Technology firms are trying to get the Feds to allow cheaper HB1 visa holders brought into this nation, instead of using Americans. The US Chamber of Commerce is begging the Feds to give amnesty to illegal aliens, so more criminals from foreign nations will come here. It is estimated that currently five million illegal aliens hold jobs in this nation—jobs belonging to Americans.

ObamaCare and the artificial minimum wage increases is causing more unemployment and underemployment. Thanks to technology, the use of robots and computers to do the work of humans—even fast food places are replacing people with machines.  Even the Left is beginning to understand.

“Middle-wage stagnation can damage consumer spending, dent career mobility, stall home buying and exacerbate a poverty rate that’s already the highest in the country, economists warn. Those concerns are amplified in a state notorious for a high cost of living.

As more mid-tier jobs disappear, economists fear middle-class workers will be increasingly sucked into the ranks of the working poor. And they could crowd out those already working low-wage jobs, or drive their salaries down further.”

Loss Of Mid-Wage Jobs Hampers State’s Growth

Gary Reber, For Economic Justice, 8/8/14

Mid-wage employment suffered the deepest decline in the recession and is the only segment to continue falling even in the recovery. Above, Valerie Colter, who lost a mid-wage job in the recession and now works a variety of jobs. (Kirk McKoy / Los Angeles Times)

On August 8, 2014, Tiffany Hsu writes in the Los Angeles Times:

On the surface, California’s job market is booming.

The state has now recovered all the jobs lost during the recession, and done so at a faster pace than all but five states.

The growth, though, belies a troubling imbalance. The fastest job creation has come in low-wage sectors, in which pay has declined. At the high end of the salary scale, a different dynamic has taken hold: rising pay and improving employment after rounds of consolidation.

Most distressing, middle-wage workers are losing out on both counts.

“People talk about it like an hourglass,” said Tracey Grose, vice president of the Bay Area Council Economic Institute. “There are fewer opportunities for people in the middle.”

Economists generally consider mid-wage jobs to pay between $15 and $30 an hour in California — encompassing a third of workers in the state. Those at the top end of that range, which amounts to about $60,000 a year, earn more than 72% of Californians.

Middle-wage stagnation can damage consumer spending, dent career mobility, stall home buying and exacerbate a poverty rate that’s already the highest in the country, economists warn. Those concerns are amplified in a state notorious for a high cost of living.

As more mid-tier jobs disappear, economists fear middle-class workers will be increasingly sucked into the ranks of the working poor. And they could crowd out those already working low-wage jobs, or drive their salaries down further.

“The long-term problem isn’t unemployment; it’s poverty,” said Stephen Levy, director of the Center for Continuing Study of the California Economy in Palo Alto. “It’s not jobs; it’s wages.”

Valerie Colter landed a $1,000-a-week job, right out of college in 2005, as an executive assistant to a sitcom producer. She was laid off two years later.

She has struggled since then to make half as much. She did a stint as a transcriber for a reality show company, working overtime to bring home $525 a week. She earned $250 every other week as an Ikea cashier; $500 a week as a postproduction assistant; $600 a week organizing a footage library.

Since 2013, the Lake Balboa resident, now 31, has worked as a coordinator at a captioning company, where she earns $500 a week while struggling to pay off student loans.

“They can’t afford to pay me what I’m worth; they can’t even match the pay at my last job,” she said. “It makes me sad. I always thought that, in 10 years, I was going to be awesome. Now here I am, just trying to survive.”

Burdened with rising healthcare and rent costs, California employers aren’t keen to raise wages. Although salaries are rising in some higher-end fields, such as electrical engineering and information technology, that mostly reflects companies competing for top candidates from a limited pool.

But there’s a glut of low- and middle-wage job seekers: former executive assistants, manufacturing technicians, insurance agents and more. Those were the types of jobs companies spent the downturn merging, automating or cutting entirely as profit margins tightened.

Earnings for both low- and mid-wage Californians have been eroding for years.

For the bottom half of the workforce, real hourly wages are 6.7% lower than they were 35 years ago, according to a June report from UC Berkeley. Since 2003, median wages for workers shrank 7.2%. The only workers in that period to enjoy real wage gains were those in the top fifth of all earners.

For now, that means the lesser-paid employees aren’t a priority for many businesses, even those that are expanding as the recovery matures. Mid-wage employment suffered the deepest decline in the recession and is the only segment to continue falling even in the recovery, according to the California Budget Project research group. Inflation-adjusted earnings in that segment slumped 3.8% between 2006 and 2012.

In historically mid-wage industries such as manufacturing, fewer supervisory positions are available because so much of the work has been automated. The largest percentage of openings are low-paying, such as the $9- to $11-an-hour assembly post being offered by Kelly Services. The staffing agency will send the worker to a facility making consumer goods near Inglewood.

Low-wage workers have had trouble moving up the ranks since the recession; mid-wage workers have fought to hold their ground. Many skilled laborers have yet to earn the certifications or education that employers are increasingly demanding of applicants, said Genine Wilson, vice president of Kelly’s Southern California territory.

“They’re looking at lower-paying jobs as an entry point toward the jobs they want,” she said.

The disparity is especially stark when comparing the northern and southern parts of California.

Compared with the state as a whole, the Bay Area was more insulated from the downturn and bounced back faster. Three of the five U.S. counties with the highest weekly wage are there, led by San Mateo, where pay averages $2,724.

But in Southern California — which has more than double the number of jobs in the Bay Area — payrolls shrank faster and have recovered more slowly.

More than a million jobs will be created in the region between 2010 and 2020, and nearly half will pay less than $14.35 an hour, projects Levy, the Palo Alto economist.

Last year, average wages in Los Angeles County declined 1.9% — tying Jefferson, Ala., for 302nd place out of 334 large counties nationwide. San Francisco ranked 19th with a 3% increase.

Statewide, the middle class still makes up the largest chunk of households, but its share has shrunk since 2007, as it has for higher-earning households. Now, nearly a third of California households are in the bottom tier of the income range, up from fewer than a quarter.

The middle class helps shore up economic stability with its spending power, said Robert Kleinhenz, chief economist of the Los Angeles County Economic Development Corp. He said low-wage jobs have historically served as a gateway.

Recent proposals from legislators and economists to boost earning power have included training programs run by local employers, more infrastructure projects and minimum-wage increases indexed to inflation.

“If you have all three income levels in balance, there’s a theoretical ladder that lower-wage households can hopefully climb,” Kleinhenz said. “It helps to sustain the overall health of communities to know that there’s the possibility of moving up. That’s the American dream.”

There is no solace in the statistics. Researchers at the American Enterprise Institute and the Center for Economic and Policy Research shows that a worker between the ages of 50 and 61 unemployed for over a year has only a 9 percent chance of finding a job in the next three months and only a 6 percent chance if he or she is 62 years or older. According to the Economic Policy Institute, there are approximately 3.3 unemployed workers for every job seeker.

Because for the vast majority of Americans a JOB is their ONLY source of income, millions of families are one layoff or family emergency away from going into bankruptcy, and then what? Start over with nothing and extremely poor JOB prospects.

And though millions of Americans own diluted stock value through the “stock market exchanges,” purchased with their earnings as labor workers, their stock holdings are relatively miniscule, as are their dividend payments compared to the top 10 percent of wealthy capital owners, whose primary source of income is from stock ownership dividends, capital gains, interest and rent––not wages.

The American Dream is fast disappearing as people experience fewer opportunities to earn an income, and as a consequence cannot act as “customers with money” necessary to support a vibrant economy. The result is a permanent national recession at the brink of a second Great Depression.

The conventional solutions are to pay higher wages and use tax extraction and national debt to finance make-work projects contracted out to narrowly-owned private sector companies who reap profitability as a result of their ownership, all in the name of JOB CREATION.

Paying higher wages drives up the cost of producing marketable products and services, which costs are passed on to the consumer.  Multiplying or creating jobs when technology can do the same thing cheaper also increases costs that are passed on to the consumer.  This is “cost-push inflation” — the rising cost of an input to production “pushes” prices up.

This is not to say that higher wages and unnecessary “job creation” also contribute to “demand-pull inflation.”  When the wages and job creation are subsidized, the money comes out of increased government debt — money creation.  Whether paid to consumers as welfare or to workers whose employment is effectively boondoggling, effective demand in the economy increases, which “pulls” prices higher in response, hence, “demand-pull inflation.

Unfortunately, our political leaders, academia, and the national media offer up ONLY the same old conventional won’t-work suggestions for the government to take the lead and arrange the marriage of private and public capital to regenerate real growth without the realization and requirement that the ownership of FUTURE productive capital wealth must be broad. No longer will we achieve growth the old-fashioned way, by investing in projects that enrich our productive capacity in the name of JOB CREATION, which is expected to have a multiplier effect, when in actual reality such investment continues to further CONCENTRATE OWNERSHIP of America’s future wealth-creating, income-generating productive capital assets among a tiny ownership class.

Of course, all this would be moot if 1) all people were capital owners and the price of labor could rise or sink to its “real” level, 2) all financing for new, non-speculative capital investment came out of future savings instead of past savings, and 3) government was prohibited from creating money (“emitting bills of credit”), living within its tax revenues, and borrowing out of existing savings to cover temporary shortfalls or meet emergencies.

That’s what “Capital Homesteading” would do.

Capital Homesteading is the ONLY viable solution to the economic decline of America. Its implementation requires that our leaders, academia and the national media recognize that all individuals to be adequately productive cannot do so when a tiny minority (capital owners) produce (via the productive assets they own) a major share and the vast majority (labor workers), a minor share of total output of the economy’s products and services. The system must be reformed to create a world in which the most productive factor of the FUTURE — physical capital — now owned by a handful of people — is owned by a majority — and ultimately 100 percent — of the consumers, while respecting all the constitutional and private property rights of present capital owners.

A balanced Just Third Way approach to building a FUTURE economy that supports general affluence for EVERY American is presently not in the national discussion. It appears that the President of the United States, the elected Congressional representatives and Senators, academia, and the media are oblivious to this principled solution that has the ingredients to power economic growth at double-digit GDP rates.

This goal requires investment in FUTURE wealth-creating, income-generating productive capital assets while simultaneously broadening private, individual ownership of the resulting expansion of existing large corporations and future corporations. Not only is employee ownership the norm to be sought wherever there are workers but beyond employee ownership the norm should be to create an OWNERSHIP CULTURE whereby EVERY American can benefit financially by owning a diversified SUPER IRA-TYPE Capital Homestead Account (CHA) portfolio of income-producing, full-voting, full-dividend payout securities in America’s expanding corporations and those newly created to produce the future products and services needed and wanted by society.

Those who read this and are in a position of influence should reach out to President Obama and the leadership of his Organizing for Action as well as to other political leaders, and call for them to convene a national discussion using the national media and social media, and our educational institutions, to open up a discussion on EVERY CITIZEN AN OWNER opportunity. We need fresh and inspired leaders who can educate on this issue at this time because academia, the media, and our so-called leaders are not addressing how people make money and the significance of OWNING wealth-creating, income-generating productive capital assets. We need to get people to understand that as with today, in the FUTURE we will continue to experience tectonic shifts in the technologies of production, which will destroy jobs and devalue the worth of labor. This is a crucial understanding because at present for the 99 percent of the nation a JOB is the ONLY source of income to support themselves and their families. We need political leaders who will commit to a government policy focus on OWNERSHIP CREATION, by which jobs will result and naturally follow as the economy revs up to double-digit GDP growth and fully applies technological innovation and invention to shift from unnecessary labor toil to human-intelligent machines, super-automation, robotics, and digital computerized operations.

To accomplish the goal of universal ownership, the Federal Reserve needs to stop monetizing unproductive debt, and begin creating an asset-backed currency that could enable every child, woman and man to establish a Capital Homestead Account or “CHA” at their local bank to acquire a growing dividend-bearing diversified stock portfolio to supplement their incomes from work and all other sources of income, and provide future financial security in retirement. Steadily over time this will create a robust economy with millions of “customers with money” to purchase the products and services that are needed and wanted.

We need to apply the proven principles of insurance to the financing of FUTURE wealth-creating, income-generating productive capital assets. We need to empower individuals to acquire multiple company diversification ownership facilitated with private capital credit insurance or a government reinsurance agency (ala the Federal Housing Administration concept). The promissory note can be offset to the government’s central Federal Reserve Bank in return for the cash equivalent of the amount of the loan, less an administrative fee. The only cost to the direct lending bank in making a loan to the corporation would be the administrative fee, or about 2 percent of the loan’s principal and then another 2 percent for capital credit insurance, with an additional quarter of a percent paid to the Federal Reserve Bank to monetize the loan and give the lender the same cash as it would have had if it had actually loaned money to the corporation. The lender’s cash loaned to the company’s Employee Stock Ownership Plan (ESOP) trust and/or the individual Capital Homestead Account or “CHA” (a SUPER-IRA or asset tax-shelter for citizens) is replenished with the Federal Reserve Bank cash. When the company pays the ESOP trust or CHA enough money to enable the trust(s) to repay the lender, the lender has to retrieve the note and pay back the Federal Reserve Bank. Thus, the loan cost would be essentially not more than 5 percent to allow ownership broadening financial capital to be in­vested in ownership broadening ESOP and CHA trusts to create new capitalists. As such, national capital credit insurance replaces the requirement for pledging past savings and security (which for the most part most Americans do not have).

Our leaders need to put on the table for national discussion this SUPER-IRA idea and the necessary reform of our tax policies that would incentivize corporations to pay out fully their earnings in the form of dividend income and issue and sell new stock to grow, instead of financing with “retained earnings” and borrowing, which further concentrates ownership among the people who now are the corporate owners. The CHA would process an equal allocation of productive credit to every citizen exclusively for purchasing full-dividend payout shares in companies needing funds for growing the economy and private sector jobs for local, national and global markets,

The shares would be purchased on credit wholly backed by projected “future savings” (earnings) in the form of new productive capital assets with future marketable products and services produced by the newly added technology, renewable energy systems, plant, rentable space and infrastructure added to the economy.

As noted above, risk of default on each stock acquisition loan would be covered by private sector capital credit risk insurance and reinsurance (ala the Federal Housing Administration concept), but would not require citizens to reduce their funds for consumption to purchase shares.

Essentially, the pressing need is for everyone in a position of influence to encourage President Obama to raise the consciousness of the America people by making his NUMBER ONE focus the introduction of a National Right To Capital Ownership Bill that restores the American dream of responsible property ownership as a primary source of personal wealth.

This is the solution to America’s economic decline in wealth and income inequality, which will result in double-digit economic growth and simultaneously broaden private, individual ownership so that EVERY American’s income significantly grows, providing the means to support themselves and their families with an affluent lifestyle and to financially sustain them in their retirement.