ARNOLD KLING
August 14, 2011
The Top Political Contributors
August 11, 2011
Gender and the New Commanding Heights
August 11, 2011
Jamie Galbraith Makes an Assumption
August 11, 2011
Macroeconometrics: The Science of Hubris
August 10, 2011
Real and Nominal Bond Yields
BRYAN CAPLAN
August 14, 2011
The Effect of Thumb Sucking on Income
August 12, 2011
The Voice of Cold, Hard Truth to All Would-Be Educators
August 12, 2011
Ability, Morality, and Prosperity: A Paper and a Report
August 11, 2011
The Theory of Time and Frittering
August 10, 2011
Male Variance and the Remnants of the Gender Gap
DAVID HENDERSON
August 9, 2011
Hayek in "Unbroken", Part Two
August 8, 2011
Hayek in "Unbroken"
August 5, 2011
James Bovard on the Peace Corps
August 4, 2011
Summers Way Off on FDR and 1941
August 3, 2011
The "Amazon" Tax
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"Catherine Rampell writes, 'A large fraction of displaced workers who have found new jobs have had to switch careers, and most of those career-changers have downgraded to a lower-paying job . . .'." But is this a *larger* fraction than *normal*--of career-switchers, and of downgraders to lower pay?
"Recalculation" is *always* going on. You are claiming that there is a lot more of it now than there was a few years ago; but, so far as I can see, you have never presented any supporting evidence. The above quotation is an example of non-evidence.
You are exactly right about the wages. Both the FDR and the Blum high wage policies were disastrous. The only difference is that FDR's policy was adopted after dollar devaluation, so the negative effects were less noticeable. Even so, the wage increases aborted a promising recovery. The negative effects of Blum's policies were more obvious.
Of course Krugman knows nothing about any of this history when he assures us that high wages are expansionary.
Regarding recalculation, today there are reports that auto sales were very strong in December. It seems that as the economy recovers auto sales are coming back. That seems like a demand problem, doesn't it?
Friends of mine in tech fields who are currently in well-paying jobs but looking for other opportunities are consistently finding that new job opportunities are out there, but all are paying less than what they are making in their current job. Some of these new opportunities are from companies that just layed off many employees.
Evidently it is easier to lay someone off who is at a higher rate of pay and hire someone at a lower rate of pay than just cutting someone's pay.
The quoted report states:
"a large number of the reemployed (41%) have had to move to a new field or career"
and
"For panelists who are employed full time, 53% are making less now than they did in their most previous job before becoming unemployed"
I don't find this surprising - when you move to a new career, you often take a pay cut due to your lack of experience in the new career compared to your old one, but over time you will gain experience and your salary will go up (this happened when I switched careers).