employment has increased as a result of the reform law, a frequent claim of critics.
http://www.nytimes.com/2014/02/05/opinion/freeing-workers-from-the-insur...
From the Washington Post: "Some people might decide to work part-time, not full time, in order to keep getting health-care subsidies. Thus, they are reducing their supply of labor to the market. Other people near retirement age might decide they no longer need to hold onto their job just because it provides health insurance, and they also leave the work force." (Scroll down to "The Facts" in the Washington Post article.)
http://www.washingtonpost.com/blogs/fact-checker/wp/2014/02/04/no-cbo-di...
"CBO estimates that the ACA will reduce the total number of hours worked, on net, by about 1.5 percent to 2.0 percent during the period from 2017 to 2024, almost entirely because workers will choose to supply less labor—given the new taxes and other incentives they will face and the financial benefits some will receive."
do we have evidence of the poor remaining poor and refusing to take a job so they could remain eligible for Medicaid? unless we’ve seen that, it’s hard to imagine anyone making that choice to keep their subsides for an ACA health care plan…
furthermore, just because a percentage of workers might decide to work less hours does not mean that hours worked in the aggregate will fall…if someone quits their extra job, whoever they had been working for will just hire someone else…the only way ACA could cause a reduction in hours would be if there were a labor shortage…if that's what they’re forecasting, we should welcome it, as it would raise wages..
dont put too much stake in such pronouncements from the CBO...Elmendorf has long had a bone to pick with welfare programs..
This blame the poor, those needing help in this society is just sick. The phrase, "there for the grace of God go I" never seems to be realized.
The farm bill will expand subsidies for crop insurance, handing over virtually the same amount of taxpayer money to giant agribusiness (large and wealthy corporations) as the old direct payment program. What’s more, the shift from direct payments to crop insurance ensures that those handouts can be distributed in a hidden, more politically palatable way, making it more difficult to ever dislodge them.
http://www.newrepublic.com/article/116470/farm-bill-2014-its-even-worse-...
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