Home / General / The Catastrophe of Mass Unemployment

The Catastrophe of Mass Unemployment

Comments
/
/
/
652 Views

In addition to the direct misery, why it’s so important in the medium- and long-term as well:

Close your eyes and picture the scariest thing you can think of. Maybe it’s a giant spider or a giant Stay Puft marshmellow man or something that’s not even giant at all. Well, whatever it is, I guarantee it’s not nearly as scary as the real scariest thing in the world. That’s long-term unemployment.

There are two labor markets nowadays. There’s the market for people who have been out of work for less than six months, and the market for people who have been out of work longer. The former is working pretty normally, and the latter is horribly dysfunctional.

[…]

But just how bad is it for the long-term unemployed? Ghayad ran a follow-up field experiment to find out. In a new working paper, he sent out 4800 fictitious resumes to 600 job openings, with 3600 of them for fake unemployed people. Among those 3600, he varied how long they’d been out of work, how often they’d switched jobs, and whether they had any industry experience. Everything else was kept constant. The mocked-up resumes were all male, all had randomly-selected (and racially ambiguous) names, and all had similar education backgrounds. The question was which of them would get callbacks.
It turns out long-term unemployment is much scarier than you could possibly imagine.

The results are equal parts unsurprising and terrifying. Employers prefer applicants who haven’t been out of work for very long, applicants who have industry experience, and applicants who haven’t moved between jobs that much. But how long you’ve been out of work trumps those other factors.

Some cuts to Social Security should put out that fire!

FacebookTwitterGoogle+Share
  • Facebook
  • Twitter
  • Google+
  • Linkedin
  • Pinterest
  • Vance Maverick

    I was going to ask whether the six-month unemployment penalty had gotten any worse (i.e. whether there’s a diachronic dimension), but then I realize it doesn’t matter — higher unemployment means more people fall into the trap, even if the shape of the trap is the same.

  • Nocomment

    Long term unemployed?
    As a “leper”.
    Untouchable.

  • Maybe the rest of the US population will just have to get used to emigrating to find work. Apparently the current US economy is only capable of providing employment to a few rich communists in places like Memphis. ;-)

    • Davis X. Machina

      Are they hiring in Oaxaca and Michoacán?

      • If you are willing to work for less than the illegal Guatemalan immigrants there. Otherwise try Africa or Asia.

      • Ben Franklin

        The Cartels? ‘Natch.

    • John

      Ghana, bitches!

  • Shakezula

    According to the Acolytes of Ayn, the magical hand of the Free Market will correct the problem by killing off chunks of the long-term unemployed population via starvation, suicide and bread riots. Fortunately, job producers such as the Karcrashian sisters and Snooky will not be disturbed by such upheavals. This is called
    Freedooom.

    • jim, some guy in iowa

      i would have called it freedumb but i like your word better

  • c u n d gulag

    Well, I’m 55, out of work for 4 years now, and I know I’m totally and forever screwed.

    It’s gotten to the point where I stopped even sending out resumes late last year.
    It was utterly pointless, since I almost never got a phone call or a return e-mail in the last 4 years, asking me to come in for an interview.
    And, certainly not in the last two years. NOT ONE! – unless it was some scam someone, or some group, was running. And, of course, those were all those “work from home” scams.

    Once you’re over 50, and are unemployed for over 6 months, you are now an American Untouchable.

    And, even if I get SSDI in a year or so, or live long enough to finally get SS, now it looks like every year, the precious little I get, will be worth less and less.

    Doing anything other than raising, or better yet, eliminating, the cap, lowering the SS eligibility age, and increasing recipient’s benefits, will not only cause real tangible suffering, but will continue to keep our economy at a slow uphill crawl – if even that.

    But, “No!”, we’re told.
    According to our Conservative sociopathic betters, “Bleeding a patient dying from anemia, is always the best cure!”
    And it is – if you’re a blood-thirsty leech, of course, which our sociopathic betters are.

    My future’s so dim, I may as well be blind.

    My plan, once my mother passes away, and if I don’t get SSDI (not that it’ll be a lot of money), is to do something so drastic, so criminal, that it will land me in jail for the rest of whatever life I’ll have to live.
    Hey, it’ll beat living under and overpass, and begging.

    • Tnap01

      Hey, if I recall correctly you used to live in Chapel Hill? If so come on back, they are opening a Waffle House on Franklin st.!

      • c u n d gulag

        Yeah, I did.

        And much as I love Chapel Hill, and Waffle House food (but don’t tell anyone ;-), my legs and back are kind of like their hashbrowns:
        scattered, smothered, covered, chunked, topped, diced, peppered, and capped – as well as mangled, and arthritic.

        If I could stand, I’d have gone back to bartending.
        Hell, I can’t even sit comfortably any more.

        • c u n d gulag

          Btw – I’m ugly enough to get a job there.
          Usually, a single Waffle House fork has more tines than the entire staff has teeth.

          • c u n d gulag

            Tnap,
            Where on Franklin are they opening it?
            Closer to Carrboro, or near the University?

            • Tnap01

              Hey c u n d gulag, it’s just east of Columbia by the Varsity. A good spot for students to grab some grub after the ol’ run down to Franklin & Columbia when the Men’s Basketball team wins a National Championship or gets a victory over Duke – if either happens again ;)

              • c u n d gulag

                OY!

                I was hoping it was closer to that Wendy’s in Carrboro.

                Hey, is there still that great Mexican food-cart that’s out there on weekends, not to far from Chapel Hill HS?

                Man, even the most Conservative NCinian had to admit that they had the BEST Messican food around the area!

                Man, I miss that area!!!
                I’ll be gone 10 years now, this July 4th weekend – I moved down to Southern Pines.

        • Linnaeus

          If I could stand, I’d have gone back to bartending.

          And if I could, I’d buy an old fashioned from you.

          • c u n d gulag

            I used to chuckle at the old-timers who ordered them.

            Then, I tried one – and there is NO doubt, they are DELICIOUS!

      • The horror.

        (Waffle houses are ok for what they are but they sure as hell don’t belong on Franklin St.)

        • Davis X. Machina

          The Carolina Coffee Shop was the place to go for waffles, years ago….

          • c u n d gulag

            They were still great, when I left in July of 2003.

    • Jon H

      “Once you’re over 50, and are unemployed for over 6 months, you are now an American Untouchable.”

      Hell, it was about as bad for me at 30. Laid off in 2001, had a few interviews over the summer, that dried up after 9/11. Didn’t get a job until 2005, and that was because my brother was working at Accenture and was able to get me in. (We do different kinds of programming, so I wasn’t easily employable at his prior jobs, but Accenture was big enough to have various requirements.)

    • Dave W.

      c u n d gulag: I don’t know if my recent experience of being out of my main career line of work for two years from ages 52-54 is relevant to you. Certainly I had many things working for me that you might not have going for you, and I wasn’t fighting a disability issue. But what I did when the offers dried up was to start my own low-capital business – in my case, a tutoring business. I had been doing volunteer tutoring in the public schools, and I decided to see if I could turn it into a real business.

      So instead of a two-year gap in my resume, I’ve got two years of running my own business and helping over eighty clients. The money wasn’t all that great – after expenses, I was only clearing around 10-15% of what I had been making at my last regular job, although I was profitable (if not very) from about the second month on. But I enjoyed helping people directly who were grateful for my help, and it helped pay some bills while I was waiting for my next break (which I eventually got), in addition to my picking up some transferable business skills.

      There’s no question that I benefited from a number of factors not available to everyone. I had the educational background that made me a credible tutor to my clients, I had my own car that was fully paid for, I had a working spouse who was able to cover me on her health care, and I was fortunate to be in relatively good health so that I could stand up to the physical demands of the job.

      I don’t know how self-employment would affect a disability application, which can be a real issue if you have ongoing health problems. I do have a friend on disability who is able to earn a certain amount each month without affecting her status (she can work sporadically, but not regularly, due to ongoing health issues).

      But in addition to looking for regular employment, it might be worth considering if you have any skills that people would be willing to pay for directly. Marketing yourself directly to potential clients who have a problem you can solve is one alternative to looking for conventional employment that can sometimes get around the “resume gap” problem.

      • c u n d gulag

        Thanks, and it’s a great tip.

        Unfortunately, I was a corporate trainer and training manager in a telecom who taught customer service, sales, and billing systems, and don’t have many skills beyond the ability to be nice, gab, and impart knowledge.

        The problem is, that today, companies are no longer looking for humans to do training – they want CBT (Computer Based Training), with some light follow-up by Subject Matter Experts.

        And, trust me on this one – the LAST person you’d want tutoring your kid on math skill, is me!

        I’d love a job as a CSR – but they won’t hire me for that.
        Why?
        I’ve been told I’m over-qualified.

        Continued good luck to you, though, in the niche you found for yourself. :-)

  • MD Rackham

    I’m not sure I understand why this is the case. Unless employers really believe that people lose their ability to work after six months of NCIS re-runs, it doesn’t make economic sense to me. And there are few fields where someone can’t catch-up on the latest developments with some concerted effort.

    I’ve been able to hire two people in the last year. Both were long-term unemployed (one 14 months, one 36+ months), and both have turned out to be stellar employees. I just looked past the unemployment issue and saw that they had great work histories with clear indications that they were self-motivated learners. Why would their problem-solving and learning abilities magically disappear at 6 months out of work? These were tech jobs in a narrow but not ridiculously specialized field.

    I may even have gotten a better “deal” since they were desperate enough that their salary demands had been greatly lowered. From a Randian viewpoint, why wouldn’t businesses want to take advantage of that?

    Of course, one of those hires was a sixty-something woman, which is another type of “unemployable” I don’t understand.

    How much of this can be laid at the feet of resume scanning software? I’m thinking that it’s set to simply reject candidates on certain criteria without looking at anything else, unlike the human HR departments way back when God was a boy and I was learning how to hire people.

    • It is assumed that if nobody else has hired you that there must be something wrong with you that is not immediately apparent from your resume/CV. After all if you did not have a problem somebody else would have hired you. It is kind of like the logic that assumes that you must be guilty if the police arrest you otherwise why would they arrest you?

      • Hogan

        I’m not sure I understand why this is the case.

        It’s not a new thing. Labor economists have known for a long time that job market queues work in reverse: the longer you wait, the farther back in the line you go. Other than much more robust unemployment insurance, I’m not sure what can be done about it.

        • howard

          The one thing that can be done is to run the macroeconomy with the interests of a tight labor market in mind, which is why the fed has a dual mandate in the first place.

          We all saw this 15 years ago, and to the right wing it was a vision of hell – employers forced to bid for employees!

      • If you have hundreds or thousands of resumes that are submitted for a single position, it’s HR’s job to weed out the unlikeliest candidates before forwarding a select few to the actual hiring manager. Typically, HR knows from nothing about hot to select candidates intelligently, based on the resume alone, apart from the requirements that the hiring manager puts into the job listing. So you start with a large pile of resumes, and then get a slightly smaller pile of resumes after weeding out the candidates who don’t meet the hiring manager’s requirements. How do you continue to weed out candidates until you hit the 20 resumes or so that are all that the hiring manager cares to read? The answer is that you start developing your own theories on what makes a bad candidate and use those theories to reduce the pile until you get the desired number.

        This is why it is a better idea to network with people that work in your desired trade, so that, when you need a job, you have the network and the knowledge to get around the innate capriciousness of the HR-based selection system.

        • dsn

          The trick is to randomly throw out a large portion of the resumes. Who wants to hire an unlucky person?

        • efgoldman

          Typically, HR knows from nothing….

          Truer words….

      • Jon H

        The amazing thing is how they do this as if completely ignorant of the job market and other economic factors.

        It’s like not hiring someone because they live in a shelter, when you ought to know that they are in the shelter because a tornado wiped out half of the town that you live in also.

    • Murc

      If I may ask, how big is the company you do hiring for? Are you hiring for a business you own, or operating as an HR guy?

      As for understanding why this is the case, it’s simple: weak labor market.

      You are absolutely correct that being old or being unemployed long-term or having changed jobs frequently doesn’t mean that someone will be a bad employee. But they’re red flags, as it were. Someone who changes jobs frequently might flake off the second they get a better offer. Someone who is old might be slowing down and is way more likely to develop physical or mental problems that your insurance has to pay out for. Someone who is out of work for six months might be lazy.

      Now, if the labor market is tight, that doesn’t really matter. Companies unable to fill positions will be happy to look at, interview, work with any applicants they get.

      But if you’re dealing with positions where they might be getting literally hundreds of resumes? Then you have your pick. So you just screen out everyone you want and only even call back people with NO danger signs at all.

      Also, you are kidding yourself if you think human HR departments didn’t just reject candidates based on certain criteria without looking at anything else. Address in the bad part of town? Rejected. Non-white sounding name? Rejected. GED instead of a high school diploma? Rejected.

      • Pooh

        This. The single best thing we can do about this problem is more jobs, full stop. Somehow though catering to the whims of the Job Creators for the last few years hasn’t seemed to, you know, cause them to create jobs. Probably because they are just pricks who are full of shit.

      • MD Rackham

        It’s a small company (15 employees) that I own. So I do get to spend more time per opening than larger concerns with many more openings. And I did get > 100 resumes for those two openings.

        But when I did work for a large company (125,000 employees at the time, now acquired, dismantled and gone), I insisted that I get the resumes directly without HR weeding through them. It took some epic battles to accomplish that, but I didn’t miss out on resumes that didn’t meet some arbitrary requirement that HR had added to their filter. In one case where I needed someone to do some esoteric digital signal processing design they decided a PhD was needed. So I’d get a stack of resumes with English Lit doctorates. Nothing against liberal arts degrees at all, but “has a Phd” is a really lousy criteria to sort resumes on when it leaves out people with directly applicable DSP experience.

        I know this crap happens everywhere, but since the current methods don’t result in hiring the best available people, nor does it find the best match for salary, it’s really not accomplishing what it should. But it’s self-perpetuating like any other bureaucracy.

        What you end up with is employees who are good at lying on their resumes and often not much else.

        It’s not going to solve our current unemployment problem, but actually trying to hire the best team possible was one of the things that led me to strike out on my own.

        • Murc

          The only response I can make to this is that, as managers with hiring authority go, you very much represent an outlier.

    • FMguru

      The soft labor market means that every job posting nets dozens or even hundreds of applications. HR sifts through them, looking for reasons to discard them to get down to a manageable number to set up phone screens. And being out of work for an extended period is a triage criterion. Why take a risk on someone who may have something wrong with them when you have a dozen other resumes with a more up-to-date job history on them? It make perfect sense from the HR department and hiring manager’s point of view. Scale that up to the entire macroeconomy and an extended period of soft labor demand, and you get the catastrophe we have today.

      This is also why college degrees are so valuable. Lots of places use the lack of one as a instant disqualification, no matter what your job experience or actually abilities might be.

      100 resumes come in, toss the 30 without college degrees, toss the 20 from schools you never heard of, throw away the 25 from people who have been out of work for six months or more, sift through the qualifications of the 25 that are left to pick 8-10 to call for a phone screen, whcih you whittle down to 3 or 4 in-person interviews, check their references, make an offer to one, if he declines make an offer to the runner-up. It’s how HR is done.

    • djangermats

      Employers use their privilege to indulge their self-serving irrationality.

  • DrDick

    We are ruled by insane idiots.

    • JKTHs

      They may be insane, but they know what they’re doing. They know who their constituency is.

      • Uncle Kvetch

        They may be insane, but they know what they’re doing. They know who their constituency is.

        This. Corporate profits are sky-high, the stock market is booming, interest rates are low with no threat of inflation on the horizon, working people are in a defensive crouch, and “deficit-reduction” is the sole order of the day for everyone but us lunatics out here on the fringe. And the architects of the recent financial unpleasantness have walked away scot-free, with all of their power, privilege and prerogatives intact.

        From the standpoint of the elites, it’s a golden age, if not yet quite gilded. But we’re getting there.

      • DrDick

        Their strategy, however, is unsustainable. It achieves their short term goals while destroying the long term sustainability of the system.

        • BigHank53

          They nearly melted the economy in 2008, and nearly all of them walked away scot-free. They whined ’cause their bonus wasn’t as big as last year’s was. All the pain has been an externality. There’s been hardly any financial regulation passed, and they’re already trying to pull its teeth.

          These are fucking morons who don’t grasp the concept of broken. They’ve never seen a supermarket that isn’t full of food or an airport without any flights because there’s no avgas or a hospital where the medical supplies consist of bandages made out of boiled torn-up sheets and a bottle of dusty aspirin. These are clowns who think any problem can be solved by waving their MasterCard at it, because that’s the only world they’ve ever seen.

          It comforts me to know that there’s a non-zero chance that some of these feckless sociopaths will be torn to pieces and eaten by feral dogs because they missed the last plane to the Caymans.

        • chris

          So what? Most of the movers and shakers are over 60 anyway. In the long run we’re all dead, but they’re dead even in the medium run.

          Besides, if the system breaks down into a banana republic, that’s still just fine for the oligarchs.

  • xxy

    Scott, you just don’t understand. Mass unemployment gives businesses immense leverage over their labor force, allowing them to efficiently streamline operations and maximize profit. We have to give job creators the freedom and power to create jobs that comes with surplus labor. For the economy!

    • Pooh

      Shock doctrine, bitches.

    • MD Rackham

      And with all that surplus labor, they still must have the freedom to get as many H1B visas as possible.

      Because, labor shortage!

      • Cody

        I complain about this one a lot, heh.

        Currently, the US has a shortage in programmers. So we need to import them from overseas.

        Yet there are tons of college graduates with degrees (like EE,CS,CE, Math) who would fit perfectly. They won’t hire these people, because they don’t have the 5-10 years of experience in the specific thing they’re hiring.

        So now we need more visas!!!

    • Are there no prisons and Union workhouses? I can’t afford to make idle people merry. I help to support the establishments I have mentioned: they cost enough! And those who are badly off must go there. If they would rather die, they had better do it, and decrease the surplus population.

  • Ben Franklin

    Even scarier is the possible collapse of the dollar. Even the employed will get plowed.

    BRICS has the dominoes.

    • Vance Maverick

      Any reason to think this is more than “possible”? And if you mean a fall in value relative to other currencies, what would its effect be on employment? I can see that it would make energy costs rise, but also that it would make the US more competitive in the export market.

      • Ben Franklin

        Not only possible, but has been the goal of Iran, Russia, China and others for some time. They have been hoarding gold to create a collateral base, and the US is understandably concerned.

        You can start here…http://in.reuters.com/article/2013/03/27/breakingviews-brics-dollar-idINDEE92Q06O20130327

        • So maybe all of this talk here about how China is a better partner for Africa than the West is even more true than we thought?

        • Vance Maverick

          China, holding a huge amount of dollar-denominated debt, wants to see the value of the dollar fall? That scrap of an article doesn’t say much other than that BRICS exists and might be a good thing from the perspective of the global plutocracy.

          • We can always hope.

          • Ben Franklin

            You raise a valid point.

            I suspect the Chinese understand the calculus of over one trillion in promissory notes. The may calculate a write-off makes sense over the long haul.

            http://www.bloomberg.com/news/2013-02-19/bofa-says-brics-are-back-as-it-recommends-emerging-market-bonds.html

            The BRIC countries grew at an average annual pace of 6.6 percent from 2001 to 2010, almost twice as fast as the global economy, according to the International Monetary Fund. China is now the world’s second-largest economy in dollar terms, while Brazil is No. 7, Russia is No. 9 and India is No. 10, IMF estimates for 2012 showed in October.

            • Vance Maverick

              Which again doesn’t touch on the “collapse of the dollar”. Exchange rates != economies.

              • Ben Franklin

                I sure hope this optimism displayed here has an effect on the outcome of IMF and Fed mad printing machines. Printing money does not a solid economy, make.

                • Murc

                  … the IMF doesn’t print money.

                  Also, the Fed needs to print MORE. We could use a few years of inflation running at five or seven percent. It would help all those people who are upside down on their mortgages and carrying a lot of student loan debt IMMENSELY.

                • Ben Franklin

                  MURC;

                  You are a riot.

                • Malaclypse

                  I love the smell of goldbuggery in the morning.

        • Rob

          You forgot the Reverse Vampires!

      • Bent Franklin

        GOLD!!!!!!!!!

    • Yes, if the US dollar loses half its value then I will be able to purchase twice as many dollars with my cedi salary. This will make things like airplane tickets, computers, other electronics, etc. much cheaper for me. This is not scary at all this would make me a lot richer in terms of purchasing power.

      • wengler

        The Gold Coast been very, very good to me!

    • Walt

      The BRICS are radically more likely to conspire to push the value of the dollar up, rather than down. The path to economic growth for a developing economy is exports, and the easiest way to do that is keep your currency artificially weak against the dollar.

      • Yes, but if you export low value raw materials mostly owned by foreigners, things like gold, oil, and mortgaged cacao crops and import most everything else then a high dollar pushes down living standards. The everything has to be payed for in expensive dollars to import into the country which drives up their price considerably. The average laptop here costs twice what it does in the US. Exports are only good if they are high value added manufactured goods. Exporting raw materials and importing finished goods is neo-colonial exploitation.

    • Murc

      … are you kidding?

      The dollar collapsing relative to other currencies would be GREAT. It would not be without problems, of course, but the US has the capacity to very rapidly put manufacturing infrastructure into place. We’d simply make tons and tons of shit and then export it. That sounds awesome to me.

      Unless you meant collapsing in terms of massive hyperinflation, to which I can only respond “you are wrong if you think this is even a remote possibility.”

      • Ben Franklin

        http://www.rapidtrends.com/gold-hyperinflation-millions-billions-trillions-and-then/

        Yes, hyperinflation…wheelbarrow full of bucks for bread.

        • newsouthzach

          God help me, I read all the way through that link. The last line:
          We continue to believe gold will hit $2,000 an ounce within twelve months.

          Given that this was written when “Today the price of gold hit $1000 an ounce,” I place the article somewhere in 2009. I just checked and gold is trading around $1,450. This isn’t exactly Dow 36,000 level stupidity, but maybe you want to be a little bit careful about listening to this guy’s economic forecasting?

          • Ben Franklin

            Nice cherry-picking.

            Call me when silver hits $100 oz and your fucking paper money is weighed like the aluminum cans you end up collecting.

            • janastas359

              Yes, taking an author’s argument at face value and refuting it sure is “Cherry picking.”

              Here in the real world, “Gold will get to $2000 an ounce within 12 months” is a falsifiable proposition.

            • Bent Franklin

              SILVER!!!!!!!!!!!

            • wengler

              I’m gonna split the difference and start collecting lead.

        • Murc

          If you think even moderate inflation, let alone hyperinflation, is any kind of real possibility anytime soon, I can only say “you are wrong.”

          The Federal Reserve would sooner commit mass suicide than allow inflation to rise above 2%. They would literally burn down the entire rest of the economy if it meant the rentier class was protected.

          • Ben Franklin

            Are you inebriated 24/7?

            What makes you think the Fed is in total control, or IMF for that matter?

            Go drink some Jones kool-aid.

            • Murc

              … I don’t think the IMF can do anything to affect inflation rates in the US. Like, at all.

              I also don’t think the Fed is in total control of inflation, but… well, the Fed is our central bank. In the absence of Congress intervening (and Congress has made it clear its disinterested in interfering with the Fed’s prerogatives and also that if it did, it would be on the side of the inflation hawks) they hold the whip hand.

              Absent believing in some shadowy conspiracy of financiers who want to destroy their own fortunes through hyperinflation, I think I’m on safe ground in assuming that the odds of it happening are real close to zero.

              Also, your insults are uncalled for. The worst thing I’ve done to YOU is say that you are wrong.

            • DrS

              When is this hyperinflation going to happen?

              It’s been much predicted, but hasn’t happened. Just like other apocalyptic nonsense, the passing of each next day of doom has been met with rescheduling. Man, it’s so sure to happen!

              So, when?

              • djangermats

                When the bond vigilantes ride.

            • Bent Franklin

              VIRGIN TEARS and GIANTS’ TOES!!!!!!!!!!!!!!!

      • Yes and then I could come with my big wad of valuable cedis and vacation like a king in the US. ;-)

    • Cody

      Was Ben Franklin some kind of “gold bug” in colonial times?

      If so, 10/10 trolling friend.

      If you’re being serious, then that’s sad. Giving you the benefit of the doubt though.

  • Ben Franklin

    In addition, BRICS intends on having it’s own credit rating agency because the current ones have proven to be unreliable. If BRICS currencies have greater value than dollar, they may be able to sell the US debt instruments on the secondary market.

    • shah8

      You’re an idiot acting out your favorite scenarios in your purple-skyed dreamland.

      Or in other words, you’re wrong, and nonsensical about being so.

      • Ben Franklin

        you’re wrong, and nonsensical about being so.

        So, you clearly demonstrated in your perceptive reply.

        • Bent Franklin

          PRECIOUS METALS!!!!!!!!!!!!!!

    • daveNYC

      If BRICS currencies have greater value than dollar, they may be able to sell the US debt instruments on the secondary market.

      What the hell are you talking about? Anyone can sell bonds on the secondary market. Having a ratings agency or a strong currency have nothing to do with that.

  • shah8

    Now, as for the topic?

    I *do* think that policymaker initiatives will happen:

    No debt can comfortably be serviced with escalating un and underemployment. Just think of all the student loan debts held by (or guaranteed by) Sallie Mae. Retail will constantly surprise to the downside, and the costs of automatic stabilizers like TANF goes up. People take fewer risks, and buying things like homes and cars (which are not normally thought of as risky, indeed, thought of as *necessary*) is done with feelings of anxiety. Not to mention that fewer people are even eligible for loans.

    Frankly, I expect a high risk of recession by 2014 or just after in 2015, and if there is a renewed loss of jobs, etc, etc, I expect that violent rejection of current political authorities will occur. Times are pretty bad, but there are lots of willfully obnoxious people who think their trusty handbags of social warfare tactics will work indefinitely. It probably won’t even be DC’s fault, actually–given that our policymakers are quite a bit less malicious than those of Europe, for example. We might (probably) just get massively sideswiped by a global recessionary tide.

    • Ben Franklin

      Don’t you mean possibly? Because you are screwing up the positivism.

      • Bent Franklin

        CANNED FOOD and AMMO!!!!!!!!!!!!!!!!!!

    • Ghoul

      Well, at least there’s an easy and popular solution to high TANF spending.

    • Davis X. Machina

      I expect that violent rejection of current political authorities will occur.

      I’m not holding my breath.

      No peasant mob yet has ever stormed a castle or chateau with a remote in one hand, instead of a torch, and a smart phone in the other, instead of a pitchfork.

      We live in the golden age of bread and circuses. Juvenal was two millenia early.

      • shah8

        When I say violent rejection, I mean right wing paramilitary violent rejection. People who think they are entitled to be violent, have lots of weapons and some organization, and are easily provoked to it.

        Besides…Urban peasant charge jails, high streets, public squares, major work sites. Rural peasants make travel dangerous. By and large, estates like those of Tsarist Russia that could be charged, looted, with owners hanged, by local peasants are rather few and far between in the modern day.

  • Rob

    The sequester cut long term unemployment benefits by about 10%. We really do have terrible policy makers.

    • Speak Truth

      I’m a horrible human being.

  • Threw out some old stuff the other day, among them a 2009 Harper’s with an article entitled Barack Hoover Obama.

It is main inner container footer text