For years lamestream economics has touted “labor market flexibility” – a euphemism for making it easier for employers to dismiss workers – as the best recipe for job creation. Guess what? It turns out that countries whose policies make labor markets more supportive for workers – including better wages, better benefits and better job security – are doing better at job creation. The evidence prompts a New York Times reporter to ask:
What if the very thing that is often viewed as one of the United States’ sources of dynamism — flexible labor markets — is the driving force behind the economy’s greatest weakness: millions of people who are neither working nor looking for a job?
Read more here.
Econ4’s Gerald Friedman laments the blindness of orthodox economics:
When I conducted an assessment of Senator Bernie Sanders’ economic proposals and found that they could produce robust growth, the negative reaction among powerful liberal economists was swift and vehement. How much, I wondered, did this reflect personal disappointment being rationalized into a political economy of despair? Professional economists tend to embrace an economic theory that government can do little more than fuss around the edges. From that stance, what do they have to offer ordinary people for whom the economy is not working? Not a whole lot.
Read Friedman’s full piece here.
A long history of elite disconnection from the economic realities faced by most Americans helped to set the stage for the nation’s current political turmoil:
For some time now most of the people in this country have been under economic pressure. Pay is not going up very much or at all, while living costs keep rising. One recent statistic stands out – 63 percent of Americans would have difficulty raising $500 to cover an emergency, like a sudden need for car repair so they can get to work. Around them the community’s roads and schools and services are in decline.
Most of the public can see this clearly, yet so many elites can’t see at all, and see it or not, they do little or nothing to make things better. This arrogance of our blind, well-fixed elites is helping drive the Donald Trump phenomenon.
Read more here.
Peter Barnes explains how protecting the environment and sharing the fruits of our economy more broadly can – and should – go hand-in-hand:
The failure to charge for common wealth — for example, letting polluters dump freely into our atmosphere — leads to what economists call “negative externalities.” The costs of pollution aren’t paid by polluters; they are shifted to pollutees, nature and future generations. And this market failure persists because no living individuals or companies would financially benefit from fixing it.But imagine a system in which everyone benefits from fixing this tragic flaw. In this system, polluters would pay and all living citizens, as joint beneficiaries and trustees of nature’s gifts, would get dividends. The higher the price for using the commons, the larger the dividends and the lower the externalities. The health of nature’s gifts would be directly linked to greater income for everyone.
Read more here.
And now, something hopeful:
The French government plans to pave 1,000 kilometers (621 miles) of its roads with solar panels in the next five years, which will supply power to millions of people.
“The maximum effect of the program, if successful, could be to furnish 5 million people with electricity, or about 8 percent of the French population,” Ségolène Royal, France’s minister of ecology and energy, said….
France’s Agency of Environment and Energy Management said that 4 meters (14 feet) of solarized road would be enough to supply the electrical needs of one household, excluding heat. One kilometer (0.62 miles) will supply enough electricity for 5,000 residents.
Read more and see a video about it here.
The drinking water crisis in Flint, Michigan, is a wake-up call, writes Econ4’s James Boyce:
The tragic crisis in Flint, Michigan, where residents have been poisoned by lead contamination, is not just about drinking water. And it’s not just about Flint. It’s about race and class, and the stark contradiction between the American dream of equal rights and opportunity for all and the American nightmare of metastasizing inequality of wealth and power.
Read his post for the Institute for New Economic Thinking here.
More guns -> more deaths -> more guns. A vicious circle becomes a business model:
While the country reels from a series of mass shootings, each one reigniting the debate over the regulation of firearms, the hottest investments in the stock market seem to be shares of gun manufacturers.
Read it and weep: here.
A new study by Stanford University scientist Mark Jacobson and colleagues offers a blueprint for a fossil-free energy future in the 50 U.S. states and across the globe:
Globally, the transition to clean, renewable energy would create more than 20 million more jobs than would be lost in the transition. It would also stabilize energy costs, thanks to free fuels such as wind, water and the sun; reduce terrorism risk by distributing electricity generation; and eliminate the overwhelming majority of heat-trapping emissions that contribute to climate change.
Engineers think water flows downhill. Economists think it flows to money. We think they’re right, and it’s wrong. Read what’s happening in California here:
APPLE VALLEY, Calif. — Outside her two-story tract home in this working-class town, Debbie Alberts, a part-time food service worker, has torn out most of the lawn. She has given up daily showers and cut her family’s water use nearly in half, to just 178 gallons per person each day.
A little more than 100 miles west, a resident of the fashionable Los Angeles hills has been labeled “the Wet Prince of Bel Air” after drinking up more than 30,000 gallons of water each day — the equivalent of 400 toilet flushes each hour with two showers running constantly, with enough water left over to keep the lawn perfectly green.
Only one of them has been fined for excessive water use: Ms. Alberts.