Morning Must Reads: Unemployment Up, Incomes Down

The New York Times this morning leads with a story based on a report by a private consulting firm called Sentier Research LLC. In the chart that follows, the quote below the plummeting red line is a measurement of income for the typical household and the skyrocketing black line is the unemployment rate. If you come across anyone arguing that we should do nothing to spur job growth, it is probably because profits measured as a share of national income reached their highest share since World War II, even while incomes have been decimated by high unemployment.

Between June 2009, when the recession officially ended, and June 2011, inflation-adjusted median household income fell 6.7 percent, to $49,909, according to a study by two former Census Bureau officials. During the recession — from December 2007 to June 2009 — household income fell 3.2 percent.

In what is the most painful irony of all, this report, which also documents a rise in inequality, is only available for a fee of $20. The research is based on a new data series (which itself is assembled from public data sources) created by a private consulting firm run by two former Census Bureau employees. To paraphrase my colleague Stephen Herzenberg, you never hear people explain that they left the private sector to get rich in the public sector.

And in completely unrelated news. Wink! Wink! Nudge! Nudge! Say no more! The Patriot News has story out on local government workers who earn more than $100,000 a year, accompanied by an online data base. Anybody see the Patriot-News build a data base of CEO pay in the region? Me neither.

You can find some CEO pay figures here.

Paul Krugman this morning reviews the hysterical reactions in some quarters to the Occupy Wall Street Movement and ends up putting the Plutocrats on the couch for some psychoanalysis. To badly paraphrase Freud, sometimes socialism for the rich is just greed.

What’s going on here? The answer, surely, is that Wall Street’s Masters of the Universe realize, deep down, how morally indefensible their position is. They’re not John Galt; they’re not even Steve Jobs. They’re people who got rich by peddling complex financial schemes that, far from delivering clear benefits to the American people, helped push us into a crisis whose aftereffects continue to blight the lives of tens of millions of their fellow citizens. Yet they have paid no price. Their institutions were bailed out by taxpayers, with few strings attached. They continue to benefit from explicit and implicit federal guarantees — basically, they’re still in a game of heads they win, tails taxpayers lose. And they benefit from tax loopholes that in many cases have people with multimillion-dollar incomes paying lower rates than middle-class families.

The Pittsburgh Post-Gazette ran a weekend story covering student loan debt; regular blog readers will see the touch of Keystone Research Center fall intern Sean Brandon.

Finally this morning, I caught some interesting comments on the Occupy Pittsburgh Campaign.

[Duquesne University associate professor of economics professor Antony] Davies, however, expressed surprise that the ideals of Occupy Wall Street — which grabbed the nation's attention when New York City police arrested 700 protesters crossing the Brooklyn Bridge on Oct. 1 — would find such willing ears here. "Of all the cities in the country, I think this would be the least likely to have protests like this," Davies said. "This area was the most shielded from the economic downturn. When the rest of the country had 10 percent unemployment, we were at 7 percent."

Cough!

The greatest antidote to nonsense is data.

The graph that follows plots the unemployment rate in Allegheny County since 1990. That the unemployment rate today remains higher than it has been in more than two decades suggests that all is not well in the City of Pittsburgh. Sure, unemployment is higher in many other places, but for the thousands of new people in Pittsburgh experiencing unemployment, such relative differences are cold comfort.

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