The Working Poor

Given that the US is relatively resource rich compared to Western Europe, the standard of living is deteriorating for 10's of millions of Americans and is compatively worse to ours so far. Imo, this has a much to do with the attitude of the governors and the abysmal ingorance of the electorate.

Each bubble has eroded the standard of living in the US. Speculation by the uninformed always leads to the better informed gaining at the expense of the average punter whether it be in gold or houses. A few lucky souls may profit by sitting on homes that rocketed in price. How many times can this happen in a generation? If it happens every generation there comes a time where homes simply become unaffordable to the vast majority. It's very simple maths.

Tax breaks for the rich, irrespective of budgetary requirements, begun by Reagan have shifted wealth from the working/middle classes to the wealthy. We've done the same in Ireland, although very, very quietly. I've even heard debates that the wealthy shouldn't pay taxes at all because they often provide jobs.

There is an entire cottage industry existing the US whereby statistians rework government inflation figures etc. in order to make them applicable to reality. This came about because many fortune 500 companies used econometric models to forecast sales and so forth. From the beginning of the 80's their model no longer worked. Stat nerds worked out that the models were fine but the inputs were garbage.

The minimum wage scam started in the US in the 60's or 70's has locked millions into a wage whereby the min wage acts as a ceiling more so than as a floor. Inflation has eaten away at the wages resulting in a new class of people called the working poor; one of the fastest growing demographic segments in the US. It has spawned an entirely new industry whereby people borrow money one week, pledging their wages from the following week as collateral. The real interest rates, due to the nature of the transaction, are exhorbitant. This phenomena has recently reached the shores of the UK and the FSA is trying to come to terms with it. It is the modern equivalent of living hand to mouth. You are productive and working a full week but the wages don't cover the costs of modern living.

Of course the issue are more complexed and intertwined than I've set out but the effects are clearly becoming visible and will become ever more clearer as times goes on imo. And its coming to a town near you.

(Could the modes move this to an existing thread? I hit the wrong button but I'm too lazy to rewrite it. Twas in the ISEQ section in response to other poster's comment. Thx)

Do you want this joined onto the ISEQ thread rocky - no need for rewriting - you could always copy and paste ...

Is Ireland still second most unequal country in the Western World, as it was in 2005? We seem to be living in an era in which there is a geographic balancing out of wealth in world terms, in parallel to a widening gap between very rich and the rest, with the middle class getting squeezed out of it.

I don't dispute the above. But at the same time statistics on the wealth gap can be a bit misleading. I probably have a reading list on it from my International Political Economy course which I did at undegraduate level - will try to dig it out tomorrow.There is certainly a widening gap but equally there is many areas where the vast majority have also got wealthier.

There is certainly a huge wealth gap in Ireland. However, that is only one way of looking at statistics. Are there less people leaving in real poverty in Ireland today than 20 years ago is another.

johnfás wrote:

I don't dispute the above. But at the same time statistics on the wealth gap can be a bit misleading. I probably have a reading list on it from my International Political Economy course which I did at undegraduate level - will try to dig it out tomorrow.There is certainly a widening gap but equally there is many areas where the vast majority have also got wealthier.

There is certainly a huge wealth gap in Ireland. However, that is only one way of looking at statistics. Are there less people leaving in real poverty in Ireland today than 20 years ago is another.

This is true - the expansion in the Irish economy brought a lot of people into employment and out of poverty. Increases in Social Welfare and Pensions in the last few years has also had an impact. The difficulty will be in sustaining this with loss of employment and erosion of the tax base. The reason for the poor living standards in the US is mainly de-industrialisation as industry has moved to places like Ireland and Mexico. The weakening of Trade Unions is the other important factor.

It has always struck me that debt enslaves people more effectively than chains. It is so much more cost effective. Slaves you have to feed, house and cloth. The poor enslave themselves preforming these tasks for you.

There are two ends to this equation, some are getting richer. Now the question is how do you create a fairer society for all?

The entire world isbeing enslaved to debt. That is to plan. The middle class is being eliminated. Borders are being erased. Don't believe me if ye like.

A New World Order is planned. A Fuedal System and the people are dreaming if they think a happy future is planned for them

rockyracoon wrote:

...
The minimum wage scam started in the US in the 60's or 70's has locked millions into a wage whereby the min wage acts as a ceiling more so than as a floor. Inflation has eaten away at the wages resulting in a new class of people called the working poor; one of the fastest growing demographic segments in the US. It has spawned an entirely new industry whereby people borrow money one week, pledging their wages from the following week as collateral. The real interest rates, due to the nature of the transaction, are exhorbitant. This phenomena has recently reached the shores of the UK and the FSA is trying to come to terms with it. It is the modern equivalent of living hand to mouth. You are productive and working a full week but the wages don't cover the costs of modern living....

Rocky, the min wage here in Ireland still does not sit comfortably with me. There is something phoney about it, but I can't figure out what. Perhaps it is an inflationary device, as I think you are insinuating, so that min wage minus the inflation it causes equals a lower wage ? Could you expand on why it is a ceiling as opposed to a floor. I'd be very interested to hear your opinion.

Squire wrote:

It has always struck me that debt enslaves people more effectively than chains. It is so much more cost effective. Slaves you have to feed, house and cloth. The poor enslave themselves preforming these tasks for you.

There are two ends to this equation, some are getting richer. Now the question is how do you create a fairer society for all?

youngdan wrote:

The entire world isbeing enslaved to debt. That is to plan. The middle class is being eliminated. Borders are being erased. Don't believe me if ye like.

A New World Order is planned. A Fuedal System and the people are dreaming if they think a happy future is planned for them

Why oh why would anyone need to enslave squillions of people by mortgages?

Now, isn't it also the truth that you'd have to create an economy around that so as to block off people getting the means to earn more to pay off their mortgages - which are something cruel over here (you borrow 330k for your house and end up paying nearly 700k for the feckin thing in the end) but if you got more work or your wife got a third job or your children's gardening experiments went to plan then maybe you'd cobble the few bob together to get out of the noose and albatross around your own neck that you 've put there yourself that is your own mortgage?

Auditor #19 wrote:

Now, isn't it also the truth that you'd have to create an economy around that so as to block off people getting the means to earn more to pay off their mortgages - which are something cruel over here (you borrow 330k for your house and end up paying nearly 700k for the feckin thing in the end) but if you got more work or your wife got a third job or your children's gardening experiments went to plan then maybe you'd cobble the few bob together to get out of the noose and albatross around your own neck that you 've put there yourself that is your own mortgage?

I think the theory is that yoy allow people to borrow, and once the assets are in the names of the working class, you raise interest rates, cutting off the ability to repay, hence repossession (spell?). Cutting off earnings reduces peoples willingness to borrow, which they don't want. They want you to borrow as much as fucking imaginable.

EvotingMachine0197 wrote:

Auditor #19 wrote:

Now, isn't it also the truth that you'd have to create an economy around that so as to block off people getting the means to earn more to pay off their mortgages - which are something cruel over here (you borrow 330k for your house and end up paying nearly 700k for the feckin thing in the end) but if you got more work or your wife got a third job or your children's gardening experiments went to plan then maybe you'd cobble the few bob together to get out of the noose and albatross around your own neck that you 've put there yourself that is your own mortgage?

I think the theory is that yoy allow people to borrow, and once the assets are in the names of the working class, you raise interest rates, cutting off the ability to repay, hence repossession (spell?). Cutting off earnings reduces peoples willingness to borrow, which they don't want. They want you to borrow as much as fucking imaginable.

Could this be possible that this really happens? I remember my parents having a **** of a time trying to pay off a relatively small Credit Union loan but that were the eighties then and there was lots of unemployment. In the late 90s here you needed a lump sum in order to apply for a mortgage then that was taken away suddenly to make it easy I suppose now the interest rates are going up. Do we live in a laboratory?

It could be done the way you're saying but why? would it be to slow down production because that's what would happen. Or would it be to sort of store up desire for more consumption and demand and supply. .. I don't know.

Economics ... if everyone built a house over the next ten years then there would be a lot less building activity.

cactus flower wrote:

Is Ireland still second most unequal country in the Western World, as it was in 2005? We seem to be living in an era in which there is a geographic balancing out of wealth in world terms, in parallel to a widening gap between very rich and the rest, with the middle class getting squeezed out of it.

That's not true. Spain, the UK, Italy, Greece, Portugal and the Baltic States are all more unequal than Ireland According to this ranking

I'm not too bothered about inequality as long as social mobility remains high in a society. It is more of a problem if people cannot improve themselves and their living standards than if their living standards are unequal with the rest of their society. This is because, through social mobility they can address that issue and make a better life for themselves.

We're also more equal than Australia, Spain, the UK, Italy and the US according to this measure.

Ard-Taoiseach wrote:

I'm not too bothered about inequality as long as social mobility remains high in a society. It is more of a problem if people cannot improve themselves and their living standards than if their living standards are unequal with the rest of their society. This is because, through social mobility they can address that issue and make a better life for themselves.

All well in theory but what about cultural norms and education? There is a huge number out there with literacy problems - the rough figure is close to 25% - could that be something we should be ignoring nowadays?

Mobility sounds fine but cultural norms and prejudices will hold you back and Ireland has plenty of them.

Auditor #9 wrote:

Ard-Taoiseach wrote:

I'm not too bothered about inequality as long as social mobility remains high in a society. It is more of a problem if people cannot improve themselves and their living standards than if their living standards are unequal with the rest of their society. This is because, through social mobility they can address that issue and make a better life for themselves.

All well in theory but what about cultural norms and education? There is a huge number out there with literacy problems - the rough figure is close to 25% - could that be something we should be ignoring nowadays?

No it isn't. Education and literacy are two of the best ways with which to enter society, make a contribution and make your way up the social ladder. I wouldn't be messing about fighting class wars of either, "tax the rich till the turn white" or "let them eat cake" varieties. I'd be out there, educating and empowering people and giving them the resources to go and make a better like for themselves by themselves. The State should enable in this instance, not enforce.

Quote :

Mobility sounds fine but cultural norms and prejudices will hold you back and Ireland has plenty of them.

So we must work to reduce these cultural norms and prejudices to dust so that people can get out there and make a better life for themselves. I'd be far happier with a perfectly mobile society than a perfectly equal one.

cactus flower wrote:

Is Ireland still second most unequal country in the Western World, as it was in 2005? We seem to be living in an era in which there is a geographic balancing out of wealth in world terms, in parallel to a widening gap between very rich and the rest, with the middle class getting squeezed out of it.

Also, if you look at this map, Ireland has a lower rate of poverty than most developed nations;

http://en.wikipedia.org/wiki/Image:Percent_poverty_world_map.png

Auditor #9 wrote:

Do we live in a laboratory?

I think we could have a thread about that. It's something I think everyone wonders about at some stage. Even Keaneu Reeves.

Quote :

Economics ... if everyone built a house over the next ten years then there would be a lot less building activity.

Beaut. Classic Auditor.

Auditor #9 wrote:

I think the theory is that yoy allow people to borrow, and once the assets are in the names of the working class, you raise interest rates, cutting off the ability to repay, hence repossession (spell?). Cutting off earnings reduces peoples willingness to borrow, which they don't want. They want you to borrow as much as fucking imaginable.

Could this be possible that this really happens? I remember my parents having a **** of a time trying to pay off a relatively small Credit Union loan but that were the eighties then and there was lots of unemployment. In the late 90s here you needed a lump sum in order to apply for a mortgage then that was taken away suddenly to make it easy I suppose now the interest rates are going up. Do we live in a laboratory?[/quote]

No, it's simply the evolution of the way in which the economy operates over time. Incrementally, things are always changing and it isn't down to some over-arching strategy. In reality, economies are far too complex to be subjected to that sort of control. We'd know by now if we were in some grand economic experiment.

Let us look at the UK, former Empire and the cradle of the industrial revolution. You would thing that by now everyone would be very comfortable but this simply is not the case.

If you work all your life and put away something for a pension you have done well, but when you die most people now get hit with death duties, which I believe are 40% on sums over £300,000. Perhaps you are ill in your old age and require nursing care then you may find that you have to borrow against your assets or sell to pay for that care. So the wealth you pass on is severely diminished and the family do not accumulate surplus wealth.

People think that this hits the rich. well it does not unless genetic inbreeding has rendered them stupid. The rich can avoid such difficulties and have the means to employ advice and nursing care is affordable out of income so assets remain untouched.

If several in a family work them, firstly their costs go up as they need several cars and nursing care for children. You have two wages chasing the same house and you may think oh good, but if everybody does the same them all that happens is the price of the house increases and in effect the extra wage achieves nothing whatsoever.

I agree with Ard-Taoiseach that you need upward mobility, but if my observations are accurate few escape the circumstance of birth. There is clearly inequality of opportunity. The circles your family move in are very important as to the type of employment you end up in.

In society I think there are 3 areas that need special consideration, these are Health Care, Care for the elderly and Education. Whilst I would not like to see the unemployed starve I dislike the benefits for nothing syndrome, and believe that there should be work expected for money received even if it is building famine walls. It could be simply cleaning the streets, or planting forests. Having able bodied individuals receiving payment for nothing is an anathema to me, but there are some who through misfortune can not work and their well being should be that of society.

Squire wrote:

I agree with Ard-Taoiseach that you need upward mobility, but if my observations are accurate few escape the circumstance of birth. There is clearly inequality of opportunity. The circles your family move in are very important as to the type of employment you end up in.

In society I think there are 3 areas that need special consideration, these are Health Care, Care for the elderly and Education. Whilst I would not like to see the unemployed starve I dislike the benefits for nothing syndrome, and believe that there should be work expected for money received even if it is building famine walls. It could be simply cleaning the streets, or planting forests. Having able bodied individuals receiving payment for nothing is an anathema to me, but there are some who through misfortune can not work and their well being should be that of society.

It's idealistic in my view to think that social mobility can be applied so simply - does anyone find that there are still guilds and prejudices in Ireland that make your other statement very true Squire - it depends often on the circles your family move in... I think it used to be stronger in the past but there is still remnants of it and I think it might have changed dramatically over the last ten or fifteen years here, maybe even less and is still indeed changing. But the days are not gone when your streetname or area code might determine whether you get the job or not.

I agree with you on the work for nothing syndrome. In Spain I believe I understood the dole as being a reflection of how much you had worked previously but it was not unlimited and eternal. I don't think it is eternal here either, just some individuals manage to somehow escape the authorities (by hiding in the pub all day?) And I think it should be like that here too - if you work for two years or more then you're entitled to dole unquestioned for a certain amount of time (3 months?) - no questions asked and it's even paid into your bank account every three months so you can potentially go abroad to look for work. This is what I understand a guy in Spain did with Ireland - he left his job there and was entitled to three months here of Spanish dole where he was presuming to come to learn english. I'd imagine the scheme is designed so that people can get work but it's my view that we should be allowed to use it, as EU citizens, to learn languages too for a certain period. You have the inconvenience of finding work when you come back again then however but the upshot should be that social welfare should reflect how much you've worked.

I know it depends on stamps or whatever it's called but I don't understand all that fully.

The problem with benefits being reliant on work previously done is that there are times when people simply cannot get work so what then? Also to limit benefits to a fixed period means that those involved must either get work here or in the case of Ireland seek employment in the UK, USA or elsewhere. What if there is a global depression? You can't have people and their dependants starving on the streets.

I have seen enough of dire poverty to know that the circumstances that many find themselves in is not through any failing of theirs. Often the poor work a lot harder than the very successful. Often they work for pittance or against a background that ensures failure.

On the question of privilege it is alive and kicking. The people I went to school with and their acquaintances are clearly in better employment than those from a normal school and it is improbable that they are in anyway more intelligent or gifted.

Auditor #9 wrote:

does anyone find that there are still guilds and prejudices in Ireland...

Try becoming a solicitor

johnfás wrote:

Auditor #9 wrote:

does anyone find that there are still guilds and prejudices in Ireland...

Try becoming a solicitor

Try being a successful barrister!

Indeed in any profession contacts help.

Auditor #9 wrote:

Squire wrote:

I agree with Ard-Taoiseach that you need upward mobility, but if my observations are accurate few escape the circumstance of birth. There is clearly inequality of opportunity. The circles your family move in are very important as to the type of employment you end up in.

In society I think there are 3 areas that need special consideration, these are Health Care, Care for the elderly and Education. Whilst I would not like to see the unemployed starve I dislike the benefits for nothing syndrome, and believe that there should be work expected for money received even if it is building famine walls. It could be simply cleaning the streets, or planting forests. Having able bodied individuals receiving payment for nothing is an anathema to me, but there are some who through misfortune can not work and their well being should be that of society.

It's idealistic in my view to think that social mobility can be applied so simply - does anyone find that there are still guilds and prejudices in Ireland that make your other statement very true Squire - it depends often on the circles your family move in... I think it used to be stronger in the past but there is still remnants of it and I think it might have changed dramatically over the last ten or fifteen years here, maybe even less and is still indeed changing. But the days are not gone when your streetname or area code might determine whether you get the job or not.

I agree with you on the work for nothing syndrome. In Spain I believe I understood the dole as being a reflection of how much you had worked previously but it was not unlimited and eternal. I don't think it is eternal here either, just some individuals manage to somehow escape the authorities (by hiding in the pub all day?) And I think it should be like that here too - if you work for two years or more then you're entitled to dole unquestioned for a certain amount of time (3 months?) - no questions asked and it's even paid into your bank account every three months so you can potentially go abroad to look for work. This is what I understand a guy in Spain did with Ireland - he left his job there and was entitled to three months here of Spanish dole where he was presuming to come to learn english. I'd imagine the scheme is designed so that people can get work but it's my view that we should be allowed to use it, as EU citizens, to learn languages too for a certain period. You have the inconvenience of finding work when you come back again then however but the upshot should be that social welfare should reflect how much you've worked.

I know it depends on stamps or whatever it's called but I don't understand all that fully.

According to the Sindo it does apply here - EU law -but government has just said everyone must sign on every week in the post office - cutting across said law.

Squire wrote:

The problem with benefits being reliant on work previously done is that there are times when people simply cannot get work so what then? Also to limit benefits to a fixed period means that those involved must either get work here or in the case of Ireland seek employment in the UK, USA or elsewhere. What if there is a global depression? You can't have people and their dependants starving on the streets.

I have seen enough of dire poverty to know that the circumstances that many find themselves in is not through any failing of theirs. Often the poor work a lot harder than the very successful. Often they work for pittance or against a background that ensures failure.

On the question of privilege it is alive and kicking. The people I went to school with and their acquaintances are clearly in better employment than those from a normal school and it is improbable that they are in anyway more intelligent or gifted.

I used to get paid quite handsomely for sitting on my arse in an office all day cursing at a compiler (might try to get into that soon again) and it always bugged me that the cleaning lady was probably getting paid a lot less but I suppose that's the market. Maybe the cleaning lady loved her job as much as I loved mine but there is a big difference in the types of job they are. I always think people in factories should get paid more for the boredom-inducement of it all day O god ...

I hadn't thought of a global depression - isn't this where social welfare came from the first day? From the Great Depression? I know it arose in Sweden but was it because of the Great Depression?

I'm convinced that Community Employment schemes and the like could be quite useful in a society to benefit both the individual and the community/society too. As it happens, Tony Killeen, FF T.D. for Clare has asked Mary Coughlan to extend the CE schemes here for people over the age of 55. I think it's interesting about people working at that age especially in the likes of down here in the back of beyond where there is going to be always a threat of unemployment at some stage. CE schemes are where you are allowed to work - part-time - while also doing your 20 hours Community Employment and the amount of time you may do this for waslimited (2 years ?) but the TD has asked that it be extended. It's good news if it gets extended - keep money floating around in the economy.

cactus flower wrote:

According to the Sindo it does apply here - EU law -but government has just said everyone must sign on every week in the post office - cutting across said law.

have you a link for that cactus ?

Ard-Taoiseach wrote:

cactus flower wrote:

Is Ireland still second most unequal country in the Western World, as it was in 2005? We seem to be living in an era in which there is a geographic balancing out of wealth in world terms, in parallel to a widening gap between very rich and the rest, with the middle class getting squeezed out of it.

Also, if you look at this map, Ireland has a lower rate of poverty than most developed nations;

http://en.wikipedia.org/wiki/Image:Percent_poverty_world_map.png

Have been looking for some up to date stats:

This is fascinating stuff Ard Taoiseach - http://www.cso.ie/newsevents/pressrelease_measuringirelandsprogress2007.htm

Ireland was performing very strongly in terms of employment and GDP/GNP but still this:

Quote :

6.9% of persons in Ireland were in consistent poverty in 2006 (Table 4.6). 22.8% of unemployed persons were in consistent poverty (Graph 4.7).
The proportion of Irish people at risk of poverty, after pensions and social transfer payments were taken into account, was 18% in 2006. This was above the EU 25 average of 16%. The effect of pension transfers on reducing the at-risk-of-poverty rate was low in Ireland compared with other EU 27 countries (Table 4.4).

I don't understand the pension stuff.