Shrinking Hours, Cut Overtime Are Stealth Forces Driving Down Economy

New York Times:

Not long ago, overtime was a regular feature at the Ludowici Roof Tile factory in eastern Ohio. Not anymore. With orders scarce and crates of unsold tiles piling up across the yard, the company has slowed production and cut working hours, sowing worry and thrift among its workers.

"We don't just hop in the car and go shopping or get something to eat," said Kim Baker, whose take-home pay at the plant has recently dropped to $450 a week, from more than $600. "You've got to watch everything. If we go to town now, it's for a reason."

Throughout the country, businesses grappling with declining fortunes are cutting hours for those on their payrolls. Self-employed people are suffering a drop in demand for their services, like music lessons, catering and management consulting. Growing numbers of people are settling for part-time work out of a failure to secure a full-time position.

Read the whole story: New York Times

Comments

[ceasenake]

At least the people in the photo look like they're "eatin' good in the neighborhood".

[lenzorizzo]

If I were king of the forest:

I'd remove the legal fiction that a corporation is a person. A corporation doesn't have a conscience on the one hand or a body that can be thrown in prison on the other hand.

I'd enforce the tax code, the part that says that income is defined as monies earned from activities outside the borders of the US and from profits earned by capital. Since profit is not defined as monies derived from trading one's labor for an agreed upon sum, that being an even exchange, that would mean that the income tax as we know it would go bye-bye.
That would also mean that companies like Halliburton, who move their corporate headquarters offshore in order to avoid paying US taxes, would end up paying their taxes, at least until they discover another loophole.

[maggiemae656]

I agree with you. I would go one step further and say that these companies who are offshoring their operations are no longer covered under an American corporate charter. Let them change their official residence to wherever else it is that gives them favorable tax treatment. Why are they still considered American corporations, anyway? Dick Cheney should definitely move to Dubai--and I think he should go now. Bye, bye, Dick, your Middle Eastern buddies await.

[ohiomark]

If the Democrats get their way, the paychecks will get even smaller, or go away all together.

It's called raising taxes.

[SusanRen]

Thats what I'm afraid will happen. We have several really good employees we dont want to lose so we pay them well.

[ohiomark]

Exactly, if your taxes go up, you might have to lay one or more of them off.

Democrats don't understand that. They just want to punish the rich.

Like Obama said during the debate the other night, "its not about revenue, it's about fairness". Spoken like a true socialist.

[biwee]

DUH!!!! Taxes will have to go UP to pay the interest on the $3.4 TRILLION increase in the national debt that Shrub Bush has created. Why do you think this is a free lunch?? Do you know what a TRILLION dollars are??

[SusanRen]

And the Democrats just sat by and watched. You guys give too much power to the Prez for someone thats suppose to be so stupid he sure has alot of power over Congress.

[mamacat]

The economy is going exactly where the neo-cons wanted it to go. The rich are getting richer, and every one else is getting poorer. Now all they have to do is convince everyone that wearing a lapel pin in the shape of a flag, made in china, is more important than sound economic policy.

[loki]

I have been noticing that more and more of the stores that bring goods to the lower income in a more affordable way are closing their doors right and left. I think many of the Value City stores in the midwest are closing up shop. Ive seen Big Lots , Family dollar, Dollar tree, Dollar stores, all emptied out in the last couple months. And they dont seem to be changing locations, just closing down. The only ones who are still seem to be around are Walmarts , Targets and a few Kmarts, but even they are closing locations in middle class and lower income areas. Walmarts and targets are carrying a much more limited selection. Have you seen their clothes selections? Youd think they were designed by some blind person in a 3rd world country. A lot of just ugly stuff this year being forced on the public. Places like Kohles and Gordmans , Macy's and the other Malls stores are basically empty most of the time. Yup, I have to admit, having the first MBA president has done wonders for the economy. Another find product of Yale and Harvard. Who like most of their graduates, are destroying America and getting rich themselves. But besides that point, its the majority of the people who are being hurt by policies based on profit, power and greed. Its truly a shame what our country has turned into over the last 8 years.

[MetalCanuck]

People could have had Ron Paul, He understands what is happening.­.HE IS STILL IN THE RACE...WRI­TE him in!
People are too blind by bull crap to realize the money is being made worthless.­.its not things going up in price, its the money being made in to something worst than the Peso. Globalism, free trade and Communist Central governments in with investors using a non gold backed currency is a dangerous thing. They will finish America if people do not wake up.

[Knowbetter]

Ron Paul is an idiot.

[IranBushsWaterloo]

So are you, Dumbo.

[MetalCanuck]

Knownothing should be your name.

[maggiemae656]

Those who do not learn from the mistakes of their past are doomed to repeat them. If you want real change, you have to loose your fears.

[MetalCanuck]

Your an idiot.

[FreedomCorpse]

In a 'service-based' economy as bush so proudly used to say and his little followers ate it up actually means Military service. A service based economy cannot exist by itself for very long

[NelsonR]

Well you are right there, a service based economy but our rich who are wealthier and amassing more of the wealth daily are currently investing in foreign nations and currencies. They have already sucked are system dry through cronyism and corruption. They determined more little people out there in other nations. Isn't globalization grand? Isn't unfair trade policies fair?
Thank you, to both the Republican and Democratic leadership who have been stupendous in their analogy's of what makes America grand? Meanwhile our leaders are fat and sassy with employment perks and benefits most would die for, well some of those they sent to Iraq are dying now for them. All insanity by an upper class citizenry.

[loki]

No it cant. but in that short time it does exist, a few people make a hell of a lot of money. And really when it comes down to it, isnt that really all bush and Co wanted to do?

[FreedomCorpse]

As the federal reserve bails out banks and investment firms for piss poor business ethics this is what will happen to the dollar...

German Mark prices of Silver and Gold from January 1919 to November 1923:

Jan. 1919 Silver 12 Gold 170
May. 1919 Silver 17 Gold 267
Sept. 1919 Silver 31 Gold 499

Jan. 1920 Silver 84 Gold 1,340
May 1920 Silver 60 Gold 966

Sept. 1921 Silver 80 Gold 2,175

Jan. 1922 Silver 249 Gold 3,976
May. 1922 Silver 375 Gold 6,012
Sept. 1922 Silver 1899 Gold 30,381

Jan. 1923 Silver 23,277 Gold 372,447
May. 1923 Silver 44,397 Gold 710,355
June 5, 1923 Silver 80,953 Gold 1,295,256
July 3, 1923 Silver 207,239 Gold 3,315,831
Aug. 7, 1923 Silver 4,273,874 Gold 68,382,000
Sept. 4, 1923 Silver 16,839,937 Gold 269,429,000
Oct. 2, 1923 Silver 414,484,000 Gold 6,631,749,000
Oct. 9, 1923 Silver 1,554,309,000 Gold 24,868,950,000
Oct. 16, 1923 Silver 5,319,567,000 Gold 84,969,072,000
Oct. 23, 1923 Silver 7,253,460,000 Gold 1,160,552,662,000
Oct. 30, 1923 Silver 8,419,200,000 Gold 1,347,070,000,000
Nov. 5, 1923 Silver 54,375,000,000 Gold 8,700,000,000,000
Nov. 13, 1923 Silver 108,750,000,000 Gold 17,400,000,000,000
Nov. 30, 1923 Silver 543,750,000,000 Gold 87,000,000,000,000

[loki]

Thats fitting as it is the Neo Nazi Rethugs running the show right now. Corporations and elite get fat, the rest pay and pay and pay, and pay, and pay, and pay.......

[noneIn2008]

At least we are able to reduce their CO2 footprint. Let's slap them with a CO2 tax to get it down more. Let's add a gas tax to make sure they drive even less.

[SusanRen]

We own a small business that employess 4. The other day one of our young employees complained he didnt make enough money. Ok then do you still smoke? Yes me and my girlfriend spend 80.00$ a week on cigarettes and we want to buy a new house( they dont like the one they are buying now). So we told him it was time that they quit smoking and that his girlfriend find a job any job. She wanted to clean our bathroom for 20.00 at our shop. It takes about 30 minutes. We are not a big business and have spent years building it up. Alot of peoples money problems is because of how they spend money. Yes I agree the economy is bad right now but there are things people can do. BTW our young employee makes 15.00$ an hr, not bad for a kid. I find a lot of people are clueless about money especially young people, maybe the hard times a coming will be a wake up call for America and its gotta have mentallity.

[mmckinl]

And the Hedge Fund Managers that pay 15% on their billion dollar income while the rest of us pays upwards of 25% and payroll taxes to boot?

Try again my dear ...

[SusanRen]

Oh we pay plenty of taxes monthly, and it pisses me off. Then there is the quarterly estimated taxes which I think everyone should experience. Thats not much fun either. And I'm afraid that whoever gets in office will raise more taxes on us it just might mean we will lose an employee or two. Well as far as the Hedge Fund managers their day will come so I dont worry about them. In fact I always thought it was silly to be jealous over how much others make.

[SusanRen]

Maybe that Hedge Fund Manager will need electrical work and call us. Doubtful that any live where we do.

[maggiemae656]

The reason why people spend money is because consumerism is the basis for the economy--we have been conditioned for many years to spend, spend, spend. This is what has made our economy go-round. Our problems revolve around one basic downfall--­degradatio­n of our wage base through job loss, underemployment and cut backs in hours.

It will take a while for Americans to release themselves from the grips of consumerism. Hopefully, we will get a break from all the advertisements and the in-your-face "buy, buy, buy" constant nagging that goes on on television, the Internet, American billboards, the sides of public busses, and on the phone with telemarketers calling during every waking hour of our lives. It will be a better life in the end, but it's not going to make American business people rich.

Your kid making $15.00 hour has concerns bigger than whether or not he should buy a carton of cigarettes. Someone at that wage level has no business buying a house. Someone should speak with him about that need for a house--people are so hung up on buying houses that in the end cause them more financial harm than good. You don't own your house--it is nothing more than a rental property that you have to maintain. Until your mortgage is paid off, you answer to your lender and to the state. Once it's paid off, you still answer to the state. It's not all it's cracked up to be.

[SusanRen]

He already bought a house a few years ago. A small 1 bedroom but its not good enough for his girlfriend. I could go on and on about what a financial idiot he is but then I see that in alot of younger people now a days. Gotta have brand new and the best. Hell I'm 55 and got my first brand new car 3 years ago and will probably drive it tills theres no gas left or it breaks down.

[mmckinl]

The real unemployment rate is north of 10% and while actual wages paid are heading south inflation is gouging any dollars left there as well.

It will only get worse. The economy will spiral downward as even the financial sector employees look over their shoulders at massive layoffs ...

No one left to increase spending that the leveraged debt banking system we have needs to produce the ever increasing amounts of money needed to feed the debt spiral. It is called a crash.

[swift goat pet for truth]

I saw an article recently about some guy who goes around t he US promoting the eating of various kinds of insects. Seriously, the insects are high in protein, eat mostly inedible vegetation or garbage, are cheap and easy to raise, and can be eaten without heating.

It's only cultural.

If I move quickly, I can be at the leading edge of a new trend for Americans.­...

[rwe2late]

The financial institutions can no longer easily make profits off bundled mortgage scams.
Now, with the help of the Federal Reserve (low interest rates and buy-outs of tainted securities), the finance brokers still have plenty of bucks (credit) to drive up commodity prices and inflate the stock market. No wonder their CEOs are saying the worst is over (for them).
Meanwhile, the rest of us, both at home and abroad, can start learning to eat dirt, like they are already forced to do in Haiti.

[swift goat pet for truth]

No, man, don't eat the dirt. Eat the EARTHWORMS. More protein. Low fat. Its natural.

THAT'S the point.

[hey0there]

Well not exactly new -- there's insect-based ingredients in many of our products already. Even things like Starbucks' strawberry n cream frapuccino gets its red color from crushed up pregnant cochineal beetles.

[Vyvjala]

Hannity could feed a family eight, hes a wormass...­..........­....

[NelsonR]

The bright side. Our upper crust are getting richer. Outsourcing means more profits for the Corporate powers that are and meanwhile these elitist raise the middle finger to the middle class.

Your food prices will increase rapidly while the commodity traders get even more richer. There is no food shortage, their is the greed factor and the farmer and trucker receives nothing but higher production and transport prices. Got to love our rich. Got to love our the system of the rich, for the rich and by the rich. Yet the average Joe Blowe accepts it all with politicians getting their kickbacks.

[swift goat pet for truth]

The American economy will not regain its former strength until the middle American worker regains access to the levels of disposable income they once had.

Our post-WWII economy was built on the disposable income of middle Americans who used it to buy cars, them new fangled TVs, refrigerators, stoves, toys, etc. After REAGAN gutted the unions and shifted the tax structure to strangle middle class Americans and benefit the rich (who soon became the uber-rich), the American worker's disposable income slowly decreased, but the spending was buoyed by financial events like the tech boom (and bubble) and the housing boom (and bubble), facilitated by easy credit.

Well, that is not happening now. And corporations have squeezed their workers to fatten their bottom lines (and CEO paychecks) about all they can. What is really needed for American corporations to grow is top line growth - SALES. And sales ain't happening if the middle class is spending all their money on food, gas, their health care, and paying off credit card debt.

The growth of the middle class was signaled last century by businessmen like Henry Ford paying their workers way more than the going price so that they could afford Mr. Ford's new cars. Until that happens, I do not see American businesses, or Americans, doing particularly well.

[outnow]

Neoliberalism is a program where the rich get richer and the poor get poorer. Adam Smith was the champion of economic liberalism. No governmental restrictions on manufacturing, no barriers to commerce, no tariffs. Free trade was a license for capitalists to make huge profits as they wished.

The neo or new liberalism came about after the great depression when John Maynard Keynes challenged the dogma because of the cycle of bust and boom that led to violent cycles in the economy and was destructive socially and politicall­y.. He favored full employment as being necessary for capitalism to grow and can only be achieved if governments and central banks intervene to increase employment. FDR's New Deal realized that the economy had locks that could be used like a canal to lift segments of the working classes by public spending to advance the public good.

Now with Reaganomics and globalization there is only the Rule of the Market; Cutting Public Expenditures for Social Services; Deregulation; Cutting taxes on the very wealthy; Privatization to further concentrate wealth; and elimination of the concept of Public Good. Internationally the World Bank and the International Monetary Fund assist the wealthy. These institutions work closely with the CIA and NGOs. Destroying welfare attacking the rights of labor and eroding environmental controls. is all part of the Contract on America and the rest of the world.

[mmckinl]

Well said ...

And the pillars of neoliberalism are the WTO, the private bankers leveraged money making machine The Federal Reserve, the Main Stream Media and the complete corruption of both major political parties.

At some point the oligarchs will only have each other to steal from, and then it gets interesting.

[JoeBlough]

I've started using a mantra that I remember was quite popular during World War II: "Is this trip really necessary?" I say it every time I walk towards my car. Most times I walk away. If people would only drive when necessary, they would have a lot more cash on hand. Why give it away to the oil companies?

[loril]

This is one way our lives have changed as well. When I was young, I used to "joyride" with my friends. Now, my husband and I share one car and our driving has been much reduced. It would be wonderful if more people would agree to park the car more often and go without.

Problem: the vast exurban sprawl. So many people have fled farther and farther away from the urban centers where public transportation still exists in a useable form. We can handle the one car situation because we live near the city on a busline and close to a commuter rail as well. This is rare in our society...­especially amongst the dwindling middle class, who still prefer the expanse of pedestrian unfriendly exurbia.

We actually chose our community about 5 years ago and the access to public transportation was a key factor in our decision. We were starting to see the writing on the wall and we realized that money would be tight for us and the cost of driving would only go up. I would love to see some of our inner ring suburbs and urban areas revitalize as people realize the benefits of living in a place where a car becomes more optional.

[ImmanuelGoldstein]

You are wise, I live in a city with some of the worst mass transit in the country and I wonder what it will be like here when gas get to $5+ a gal. as it inevitably will.Once I finish my training I'm comtemplating a move to a more sustainable area.

The costs of maintaining carworld are going to increase, exponentially as we try to export this unsustainable model. The question, will we sidetrack into irrational dead ends like the ethanol fiasco or will we finally begin to question the religion of the car?