Obama’s Work for Almost Free, Maybe You Get Hired Program

I so often criticize the New York Times for doing stenography for officialdom that I feel compelled to point out a case of good reporting on an Obama initiative I’ve seen criticized in other venues and failed to shred on NC.

The Times piece focuses on a Georgia “tryout” program in which workers still on unemployment get to work for free for prospective employers for a maximum of 24 weeks (correction, 8 weeks). The employer is under no obligation to hire anyone. Needless to say, this program is more than a tad skewed in favor of companies. But it costs no money and creates the impression the government is Doing Something. So since no one in DC wants the government to spend more money, particularly on little people, this gimmick is perfect fit with the “let them eat cake” zeitgeist.

Key sections of the Times piece:

….economists say there is little evidence that participants find work faster. And a lack of promotion, limited oversight and budget constraints have limited the program, Georgia Works, to a tiny portion of the state’s nearly half a million unemployed workers. Only about 120 people have been hired because of it this year…

Since the program began in 2003, only 18 percent of those who completed the training have been hired by the employer that trained them, according to data released this week by the state labor department. More recently, job placement has declined to about 10 percent. New Hampshire, North Carolina and Missouri report far better results from their programs, though they are still quite small. The Obama administration estimates that if every state opted in, the program would cost $1 billion to $1.5 billion.

Supporters of the effort say that hirings are not the only measure of success. The program keeps the unemployed tethered to a workplace environment. It can provide training — under federal labor laws that forbid unpaid labor, it is required to, though the state labor department’s literature refers to it as a “free trial” for employers.

The part I find sus is the “training” claim. While the article does provide an example of a worker who learned how to write smartphone apps, a lot of “training” new workers get is “how we do stuff around here.” Learning the ropes is important to becoming productive in any company, but a lot of it is not transferrable to other employers. The story confirms my suspicions:

Georgia State has hired 37 workers through the program, out of 54 who have begun trial periods. But the overseers of the program there acknowledged that for many, the program was more valuable as a foot in the door than as a learning experience.

The Obama Administration is going to sweeten the pot a bit, but minimum wage pay is well below a living wage in most of the US:

Unions and labor advocates like the National Employment Law Project have criticized the program as free labor for employers rather than training. The White House has tried to neutralize that complaint by ensuring that under its proposal, called Bridge to Work, the worker would receive the equivalent of minimum wage. States may apply for money to bolster unemployment benefits and to provide stipends for travel and child care, which would come out of a $4 billion federal fund meant to cover that and other re-employment programs in the jobs bill.

I suspect that the efforts to tweak the program will reduce what little impact it might have. The whole premise was to give employers a free look at workers. Even then, the results were underwhelming. The Administration claims it will monitor whether employers actually hire people and will kick out employers who take too many look-sees, but that still does not mean employers won’t intentionally or unwittingly abuse the initiative.

And who are we kidding? A program that does not create new jobs, and allows workers to be paid less than they might otherwise be if a company had to hire them, actually had the net effect of REDUCING income paid to workers. The only impact may be changing who gets hired (program participants v. others) and perhaps the company saving some money by not having to run ads that might be plowed back into wages. But the latter effect is likely to be trivial.

This program is further proof of why Obama deserves to lose in 2012. As our Richard Kline said:

To me, the best possible outcome of the present market trauma would be for a spectacular implosion between now and November, 2011 turning Barack Obama into a certifiable carbon shadow on a blast wall such that the Democratic Party has to abandon him on the lip of the primary season, leading to a wild scramble for the Democratic candidacy.

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  1. seabos84

    As someone who grew up on welfare in the 70’s and who has broken the 50k a year mark 2 or 3 times in my life (up to …51 or 52k!) and who has changed careers and who has a mountain of debt –

    yahoo! instead of spending my time unemployed trying to get better skills or a NOT complete piece of shit job,

    I get to stack boxes for 6 bucks an hour!

    thanks 0bummer – I expect this shit from the fascists.

    “a boot stomping on a human face forever”


    1. JasonRines

      You got it Seabos, forced labor is a hallmark of Fascism. The people are better off with collapse and returning to freedom than supporting the beast but fear the uknown. I’ll take the wheat pasta and yellow cheese road for a year of the harsh difficulties in exchange for my freedom. No one need starve.

    2. Sev

      Right. And we want to evaluate your performance, bootwise. We like people who stomp with enthusiasm. Are you a people person?

  2. YankeeFrank

    What’s amazing is that I am still arguing with people who say “he’s the best we can do” and “if the republicans take over it’ll be worse”. I’ve asked them what they expect to get of benefit out of a second Obama administration and they just ignore the question. I actually have to say I don’t think W would have ignored such high unemployment for as long as Obama has. Yes the supreme court worries me, so that’s why I agree with Richard — its time for Obummer to bow out and let someone else have a try.

    1. alex

      “I’ve asked them what they expect to get of benefit out of a second Obama administration and they just ignore the question.”

      As someone who is no fan of Obama but fears the R candidates even more, I’ll answer. It’s not what I hope Obama will do, it’s what I fear the R will do even worse.

      More tax cuts for the rich (to fight the deficit, of course). Cutting federal spending that provides some stimulus. No further stimulus. Gutting the few good provisions of Obamacare (I think they’re there – look closely) and leaving the more onerous ones, hence making it even more like Medicare Part D. Bigger cuts to Social Security and perhaps even privatization.

      I admit it’s getting harder to tell the difference. An honest Obama slogan would be “I won’t screw you quite as badly as my opponent”, but I certainly can’t see an R being any better.

      The only way an R would be better is under the theory that things have to get worse in order to get better. An R in 2012 so we can get a real Democrat in 2016. But are there any real Democrats left? Would we get another Obama in 2016?

      1. doom

        Welcome to Latin America Norte. No party represents you. It’s time we gave up this pathetic trust in electoral politics. Civil Society organizations will have to do the work our parties pretend to do: witholding consent of the governed, imposing world standards for governance, and crossing borders to undermine the predatory parts of state.

      2. wunsacon

        If the GOP does any of the things you fear they will, won’t the situation for Americans become worse enough to cause riots and, finally, some change?

        >> More tax cuts for the rich (to fight the deficit, of course).

        Tax cuts for the rich = more deficit spending = currency depreciation = food commodity price rise = more misery bottom 90% = riots.

        >> Cutting federal spending that provides some stimulus. No further stimulus.

        Less printing = cash offers better ROI than investing = businesses cut back hiring = more misery bottom 90% = riots.

        >> Gutting the few good provisions of Obamacare (I think they’re there – look closely) and leaving the more onerous ones, hence making it even more like Medicare Part D.

        Will Repubs cut the individual mandate? I hope so, because I don’t like the idea of government forcing anyone to buy the services of a corporation. But, will Repubs risk hurting corporate profits lost by cutting the individual mandate? Hmm…

        >> Bigger cuts to Social Security and perhaps even privatization.

        Harms the GOP’s own base of older voters.

      3. Tertium Squid

        If McCain had been elected I don’t think we’d be fighting in ten-odd wars right now, because you progressives (overall) would have actually opposed an R doing it.

        But who knows. We are generally screwed.

          1. Jesse

            You didn’t read his whole statement. President McCain wouldn’t have started 10 wars b/c progressives would have opposed it.

            Instead, we have a Democrat in the White House, which means that most Democrats support out of partisan loyalty and most Republicans support because they’re war hawks. (Though there are Dems who are war hawks for any war too.)

    2. Yearning To Learn

      @Yankee Frank:
      In terms of economics, there is little difference, and in fact Obama is worse than Republicans, because he can do things no R president could do (like cut Social Security).

      However; socially there are some differences if you are not a straight white male.

      I’m in MN, and have watched Bachmann for many years. She is CRAZY, and she is a zealot. Make no mistake, a President Bachmann could very well lead to “re-education” camps for gays as example. People scoff, but her clinics are trying to do it as we speak. she is a somewhat charismatic and clearly poorly informed bigot attempting an American Theocracy.

      Ron Paul is AGAINST the Civil Rights Act.

      Rick Perry is ok executing people, even if some of them may be innocent.

      IMO, many straight white people really don’t get it. to them it is an outrage when a child gets a pat down by airport security.

      To those of us who are not white, we see police shooting our kids in the street. and although many of the kids may be guilty, and some may look like “scary gang bangers”, let me tell you by PERSONAL experience that some are not. (and I would argue it is not ok to shoot someone becaue they “look” like a gangbanger… because “looking” like a gangbanger often just means that you’re not white).

      I was stopped by police with handgun drawn multiple times the first ONE MONTH of my training at the world famous mayo clinic. All for minor traffic violations (that I did not do). how many of you have been stopped by a cop with his GUN DRAWN on you, because you have a tail light out. how many of you have been accused with a gun pointing in your face of swerving drunk and running a red light at 9am in the morning while wearing surgical scrubs? I have. How many of you were vindicated ONLY because your key card that lets you out of the garage proved that you couldn’t possibly have done what the cop lied about? again, I have.

      it came as no surprise to me that after I left Mayo that a cop shot a MEDICAL DOCTOR from the mayo clinic in the face as the doc was trying to get his id. The infraction: broken tail light. Of course, it was called “an accident”. the cop didn’t TRY to shoot the guy in the face, as he was banging the gun against the guy’s window. oops…

      This stuff comes from top down.

      So although I hate Obama more than any modern human president except Bush, I as a non straight white male don’t really have an interest in being shot with firehoses or having my biracial family use separate toilets at functions.

      and although many straight white people really don’t think about this on a personal level, those of us shot with fire hoses in the past do.

      Unfortunately, this is how effective the FALSE Repub vs Dem dichotomy is… there is no hope.

      I have as much chance of voting for Bachmann as the Religious Right does of voting for Osama Bin Laden.

      And thus, I completely waste my vote on Denis Kucinich every year, and perhaps Bernie Sanders next election.

      It’s exactly how both the R and D like it.

      American “democracy” in action.

      1. Jim Haygood

        Ditto. YTL might enjoy the always-literate blog of Will Grigg, a half-Mexican who probably encounters more than his fair share of prejudice in Idaho where he lives. Police violence is one of his recurring themes, as in this blog entry from August:

        In every encounter between a police officer and a “civilian,” Jack Dunphy [an LAPD officer] writes, the officer is “concerned with protecting his mortal hide from having holes placed in it where God did not intend. And you, if in asserting your constitutional right to be free from unlawful search and seizure fail to do as the officer asks, run the risk of having such holes placed in your own.”

        What this means is that a Mundane who displays anything other than abject servility is perceived as a threat to “officer safety” – and, by Dunphy’s calculation, is a suitable subject for immediate termination.


        1. Billions for me, None for you

          It’s called termination at will. Latin American police have long practiced it, but like loyal dogs they don’t turn on their masters. Finally, American police are catching on to the enlightened ways of their enlightened Southern counterparts.

        2. Fraud Guy

          My wife (white female) was living with her mother prior to our marriage, and one night, at 2 am, was awake and restless and decided to clean the detached garage (don’t ask).

          She was startled by a male voice saying “Don’t move” while she was holding a garden shovel. When she was able to turn around, she saw the police officer pointing his gun at her.

          Later, she told me that, since he hadn’t declared himself as a police officer when he made his comment, that if she had turned to hit him with her shovel, that he would have been at fault.

          I told her, no, he would have shot you and claimed that he had identified himself, and that you assaulted him, and after a brief investigation, would have been back on the job.

      2. F. Beard

        Excellent comment. Thanks.

        Ron Paul should have better sense than to attack the Civil Rights Act. It show his priorities are misplaced at the least.

        1. Jesse

          This is not a priority for him, the only reason it was even brought onto the national stage (for mere minutes too) is because his son set off a firestorm whenever he made similar comment ~1 year ago.

        2. Fraud Guy

          Actually, I have spoken to several of his local fans. They support him in this, because they feel that they should have the right to refuse business to anyone for any reason, including race, and the government has no right to interfere.

          They then claim that doing so would hurt their business, so they wouldn’t, without thinking of the fact that pre-Civil Rights, that it probably would not have, which is why we have it.

    3. TK421

      ““he’s the best we can do” and “if the republicans take over it’ll be worse””

      One has to stand for something. The Republicans will always be worse–that doesn’t mean that anything the Democrats do at the same time is acceptable. Our country needs help, not “well the otehr guy is worse”.

    4. jake chase

      Anyone paying attention in 2008 knew BHO was a fraud, a cartoon character manipulating affirmative action and liberal white guilt while remaining a stooge to the power structure that plucked him from nowhere and selected him on his one ability: to blow smoke up the public’s ass. He was never anything more than Al Sharpton without the conk.

      As for what happens next the answer is austerity, whether or not accompanied by an asset bubble or a crash. Debt which cannot be repaid will not be repaid. This means mortgage debt, Eurozone debt, municipal debt. The only debt which can be repaid is soverign debt owned by issuers of fiat currency. Line up suckers to get your ten year treasuries at 2 1/2%. Or take your chances buying and holding corporate stocks issued by those behemoths which have to win in the long run because they hold all the economic and political cards. Trust the Fed to juggle the markets by buying whatever drek banks and hedge funds refuse to hold. That is what the Fed does.

      As for employment, all those jobs which have disappeared are not coming back. Sooner or later there will be Federal leaf raking creating a new class of politically connected beneficiaries. For everyone else, welcome to free enterprise where labor is no longer at a premium. There are a million individual solutions to this problem but there is no group solution. Each individual must find something he can do that others are willing to pay for. It hasn’t been that way in America for over one hundred years, but it is going to be that way now. Political solutions are reserved for those who can afford the politicians up for sale. High school civics lessons are bogus and campaign rhetoric is nothing but hot air.

      For full employment we will need another global war or a national insurrection, and then the jobs will be shooting and clubbing other poor bastards suffering through the same disasters afflicting the unemployed now.

      It isn’t much to look forward to.

  3. Richard Kline

    Workfare all over again, i.e. a trial run for neo-serfdom where the impoverished provide free labor for their masters for an extended period with the _potential_ to be hired if they’re sufficiently servile for long enough. Sure, employers would _love_ to weed out malcontents and problem employees before they hire. And anyone sufficiently desperate and lacking in self-worth to provide SIX MONTHS of unpaid or trivially paid labor to a boss is unlikely to be the sort to cause them any problems afterwards since already broken to the yoke by definition. Question: Why does the government have to give the imprimateur of authority to already too powerful bosses?

    Anyone anywhere who has the remaining delusion that Obama is or was an ‘activist’ of any kind need only look at this disgusting exploitation of the most helpless to snap back to the vile reality. Like the rest of the ‘Nude Democrats’ whom Obama has done everything to copy, his contempt for the poor is as boundless as it is unctuous. The man has no clue what slavery looked like since someone else who got their head busted in for trying opened the door he’s skated through his whole life.

      1. alex

        “he’s certainly no democrat”

        That’s for sure, but how many Democratic politicians are actually Democrats these days? Harry Truman is rolling over in his grave.

        1. Clonal Antibody

          And Harry Truman was forced on to FDR as a VP because the PTB were afraid that Henry Agard Wallace http://en.wikipedia.org/wiki/Henry_A._Wallace would become President — most people forget that — Harry Truman was already a step down from FDR and Henry Wallace.

          From – Henry Wallace – A Biography – http://www.spartacus.schoolnet.co.uk/USARwallace.htm

          Henry Agard Wallace was born in Adair County, Iowa, on 7th October, 1888. After studying at the Iowa State University he began work on his grandfather’s journal, Wallaces’ Farmer in 1910. His father, Henry Cantwell Wallace, served as Secretary of Agriculture (1921-24) under Warren Harding and Calvin Coolidge.

          Wallace became editor of Wallaces Farmer and during the Great Depression advocated government intervention in agricultural production. He urged his readers to vote for Robert LaFollette and his Progressive Party in the 1924 presidential election.

          Although previously a Republican, Wallace supported Franklin D. Roosevelt during the 1932 presidential campaign.

          Wallace’s left-wing views made him increasingly unpopular in the Democratic Party and Roosevelt came under pressure to drop him as his vice-president in 1944.

    1. Jim Haygood

      ‘And anyone sufficiently desperate and lacking in self-worth to provide SIX MONTHS of unpaid or trivially paid labor to a boss is unlikely to be the sort to cause them any problems afterwards since already broken to the yoke by definition.’

      If I could apprentice myself to, say, Ray Dalio for six months at no pay, I’d do that in a New York minute.

      Fedgov law forbids consenting adults from agreeing on work at no pay? Damned shame — so call me a ‘volunteer’ … a hedge fund volunteer. (I’m the dude on the right, wearin’ the fuzzy lampshade:)


      Dunno about self worth, but I reckon the net worth would be rising pretty rapidly, just from absorption of the rarified high-level macro view.

      Are you listening, Ray?

      1. Typing Monkey

        If I could apprentice myself to, say, Ray Dalio for six months at no pay, I’d do that in a New York minute.

        Me too (well, maybe not to Dalio, but the general principle remains).

        But I believe Yves was also against rich young volunteers getting to pad their resumes with impressive volunteering jobs while their poor counterparts struggled to take any job they could get, without the commensurate prestigious resume boost, so that might draw her ire as well…

        As somebody noted below, I don’t see how this program is much different than the slave-labor type pay in pursuing a Masters degree or a Doctorate.

    2. sleepy

      I’ve been on the dole now for about 15 weeks, and will most likely be on it for awhile.

      In the past I’ve worked (unpaid) as a union organizer.

      If I should be so lucky as to get one of these plum “training” positions, my goal would be to begin an immediate organizing drive at the workplace.

      Mr. Obama would be pleased, no?

    1. Melody

      Yes, there are prisons . . . and some of them pay their “laborers” (pennies per hour . . . but hey, their housing/maintenance/healthcare costs are cheap–for the laborer).

      1. Billions for me, None for you

        You might be wondering: why do prisoners get paid to work, but not me? The reason is to subsidize our lucrative price gouging junk food and telephone service rackets we have going on in there. It’s not an ideal situation since we still aren’t allowed to loan shark in prisons, but we’re actively lobbying the pols about that.

    2. another

      Scrooge was ashamed when these words were later repeated back to him. Our modern Scrooges are incapable of shame. Such progress we’ve made!

  4. rf

    What if the government continued unemployment insurance payments while the person worked for free? Or should the government just force companies to hire people at some specified wage?

    1. Procopius

      Maybe I misunderstood, but I got the impression that they DO continue to receive unemployment insurance payments while “working for free.” It’s free to the companies that use them, but the people do get money during this time. They just are not looking at other places for work.

  5. Kevin de Bruxelles

    Maybe I have reading comprehension issues but what I take from the NYT’s article is that the program has a maximum duration of eight (8) weeks with a maximum of 24 hours worked per week.

    I went through a program like this when I was an immigrant in Sweden. It helped me alot especially with the language and workplace culture. At the end of my term I got a job with the local urban planning authority. I think programs like this are quite common in Europe and not looked down upon as oppressive. Of course national indutrial policies would have a greater impact on employment.

    Since neither side of the political divide will do anything about the real drivers of unemployment – the simultaneous off-shoring of jobs to cheap labour countries and in in-shoring of cheap third world labour — then the government is pretty much stuck with programs like these that at best can only have a minor impact.

    1. alex

      Who did you work for in the Swedish program? What was the hiring rate? The devil is in the details.

      I know plenty of people that would do this if it gave them a decent chance at a job, but it just sounds like temporary free labor.

    2. Billions for me, None for you

      There’s an idea: integrate Mexican immigrants using this program. I love the idea of replacing Americans with low wage Mexicans.

  6. Middle Seaman

    The Obama problem is exacerbated by the almost total collapse of the Democratic party. Way before Obama, when W was on the ropes, the Democrats still voted for almost everything he wanted.

    Perry will be worse than Obama, but it seems that our choice is between Aids and brain cancer; we have no decent options. There is no Democrat on the horizon that wants to and can run.

    Sadly and not constructively, we look back at the 2008 primaries when many of us saw Obama for what he is. What the hell possessed those fake, dim witted progressives to support their hoodlum?

    1. citalopram

      Someone earlier this week commented on pulling the lever for Perry. I’m inclined to agree. Let’s add a little fuel to the fire! Yee haw!

    2. nobody

      Some people saw him for what he was but saw the likes of Clinton, Edwards, etc as well.

      And no the answer is not to be found in names like Kucinich or Sanders.

  7. Bam_Man

    If this program compelled the “employer” to provide food and shelter, then it would roughly equate to what used to be called slavery. But this is an even better deal for the “masters”. And it’s being piloted in Georgia. You can’t make this stuff up.

  8. Dave of Maryland

    Politicians have become hysterical. They will go on shoveling money at the banks and stiffing everyone else, until they are forcibly stopped. That’s the nature of an hysteric.

    They do this because they’ve always done it: feed the rich, starve everyone else. It’s the only thing they know. A guess would be they’re presently both hysterical and in full panic mode.

    The key words are hysterical and forcibly. Riots will merely make them more hysterical.

    Elections in such conditions will simply be an aggravation. Protesters will be encircled by police and marginalized. A general strike could be a solution, but if any leader emerges to promote it, all means of communication will be shut down to prevent it.

    Before the crash, my little mom’n’pop grossed $3200/week. That’s not net. Gross. Not much but it was okay. This past week it was $910. This isn’t local money. I’m in international mail order. Sauve qui peut.

  9. brian

    its too bad we couldn’t have applied a similar program to obama before he was allowed to run for president
    we could have checked him out before all this

  10. Greg

    Businesses have come to college campuses for years looking for “volunteer” labor and trying to get the schools to help them find “interns” perhaps even for college credits. As a faculty member, I’ve advised many such arrangements, both paid and unpaid and would have to agree that overall, the unpaid arrangements are not healthy for either party. Typically, the volunteer quickly feels abused and the work supervisor has little incentive to provide meaningful work experiences. That changes rather significantly when the work is paid.

  11. Crazy Horse

    The solution to the unemployment problem is quite simple. We need more prisons. This will provide the unemployed with a real alternative to working for no salary, living under a freeway overpass, and starving to death.

    If we simply built more prisons it would put unemployed construction workers to work. Then when they are laid off they could go into a McDonalds, order a Big Mac, refuse to pay for it, and be sentenced to life in prison. They would still have to work for no pay, but at least would have a roof over their heads and macaroni and cheese for life.

  12. PhilWong

    Democrats? What Democrats? They no longer exist.

    Better than working for free are the multiple multiple level marketing scams that have been around forever.

    “Work for the environment!””Attend a seminar on how”.
    OK, maybe worth checking out. A new Mercedes roadster prominently parked at the front of the hotel’s rent a conference room and a stunning blonde with perfect teeth giving out name tags to those entering.

    Lots of Hispanic busboys and defeated Americans with a shard of hope in their eyes, pens ready to write on yellow legal pads.

    The speaker comes out and rouses everyone with tales of riches to come, how the line of Equinox products will save the world, how natural their are, how safe etc.

    Busboys with garages full of “product” that they had bought in the hopes of getting a Mercedes roadster…another tragic scam on the public.

  13. Crazy Horse

    It’s a sound bite world. Somehow kleptocracy has that intellectual elitist ring to it. Must be a commie word. Now, Vulture Capitalism— there is an image the sheeple can relate to!

  14. Billions for me, None for you

    I hope this program really takes off so I can lay off my paid employees and replace them with unpaid ones.

  15. Shankara

    I think Yves is being a bit tough on this program. This “Corp Corps” as it could be called, might just provide important assistance to corporations across the land that’ve had issues during these grave financial times. Not knowing where to invest billions in hoarded cash while being provided a free source of manpower could mean the difference in simply “thriving by” to having a banner year.

    Besides, these laborers can’t possibly have anything better to do with their time. Having more than likely already lost their homes to foreclosure, they have no mortgage payments to be concerned with, therefore have very little need for actual money. To desire anything more from life would be arrogant and wasteful of the limited resources allocated to this class.

    1. Yves Smith Post author

      There is NO evidence that this program has increased the number of jobs in Georgia. And why should it? An employer is not going to create a job because he gets a free or cheap “look-see” at a worker. That’s a trivial subsidy compared to a major decision.

      The net effect of this job is to:

      1. Lead employers who participate to favor workers who come to them via this program over other potential hires. So all your are doing is helping one group of prospective workers v. the rest

      2. Have employers pay LESS to workers overall. They get to pay less for the trial period. As readers pointed out a above, and I did in the post, some employers are bound to game the system, whether deliberately or less nefariously (being fussy re who they hire, or kidding themselves re their willingness to add new workers).

      We need more jobs, period. This program does nothing to help overall employment, per 2 it may actually lower the money spent on workers in aggregate at the margin. This is worse than a sham, it might actually be a net negative.

      1. Typing Monkey

        Ummm…I can’t be sure, since I didn’t post the above comment, but I think you are taking what was meant to be a sarcastic post at face value.

      2. Stepph

        I agree with Typing Monkey, the above seems to be satire.

        But, as always, we appreciate how quick on the draw you are Yves.

  16. avgJohn

    “I suspect that the efforts to tweak the program will reduce what little impact it might have”

    Yes, the program as outlined above is a terrible idea but just maybe it could be improved.

    What if there was a requirement that any company participating in the program was required to share the profits with the workers? So even though the initial pay isn’t great, at least they have an opportunity to share the rewards for their efforts in the company’s success.

    In addition, support it with generous tax credits based on payroll and capital investments (for program participant companies only) and special tax incentives for small community banks to provide financing (Wall Street not welcome here thank you). And no government guarantees on loans, as we know that con men would end up forming community banks for the sole purpose of defrauding the program.

    Seems to me that there are a lot of small businesses up against the ropes in this economy, struggling for financing, and this program could be beefed up and made an attractive alternative to inevitable bankruptcy.

    Maybe the economists types and government type wonks here at NC could build on this idea with some suggestions that would at least make it reasonably attractive to all participating parties and give it a reasonable chance to succeed?

    1. avgJohn

      And here is another idea.

      For years I have harbored a resentment to the very idea of temp agencies. It seemed to me that they were instrumental in destroying the existing social contract between companies and their employees.

      How about extending this concept to participating temp agencies. That is a special program for temp agencies that met the profit sharing guidelines of the program. Think about it. There would be tremendous incentives for employees working temp assignments to become permanent employees of the temp agencies if they were sharing in the profits of their labor, and given an alternative who wouldn’t rather work for a temp agency that offered profit sharing and treated the temp worker as a partner rather than a human commodity.? These same tax credits would be offered to the employee owned temp agency.

      For example, offer generous payroll based tax credits, say up to a limit of 75% of what that employee would receive on unemployment insurance or food stamps and government support. This would satisfy the conservatives that it would be a better alternative than unemployment. And possibly a special health insurance program offering tax credits for participating doctors.

      Remember, these tax breaks would be for the workers. Putting people back to work with dignity and opportunity would benefit the entire economy. And these tax beaks would allow them to offer very competitive pricing against their private only competitors, hopefully running them out of business.

    2. Mel

      “What if there was a requirement that any company participating in the program was required to share the profits with the workers? So even though the initial pay isn’t great, at least they have an opportunity to share the rewards for their efforts in the company’s success.”

      Every story we’re hearing now says that small businesses won’t hire because they won’t be able to sell the product. They won’t sell the product because there are no buyers. “Hiring” people at no pay is a tacit admission that there will be no added sales, and no added profit.

      Reducing cost of employment is not going to move anything. Things that get actual money into the actual Main St. market are the kind of measures that will help. Things that keep the money from vanishing into Wall St. after one lap around Main St. would be good, too.

      1. avgJohn

        What comes first, the chicken or the egg?

        Mel, IF there was a program that provided this type of government support, even I would seek financing for a a home-based internet employment agency, centralize the administration duties such as payroll and government filings at my own home computer, offer online reporting to field employees, and operate it on a regional basis over the internet. There are a lot of talented unemployed people in marketing, IT, internet-based technologies, and so forth that would pitch in, if given the right incentives (ownership).

        I would also be a “working partner” in that I would contract my own labor out at least on a part-time basis.

        Once the business was off the ground, some employees (partners) in the agency could devote full time efforts to administration, IT, and marketing duties. But as far as the pay scales goes, everyone shares in the earnings regardless whether they work in the field as a temp or for the agency (remember, everyone is a partner). The degree of company democracy would be up to the employees, those companies that treated the partners the best would attract the best.

        I could even envision entire networks of these small business “worker partnerships reaching out and contracting with each other and building vibrant small business communities owned by the employees, all across America.

        Is it going to happen with this program. No! Am I just dreaming, probably.

        But some how conservatives makes the argument that cutting taxes for business will create jobs now. I just want to target those cuts so that the benefit is realized by all of the people.

        Heck, some unemployed small business executives could even form “working partnership” consulting firms, offering turn key set up for setting up such businesses. They certainly offer turn key consulting for off-shoring work.

        And for federal, state, and local infrastructure projects, what could be better than forming such “working partnerships” with unemployed talented construction people and requiring these contracts to be let out to these types of companies? We all know about the price gouging and cronyism that goes on with government contracting. It’s not what you know, it’s who.

        Some how capital gains tax of 15% is a good idea for investors of multi-national corporations, corporations that employee most of their work force offshore and direct all major capital investment projects to other countries as well. Well, with properly directed tax policy, perhaps we can put some heat on Wall Street and globalized companies?

        1. Mel

          I fully agree. I’m trying this myself in a small way, right now. The current problem is finding people who’ll pay money to have things done. It’s such a natural idea that in an active economy, we’d probably neither of us be talking about it at all; as much time as we cared to put in would be taken up doing it.

          Per my remark about demand in another comment, I think the peculiar situation we’re in is that the people with money and the people with a yen to produce are completely different people.

          Now that I’ve thought about it “is not going to move anything” is pretty stark. There must be some projects at the margin that will get viable with e.g. lowered payroll tax; anything good is worth doing. As hyperbole goes, though, it was good hyperbole.

  17. hello

    obama campaigned on raising the minimum wage ( http://www.youtube.com/watch?v=q5voSHCn6NE ), which could’ve happened easily had it been included as part of a grand bargain w/Repubs + conservate Dems to lower payroll taxes, temporarily extend Bush tax cuts and expand off-shore drilling—-every single policy points that Obama literally gave away for nothing in return.

  18. Sauron

    Agree there is a substantial ick factor…but I’m also struggling to see how this is in principle different from education. Sure corporations/buinesses profit off of your labour, but universities profit off of your tuition and neither offers much of a path to success.

  19. PQS

    Ouch! Tough room here today.

    If I understand the program correctly, it is limited to a certain number of hours per week and the participants still get their unemployment money, paltry as that may be.

    Of course the obvious “morality” play here is offensive: that somehow people on UI are “lazy” and just need to work in order to BE employable, which is an insult to the tens of millions of unemployed who are perfectly employable, if there were jobs!

    However, here in WA state, we have a progarm called “Shared Work” which I actually participated in. When things got slow (as they did in construction starting in 2009), my employer signed me up on Shared Work. (I actually did the research on it and asked for it, because I thought it would be a good stop gap while things were slow….)

    I worked 24 hours a week at my regular pay and continued my benefits, and the rest of the week I collected UI for 16 hours. Gave me a change to spend some time with the family without the total freefall of unemployment. Yes, it was a pay cut, but I kept my insurance and it wasn’t as big a pay cut as UI was. Which I also enjoyed for six long months.

    None of these band aids address any of the REAL PROBLEMS in the economy, most of which stem from LACK OF DEMAND. IMO.

  20. PQS

    Oh, and all this emphasis on Training and Educational Opportunity is just wasted breath. People with 15-20 years experience in an industry typically do NOT need to be Trained in anything. People who were working just a year ago haven’t had their skills stagnate. They need demand for their skills. And, as in construction, when nobody is building anything, there is NO DEMAND.

    If anybody in the economy needs retraining, I’d say let’s start in DC and get them trained in the Real World.

    1. Susan the other

      It is time to redefine “demand.” We’ve got plenty of demand: clean air, clean water, clean food, decent housing, relevant education, truth in government, truth in business; white collar crime enforcement, etc. All of these demands can generate good jobs and good pay.

      1. Mel

        Economically, demand is (or should be) defined as desire times money. Currently all the desire is at one end of the social scale, and all the money is at the other. The demand multiplies out to zero across the board.

        Except, I guess, for the desire for more money. There’s probably be some of that operating over at the moneyed end.

      2. PQS

        Agreed. In early 2010, UI in construction was over 25%. All that skill base and experience just sitting around waiting for something to do. Not that I think health care shouldn’t have been tackled, but a serious focus on our crumbling infrastructure, or a massive Green Energy focus would have offered tons of opportunity not only for jobs and employment, but the development of whole sectors of the economy. BUt there was no vision for this, apart from a few jobs in the stimulus package. I supposed our Masters would say we should be happy with that.

    2. Typing Monkey

      People with 15-20 years experience in an industry typically do NOT need to be Trained in anything.

      Wow…I have no idea what sector you work in, but my area of specialization requires that I *constantly* retrain. Even the (non management) people who are close to retirement in my company are constantly trying to update their knowledge base and skill set.

  21. ANetliner

    I agree with Yves that this program will not fix the economy, but it has some advantages: it keeps the unemployed worker attached to the workplace, doing something productive and, one hopes, facilitating social interaction and job hunting. That’s a plus, albeit not a fix. I think Yves was too harsh.

    1. BillF

      Out of 500,000 unemployed in Georgia, 120 (.024%) have been hired this year due to the state’s prototype program. I don’t agree that Yves is being too harsh. These results are inconsequential. As Yves points out, it merely gives the impression of doing something and marginalizes the need to do anything serious. Fodder for campaign 2012.

    2. rotter

      And Ill add to what Bill F said, that
      “keeping the unemployed attached to the workplace” only benefits politicians who serve corporations who are waging a vicious war on American Workers. It may keep them busy and distracted hoping for a job, which as the NYT piece points out, they have no reason to hope for, instead of what? thinking about whats happening to them? reading and researching, networking with other unemployed on the Internet?Getting really pissed off? Its a less than nothing program.Its not merely nothing, its worse than nothing.

  22. Jane

    Well – it’s official then – slavery is back in the South.

    Would we have been better off with Hillary? This question frequently crosses my mind.

    The oligarchs know that Trouble (yes with a capital T) is brewing. There are protests and union action taking place across the country, but the MSM won’t report it.

    It’s ironic how they couldn’t wait to report on the Arab Spring. But an ‘American Spring’ – well that’s just too dangerous. The contagion would lead to chaos in the streets. Frankly, it can’t come too soon.

    1. Pepe

      It’s merely an academic exercise, but I’ll play:

      yes, we would have been better off under Hillary because she would have had less success pushing a neoliberal agenda for two main reasons:
      (1) more Democrats would have been willing to stand up to her; and,
      (2) she would have not had a teflon coating w/r/t the press

  23. Hugh

    The only difference between the Democrats and the Republicans is in the atmospherics. They do not differ at all on the substance. The problem is not Obama. It is all our elites. Both parties are equally committed to the corporations, the rich, the elites, the wars, the looting.

    Lesser evilism is a con. What we are really seeing is the ratchet effect. One party goes to the right and then the other party follows. Nor is it just Republicans who push things further right. The repeal of Glass-Steagall happened under Clinton. The repeal of the usury laws under Carter. Obama has been much more sustained and successful in his attacks on Medicare and Social Security than Bush ever was. And who has been the bigger austerian in the recent budget debates, Obama or the Republicans?

    The Supreme Court? You may not have been paying attention but the Court already has a 5-4 majority of radical conservatives in Roberts, Alito, Scalia, Thomas, and Kennedy. The only thing is that Kennedy is a little bit pricklier about Executive encroachments on judical turf. Everyone looks at Roe but the Court has been systematically dismantling Title VII (anti-discrimination). It has been equally committed to privileging the rights of corporations over the lowly individual. What was the Democratic response to all this? Obama chose a technician in Sotomayor and an Executive power flunky in Kagan. A woman’s right to choose? The Democrats expanded restrictions on it as part of Obamacare.

    As for more and better Democrats/progressives à la Kucinich and Sanders, both caved like the feckless politicians they are on Obamacare.

    Elites have not only failed us. They have fundamentally betrayed us. To look for leadership among them is both wrong and futile. It is to acquiesce in their lootings, wars, and frauds. If we are to find people to represent us, stand for us, fight for our needs, we are not going to find them among any currently on the state and national scenes. A vote for any Democrat or any Republican is a vote to perpetuate and accelerate our downward spiral.

    To vote for one because you think the other is worse is to play into their hands. You have changed nothing but you have validated the system they have completely corrupted.

    1. rotter

      “To vote for one because you think the other is worse is to play into their hands. You have changed nothing but you have validated the system they have completely corrupted.”

      Yes, its pointless to vote for candidates that werent democratically chosen. Its ridiculous that Americans think they have a democracy because once every 4 years they get to vote for one or the other corporately selected douchebags who will continue marginalizing and weakening their political power. And both sides play the same sad game, “you have to vote for me because my opponent is just too horrible to be allowed into office”…The REALLY sad thin is that millions of people, should be a a pretty powerful political force. Good Information is the only thing that could save us now, if it reached enough people and sunk in.

    2. Because

      Frankly, who gives a rats about ‘Obamacare’. Find something “real” to post on.

      fwiw, neither Kucinich or Sanders voted for ‘Obamacare’.

      The uselessness of posts like these represent the problems with people. The problem is to much capital out there. Period. Raising wages signifigently would suck that up, but force the plutocracy to expand, which they don’t want to do right now. Simple as that.

      1. Hugh

        You are factually incorrect. The final vote on the reconciliation bill on healthcare (Obamacare) was taken on March 25, 2010 in both the House and Senate. Sanders voted for it in the Senate:


        and Kucinich voted for it in the House:


        Kucinich had spoken against Obamacare but caved in rather spectacular fashion after a visit with Obama on Air Force One. He then turned around and actually lobbied for the bill he had so recently castigated. Sanders, on the other hand, is famous for his caves. He pretty much is a standing joke among political watchers. He sold his vote for aid, actually quite a bit of aid, to clinics in his home state of Vermont. So his support never really was in doubt.

        The importance of the healthcare debate, its politics and its votes, is that it showed once and for all that there was no such thing as a good Democrat or a progressive in Washington. Not one. When push came to shove they all dutifully voted the corporatist line. The only Democratic votes cast against the bill were by the Blue Dogs.

    3. globalnomad

      Well said. Couldn’t agree more. Our energy would be better served by focusing on the few moderate and reasonable democrats and republicans there are, and demanding and cajoling them fervently to unite and push for real change of the system in blatant support of the “non-elites” who make up most of America. It is time people united together to really pull out the powerful and poisonous weeds in the American back yard. Only then can we really sow seeds of hope and change which contribute to creating a fairer, just and prosperous future for ourselves and generations of Americans to come.

  24. Barbyrah

    I’ve seen some incredibly astute “outside-the-box” comments at this site. Which is why I come here.

    No, I’m not an economist. Nor a mathematician. But I am a “Bigger Picture” observer/analyst type. Which is why I throw out the following:

    1. Why do we still assume whatever shifts that need to occur with jobs, employment, money, etc….must originate from and be applied to the exact same paradigm we’re currently in?
    2. Why do we still assume elections will come out of the same old paradigm?
    3. Why assume we’ll be getting the same types of leaders we’ve always gotten (from this outdated, obsolete paradigm)?

    FYI: There ARE people – smart people, insightful people, leading-edge thinking people – who see massive Change ahead. MASSIVE. And with such massive Change, who can honestly say the way economies are currently structured must or will remain, or the way we “elect” leaders must or will remain, or the types of people we entrust with implementing a new vision will be like the Obamas of the world, or the Romneys of the world?

    Spend time researching online and you’ll see some incredible stuff being talked about, and it has NOTHING to do with having to “earn” money in order to live comfortably, nothing to do with having to “work” at a job, nothing to do with voting D or R, nothing to do with keeping banks or any kinds of corporate structures intact, nothing to do with abusing our planet’s dwindling resources just to get a paycheck and to heck with what results from such abuse…

    Bottom line: We’re at a moment when we can turn this puppy around, big time. We DO NOT have to keep doing it the way it’s “always” been done.

    A Time of Newness: new plotline, new roles, new script. New intention.

    Which means perhaps what’s being debated…is a moot point. Or will be within a matter of months.

    Because this Change, capital “C”…well, me thinks it’ll be arriving pretty fast. (Has already begun to, in fact – we’re just not used to seeing it, so we’re still trying to frame within the Old Paradigm. Problem is – it doesn’t fit anymore.)

    Humbly offered…for your consideration.

    P.S. For a preview, look up the concept of “Contributionism” or “resource-based economy” or “moneyless culture”…and have a little fun.

    1. psychohistorian

      Laugh the global inherited rich out of control of our society……and into “rooms” at the Hague.

  25. Ishmael

    I did not read the whole article but you know sometimes I do free work. I work as a consultant. Working for a Big 5 firm I would sometimes reduce our rate to practically free. Sometimes you have to often a sweetner to keep your foot in the door. Right now I have cut my rate 50% because other people screwed up a project so it lasted longer than we planned and I want the project to succeed plus summers are slow. During that period I have saved the people 10 times my consulting rate. Do I get all up in arms — nope.

    By the way, my parents were working class, I paid my way through school and the only person to complete college. I have made a good life but I do not have a class attitude, but do what it takes. Many people have treated me poorly, but I brush myself off and go on.

    All work comes from word of mouth.

    1. Yves Smith Post author

      You have the ability to discriminate whether someone for whom you do free work is likely to hire you or give you a super good reference that might get you hired. That is not at all the case with this program. You have desperate unemployed people “matched up” with employers. Think they have any basis for knowing whether the prospective employer is for real, or dare say no if they think they are going to be used as a temp and discarded in a few weeks? No.

      The situations are chalk and cheese.

      And even in your space, when demand is slack (and the economy IS super slack) giving away work is not a good strategy. McKinsey did LOTS of free studies, something it had never done, when demand for consulting collapsed in the dot bomb era. Most consultants had bulked up to service companies freaked out about what to do re the Internet, and McKinsey had added a lot of people right before the crash hit.

      I heard from lots of quarters that the clients took the free work and just about never did a study afterwards. Over 2 years, McKinsey reduced its headcount in its US offices by about 50%.

      1. Typing Monkey

        I heard from lots of quarters that the clients took the free work and just about never did a study afterwards.

        Perhaps that has something to do with the quality of McKinsey’s work as opposed to the people who requested that work? (I have no idea–just a suggestion)

  26. citalopram

    Has anyone seen Obama’s petitions that were posted on the Whitehouse.gov site? I wonder if this is a feel-good feature, or if they’ll actually pay attention to the results? One of em was asking if we should abolish the TSA, and another one asked if we should end all software patents. Both polls had over 5000 votes so far when I viewed them.

    1. Jane

      I think you got it right at ‘feel-good feature’.

      They’re not interested in anybody’s ideas except their own.
      Just another PR stunt. Look out – they’ll be coming fast and furious in the coming months.

  27. Michael Fiorillo

    Though most white liberals and progressives bought the Obama brand, with some exceptions like Doug Henwood, much of the Black Left has always been on to him.

    Here’s a link to a May, 2008 article by Adolph Reed. Most NK readers will be struck by its insight and prescience. Reed has followed Obama’s career from the first, having lived in his state senate district:


    Here’s Reed on Obama in 1996 (!): “In Chicago, for instance, we’ve gotten a foretaste of the new breed of foundation-hatched black communitarian voices; one of them, a smooth Harvard lawyer with impeccable do-good credentials and vacuous to repressive neoliberal politics, has won a state senate seat on a base mainly in the liberal foundation and development worlds… I suspect that his ilk is the wave of the future in U.S black politics…” (Village Voice, 1/16/96)

    Could anyone possibly say it better today? “Vacuous to repressive neoliberal politics?”

    Black Agenda Report (www.blackagendareport.com) has also had Obama tagged from the beginning.

    To me, the most incredible thing is that a black man is going to take the fall for great Depression 2.0. That he will bear much responsibility for that- he was from the first a transitional and diversionary figure, and willing agent of his patrons – is not much consolation in the face of the Furies that may be unleashed.

    In that sense, McCain’s election might have been better, despite the two terrible Supreme Court appointments he’d have surely made; his incompetence might have driven the nails into neoliberalism’s coffin, rather than given it a short-term makeover.

    Granting all the above, a voice nevertheless occasionally arises in my mind: what if Obama really is the best we can expect, given the rapid decline of the country and the clinical insanity residing among the Republicans? Maybe it is better to have the slightly less vicious son-of-a-bitch. I’m not arguing for that, but just saying…

    Nothing but awful choices anywhere, though the time is soon coming for people to choose where to stand and fight.

    1. citalopram

      The only difference between the two parties as it stands right now is that one party is offering to drive you into the wall at 200 mph, and the other party is offering to drive you over a cliff going 100 mph.

  28. Tom Shillock

    Work for free?! Such generosity. It reminds me of the west coast bureaucrat who, during the Japanese internment, suggested to FDR that the Japanese could be put to work for free to help the war effort, that is after the government had confiscated their property or help non-Japanese Americans do so. I wonder whether even Bush or Cheney would have had the audacity to suggest that the unemployed work for free? It is difficult to conjure a just fate for a president who invents such programs.

  29. Glenn

    More work for lower wages is a great policy.

    It created the economic miracle of the USSR.

    Join the American Stakhanovite movement.

  30. Tom

    My wife is a 16 year GA DOL employee.
    You continue to receive your unemployment while in the GA Works program. If a person were to take anything offered out of desperation and then be fired or decide that the job was not a good fit they could either loose UI benefits for quitting or a discharge with cause. The person under GA Works can walk away from the job without penalty and continue on UI if it does not fit their skill set.
    For the employer they can give someone a chance at a job and if it is not productive for both parties, release the GA Works participant without incurring a penalty and having the UI rates they pay raised.
    The person would otherwise be sitting at home drawing benefits and slowly loosing skills and the routine of getting up and out every day.
    The program was not pushed like it could have due to the work load upon employees and budget restrictions. GA has gone from under %5 unemployment to over %10 without a budget increase in the Department or any appreciable hiring.
    For her part, my wife carried the load for her office by placing 40 of the 42 persons that participated in the program in her area. She began her career at the DOL during the Clinton era and was first assigned the Welfare to Work program duties in cooperation with DFACS.
    As a concept it helps those who are truly wanting to find employment and the employers that would like to hire someone but are reluctant to invest due to risk. People riding out the benefits are not interested in the program. Employers that abuse it are not used….
    It has been her experience in this downturn that the people calling her and asking how many weeks of benefits they have left are riding it out rather then taking what they can get to preserve the benefits for when they truly cannot find work. “Only three weeks left? What am I gonna do?” they might say. Then she pulls the file and see that they have logged on to the system to certify for benefits but have never clicked on a link to get a referral for the job interview. Then she can see that they should have been called in to the office after the first 13 weeks and have been made to show the job contacts they are REQUIRED to make and keep a record of. The system there will be automated soon to automatically cut off benefits and call people in to the office if they have not at least made an online job referral attempt.
    In my opinion, not hers, there are too many people riding out the storm in this manner. At the trucking company where I work we cannot find enough dock workers even though the starting wage is over $14 an hour. Full time pay for them tops out at $21 per hour.
    Personally, I have little compassion for those who are unwilling to do what it takes to put food on the table and pass up honest work as being beneath them…
    The wife has no qualms about cutting off people who are not available for and actively seeking work. After picking me up for our carpool home after a 12 hour day and I’m drenched in sweat she knows that office jobs are a luxury.
    As a nation we are about out of that.
    PS buy domestically manufactured whenever possible.

    1. avgJohn

      “At the trucking company where I work we cannot find enough dock workers even though the starting wage is over $14 an hour. Full time pay for them tops out at $21 per hour.”

      This is very interesting.

      I’m not doubting what you say, but I would think at the very least, people working fast food or retail jobs in your area would happily trade up to the type of job your company offers. Is the company in a remote area or off the bus route? Does the company have an effective jobs recruiting program (advertise in local paper, etc?).

      When your wife councils people at the unemployment office and advises them of a job at your company, what is their response? It seems that even temp agencies should be able to provide you with an ample supply of job candidates at $14.00 per hour.

      I’m not going to ask for the exact location of your company but could you tell me what city it is located in? The unemployment benefits in your state must be on the generous side for people to turn down jobs such as your company offers.

    2. avgJohn

      I just googled dock worker jobs in GA. I see that there is a temp agency that charges a $190.00 flat fee for candidates that would like a $15.00 per hour dock worker job in GA.


      This wouldn’t by any chance be a job with company you work for would it? Does your company hire direct or use a temp agency? It seems that if your company offers $14.00 per hour with benefits, they should be able to hire direct, rather than use a temp agency. If so maybe your company could list it on the internet.

      Just one more question. Does your company have a high turn over rate for dock worker jobs at your company?

      Just trying to be helpful and I would love to see someone in GA that really needs a job secure employment with your company.

      1. Tom

        @ Average John. I work for a large non-union Less Than truck Load (LTL) company and that is the average pay in this industry. This is the segment that used to be dominated by the Teamster affiliated companies. Since deregulation in the early 80’s they have lost market share. I am currently compensated more per hour than the Yellow Freight drivers are after they took a pay reduction to help the largest Teamster company stay afloat. Things are that tough.
        LTL drivers make from about 45k to over 70k per year depending upon whether they are paid by the hour for city pickup and delivery or by the mile for running the highways pulling double trailers. For example, Fed Ex Freight drivers make 56 cents a mile. Most get between 500 to 600 miles a night. Pretty decent for blue collar work in an air conditioned cab. They are also non-union. Hourly pays top out in the low to mid 20’s per hour and you will usually get 50 hours per week.
        The company I work for is privately held and debt free, which is the primary reason I applied here. I had to start out on a forklift until the Spring came and I was the first new full time hire in over two years. I worked part time for five months rather than go over the road (OTR) and be away from home. It was a choice to basically begin my career all over again at age 41. That was in 2009.
        I started as a dock worker in 1992 while going to college.
        I would attend classes all day and then hit the loading docks from 5 pm until midnight. Go home, sleep and be back in class at 9 AM. I managed a 3.25 GPA in Mechanical Drafting and Design while taking the core courses necessary to transfer to a 4 year engineering program. It got cut short due to the necessity of taking the fastest route possible to a decent job. After two years as a dockworker I was offered a position in a company CDL training program by Con-Way Freight at no cost. Compared to the AS degree it payed over double the entry level of a CAD operator at the time. My second year full time I broke the 50k level. I have been in the industry as a driver for 17 years now. It is very high pressure, competitive and particularly physical.
        Now everyone is tracked by GPS and scored for productivity on a daily basis. Dockworkers are scored daily as well. In that position we have a turnover of about %50 per year from my observations. I have seen people quit within hours of their first day on the job if not on the first trailer they are assigned to. Opening the door on a trailer that has been in the hot ATL sun all day and having to handle 500 tires and separate them by order is no cup of tea. Similarly, maneuvering a tractor trailer through downtown city traffic and unloading various types of heavy freight on a tight schedule is nerve wracking in its own way. I am 6 inches away from loosing my job on countless instances along my route if I happen to have a serious accident. I keep my job because of my literal street smarts.
        This industry is a good example of labor supply and demand reaching an equilibrium that is still solidly in the middle class. Lots of people can learn to steer a big rig down a desolate highway in the Western States. There are few that care to tackle the rigors of big city driving or have the patience to stick with a company long enough to get the seniority needed for a 70k per year line haul run.
        The OTR full truckload guys are screwed now that the Mexican trucks can come across the border.
        Within a couple of years 30 cents a mile will be high paying for that line of work.
        Right now it is in the mid 40’s for experienced drivers.
        LTL by its nature is protected in the NAFTA treaty. Foreign trucks can not haul from point to point within the US. From outside the US to deliver, reload and exit the country is allowed.

        There are still good paying jobs that require seemingly menial labor and only basic reading and arithmetic skills that are hard to keep filled.
        Most importantly, they are jobs that are absolutely necessary in the modern economy.
        You expect the store shelves to be stocked when you walk in. They are, usually.
        People need their stuff.
        It is my job, my co-workers job, and the entire logistics industry’s to get it to them.
        You could make us all independent contractors, but you can’t outsource us to China.

        That is why I have done it for as long as I have.

      2. Tom

        That link is a ripoff…. taking advantage of desperate people.
        Yes there are jobs in that range and most are filled by word of mouth within the industry or on company web postings. It is located in Savannah which by dock length is the largest container port on the East Coast. With the soon to be completed enlargement of the Panama Canal it will allow the super sized container ships to cut off a month’s travel time by not having to go around Cape Horn or the Cape of Good Hope. More importantly it allow them to bypass the congestion at the port of Long Beach and its excessively high costs. Gate checkers holding clipboards start out at $117k a year. The longshoremen had a very successful negotiation that set off a huge chain of development. CARB mandating that ships there must use ultra low sulfur diesel fuel didn’t help either. There are now huge container ports due to open in Mexico and when coupled with the Trans Texas Corridor, they will be bypassed. Savannah will benefit as well. There is a warehouse development boom underway in the area to handle the separation and segregation of loads from the Asian manufacturers to regional retail distribution centers. St Louis and the surrounding area is growing its logistics capabilities, particularly inter-modal rail. Over the long term a truck, train, pipeline, HV electric lines will run from the border to the geographic center of the US in that area and not be considered as entering the US. The corridor is a foreign trade zone. You will see foreign trade zone signs around factories that are non-domestically owned as well.
        There are plans to extend I-16 out of Savannah from where it ends in Macon across to Lagrange by the new Kia factory then all the way to Birmingham and tie into the I-22 corridor. You could run interstate all the way from the Port of Savannah to Memphis then St. Louis when it is complete.
        This is a literal divide and conquer.
        We live in “Markets” now, not Nations.
        Where we peons plan month to month or maybe year to year, Big Money plans Decade by Decade….to profit at almost any social cost.

  31. Bill G

    An easier way to do this would be to eliminate the minimum wage and let people work for what the market will bear. The move towards legislating a “living wage” for even the most menial of tasks will likely lead to more jobs in China and is not the best thing to do. Maybe if we eliminate the minimum wage all these jobs will not go to China and people can learn to have better interpersonal, life and work skills and start to move up the ladder???

    1. F. Beard

      An easier way to do this would be to eliminate the minimum wage and let people work for what the market will bear. Bill G

      Baloney. Much of the need for workers at any wage has been eliminated with the population’s own stolen purchasing power via loans from the counterfeiting cartel, the banking system. Thus those productivity increases should be shared with the entire population including, of course, the workers.

      Is government coercion the ideal way for productivity increases to be justly shared? No it isn’t but since government coercion allows banks and businesses to steal the workers’ purchasing power then government coercion wrt wages is justified too.

      1. Bill G

        Not sure about the stolen purchasing power comment – inflation? That’s a governmental policy issue aimed at reducing the public debt – incurred largely by overspending and defacto conversion of private wealth to public weal. Regarding productivity sharing – in general workers at all levels share in wealth from productivity improvements, just not as much as some may wish. Finally, a competitive wage for some work might reduce the incentive to pursue a productivity increase – just sayin.

  32. Bill G

    “When Adam Smith wrote The Wealth of Nations, he noted that although the wages of the lowest classes were oftentimes determined by the lowest their employers could pay, humankind’s present population acknowledges that at large, even with an imbalance of wealth, employers could not sustainably pay their workers less than would maintain a family of four (Book I, chapter VIII). If employers were to seek to pay less, then populations would shrink until competition over labor would force the wages of even the lowest classes higher.” http://www.americanthinker.com/2011/09/how_the_dual_income_destroys_the_lower_classes.html So maybe the issues we face today are a product of excess population driven by the abundant social safety nets that facilitate sub-optimal decision-making???

  33. Fraud Guy

    And just a general reply.

    This is not much different from the activity in the temp/service sector for some companies.

    My wife (she has been through a lot), twice worked for companies that had the standard 90-day probationary period. She took the positions, did her usual outstanding job, and was let go on day 89, after seeing many other employees last 30-60 days, except for the management.

    They were basically renting employees and just above minimum wage without benefits, then cutting them before they were entitled to UI from the company.

    La plus ça change.

  34. beowulf

    This is the sort of thing that drives me crazy about the Obama Administration. If they recognized the box they were in– very high unemployment and (self-inflicted) budgetary constraints– they would have taken the Georgia Plan and supersized it. Since unemployment benefits are an automatic appropriation entitlement program, spending will wax and wane countercyclically. So how could the supersize it?
    1. Make the hourly rate $10/hr (inflation-adjusted 1968 minimum wage).
    2. Open it up to everyone (only 27% of unemployed even qualify for unemployment benefits currently) and allow the still unemployed roll over to new 8 week projects indefinitely.
    3. Focus on nonprofit employers (shouldn’t private sector employees at least bid on the right for free labor?). Along with that, require every state to come up with their own version of the rather awesome Hands On Atlanta community service website.
    4. Quietly change the name to “Jobs Guarantee” or if they want to go old school, “Employment Assurance.
    “As the major contribution of the Federal Government in providing a safeguard against unemployment we suggest employment assurance– the stimulation of private employment and the provision of public employment for those able-bodied workers whom industry cannot employ at a given time.

    1. Tom

      That looks like a much better way to go about public service projects. I have heard about it for years having grown up in the ATl area burbs.
      I still have not heard a thing about trade policy.
      We have lost three auto plants in the ATL area in my lifetime, Two in the last decade. It isn’t the foreign owned auto manufactures that did it. It is the loss of work in other manufacturing jobs that were providing income for the customers of the domestic auto manufacturers.
      They guy making Fruit of The Looms underwear might not make as much as a UAW worker but it is steady work. Socks,T-shirts and underwear have a short lifespan and need to be replaced. MR. FTL might not be able to afford the Caddy but a Plymouth, Chevy or Ford he could purchase every decade or so. As the non durable goods or small electronics and textile industries went overseas the big three lost their customer base. Meanwhile the German luxury brands and Korean value manufacturers moved in to be closer to the markets they served. White collar financial class people wanted $40k BMW’s and M class SUV’s and the remaining blue collar workers could only buy new if it was less than $15k. The big three were priced in between and lacked the snob appeal to draw the moneyed class. Nobody noticed the people making items that retailed for $3 – $300 losing their jobs. It was all for the good supposedly and they could be retrained…..

      My wife used to work on the mass layoff crisis team at the DOL. They would put her up in a hotel along with the rest of the team as they would work in the factory processing the claims and explaining benefits. MANY times she would have to have a witness when someone would sign with an X mark for their name. How is that person going to be retrained for a high tech job?
      We need our so called mundane jobs to be returned to the US.
      There are millions of people in the 50-62 year age bracket that will be unemployed until they are eligible for Social Security. There are millions of soon to graduate teenagers that are not college material… where will they go? Into the vegetable fields? The military? We cannot afford endless war to sacrifice them in. The new military is too selective to accept a large portion of them. We have raised two generations of push button children that have little work ethic or innate curiosity beyond what is on television or a social media site. My own step daughter recently complained that the microwave was too slow!!!!!
      We may be facing the necessity of a new CCC or something similar in the near future just to help maintain civil order. Idle hands and mass media dominated by violent content lead to trouble.

      1. John F. Opie

        Here you’ve hit at the core of the real problem: how are you going to employ those who are under average and aren’t going to be the sharpest knives in the drawer?

        The challenge here is that manufacturing can be done elsewhere. It doesn’t have to be, but as long as people want lower and lower prices for widgets, it will converge on those countries offering the best wage/productivity ratio for the life of the widget (let alone the factory).

        This is the challenge facing the lower segments of the economy. The assembly-line job your grandfather might have had is now located in Vietnam, where teenage girls are working overtime to earn enough for a dowry or to help the rest of the family to survive. Unions helped drive production overseas (but not entirely their fault: the need to turn a profit is the real culprit here.

        Of course, we could return to a mercantilist, protectionist world where there is virtually no trade: we’d all be a lot poorer, since all of our goods would cost more (and they would: paying your workers a living wage in the US is more expensive than paying your workers a living wage in Thailand). While employment would be up drastically for the lower echelons of society, it’d also be a lower quality of life, since many would be working tedious, repetitive jobs that don’t require much training or even intelligence. On the other hand, the robotics industry could have handled most of those jobs, but given that jobs were instead exported, we won’t know.

        The “good” blue-collar jobs that can be located elsewhere are gone: if you are making widgets in the US that can be made elsewhere, your worker is competing against folks who are more than happy enough to be earning 1/10th of his income because in their country, that’s a living wage for a good blue-collar job.

        I don’t have an answer to the dilemma: suffice to say that it is breaking the lower cohorts in the US one after another. The only jobs with any sort of future for the lower cohorts are those that can’t be exported: personal services (haircutting, massages, prostitution, funeral parlors and the like) and anything to do with the real estate industry that doesn’t involve finances.

        It’s a glum picture. You can throw lots and lots of training at folks who are not really capable of absorbing that training: it’s just as much a waste of time as if you were to try to teach a pig to sing. You can’t turn a largely disinterested high-school graduate with low SAT scores into a rocket scientist by throwing training at them. Serious waste of time.

        Perhaps an enlightened protectionism would be possible, protecting key low-skill-set industries (assembly line manufacturing, textiles and clothing, shoes and leather products, for instance) in order to reduce the danger of large-scale unemployment for those who aren’t ever going to go to even their local community college. It means breaking a number of treaties and accepting, as well, significantly higher prices for a large number of every-day consumer goods, making us all more than a tad worse off.

        On the other hand, knowing the crony capitalists that have enthralled more than one politician, I’d guess that it’d end in tears. You’d have industries which would hide behind their walls of protection and pocket absurd profits because they’d not be facing competition.

        The economics of the situation suck, big time. There is no easy answer and there are even fewer solutions that make sense…

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