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Whether you call them freelancers, “permalancers,” contractors, or long-term temps, an estimated one third of all American workers are carving out careers that don’t provide a weekly paycheck. The Freelancers Union, an organization that promotes the interests of independent workers, puts their number at 42 million.

"Many, particularly the young, are trapped in low-paying or temporary jobs that are replacing permanent ones. The situation is set to worsen, as government responds to the crisis by pushing for deep spending cuts to close budget gaps ."

See also Office Slaves: the rise of bullshit jobs

Many large firms especially retail (Wal Mart is one example) are pushing permanent workforce into temp status. Barbara Garson described this "forced part time" as practiced by Wal Mart and several other large companies pretty well in How to Become a Part-Time Worker Without Really Trying (August 21, 2013, TomDispatch)

Yves here. This post by Barbara Garson, which originally appeared at TomDispatch, describes how big companies squeeze down even more on workers by turning what were once full-time jobs into part-time positions to avoid providing benefits and to push pay even lower (workers who are desperate to get more hours will also accept reduced wages, working off the clock, and abusive work conditions).

Tom Engelhardt, in his introduction, pointed out that this campaign to drive ordinary workers into penury so as to fatten executive pay packages, was made respectable by Walmart. Of course, the end result, as some economists predicted, is that failing to share the benefits of productivity gains is ultimately self-defeating. It sucks demand out of the economy, limiting revenue growth, as the New York Times reported last week:

Major retailers, like Walmart and Kohl’s, that cater to budget-conscious customers with lower incomes cited sluggish sales this week as they decreased their annual forecasts. Macy’s, with a slightly higher-income clientele, did not meet analysts’ expectations for the first time in 25 quarters.

But even upper-income consumers do not seem to be spending as freely as some hoped. While Nordstrom’s, which reaches a middle-to-luxury-end market, reported a higher-than-expected quarterly profit on Thursday, it too said sales “remained softer than anticipated” and lowered its forecast.

And who is responsible for this type of scheme to crush labor? McKinsey. In The Firm, a book on McKinsey due out in early September, Duff McDonald reports that in 2007, McKinsey told Walmart that more experienced “associates” (with seven plus years of tenure) earned 55% more than ones who were one year into the job but were no more productive. The clear implication was that Walmart should ditch more seasoned employees and encourage churn, since having overly-experienced workers was too costly.

By Barbara Garson, the author of a series of books describing American working lives at historical turning points, including All the Livelong Day (1975), The Electronic Sweatshop (1988), and Money Makes the World Go Around (2001).  Her new book is Down the Up Escalator: How the 99% Live in the Great Recession (Doubleday). Cross posted from TomDispatch.

Watch closely: I’m about to demystify the sleight-of-hand by which good jobs were transformed into bad jobs, full-time workers with benefits into freelancers with nothing, during the dark days of the Great Recession.

First, be aware of what a weird economic downturn and recovery this has been.  From the end of an “average” American recession, it ordinarily takes slightly less than a year to reach or surpass the previous employment peak.  But in June 2013 — four full years after the official end of the Great Recession — we had recovered only 6.6 million jobs, or just three-quarters of the 8.7 million jobs we lost.

Here’s the truly mysterious aspect of this “recovery”: 21% of the jobs lost during the Great Recession were low wage, meaning they paid $13.83 an hour or less.  But 58% of the jobs regained fall into that category. A common explanation for that startling statistic is that the bad jobs are coming back first and the good jobs will follow. 

But let me suggest another explanation: the good jobs are here among us right now — it’s just their wages, their benefits, and the long-term security that have vanished.

Consider the experiences of two workers I initially interviewed for my book Down the Up Escalator: How the 99% Live in the Great Recession and you’ll see just how some companies used the recession to accomplish this magician’s disappearing trick.

Freelance Nation

Ina Bromberg genuinely likes to outfit people.  Trim and well dressed herself, Ina sells petites at the Madison Avenue flagship store of a designer brand boutique with several hundred outlets.  Even I had heard of the label.  I had to ask what its exact place in the fashion hierarchy was, though.  “We fall into a niche below Barney’s-Bergdorf-Chanel,” she explained.

In the course of a 20-year career, Ina, now in her sixties, had been the company’s top-earning national sales associate more than once.  Her loyal clients return each season saying, “You know what I like.  What have you got for me?”

When I first met her during the Great Recession, however, her hours had been cut back.  “They’ve moved the entire sales staff onto flexible schedules,” she explained.  “On Thursday, we are told what our schedule will be for the following week.  When they told me my new hours that first week, it was down to tenI said, ‘Why don’t you just lay me off?  I can collect unemployment.’  And [my boss] said, ‘No, no, it won’t be this way every week.’”

“Maybe this is their way of sharing the work in order to keep the experienced people till the recession is over,” I suggested. That used to be standard practice during a downturn.

Ina didn’t think so.  She referred me to an article about her firm on a fashion website.  “Read the responses,” she said.  “These are by people who worked in the office — probably not anymore.  They say that in some of the stores they’ve taken all the full time people and made them part-time.  And with that, there’s no more sick days, no more vacation days, no more commissions for anyone.  They say they’re going to do that to all the stores, even New York.”

“Do your managers claim that the short hours are just for the recession?” I asked.  “Do they thank you for making sacrifices till business picks up?”

“Not that I ever heard,” Ina answered.  “I think — and I’ve been saying this for a year and a half — their ultimate goal is to have all part-time sales people working shifts of four-and-a-half hours.  That way they’re not responsible for lunch, they have a lot of bodies, they pay no commissions, no benefits, and it’s a constant turnover.  This is what I think they want even after the recession because,” here she leaned in as though to reveal a secret, “they haven’t stopped hiring people.”  She checked to see if I grasped the significance of that.

I did and so did her fellow saleswomen, but it’s hard to go job-hunting during a recession.  While a few of the old professionals had already left, most were holding on, chewing over any bits of information they could pick up that might indicate management’s intentions.

“In our store we know they’ve continued the health benefits until March,” Ina said.  “What will happen after is what we’re trying to find out.”

Eventually, the company broke the suspense.  Managers called the remaining full-timers into the office and gave them two choices.  They could take a small severance package and collect unemployment or they could stay at truncated versions of their old jobs if they wished, but as part-timers with no benefits and no commissions.  In a way, the company had made government unemployment benefits a part of its buyout package. They were saying, in effect: you go voluntarily and we’ll agree that we laid you off.

Four years after the official end of the recession I interviewed Ina again.  She was the only one of the former sales staff still working there.  Her earnings were less than a quarter of what they’d been a few years earlier. 

“I can afford to retire,” she assured me.   “In a way, I already am.  I just like coming out of the house and seeing my regular customers.  But everyone who had to support themselves left.  All the new people are young,” Ina complained. “They have no commitment to the job.  They skip days whenever they feel like it.

“But why shouldn’t they?” she said suddenly, reversing her judgmental tone.  “It used to be if you missed a day, you missed a chance to earn commissions.  It mattered.  But at nine or ten dollars an hour, if they have something else to do they skip it.

“The job is only worth it if you’re a college student and the hours are a perfect fit for your schedule.  If that changes the next term, they leave.  And it doesn’t seem to make a difference to the company.  They treat employees like nothing now.  I don’t mean it has to be a family, but it isn’t even a team.”

I recently checked her company’s website under “careers” and it was true; they were advertising for more than 70 sales assistants for their various North American stores.  All but one of the positions was listed as part-time.  The sole full time job happened to be in Canada.

In other words, under the shadow of the recession, the company hadn’t sent jobs offshore or eliminated them.  It had simply replaced decently paying full-time employment, including benefits, with low-wage, contingent employment without benefits.  It had, that is, pulled the old switcheroo, turning good jobs into bad ones on premises.

Entering the Freelance Life

Here’s how the same magic trick works a little higher up the food chain.

Greg Feldman was a full-time professional doing computer graphics for an educational publisher which produces test preparation materials for school districts.  One day during the recession, his company laid off some 20 staffers including him.  As far as I can tell, its business wasn’t declining.  (Standardized test prep must be one of the last things desperate school districts cut.)

“When I got home I went into panic mode,” Feldman remembered.  “I said I better redo my resume before the weekend.  And I did.  But there were a couple of openings I could have applied for that day — one full time, one long-term temp.  But I waited till after the weekend to send it in.  That was in November [2008] and this is February [2009].  I’m on the websites every day and I haven’t come across any other regular staff positions since those two.”

Four years later Feldman was piecing together his living by combining a steady but low-paying part-time job with freelance gigs.  He still considers himself unemployed.  Whenever we speak he enumerates the new computer graphics programs he’s mastered and asks me about job leads.

But is Feldman really unemployed by post-recession standards?  He may not have a full-time job with his old company, but neither does just about anyone else who did the work he used to do for them. It’s by no means impossible, I once suggested to Feldman, that he himself might wind up working for his old firm through a subcontractor. 

“Possible but not likely,” he answered. “What I heard is that they send that work overseas now.”

The Good Old Switcheroo

When America’s industrial workers were hit hard in the 1970s and 1980s, the excuse for breaking their unions, lowering their wages, and outsourcing their work was that we had to compete with foreign manufacturers.  But not to worry, it was then suggested, there might be tough times ahead for a few blue-collar troglodytes who couldn’t be retrained, but the rest of us would soon be data manipulators in a booming postindustrial society.

Feldman is as postindustrial as you can get and his former company doesn’t even compete with foreign firms.  It seems, though, that corporate headquarters no longer needs excuses or explanations to make workers cheaper and more replaceable.  

The recession itself certainly doesn’t explain such job transformations.  Traditionally, during recessions employers reduced hours or laid people off in a way that would enable them to reconstitute an experienced work force when business picked up.  In the meantime, they competed on price and took less profit.  As a result, the share of national income that went to owners and investors used to decline during such periods, while the share that went to workers actually rose.

No longer.  Ina’s and Greg’s employers used the downturn to dump entire departments and reorganize themselves so that the same work, the same jobs, requiring the same skills, would henceforth, in good times and bad, be done by contingent workers.  Many other companies seem to be doing the same thing.  One sign of that: during the course of the Great Recession corporate profits went up by 25%-30%, while wages as a share of national income fell to their lowest point since that number began to be recorded after World War II.

According to the latest Labor Department figures, 65% of the jobs added to the economy in July 2013 were part-time.  The average hourly wage fell slightly. Interpreters of those statistics will make it sound as though it’s simply a matter of factories firing and burger joints hiring.   That, at least, would be a situation that could be reversed over time.  If, however, golden jobs are being transmuted into lead by the reverse alchemy described in this piece, then they’re not coming back gradually, certainly not without a growing labor movement and a fight.

I checked back recently with Ina Bromberg to see if anything had changed for the saleswomen in her store as the nation crawled into what’s now called “recovery.”

“The hours are creeping back up,” she said, and pointed to an irony.  “When they started all this they told us that short shifts make us more efficient.  Now, they’re letting a few people work, six, seven, even eight hours some days.”

I asked if benefits and commission were also creeping back.

“Of course not!” she answered.

“It’s sad in a way,” Ina mused.  “If one of these young women gets eight hours for a while, she’ll think she has a regular job.  None of them can remember what a regular job was like.”

Ina is describing a perfect sleight of hand.  Good jobs disappeared into bad jobs so deftly that hardly anyone has noticed the switcheroo.  Soon enough the zombie jobs that replace the real ones will move among us as if they were normal.  If you sense that there’s something missing, there must be something wrong with you.  Get with the program.  We’re becoming a freelance nation. 

[Sep 17, 2011] Even Harvard couldn't protect me

"We live in a society where it's hard to maintain self-respect if you don't have a job," Kwame Anthony Appiah, philosopher at Princeton, said in a recent radio interview, and I can certainly identify. All of my life I've been an achievement junkie. I have two Harvard degrees, practiced law at elite Manhattan firms, and wrote and published two novels, among other things. But of all my accomplishments, by far the most impressive is absent from my résumé: It's my more than two-year stint of job searching and unemployment.

If you've been unemployed you already know this, but if you haven't, here's a news flash: Coping with prolonged joblessness is hugely demanding. It requires deep reservoirs of fortitude, faith, patience, courage and self-control, traditional virtues generally accorded high regard in our nation's pantheon of values. Of course, we're a country that values hard work, and that's as it should be. But don't our values also dictate respect for the efforts of the struggling unemployed?

Two years of job hunting has required infinitely more of me than any of my lauded past achievements. And I, of course, am among the relatively fortunate, with a cushion of savings and a supportive group of friends. And here is what I think: If the experience is still this hard for me, how much harder must it be for the millions who lack these things?

There is a distinct Groundhog Day quality to days spent looking for work: Write letters. Prepare résumés. Search job boards. Make phone calls and brainstorm over coffee. Sleep. Get up. Repeat. After sending off my materials, I often hear nothing back. I've long since lost count of the number of jobs I've applied for.

As an "older worker" -- When did that happen? -- I try to ignore a drumbeat of statistics telling me I face an uphill battle. It's hard not to feel worn down, to succumb to "learned helplessness," our innate tendency to give up when our efforts fail to yield results. Still, like millions of others, day by day I keep going.

My exertions often seem strangely invisible, not only to my family and friends but increasingly to me -- an experience that turns out to be widely shared in job-loss land. And this is just the tip of the iceberg. As Atlantic journalist Don Peck recounts in "Pinched," his sobering account of the changes wrought by the Great Recession, studies show "a growing isolation, a warping of family dynamics, and a slow separation from mainstream society" among the long-term unemployed. Strikingly, no other circumstance triggers a larger decline in well-being and mental health than involuntary joblessness. Only the death of a spouse compares.

...At the start of this year, the average unemployment duration of more than nine months was longer than it's been since the Bureau of Labor Statistics began tracking the figure in 1948, according to Peck.

And yet, daunting as these numbers may be, they only hint at the human suffering that they reflect. In his 2010 book "The Honor Code," Appiah places honor at the heart of what it takes to lead a successful life, noting that throughout history, societies have adopted guidelines for how people "can gain the right to respect, how they can lose it, and how having and losing honor changes the way they should be treated." The result: "[P]eople in an honor world automatically regard those who meet its codes with respect and those who breach them with contempt."

This stark dichotomy -- between respect and contempt -- got me to thinking. You don't have to be a mathematical genius to see that when there are six job seekers for every job, it's simply not possible for everyone to find work. And in fact, as others have noted, the reality is even tougher on the unemployed than these numbers suggest. For one, they (we) are competing for positions not only with other unemployed workers but also with applicants already in the workforce who are looking to move on. They (we) are also contending with subtle -- and not so subtle -- biases against the unemployed, including the proliferation of "unemployed need not apply" caveats on job ads for positions ranging from electrical engineers to restaurant managers. Thanks to my legal background, this shocked me less than it did some of my friends. I knew that current laws don't prohibit discrimination against the jobless.

So how is it that so many have come to disdain the unemployed? To equate unemployment with failure and shiftlessness? If the barometer of popular culture is any indication, this wasn't always so. In the 1962 film classic "A Touch of Mink," plucky all-American Cathy Timberlake (aka Doris Day) is on the way to collect her unemployment check, when a chauffeured limousine splashes her with mud. It's Cathy Timberlake -- not the feckless industry titan played by Cary Grant -- who represents the traditional American values that in the end carry the day. Firmly planted at the dark pole of the film's moral compass is the creepy unemployment office bureaucrat who alternately taunts Timberlake for taking government money and hits on her. The film has plenty of disdain for the titan and the bureaucrat and plenty of sympathy for Timberlake.

 


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[Dec 23, 2016] Top Ex-White House Economist Admits 94% Of All New Jobs Under Obama Were Part-Time

Growing inequality. We are already at Gini coefficients normally only found in banana republics.
Notable quotes:
"... from 2005 to 2015, the proportion of Americans workers engaged in what they refer to as "alternative work" soared during the Obama era, from 10.7% in 2005 to 15.8% in 2015. Alternative, or "gig" work is defined as "temporary help agency workers, on-call workers, contract company workers, independent contractors or freelancers", and is generally unsteady, without a fixed paycheck and with virtually no benefits. ..."
"... The two economists also found that each of the common types of alternative work increased from 2005 to 2015-with the largest changes in the number of independent contractors and workers provided by contract firms, such as janitors that work full-time at a particular office, but are paid by a janitorial services firm. ..."
Dec 23, 2016 | www.zerohedge.com
Just over six years ago, in December of 2010, we wrote " Charting America's Transformation To A Part-Time Worker Society ", in which we predicted - and showed - that in light of the underlying changes resulting from the second great depression, whose full impacts remain masked by trillions in monetary stimulus and soon, perhaps fiscal, America is shifting from a traditional work force, one where the majority of new employment is retained on a full-time basis, to a "gig" economy, where workers are severely disenfranchised, and enjoy far less employment leverage, job stability and perks than their pre-crash peers. It also explains why despite the 4.5% unemployment rate, which the Fed has erroneously assumed is indicative of job market at "capacity", wage growth not only refuses to materialize, but as we showed yesterday, the growth in real disposable personal income was the lowest since 2014 .

When we first penned our article, it was dubbed "fringe" tinfoil hattery, or in the latest vernacular, "fake news."

Fast forward 6 years, when a report by Harvard and Princeton economists Lawrence Katz and Alan Krueger , confirms exactly what we warned. In their study, the duo show that from 2005 to 2015, the proportion of Americans workers engaged in what they refer to as "alternative work" soared during the Obama era, from 10.7% in 2005 to 15.8% in 2015. Alternative, or "gig" work is defined as "temporary help agency workers, on-call workers, contract company workers, independent contractors or freelancers", and is generally unsteady, without a fixed paycheck and with virtually no benefits.

The two economists also found that each of the common types of alternative work increased from 2005 to 2015-with the largest changes in the number of independent contractors and workers provided by contract firms, such as janitors that work full-time at a particular office, but are paid by a janitorial services firm.

Krueger, who until 2013 was also the top White House economist serving as chairman of the Council of Economic Advisers under Obama, was "surprised" by the finding.

Quoted by quartz , he said " We find that 94% of net job growth in the past decade was in the alternative work category ," said Krueger. "And over 60% was due to the [the rise] of independent contractors, freelancers and contract company workers." In other words, nearly all of the 10 million jobs created between 2005 and 2015 were not traditional nine-to-five employment.

While the finding is good news for some, such as graphic designers and lawyers who hate going to an office, for whom new technology and Obamacare has made it more appealing to become an independent contractor. But for those seeking a steady administrative assistant office job, the market is grim. It also explains why despite an apparent recovery in the labor market, wage growth has been non-existant, due to the lack of career advancement and salary increase options for this vast cohort which was hired over the past decade.

The decline of conventional full-time work has impacted every demographic. Whether this change is good or bad depends on what kinds of jobs people want. " Workers seeking full-time, steady work have lost," said Krueger. He then added, perhaps sarcastically, that "while many of those who value flexibility and have a spouse with a steady job have probably gained."

Yes, well, spousal support aside, it also confirms another troubling finding this website reported first earlier this month, namely that the number of multiple jobholders has recently hit the highest number this century.

Is America Turning into a Freelance Nation

Whether you call them freelancers, "permalancers," contractors, or long-term temps, an estimated one third of all American workers are carving out careers that don't provide a weekly paycheck. The Freelancers Union, an organization that promotes the interests of independent workers, puts their number at 42 million.

Rutgers Today asked William M. Rodgers, professor and chief economist at the Heldrich Center for Workplace Development at Rutgers' Edward J. Bloustein School of Planning and Public Policy, to put those figures into context, and to share his thoughts on how the phenomenon is reshaping the nation's employment landscape. A professor on the graduate faculty of Rutgers' School of Management and Labor Relations, Rodgers is a specialist in the health of the U.S. labor market and its impact on American families.

Rutgers Today: Is the notion of working for one employer for 25 years or more gone forever? If so, what impact does that have on issues like morale, worker productivity, and loyalty to a company?

Rodgers: Before the "Great Recession," I would have said yes, that concept is a thing of the past. The threat of job loss from outsourcing and restructuring had risen for all educational attainments and skills, weakening the historically strong employer-employee compact. However, in the aftermath of the recession, we may see more Americans placing greater value on job security. The recession has caused many Americans to press the reset button on their career expectations.

Rutgers Today: What is the upside of a career as a freelancer in a job market that seems to be improving, but still remains relatively unstable? What are the benefits to the employer?

Rodgers: One upside is the potential for flexibility. A word of caution, however: Flexibility should not be interpreted as a lack of formality, such as not signing a contract, which is very common.

Rutgers Today: Aside from the uncertain cash flow and the lack of benefits, are there other disadvantages, either for the worker or for the employer?

Rodgers: A significant problem is that many freelancers and their clients don't sign contracts, which leads to expending time and effort to recover payment for services. The Freelancers Union posts sample contracts that can be downloaded. Unfortunately, I have found in my research that even when you have a contract, it doesn't guarantee you will be paid on time – or paid at all. A contract is a self-enforcing mechanism. When you start negotiations with a client, I suggest getting the details written down: when you will get the product to them, when they will pay you. If there's no contract, you have to decide how credible the individual or firm is – assess the track record, ask for references.

If you don't get paid on time, or if you don't get the agreed-upon amount, you might try the following steps: 1) make personal requests via email, phone calls, or letters; 2) utilize a collection agency; or 3) take the client to small claims court. You might also pursue legal means such as litigation, arbitration, and mediation, all time-consuming and costly remedies.

The Freelancers Union asks members to report various clients who are not as faithful about meeting their payment obligations. You can check those postings on the union's web site.

[Aug 25, 2013] Is The U.S. Turning Into A Nation Of Temps By Dan Fastenberg

Jun 24, 2013 | AOL Jobs

Have you been wondering why it's so hard to get a full-time position with benefits? Everyone knows it's a bad economy out there, but if you've been struggling, new data may help you understand why. According to the Bureau of Labor Statistics, the total number of temp workers surged by 7.5 percent in the past year, to 2,679,800 in May. That's the highest it's been since it reached 2,767,300 in October 2006. So while the economy has been slowly improving, with more employers hiring, the reality is that many of the new jobs offer only temporary employment without benefits.

Two sobering facts: The hiring rate of temp workers is five times that of hiring overall in the past year, points out Mediabistro, a media industry website. And the number of temp workers has been rising steadily since 2009 (as shown by this chart at the employee recruitment news website ERE.)

Who's moving to a temp workforce? Pretty much everyone. Just last week retail behemoth Walmart, with some 1.3 million workers, confirmed that its hiring strategy has changed, stressing a temp workforce. Before the year began, part-time workers only comprised 1 percent of the Walmart workforce, but now the figure is around 10 percent. As Fortune noted, the uptick in temp hiring during the financial crisis has also been apparent at large employers from across the economy, from colleges to internet technology firms.

What are the reasons for the shift? Here are three leading theories:

1. It's a reaction to Obamacare. Some, including the right-leaning Investor's Business Daily, have suggested that the high number of temp workers is proof that employers are replacing full-time workers "to lighten the burden of Obamacare's regulations." (Some of the Affordable Care Act's provisions have been taking effect since March 2010.) According to the law, employers are only subject to fines from the health care act once they have more than 50 full-time workers, and so, as the argument goes, companies have an incentive to keep their head counts low.

2. A temp workforce makes employers more competitive. In speaking to Reuters, Walmart spokesman David Tovar said the change was not related to the new health-care law. Instead, it was described as a way to cut costs when consumers are spending less during tough times. Crucially, the model is also thought to give Walmart an edge over other big box stores, such as Costco, Sears and Target, who haven't moved toward the temp workforce.

3. The financial crisis emboldened employers. Labor market analysts told Reuters that it's possible that employers are simply taking advantage of a favorable environment in which so many Americans have been out of work for so long that the unemployed don't have the luxury of waiting for good jobs with full benefits.

Erin Hatton, author of "The Temp Economy," told AOL Jobs that employers could be given incentives to reduce the size of their temp workforce. For example, if the "burden of [providing] health insurance were lifted" from employers, said Hatton (who's a professor of sociology at the State University of New York, Buffalo), it's likely that companies would not have to resort to such cost-cutting measures. Such an idea remains controversial, though, as it would require the government to step in and offer health care.

But Hatton warned that "if nothing is done -- whether it's because of workers themselves or people rallying on their behalf -- to force employers to put restrictions on temp workers, this practice will definitely continue to grow."

What do you think about the rise in temp workers? Share your comments below.

This story was updated on June 24 at 3:30 PM EDT with the quotes from Hatton.

[Aug 22, 2013] Barbara Garson How to Become a Part-Time Worker Without Really Trying

naked capitalism

Clive:

Found the link now:

http://www.theguardian.com/money/2013/aug/21/bank-intern-death-working-hours

LucyLulu:

I don't recall where I read another story about this, but it said the cause of death was unknown. It also showed a portion of his webpage with the Serenity Prayer quoted and I wondered (granted, was speculative) if he had a history of addiction. Then I read the Guardian link posted and saw it reported that toxicology results were pending (yeah, it's routine testing for a death of unknown cause, but not typically highlighted in press reports IME). So, I question how accurate "working himself to death" might be. A gut feeling says his death was drug-related, not that it becomes any less tragic or senseless for being so.

That being said, if he did struggle with addiction or had become sober relatively recently, working those type of hours would have put his sobriety at risk. He either would have or should have been warned to limit himself to ~40 hours/week, even if it meant skipping the internship (as whatever is deemed more important than staying clean will be lost…… or so is the common wisdom).

I wonder if Merrill Lynch was unaware of his being at risk, or if they knew and ignored it. I could be wrong but it seems an internship and the mentoring role would (or perhaps the mother in me thinks it should) imply some sort of custodial responsibility on the part of Merrill, or whatever the correct term would be.

Clive:

You're right of course Lucy - innocent until proven guilty applies to everyone or not at all.

I would add that suicidality, depression / stress, chemical or behavioural dependency are often co-morbid. If an individual is predisposed to these conditions, it will be exacerbated by a presence of overwork.

Overwork can also be a trigger. I'm not sure we ever want to normalise a culture where 15 hour days are routinely tolerated and thus degenerate into employment Darwinism where only the strongest survive.

Yves Smith

LucyLulu,

I don't know if you've every worked the sort of hours young people on the investment banking (NOT trading) side work at big firms. I had one of these jobs back in the early 1980s. It is simply inconceivable unless you've been in it. It's worse than what medical residents are put through. You are not permitted to say no, you have (in my case) 100 people who can give you work (30+ clients, typically 2 or more people at the firm who could ask that something be done, plus the client would often call the junior staffers directly if they wanted something small done quickly) with none of them caring what the other 99 had you doing. Priorities changing all the time intra day as markets moved and deals got accelerated or delayed and pitches to clients had to be changed based on changing market info (you could not finalize any client marketing piece until you had closing prices at 4, which meant inevitably you were working into the evening, and that was the more ordered part of the work).

How do these firms get away with it? They are the most prestigious, sought after employers. They can hire whoever they want. They seek people who are smart, intensely competitive, and insecure. They then wind up in an environment that has much in common with a cult. People wind up largely abandoning all their former friends and spending much less time with their families due to the hours and the pay gap (people who make that much money are quickly acculturated to eat out and spend what little recreational time they have at a lavish level). The environments are also extremely conformist. Social psychologists write about the power of social assent, that if enough people in your environment do something, you'll see it as normal, even required. And the extreme hours are most certainly required. Young people in these jobs are expected to have no boundaries. When asked to do something, they are not permitted to say "No, I already have too much on my plate, I can't take that on". The only acceptable answer is "When do you need it?"

I known one someone at Salomon who started vomiting under the stress. Every half hour. Went back and kept working after each incident. Electrolytes got so messed up he collapsed and had to be hospitalized. I know another person at Lazard, working on a big deal. Was seen in the office lying on the floor on one side reading documents over the weekend. People asked if she was OK. She waved them away, insisted she was fine. The pain eventually got so bad she went home and called her boyfriend. He ran up and took her immediately to the hospital. The operated straight away, thinking it was appendicitis. It was diverticulitis, which is usually a disease of old people but can be brought on by stress and bad diet. They had to remove half her colon. Had they gotten to her a half hour later, her colon would have ruptured and she would have died.

Same woman later lost 90% of her vision in one eye due to glaucoma, didn't have time to get regular eye exams. This was the price of becoming the first woman partner in M&A at any major firm.

I can give you other stories like that. Breakdown is hardly unheard of.

I did 2 all nighters in a row and was starting to have trouble with motor function (coordination for inputting data was starting to go). Three, which is what this young man did, amounts to torture. And you can do that on mere caffeine.

Your blaming his death on drugs when I am highly confident you've never done more than one all nighter and have no idea what that does to you is uninformed and is supporting the banks and abusive work environments generally.

LucyLulu:

I read the link you posted and one other article. If it was mentioned that he had stayed up three nights in a row, somehow I overlooked it. And yes, I've done several (successive) all-nighters in the past, having to be on call for a week at a time, and work 12 hour days even if up all night (fairly often). I didn't fare well, and didn't stay at the job long.

I wasn't meaning to be judgmental towards the intern. I consider his death just as tragic and senseless if it was fatigue-induced, and my point about responsibility lying with the mentoring firm still stands.

In fact, I don't understand why the practice is allowed to continue. Medical residents and related professions have since had limits imposed on the number of hours that can be asked to work without time off.

Yves Smith:

Lucy,

Thanks for the reply, but even then, your experience with all nighters is not directly comparable. I meant all nighters while you were working, as in 48+ hours of continuous work except for dealing with essential bodily functions and some hygiene. And this is also in an environment that is intolerant of errors, where typos or computation errors are career enders or severely detrimental.

So even working 12 hours and not sleeping well/at all by being on call is not the same as having to keep working except for eating and showering/clothes change time/pottie breaks. The stress level is considerably worse.

As to the three all-nighters, it has been reported but not confirmed. And BofA will clearly try to make what happened look less awful than it was:

http://www.theglobeandmail.com/life/the-hot-button/bank-of-america-intern-found-dead-alleged-to-have-pulled-three-all-nighters-in-a-row/article13897556/

http://www.independent.co.uk/news/uk/home-news/slavery-in-the-city-death-of-21yearold-intern-moritz-erhardt-at-merrill-lynch-sparks-furore-over-long-hours-and-macho-culture-at-banks-8775917.html

http://jobs.aol.com/articles/2013/08/20/bank-of-america-intern-died-after-pulling-three-all-nighters-re/

DolleyMadison:

yep…I used to wonder how battered women stayed with their abusers…I didn't realize until after I LEFT BofA that I was essentially a battered woman…surrounded by her enabling in laws.

You don't realize how crazy it is until you leave. It really is like a cult.

If you raise your hand to question the regime, retribution is swift and sure, even among "friends" with decades long relationships, and even against spouses. I truly believe some of my former co-workers would even commit murder if their overlords insisted on it.

Nathanael:

I'm glad to be immune to that particular sort of coercion thanks to abnormal psychology. I wish more people were like me.

Worth noting: the particular psychological oddities which make people resistant to that type of coercion seem to be the same ones which make people good at computer programming. I have no idea what the social consequences of that combination will be.

LucyLulu:

I'm really not trying to be argumentative, but actually I WAS talking about working all night, as I took after-hours call from home, at least until I had to go get somebody admitted or petitioned or go out and do an emergency assessment or something. It was clear what you meant when I said I had done it also. I would also argue that mistakes kinda aren't tolerated in the health field either, though perhaps for different reasons.

Nobody should be expected to work for 72 hours straight, nor is there a need, it's sheer exploitation to maximize profits. It's more than the human body and mind can endure. Workers need to stand up and say no. I think that's something people tend to learn as they get older, gain confidence, and their priorities become more clear. 21 is still very young. And saying no, if it means possibly the loss of the job, is not so easy when employment is scarce and an income is needed, or it's a standard requirement for one's chosen career, as apparently it must be in finance (Higher Power sending initial clue that one has chosen lousy career??). Workers no longer have unions to help them negotiate collectively….. though nursing never joined unions in most parts of the country, It was deemed to be beneath the professional status of a registered nurse to be a union member, rather conveniently. Thee places I ended working, almost exclusively in the south, it was risky to be overheard mentioning "unions" within earshot of management. IIRC, the provision of nursing staff is easily a hospital's single largest expenditure. With unionized nursing, how can a hospital pay their CEO their $15M living wage?

fajensen:

I wonder if Merrill Lynch was unaware of his being at risk, or if they knew and ignored it.

Easy to find out*: If the HR-bods either knew or suspected anything they would have taken out a life insurance on the poor guy, with Merill Lynch as beneficiaries.

Gotta play them odds!

*) Or maybe not so easy – It is depressingly common for employers to buy a little bet on the early demise of the "Human Ressources".

Nathanael:

"But what of the next generation, mired in debt and subject to the extraction by the multitude of licensed protection racket players in healthcare, finance, education or housing ? How can they ever get ahead ?"

Off-the-books economy. Find one part-time job which gives you enough tenuous connection to the on-the-books economy that the police state doesn't get suspicious, then do *ALL* your other work off the books.

Lambert Strether:

"Off-the-books economy." And commit perjury on your ObamaCare application?

LucyLulu:

If it's off the books, you're already committing tax fraud (or tax evasion, or something like that) on your IRS return.

Nathanael, The off-the-book work would also have to be something that could be done on a flexible schedule since the part time job hours will change every week. But any work where you can be your own boss and set your own hours is preferable to dependence upon the 'good will' of an employer, IMO. I'm working on that one myself. (I knew I should have taken basketweaving.)

LucyLulu:

This link by Charlie Stross was on Jesse's page and was an intriguing read on the implications of the current labor culture. Stross theorizes that Snowden and Alynikov type defectors will become the norm now that Gen Y, first born in the early 80′s, are starting to flood the labor market (most employers don't have the vast resources for retribution of the US gov and Goldman-Sachs).

Gen Y is the first generation having no prior work experience in a culture that favors mutual employee/employer commitment, nor having grown up witnessing parents in more secure "jobs-for-life" and termination-for-cause employment. They've only had experience with jobs that are outsourced, offshored, laid-off, contract, zero-hours, temporary, part-time, etc.

Gen Y believes in the workplace golden rule ("do unto others as they do unto you"… okay, I've taken some liberties paraphrasing Stross). Thus today's employees will have no less reticence about 'screwing' their (former) employers to advance their own self-interests, than employers have about 'screwing' their workers to maximize profits. It's a good read.

With any luck, it won't be merely wishful thinking to say: Karma's a bitch!

Doug Terpstra:

Yes, it's "funny" how the Wal-Mart right-to-work churn, permanent student debt, gross inequality, and social insecurity caused by a triumphant class war has fractured American cultural cohesion, especially within Gen Y. At this juncture economic dynamism can no longer be sustained, and along with it, autonomic patriotism. Following up on fajensen above, in a climate of callous top-down disloyalty, the roster of conscientious whistleblowers such as Snowden, Manning, Assange, Kiriakou, Darby (Abu Ghraib), Drake (NSA) and many more, is certain to grow. Dissent rises gradually, then rapidly, as things fall apart and the center cannot hold.

I think we have a great disharmonic convergence coming, likely this year. Ben Shalom is leaving and is almost sure to take away the punch bowl before Summers is seated.

psychohistorian:

Karma is a bitch.

That is what is going to bring the current system to a halt. The young ones are not daft, I am finding.

The current economic/social system runs on computers and if servers stop/slow or the networks begin not working right, the trust level is eventually broke and all hell breaks loose…..geometric finger pointing and cascading fail overs between and among vendors.

Being an old techie I engage every other techie I run into and the young contract techies keeping the NSA sub contractors running are a hairsbreath from mayhem the management can't contain.

Go long on popcorn and don't be surprised if techie shit gets less reliable for a while. Prepare for a bouncy ride.

Kievite:

psychohistorian,

The trend toward less qualification in IT is probably present as younger people did not experience the emerging of all those technologies as oltimers did. So they have less "in-depth" knowledge that old-timers acquired due to this process. But there are old-timers and old-timers. A lot of old-times are just accidental people which moved to the field during boom years of IT (say, 1990-1998). Many of them are barely competent in what they are doing even now.

I would not get too exited about new generation of IT workers (mostly part-time and lower paid) greatly affecting network or server reliability. May be something will happen on the margins. But it looks completely remote to me. May be due to commodization of the technology the IT support on the level of the firm now matter less. Complex issues are solved by vendor support, or professional consultants. Enterprise software is also more or less standardized.

Where huge blunders are now made is at senior level, where people became generally detached from technology (and sometimes from reality). Also too many technically illiterate bean counters were promoted to senior positions. And they often rely on fashion (and vendor hype and/or bribing) in adopting new technologies for the firm. But at the end of the day this is just modest cost overruns. Nothing to be exited about. So something that cost $100K is bought for a million and cost another couple of million in maintenance fees and internal costs before being abandoned. That's about it. Remember IT is generally around 1% of the total cost of a large company operations.

hazmat:

Employers destroyed the golden rule in the work place. As an employee, you simply cannot continue to treat them the way you wish to be treated over a sustainable period of time when they offer only these kinds of abuses in return.

Reciprocity is the new rule for employees. If they take care of you, take care of them and treat them well. Pamper them. If they screw you over, return the favor a multitude worse. Make it painful.

Doug Terpstra:

Thank you, Yves, for another great bottom-line assessment of the change Obama has inflicted on us - the exact inverse of his electoral campaign. Although Ms. Garson says nothing of Obamacare directly, the ACA (the Insurance Racket Bailout Act) is now a huge reason for the great bait-and-switch acceleration to part-time and freelance jobs. As Lambert has reported it is hugely damaging socio-economic engineering.

https://www.facebook.com/Forever21/posts/10151671544189550.

This is Obama's legacy, shaping up to be not abysmal but disastrous. Even worse, I suspect it's intentional, the deliberate creative destruction of disaster capitalism in a grab for absolute power. That's the most disheartening apprehension.

Here are a few more inconvenient truths about our change president from "33 Shocking Facts Which Show How Badly The Economy Has Tanked Since Obama Became President". It's an objective and damning assessment of real change under Obama. People won't be able to ignore these much longer, and eventually even veal pen journalists (MSDNC) will have to acknowledge certain stubborn facts:

#1 When Barack Obama entered the White House, 60.6 percent of working age Americans had a job. Today, only 58.7 percent of working age Americans have a job.

#2 Since Obama has been president, seven out of every eight jobs that have been "created" in the U.S. economy have been part-time jobs. [87% of job creation…part-time; this differs from the post(?)] … #5 40 percent of all workers in the United States actually make less than what a full-time 11 since the 2006-2007 school year. … #8 According to the U.S. Census Bureau, the middle class is taking home a smaller share of the overall income pie than has ever been recorded before.

#20 Health insurance costs have risen by 29 percent since Barack Obama became president, and Obamacare is going to make things far worse. … #23 In 2008, that total amount of student loan debt in this country was 440 billion dollars. At this point, it has shot up to about a trillion dollars.

#24 According to one recent survey, 76 percent of all Americans are living paycheck to paycheck.

http://theeconomiccollapseblog.com/archives/33-shocking-facts-which-show-how-the-u-s-economy-has-tanked-since-obama-became-president

You get the idea. And those are only some of the economic changes, without even broaching disastrous militarism, and police-state espionage.

Robert Dudek:

I've got a good title for a book on this phenomenon. Unfortunately, it's already been taken: Road to Serfdom.

reason

And you seriously think this is all Obama's fault and that the GOP had nothing to do with it?

Michael Fiorillo:

Needless to say, the GOP has much to do with it, but it's two hands washing each other.

The infernal brilliance of the Overclass' support for Obama is his ability to misdirect and divert whatever energies for resistance remain within what passes for the Left.

What insidious genius to have a Black man (well, sort of) be the one to undermine Social Security, public education (his policies are at least as bad as Bush's, probably worse) and institutionalize the National Security State.

Sure, the GOP is at fault, but Obama was hired to make sure that potential opposition remains paralyzed.

Doug Terpstra:

All O's fault? No, but it's his legacy, like it or not. Clearly it doesn't bother him.

Blame the last four and a half years on Republicans if you like. So then, let's just say O's been implausibly impotent and hopelessly inept.

Not only are none of the foregoing economic failures his fault,

I could go on and on but it would bore informed NC readers to tears. You may think Obama is hapless and incompetent to the point of making Herbert Hoover look like an activist progressive. I happen to believe he's brilliant, an epic false messiah, a diabolically-hypnotic charlatan who's a total eclipse of his idol Reagan.

Nathanael:

"You may think Obama is hapless and incompetent to the point of making Herbert Hoover look like an activist progressive. I happen to believe he's brilliant, an epic false messiah, a diabolically-hypnotic charlatan who's a total eclipse of his idol Reagan."

And I don't really care which he is. I judge entirely by results. Whatever is in his "deepest heart", in practice Obama has been very close to G.W.Bush's third and fourth terms. (Oh, there are weird little exceptions, like railway funding, but I think Obama wasn't paying ANY attention to that.)

bluntobj:

Laying blame on one side or the other is like sitting in a stadium and cheering for your team, red or blue. The owners of both teams are up in the owner's box, drinking champagne together and counting the ticket & concession sales cash.

Just entering that stadium means you've bought in to their propaganda. The only safe path is to opt out and create an alternative to the game inside for yourself.

George:

None of this is a surprise. . . a few years ago at my company, it was decided to withdraw all benefits for freelance employees, many who were putting in full time hours as any staff employee. The freelancers staged a walk out and the company relented in the short term by grandfathering those freelancers employed at that time with their current benefits.

Since then, the benefits for those freelancers have been reduced to the barest of medical plans with high deductibles. Any new freelancers who come in don't get health insurance unless they work a consecutive number of days in a row, which is near to impossible since the company forces them to take 6 weeks off throughout the year, thus cementing the fact that they'll never receive health insurance.

At that time, the company cited being competitive in the global market, and pointed to our competitors which made similar changes years earlier. Considering we've been earning healthy profits after the first year of the Great Recession, and the CEO and other high level execs lining their pockets with record sums, it's pretty clear they're more interested in short term gains as pushed by Wall Street.

That greed is really what's ruining this country and those playing the game won't be satisfied till they've squeezed us for all the money we have, laughing all the way to the bank in Singapore

Handgrip:

Give me one good reason "to work" at all?

bluntobj:

Only work for yourself by opting out of the game being played in the stadium.

You will be considered a whacko and stupid, but those insults will be coming from people with underwater houses, CC debt up to their eyeballs, a job they hate, a 101k retirement plan coming in September, and a heart condition due to stress.

Think alternatively, and be much happier.

Wat Tyler:

Saying from the old Soviet Union:

"They pretend to pay us and we pretend to work."

No society can survive if work is not valued at the economic and psychological levels.

In Rich Europe, Growing Ranks of Working Poor

Apr 02, 2012 | NYTimes.com

Melissa Dos Santos, 21, and Jimmy Colin, 22, live in a trailer in a campground 30 miles north of Paris. "I grew up in a house; living in a campground isn't the same," Ms. Dos Santos, 21, said wistfully.

Her dreams of a more normal life in an apartment with her boyfriend evaporated when they both took minimum-wage jobs - she in a supermarket and he as a Paris street sweeper - after months of searching fruitlessly for better-paying work. "People call us marginal," she said. "Little by little, it's eating us up."

Europe's long-running euro crisis may be cooling. But the economic distress it has left in its wake is pushing a rising tide of workers into precarious straits in France and across the European Union. Today, hundreds of thousands of people are living in campgrounds, vehicles and cheap hotel rooms. Millions more are sharing space with relatives, unable to afford the basic costs of living.

These people are the extreme edge of Europe's working poor: a growing slice of the population that is slipping through Europe's long-vaunted social safety net. Many, particularly the young, are trapped in low-paying or temporary jobs that are replacing permanent ones destroyed in Europe's economic downturn.

Now, economists, European officials and social watchdog groups are warning that the situation is set to worsen. As European governments respond to the crisis by pushing for deep spending cuts to close budget gaps and greater flexibility in their work forces, "the population of working poor will explode," said Jean-Paul Fitoussi, an economics professor at L'Institut d'Études Politiques in Paris.

To most Europeans, and especially the French, it seems this should not be happening. With generous minimum wage laws and the world's strongest welfare systems, Europeans are accustomed to thinking they are more protected from a phenomenon they associate with the United States and other laissez-faire economies.

But the European welfare state, designed to ensure that those without jobs are provided with a basic income, access to health care and subsidized housing, is proving ill-prepared to deal with the steady increase in working people who do not make enough to get by.

The trend is most alarming in hard-hit countries like Greece and Spain, but it is rising even in more prosperous nations like France and Germany.

"France is a rich country," Mr. Fitoussi said. "But the working poor are living in the same condition as in the 19th century. They can't pay for heating, they can't pay for their children's clothes, they are sometimes living five people in a nine-square-meter apartment - here in France!" he exclaimed, speaking of an apartment of about 100 square feet.

In 2010, the latest year for which data were available, 8.2 percent of workers in the 17 European Union countries that use the euro were living under the region's average poverty threshold of 10,240 euros, or about $13,500, a year for single adult workers, up from 7.3 percent in 2006, according to Eurostat. The situation is nearly twice as bad in Spain and Greece.

While direct comparisons are difficult because of different standards, the Labor Department estimated that 7 percent of single adult workers in the United States earned less than the poverty threshold in 2009 of $10,830 in 2009, up from 5.1 percent in 2006.

France fares better than most European countries, at 6.6 percent, but perhaps nowhere is the phenomenon more startling. While the country seems to exude prosperity, the number of working poor is up from 6.1 percent in 2006, and experts predict it will grow.

In France, half the nation's workers earn less than $25,000.

The median monthly paycheck is $2,199, 26 percent above the average for the entire European Union. But the high cost of living and the difficulty many people face securing affordable housing (home prices have surged 110 percent in the last decade, and most rentals require large advance deposits), leaves a growing number out in the cold.

Ms. Dos Santos and her boyfriend, Jimmy Collin, 22, moved to the trailer because they did not want to live with their families and lacked upfront money for an apartment. Mr. Collin, a high school graduate with some additional technical training, searched for work for more than six months before landing a minimum-wage contract last year, at $1,800 a month, cleaning streets near Parisian jewels like the Eiffel Tower. He gets a small government stipend for low-income earners, but they still found it hard to save after paying taxes and living expenses. The wait for subsidized housing is more than five years.

1 2 Next Page " Maïa de le Baume contributed reporting.

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Blazerbird, Spokane, WA

France and most of the rest of Europe is teetering despite their best efforts to give everyone everything all the time. Meanwhile, those of us in America who still believe we can do better on our own are prospering. I'll keep paying my taxes to defend the world, feed the poor, and educate kids in glorified daycares. My family still has the opportunity to make a future for ourselves. Europe, not so much. April 1, 2012 at 7:37 p.m.Share this on Facebook
lbdiamond, san francisco
Instead of blaming banks, governments and rich people why don't we all face up to the real facts of why everything is going to hell in a hand basket. There are simply to many people in the world.

Millions added every month. Every one of them adding to the physical requirements necessary for their wants. I want cars, food, water, health and to live like the Americans do. In order to just keep up with the additional population the economy of the United States needs to add over 500,000 jobs per month. Same goes for the rest of the world, the economies just can't keep up with the population growth.

I've watched this through the years and never could understand why we continue to let our populations explode while wiping out every species in the oceans and decimating the planet.

In the end it will be issues like water that decide who has the safety net under them. Good luck to all.

Larry Figdill, Charlottesville, VA
It sounds like the French, at least, have let their minimum wage laws lapse and now allow workers to be exploited for corporate profits as we do in the U.S. Working people living in campgrounds and trailers have nothing to do with the social safety net, which are intended to help old and disabled. Rather they result entirely from excessive capitalist exploitation and a lack of worker protections. True in US too, of course, but it has been that way for a very long time and is not an argument that ever gets considered here (The US version is just "you're a loser if you don't make enough money").
Shane Cline, Cincinnati
Let's see. French government spending makes up 55% up GDP. About 20% of GDP is spent on infrastructure, courts, police, national defense, and lots of corporate subsidies. That leaves 35%, which is social spending. People on the political left should be asking, how can there possibly still be poor people in a country where 35% of the national pie is redistributed? The answer is complex. But there is two striking facts. First, most redistribution does not go to people in need. Second, the big spending, big regulation, big taxation, big debt approach has throttled growth, and seriously reduced the number of good opportunities available to people - especially young people. This was true before recession as seen in Europe's high long-term unemployment numbers - especially among young people. The recession has made it worse. If France has the political will to reduce government spending to boost growth, and at the same time direct money to the the needy, then things will get better. In the meanwhile, the upper middle class still insists on free education, free healthcare, and free retirement as some kind of perverse property right.

New moniker, Miami

President Obama is an ardent admirer of European welfare Statism and is rushing with all deliberate speed to emulate them to the urging of an misinfirmed American electorate. It may just be that this excellent article in today's Times will bring some sense to the public understanding of what we may be facing in short order if allowed to go the ultra-progressive way. April 1, 2012 at 7:38 p.m.Share this on Facebook
Why, Pasadena, CA
"Socialism" is a very very widespread misnomer for "society with a welfare net", and the word is so often used to incite panic among those selfish individuals that are worried that they would be supporting the poor, who don't deserve anything from society in their opinion.

These people do not realize that there are many many reasons for one to fall into poverty, laziness is just one possibility. Lack of access to proper education, family violence, or the absence of jobs nearby all contribute to the inability of young people to make ends meet.

It is very sad that ignorance and religious conservatism are blinding so many people in this country, many of whom will need help from society sooner or later in their lives. April 1, 2012 at 7:10 p.m.Recommended14Share this on Facebook

.Doc Who, San Diego
It's comforting to blame laziness; " it can't happen to me, I work hard".

The reality, at least in the US, the biggest cause of bankruptcy is an expensive illness, according to academic research by Prof Elizabeth Warren.

Cespur, Netherlands, Europe
So many anti-welfare capitalism commentators here. The fact of the matter is that "poverty" in Europe is still way less common than "poverty" in the US, and that the people who are in poverty are still way better off in Europe than they are in the US. They still have access to quality health care, and they still can get an education. This article also focusses for 99% on France, which isn't a good example for the rest of Europe. France has, in contrary to countries such as the Netherlands, Germany and Scandinavia, build it's welfare state on the employer rather than the state: the employer has to provide the safety net for the citizen, rather than paying taxes and let the government in turn do this.

The way Northern Europe handles it actually works perfectly, but for some reason conservative Americans refuse to see this. They look at a single given and automatically assume that welfare-capitalism is a bad thing, just as they refuse to see that legalization of soft-drugs and alcohol is way more responsible than making it illegal. April 1, 2012 at 7:10 p.m.Recommended8Share this on Facebook

Luboman411NY, NY
I will say that in all my travels through Europe, the only place I didn't stumble upon poverty and homelessnes in a large city was the Netherlands. I traveled everywhere in Amsterdam, and I mean everywhere (it's a small city), and saw no outward indications of poverty. That pleased me. Keep up the good work in Northern Europe. I haven't been to Scandinavia yet, but I bet it's just as well-ordered and equitable, civilized, and wealthy as what I saw in Amsterdam in 2007. If only the same could be said about Paris, London, and New York . April 1, 2012 at 7:15 p.m.Recommended1Share this on Facebook
RHFJamison, PA 18929
1 in 6 people in America live in poverty. There are almost 50 million people in the US without health insurance. Doesn't seem like capitalism is doing much to improve the common good either. Globalization is causing a world-wide equalization of wages and demand for goods is increasing world-wide raising the prices for all commodities. US has only 5% of the worlds population but uses 20% of all energy resources. Bottom line - US standard of living is not maintainable and the citizens in the lower and middle class are going to suffer the most because their wages cannot compete with impoverished nation wages and therefore cannot keep pace with increasing prices of goods and services from the higher demands. The people at the top realize all the gains because their money, power, control of production allow them to exploit globally impoverished workers where-ever they may reside. Unfettered capitalism is just as evil and dysfunctional as communism. This is not to say that globalization or wealth redistribution to less well off countries is a bad thing, but we have to recognize that its not in our nations best interest to allow wealth to be so inequitably concentrated at the top that for people who want to work hard are unable to obtain health insurance and make a living wage. April 1, 2012 at 7:09 p.m.Recommended10Share this on Facebook
Hard Work Pays, New York City
The article paints a sordid picture of deteriorating conditions. But it does not say how much conditions have deteriorated, nor does it discuss the causes of such deterioration. The reader is left to assume that the situations described are materially worse than they were, say, before the financial crisis, and that they are attributable to the crisis, with little responsibility falling on those described.

A half percent increase in the working poor metric is sad, true .but probably to be expected given the financial crisis we have just been through? And perhaps nowhere near as bad as it might have been?

What to take from this? Perhaps that France has been spending more than is sustainable, given the normalized growth one can expect from a heavily subsidized, 35hr/work week economy?

John G., San Francisco
Most people during their lives have periods when they don't make significant money, whatever their talents or ambition. Low income doesn't usually constitute a permanent state. I didn't finally become financially successful until I was 50 year old. I followed a circuitous path to get there. Without being resilient and flexible I would have never found the work that I love and will pursue for the rest of my life.

Staying sober, staying focused and having a willingness to accept a job maybe below plan gets the employee exposure in the marketplace. The fact is that most employers prefer to hire and promote from among existing workers. You can't get lucky and find that rewarding job if you're not in the game!

Luboman411, NY, NY
Poor Jean. If he only knew that the American Dream has been slowly strangled by trickle-down zealots and free-market ideologues since Reagan. Except for maybe Scandinavia, there are no parts of the rich world that are immune from the vast changes sweeping the global economy, or from policies that seek to take away from the young and poor and give to the rich and old. I remember that one of the first sights I saw in France was of vagrants camping out in this cute little park right next to the Gucci and Givenchy stores on the esplanade in Nice. Reminded me of Californian homelessness to a certain degree. It was also deeply disillusioning since I swallowed French propoganda about it being a "caring welfare state" hook, line and sinker. Homeless people living in parks in Kyoto and Tokyo, Japan, was also a disillusioning sight. And that was in 2007 and 2003 respectively. I bet it's now worse in those countries from my appraisal of how their economies have been doing over the past decade or so.
trkplano, txtrk
And just wait for the GOP to gain power. Many Americans will be in even worse shape. When you think GOP just think 1890's. After all Romney and the wealthy need more tax breaks. If in doubt merely check his tax proposal which amounts to big savings for him. It will have to be paid for somehow. April 1, 2012 at 6:55 p.m.Recommended14Share this on Facebook
Shismar, Germany
Ms. Dos Santos earns at least € 1290.80 a month, gross, assuming minimum wages. Minus some euros for health and unemployment insurance, she and her boyfriend should come out at about € 2000 net. That is about $ 2668,40. Even in the Paris area, that easily rents you a modest apartment and leaves enough for nice living. Children might complicate financial issues if this wasn't France, where there are serious benefits for parents.

They are not poor, not by European standards, nor by French standards. If they were, they would receive additional benefits, including rent help.

I do not have the time to fact check the rest of the numbers in this article, but it does sound like a steaming pile of nonsense to me. I have no clue, where a grain of truth may be hidden below all the misleading assertions, but full time working people have no issue in Western Europe to earn their living.

There are other issues the European labor markets have. Temporary jobs may be one. This is a problem new to countries like France, Germany or Spain where employment used to for live. Low hours employment another. 35 hours is full time, btw This is Europe after all.

Ceadan, New Jersey
The astonishing thing is not that multinational corporations and banks have their sights set on knocking over progressive social and economic governmental structures in Europe and the United States and appropriating and confiscating the wealth of the middling classes. It's what they do if they're not regulated and tightly controlled.

Most shocking is that the populations of these countries are willingly and voluntarily surrendering their economic rights, their modest wealth and their hopes for the future to these malefactors by voting in corporate-controlled governments. Historians of the distant future will no doubt be scratching their heads at how, in the early 21st century, the middle classes of Europe and the United States were manipulated into voting themselves back into the penury and serfdom that their ancestors fought for centuries to escape. April 1, 2012 at 6:53 p.m.Recommended8Share this on Facebook

Abel Fernandez, Albuquerque, New Mexico
Campground living may be new to Europe but it is not new to America. The poor here have been using private and public camp grounds to live in for decades. It is a step up from living in cars, under bridges, or on the street. Just ask Park Rangers or Forest Service officials about all the single men and women and families living in trailers deep in the woods Many move from state to state in their rvs and trailers taking short term jobs. Many of these people work two and three jobs but still cannot put enough together to rent a house or an apartment. Contrast this with the fact that a man with an elevator from his garage to his 8000 square foot house, a man who wants to eliminate every safety net for the poor and disabled, a man who thinks it is humorous that his father threw thousands of people out of work, will most likely be nominated President of the United States. April 1, 2012 at 6:52 p.m.Recommended20Share this on Facebook
aggie99, Texas
European socialists made a pledge in the 1970s to create absolute security for the baby boom generation. And they've fulfilled that pledge. But in the process they've made it almost impossible for the young to board the same gravy train. I can't believe it when I see young people in Spain protesting the very labor reforms that will give them a chance at a job.
Shirley S, Minneapolis
Don't you know? The capitalist's dream is everyone working for $8 an hour. What is happening in France has been happening in the US since Reagan. When Reagan broke the air traffic controllers' strike, it sent a message to business. They listened and have accelerated the process. Since then we have seen continued weakening of unions, the death throes of the social contract, disappearing pensions, (replaced with 401ks), impossibly expensive health care costs, whether paid for by insurance or not, housing costs that have skyrocketed, along with commodity inflation a commensurate downward spiral of political discourse, basic literacy and basci human civility.

The macro trends are clear, but get drowned out by the right-wing fringe, which is intent on smaller government, except when it comes to a woman's life, activities in the bedroom, and legislating "intelligent design" nonsense.

It may be that the French and other "socialist" states, that have had a strong safety net, would have been all right, but for the international bankers who managed to blow up the economy on a world-wide basis.

Pathere

Wait. You mean to tell me that government imposed solutions on the economy don't work? Who woulda thunk? April 1, 2012 at 6:41 p.m.Recommended4 Share this on Facebook
rick hellebrandomaha, nebraska
I can promise you that Amy has never lived in a "socialist," by which she means welfare-capitalist, country. She, like so many in the U.S., has been indoctrinated. I have lived in France and Denmark, and in fact they work very well. The problem of French capitalists scrambling for more profits by cutting permanent jobs and replacing them with temp workers is something else.

Staccatony, ny

On second thought, all these campground people should move their campground to Bastille. They wouldn't dare try to expel them from there.
Scorpio69er, Honolulu
"Many, particularly the young, are trapped in low-paying or temporary jobs that are replacing permanent ones .the situation is set to worsen. As .government responds to the crisis by pushing for deep spending cuts to close budget gaps ."

Sounds just like the United States.

This is what the shifting of once good-paying jobs to wage slaves in Communist China -- euphemistically known as "globalization" under the banner of "free trade" -- has wrought.

Staccatony, ny
This is the failure of the Ruling Class everywhere. They are corrupt, from top to bottom. They only care about themselves.
Max, Manhattan
Liberal politicians think that passing above-market minimum wages and benefits is a kindness to the working poor. It isn't. It simply results in the contract labor phenomenon. Wages, like water, have a horrible way of eventually finding their own natural level.
SW, San Francisco
How unfortunate that Ms. Dos Santos can't work more than 35 hours per week, even though she wants to. The French wanted a shortened work week, which has had the effect of capping the earnings of those industrious employees who would cheerfully work more if it would bring in more income. Despite what the intellectual elite in America believe, people all over the world still clamor for the freedom to work hard, move up the food chain and obtain the American dream. April 1, 2012 at 6:32 p.m.Recommended4Share this on Facebook
Tim Bazzaro, Houston
We are not that far here in the U.S. from having the same situation. It will be a two tier society. Rich vs. poor, all over the world. 5% will be only rich, the remaining will be poor of all sorts. Those not so poor and those in extreme poverty.
Amy, Brooklyn
Europe lived for decades believeing that socialism would improve the common good. In fact, it doesn't. Eventually, it drives the economy into a tailspin and it robs the people of the spirit to innovate. They result is actually increasing poverty for everyone.
James, PA
What? The fact is that many times less people in Europe are living on the margins as working poor, the type of people profiled in this article, than here in the United States? This is precisely because of socialistic economic policies.
mfordatl
Wait a second there Amy. The poverty rate in France is still lower than in the United States, without signs that either will be reversing the trend anytime soon. This is a problem with the global economy.



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