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Old 08-10-2013, 03:10 PM  
gblowfish gblowfish is offline
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US Companies Thrive as US Workers Fall Behind

Says that Communist, Prava Worshiping Fish Wrap The New York Times.

U.S. Companies Thrive as Workers Fall Behind
By FLOYD NORRIS
Published: August 9, 2013
http://tinyurl.com/mmvdkl7

AMERICAN companies are more profitable than ever — and more profitable than we thought they were before the government revised the national income accounts last week. Wage earners are making less than we thought, in part because the government now thinks it was overestimating the amount of income not reported by taxpayers.

The major change in the latest comprehensive revision of the national income and product accounts — known as NIPA to statistics aficionados — is to treat research and development spending as an investment, similar to the way the purchase of a new machine tool would be treated by a manufacturer, rather than as an expense. That investment is then written down over a number of years.

The result is to make the size of the economy, the gross domestic product, look bigger, and to appear to be growing faster, in years when new research spending is greater than the amount being written down from previous years. For the same reason, corporate profits also look better in those years.
A lot of money is spent on research and development. Nicole Mayerhauser, the chief of the national income and wealth division of the Bureau of Economic Analysis, which compiles the figures, said that in 2012 the total was $418 billion, about one-third of which was spent by governments. That amounted to about 2.6 percent of G.D.P.

The other major conceptual change deals with pensions. Until now, corporate and government contributions to pension plans were counted as personal income only when the contributions were made. Under the revision, the government estimates how much should have been contributed to meet the promises made to workers, and counts that amount, whether it is higher or lower than the amount actually put into the pension plan. That causes personal income to appear larger in years when pension contributions are lower than they should be.

The revised numbers also reflect some better information as new data becomes available. Ms. Mayerhauser said that it now appeared that in recent years the government might have overestimated the amount of income that went unreported by taxpayers, including the amounts of unreported tips received by restaurant employees. Revising those figures down meant that workers as a group appeared to be doing even worse than they had appeared to be doing.

And that was none too well. Before the figures were revised, it appeared that wages and salary income in 2012 amounted to 44 percent of G.D.P., the lowest at any time since 1929, which is as far back as the data goes.
But the revisions cut that to 42.6 percent, which matched the revised 2010 figure as the lowest ever.

The flip side of that is that corporate profits after taxes amounted to a record 9.7 percent of G.D.P. Each of the last three years has been higher than the earlier record high, of 9.1 percent, which was set in 1929.
The charts help to demonstrate how the post-recession economy differs from the one before the downturn. In the three years from 2005 through 2007, the share of G.D.P. going to corporate profits was 1.5 percentage points lower than it was during the years 2010 through 2012. The share going to workers was 1.1 percentage points higher during the earlier years.
Corporate taxes, as a proportion of corporate profits, rose to a four-year high of 21.6 percent in 2012, but remained well below the long-term average level. Personal taxes also hit a four-year high, at 14.1 percent of personal income, but were still well below the historical average.
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Old 08-11-2013, 06:03 PM   #16
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So is it in dispute that us wages aren't keeping pace with corporate gains? Or are some simply saying that it is happening but nothing to be concerned about?
Be as concerned as you want. It would be a waste of my time, but maybe you've found a hobby.
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Old 08-11-2013, 06:06 PM   #17
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There is nothing wrong with exporting jobs. Economic theory suggests that if you're exporting jobs, it's because your country isn't competitive at that job anyway. We'll basically be paying more money for wages to get inferior product, which means higher prices to the consumer.

Rather than force companies to hire unnecessary labor, companies should be investing in growth to increase the # of necessary middle class jobs. That and actually invest in workers to improve their skill set -- if you can move the middle class up to better jobs, that opens more jobs up underneath.

But none of those things happen if the company focuses on short-term profits.

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Originally Posted by Buzz_TinBalls View Post
what is the obscured mssg here?



I agree to some extent, but the american wage is falling every year with inflation (or the devaluation of the USD is more accurate) and there isn't enough jobs to support a healthy middle class in the US.

US corps (or corps employing US workers) know this and don't give one shit as they continue growing the workforce in 3rd world countries.

It isn't good for america. in fact, it is poisoning america year after year by exporting employment that is necessary for a healthy middle class. and, it devalues the USD by taking away a huge american resource that used to be considered "the edge" over other competitive products from other countries -- it takes away american human resources.
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Old 08-11-2013, 06:24 PM   #18
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Originally Posted by chiefzilla1501 View Post
Profitability is highly, highly overrated. It is too often short-term oriented, even if those decisions hurt the long-term health of your company.

Many times executives drive up profits in order to pad their own paychecks. That means they slash costs and operations that are necessary to grow the business, and they come out looking like they made the company more money.

I would rather companies invest back into their companies. Build new plants, hire better skill workers, re-train your work force, or invest in some program to improve employee engagement.
It's none of your business what companies do with their money or whether they invest back in their companies. You are such a busy body and sound anti-freedom.
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Old 08-11-2013, 06:27 PM   #19
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Originally Posted by BucEyedPea View Post
It's none of your business what companies do with their money or whether they invest back in their companies. You are such a busy body and sound anti-freedom.
It's none of your business what he does with his opinion or where he posts it. You are such a busy body and still sound crazy than a batch of bat shit dip.
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Old 08-11-2013, 07:46 PM   #20
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Originally Posted by BucEyedPea View Post
It's none of your business what companies do with their money or whether they invest back in their companies. You are such a busy body and sound anti-freedom.
You keep making this point, as if corporations are people. They are not. They are companies owned by the shareholders, run by people who very often report to governing boards instead of the shareholders. I don't have much criticism for how small, unincorporated businesses and LLCs run. They own their business and can run it as they please. When executives start serving their own self-interests for a corporation they don't own and shareholder power is pretty much meaningless, that becomes a problem. And as long as corporations get government handouts, we have a right to question why that money gets put into executive compensation instead of going back into the business.
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Old 08-11-2013, 10:07 PM   #21
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Originally Posted by chiefzilla1501 View Post
You keep making this point, as if corporations are people. They are not. They are companies owned by the shareholders, run by people who very often report to governing boards instead of the shareholders. I don't have much criticism for how small, unincorporated businesses and LLCs run. They own their business and can run it as they please. When executives start serving their own self-interests for a corporation they don't own and shareholder power is pretty much meaningless, that becomes a problem. And as long as corporations get government handouts, we have a right to question why that money gets put into executive compensation instead of going back into the business.
Pure lunacy.
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Old 08-12-2013, 07:25 PM   #22
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We're maybe 20-30 years away from smart robots that can do most menial jobs. And no, other low-skill, low-talent-requiring jobs will not crop up that robots can't do. Not enough of them anyway.

At that point what do we do with most of the sub-100 IQ people in this country who have no particular in-demand talent or physical skill?

Do we...

A) pay people to do meaningless work?

B) pay people to do nothing?

C) bloviate about the lazy poors and expand our prisons - Escape From NY style?

I think we know the plan this forum will be frothing at the mouth to go with.
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Old 08-12-2013, 07:27 PM   #23
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Originally Posted by suzzer99 View Post
We're maybe 20-30 years away from smart robots that can do most menial jobs. And no, other low-skill, low-talent-requiring jobs will not crop up that robots can't do. Not enough of them anyway.

At that point what do we do with most of the sub-100 IQ people in this country who have no particular in-demand talent or physical skill?

Do we...

A) pay people to do meaningless work?

B) pay people to do nothing?

C) bloviate about the lazy poors and expand our prisons - Escape From NY style?

I think we know the plan this forum will be frothing at the mouth to go with.
STDs and starvation. Is that what you are trolling for? Clearly we should expand abortions to save the future from the ignorant poor. Kill them before birth. Yea Liberalism!!!
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Old 08-12-2013, 07:43 PM   #24
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Originally Posted by suzzer99 View Post

What do we do with most of the sub-100 IQ people in this country who have no particular in-demand talent or physical skill?
Call them liberals and let the 101+ IQ people pay their way while they leach off the system, just like today.
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Old 08-14-2013, 07:07 AM   #25
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Originally Posted by chiefzilla1501 View Post
Profitability is highly, highly overrated. It is too often short-term oriented, even if those decisions hurt the long-term health of your company.

Many times executives drive up profits in order to pad their own paychecks. That means they slash costs and operations that are necessary to grow the business, and they come out looking like they made the company more money.

I would rather companies invest back into their companies. Build new plants, hire better skill workers, re-train your work force, or invest in some program to improve employee engagement.
Man, that's a pretty sweeping generalization. I will agree that there are far too many companies operating purely for quarterly earnings, but not all of them.

And quite honestly, I don't see a way out of it without massive regulation (in addition to that which business already faces)

My opinion is let the free market work it out. The companies that mind the long term goal will do better over the long term. Either that or their system isn't any better than the short term thinkers.

At the end of the day it is all what the shareholders want. If the shareholders want quarterly profits, they get quarterly profits. If they want a long term vision, they get a long term vision.

Quote:
Originally Posted by Buzz_TinBalls View Post
what is the obscured mssg here?



I agree to some extent, but the american wage is falling every year with inflation (or the devaluation of the USD is more accurate) and there isn't enough jobs to support a healthy middle class in the US.

US corps (or corps employing US workers) know this and don't give one shit as they continue growing the workforce in 3rd world countries.

It isn't good for america. in fact, it is poisoning america year after year by exporting employment that is necessary for a healthy middle class. and, it devalues the USD by taking away a huge american resource that used to be considered "the edge" over other competitive products from other countries -- it takes away american human resources.
What the **** do you suggest they do? Retool and hire American labor at 3x the cost, spend 10x the money they otherwise would on dealing with the massive ****ing regulations they are faced with, and pay higher payroll taxes and workmans comp?

I have no idea what the numbers are, but I'm quite certain it is staggering how expensive it is to produce anything here that is currently exported. Go ahead and mandate that everything be produced here. All that will happen is the company that used to outsource will go ****ing broke and you will import it from whatever country we used to export the jobs to.

The problem isn't with American companies. The problem lies in the environment in which American companies operate. And unless the voting constituency of the government is willing to change that environment, the constituency are the ones that should be accused of not giving one shit about it.
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Old 08-14-2013, 09:54 AM   #26
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Man, that's a pretty sweeping generalization. I will agree that there are far too many companies operating purely for quarterly earnings, but not all of them.

And quite honestly, I don't see a way out of it without massive regulation (in addition to that which business already faces)

My opinion is let the free market work it out. The companies that mind the long term goal will do better over the long term. Either that or their system isn't any better than the short term thinkers.

At the end of the day it is all what the shareholders want. If the shareholders want quarterly profits, they get quarterly profits. If they want a long term vision, they get a long term vision.



What the **** do you suggest they do? Retool and hire American labor at 3x the cost, spend 10x the money they otherwise would on dealing with the massive ****ing regulations they are faced with, and pay higher payroll taxes and workmans comp?

I have no idea what the numbers are, but I'm quite certain it is staggering how expensive it is to produce anything here that is currently exported. Go ahead and mandate that everything be produced here. All that will happen is the company that used to outsource will go ****ing broke and you will import it from whatever country we used to export the jobs to.

The problem isn't with American companies. The problem lies in the environment in which American companies operate. And unless the voting constituency of the government is willing to change that environment, the constituency are the ones that should be accused of not giving one shit about it.
Ron Paul had some answers but no one wanted him. So enjoy the angry rioters coming to a wheat field near you.
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Old 08-14-2013, 10:02 AM   #27
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Originally Posted by Bwana View Post
Call them liberals and let the 101+ IQ people pay their way while they leach off the system, just like today.
That's funny.
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Old 08-14-2013, 10:02 AM   #28
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Originally Posted by KILLER_CLOWN View Post
Ron Paul had some answers but no one wanted him. So enjoy the angry rioters coming to a wheat field near you.
I'm pretty sure Ron Paul is BEP in a suit.
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Old 08-14-2013, 10:11 AM   #29
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Originally Posted by Buehler445 View Post
Man, that's a pretty sweeping generalization. I will agree that there are far too many companies operating purely for quarterly earnings, but not all of them.

And quite honestly, I don't see a way out of it without massive regulation (in addition to that which business already faces)

My opinion is let the free market work it out. The companies that mind the long term goal will do better over the long term. Either that or their system isn't any better than the short term thinkers.

At the end of the day it is all what the shareholders want. If the shareholders want quarterly profits, they get quarterly profits. If they want a long term vision, they get a long term vision.



What the **** do you suggest they do? Retool and hire American labor at 3x the cost, spend 10x the money they otherwise would on dealing with the massive ****ing regulations they are faced with, and pay higher payroll taxes and workmans comp?

I have no idea what the numbers are, but I'm quite certain it is staggering how expensive it is to produce anything here that is currently exported. Go ahead and mandate that everything be produced here. All that will happen is the company that used to outsource will go ****ing broke and you will import it from whatever country we used to export the jobs to.

The problem isn't with American companies. The problem lies in the environment in which American companies operate. And unless the voting constituency of the government is willing to change that environment, the constituency are the ones that should be accused of not giving one shit about it.
Is that why we are still seeing way above average profit margins?

FFS let the partisan shit go and recognize that businesses have a very favorable US environment.
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Old 08-14-2013, 10:16 AM   #30
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Timely piece for the thread

Post is full of links at the source.

http://www.ritholtz.com/blog/2013/08...eting-ceo-pay/

Quote:
In 2011, I posed the question “Is McKinsey & Co. the Root of All Evil ?” This was not a tongue-in-cheek query, but rather, a look at how so many recent disasters traced their origins back to McKinsey & Co.

Which brings us to the latest issue negatively affecting the United States, skyrocketing CEO pay and income inequality. The parade of bad societal effects that are related to that has been well established — especially with income mobility.(Surprisingly, Wikipedia has a good overview).

Duff McDonald has a new book coming out this Fall titled The Firm: The Story of McKinsey and Its Secret Influence on American Business. He points to you-know-who as the early mover in a number of societal ills. It should come as no surprise that CEO pay is one of them. In terms of income & wages, Duff traces McKinsey’s influence back to 1935, when “managers sought advice about how to deal with the rising power of unions, they turned to outside advisers such as McKinsey & Company.”

That then morphed into something different entirely in 1952. That was when the CEO of Pan American World Airways got interested in a McKinsey study of stock options.

The entire We can trace the rise of CEO compensation to that date:
“Anyone who has worked in the corporate milieu knows that the arrival of McKinsey on the scene tends to not be a sign of good news for the rank and file. What is less known is McKinsey’s role in the creation of the CEO-to-worker gap itself. In 1951, General Motors hired McKinsey consultant Arch Patton to conduct a multi-industry study of executive compensation. The results appeared in Harvard Business Review, with the specific finding that from 1939 to 1950, the pay of hourly employees had more than doubled, while that of “policy level” management had risen only 35 percent. If you adjusted that for inflation, top management’s spendable income had actually dropped 59 percent during the period, whereas hourly employees had improved their purchasing power.

The “academic” imprimatur of Harvard Business School’s house organ gave the work a certain credibility and the study was suddenly an annual affair, appearing in HBR for more than a decade thereafter, at which point it moved into McKinsey Quarterly. From 1948 to 1951, HBR had one article a year on executive compensation. A few years later, the review was running five times that amount. This was actually a perfect moment for the new “field of study,” because in the post-World War II years, there was a shortage of executive talent and corporate leaders had begun poaching executives not just from the competition but also from entirely different sectors. And they had to know how much to offer, did they not? Moreover, in the post-Depression years, no one had wanted to talk out loud about compensation. But after the war, they were ready to raise the volume.”
Crony capitalism and the transfer of wealth from shareholders to insiders goes back much further than you may have guessed.

Good ideas gradually die of their own accord, replaced with better ones. Bad ideas have a death grip on society, often with wealthy sponsors benefiting from them. That’s why they seem to hang around forever…
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Originally Posted by Iowanian View Post
I'm just a little pussy from Iowa
Posts: 18,900
KC native is too fat/Omaha.KC native is too fat/Omaha.KC native is too fat/Omaha.KC native is too fat/Omaha.KC native is too fat/Omaha.KC native is too fat/Omaha.KC native is too fat/Omaha.KC native is too fat/Omaha.KC native is too fat/Omaha.KC native is too fat/Omaha.KC native is too fat/Omaha.
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