Capital Always Wins

TW: Folks for millenia have been getting pissed off about capital screwing labor. Our nation revels in worshiping capital (and its associated derivative- credit). This go round has been especially delightful as the capital markets figured out how to absorb increasing proportions of folk's wealth through pension funds, 401Ks etc. Then crashed.

Now "Wall Street" is roaring back far ahead of the median household (which has barely moved forward for forty years anyway). There is populist anger. But the brilliant folks known as Americana are chiefly orienting their ire at those trying to initiate universal health care, maybe do some financial regulation and raise taxes on the wealthy. Things which would actually help mitigate the capital v. labor imbalance.

From Randy Forsythe at Barrons via the Big Picture blog:
“THE RISING TIDE LIFTS ALL SHIPS, but the galley slaves aren’t feeling it. They’re rowing harder than ever to make up for their colleagues who have been thrown overboard (getting rid of that extra weight improves the vessel’s efficiency).

Now, after a long spate in the doldrums, the captain has called for those still manning the oars to pick up the pace to move some cargoes, which had been notably scarce for well on a year and a half. It seems that money had been showered down like manna from heaven (this was before helicopters). That it came from a printing press or by pledging the credit of the land mattered little. Some of the money was spent, which, in turn, brought forth new orders of goods, since the storehouses had been emptied. And thus the need for the slaves to pick up their pace.

It has all put dough in the pouches of the owners and the captain of the ship, but there isn’t much for the slaves. And, no surprise, that’s caused some grumbling below. Not that there’s much the galley slaves can do about it, lest they become the next to get tossed overboard.
The genius of American business for doing more with less has been evident in the parade of earnings reports showing profits improving far more than the revenue that produces them. The secret: Productivity soared at a 9.5% annual rate in the third quarter, a stunning increase that was nearly half again as much as economists had projected. Business cut labor costs at a 5.2% annual rate, with total hours falling at a 5% pace. Fewer workers worked fewer hours.

But for the laborers, it’s been another story entirely. The unemployment rate shot up to 10.2% in October, the highest since 1983, when we were coming out of what had been the worst recession of the post-World War II era. Even the doleful double-digit rate understates the joblessness; more folks are dropping out of the labor force or are among those having to work part-time involuntarily. If you add them to the army of the unemployed, you get what the bean-counters euphemistically call an “underemployment rate” of 17.5% last month, up a full half-percentage point from September.”