Why We Need Community Organizers

Are you better off today than you were eight years ago? If you are the top of the food chain, the answer is yes, but for everyone else the answer is generally no. And today's news doesn't help. The unemployment rate rose from 5.7 to 6.1 percent in August, and the broadest measure of unemployment (U6) now stands at 10.7%. That's up from 10.4% a month ago, and 8.4% a year ago.

When you look further into the numbers and break them down into groups who generally struggle economically, conditions are much worse. If you are a woman trying to maintain a household, your unemployment rate rose from 8.5% to 9.6%. The unemployment rate for blacks rose from 9.7% to 10.6%, and for Hispanics from 7.4% to 8.0%. Teen unemployment actually fell by 1.6% as compared to last month, but it still stands at 18.9%. And for the slightly older age group, ages 20-24, the rate stands at 10.5%. And those are all the narrow measure of unemployment, U3. The broader measures such as U6 would, of course, show conditions to be much worse.

Have Republicans devoted enough attention to these issues? No. This brings us to an important point.

Republicans have been targeting Community Organizers this week, but one of the important things Community Organizers do is clean up after Republicans. Without their help, and given Republicans blindness to these issues and the needs of these communities, and given that their trickle down economic policies have not, in fact, trickled down, conditions would be much worse.

Here's more discussion of the report:

• Yep, This Is Definitely a Recession..., Brad DeLong
• More Bad News from the Labor Front, Angry Bear
• Employment Report, Angry Bear
• Economic doldrums, ataxingmatter
• The un-recession, Paul Krugman
• How Bad Will The Recession Get?, Michael Mandel
• What Do You Call This?, Andrew Samwick
• The August Employment Report, CBPP
• Jobs_and_wage_insurance, Andrew Leonard
• Today's Jobs Report, and What it Means, Robert Reich
• Recession? It's starting to look like it, but it's a very odd one, William Polley
• Negative Jobs Report Not Game Changer for the Fed, Real Time Economics

Gas Prices, Exports and the "Jobs Recession" Thing, Paul Kedrosky: This morning off the top of The Call on CNBC I was chatting about jobs and the economy with Larry Kudlow and Robert Reich. It was, as you might expect, highly amusing, with noisy positions taken all around, and little time to expand on things.

So, three quick points:

1. First, Larry kept saying we may "technically" be in a "jobs recession". I tried to point out that I have no idea what that is, that it must be some sort of Larry-ism, but don't think it came through in the cross-talk. But here's the main take-away: Whatever a jobs recession is (and I'll defer to Barry's Kudlow-to-English dictionary on that one), we have never had eight months of job losses without being in a recession, so splitting things this way is semantic at best.
2. Lower gas prices are good, as Larry said, but we are only back to prices that eight months people, ahem, were were calling outrageously high and economically damaging. So, while some of the pressure is off, let's be clear about relative versus absolute effects of lower gas prices. Transportation and manufacturing generally are still being pounded, and that isn't stopping.
3. Finally, with respect to exports, it is true that Europe and Japan haven't accounted for the bulk of the growth in U.S. overseas exports in recent years, so weakness in those markets is, while not a wash, less dire than weakness elsewhere. That said, the BRIC countries aren't currently headed into a recession, but they are all weakening materially, as I have been saying they would for some time.  So, from a U.S. export standpoint, a 300 basis-point across the board cut in GDP growth in BRICs, which is what we are currently looking at, is highly damaging, even if you stay well away from recession.

On the last point, an important factor going forward will be the strength of exports, and that will depend in part upon whether the rest of the world has "decoupled". If decoupling has occurred, a slowdown here will not substantially alter the demand for our exported goods. But if the economies are coupled, a slowdown here will cause a slowdown elsewhere, and that will feedback through to the U.S. as a lowered demand for exported goods (lowering GDP).On that issue:

Whither De-coupling?, Kids Prefer Cheese: One the one hand the global economy seems more integrated than ever, but on the other, it is claimed that the BRICs are growing right through rich country cycles, so what is up with the de-coupling hypothesis?

A new paper by Kose Otruk & Prasad addresses this question empirically using a large dataset of over 100 countries from 1960-2005. They divide the countries into Industrial, Emerging, & Other and use Bayesian methods (Gibbs sampling with data augmentation) to estimate a dynamic factor model of what shocks drive cycles in these countries. When comparing the 1960-84 period with 1985-2005, they find that the global factor has declined in importance in all three groups, while the group factor has become more important in the Industrial and Emerging groups.

So globally, decoupling but within two of the three regions, increased syncronization while in the dreaded "Other" group (developing but not emerging!) idiosyncratic factors have become more important.

Very nice paper, but it seems to me that Tolstoy should get a shout out in the acknowledgements! After all, he said it first.

Comments

[anne]

Adolf Reed of University of Pennsylvania is an expert on community organizing, and finds the approach importantly effective when practiced but complains about the approach being remarkably little practiced. I do not have a sense of community organizing, having seemingly never been part of a community in which there is any meaningful organizing, so I would lean to Reed in thinking there is little organizing but there could be.

[anne]

Reed was interviewed, sort of, a week ago and I read the transcript in which he tried to point out that working from above in terms of generating political change was not and would not be effective. Katrina vanden Heuvel was however being interviewed alongside, and insisted that leadership, top down, was what was needed and Reed could scarcely find space to argue. *

* http://www.pbs.org/moyers/journal/08292008/profile.html

[Bruce Wilder]

Home loan troubles break records again: Financial News - Yahoo! Finance: "The Mortgage Bankers Association said Friday that more than 4 million American homeowners with a mortgage -- a record 9 percent -- were either behind on their payments or in foreclosure at the end of June.The Mortgage Bankers Association said Friday that more than 4 million American homeowners with a mortgage -- a record 9 percent -- were either behind on their payments or in foreclosure at the end of June."

I heard this on NPR this morning and it didn't quite register thru my sleepiness, but Atrios cited the same report, calling it, stunning. I agree.

That's a fantastically high number. This is not going to be your father's recession.

[donna]

Without the "community organizers" Palin disparages, she would have neither the right to vote or to run for political office.

She might want to think about that a bit.

[anne]

Darn, I really think we should be worried about not understanding enough of what has been happening through this business cycle, whether taken from the end of the last recession when the initial Bush budget was in place or from the beginning when the Federal Reserve had become pronounced rate reductions. There was a difference here, from western Europe or Australia or even linked Canada that I do not understand.

Joseph Stiglitz tried a war-related explanation, but ultimately not convincingly.

[rufus]

donna says...
"Without the "community organizers" Palin disparages, she would have neither the right to vote or to run for political office."

Brilliant!

[lonesome moderate]

Saw a nice line about this on another blog--"Jesus was not a politician, he was a community organizer".

[Robinia]

I think a couple of years of service as a community organizer, or service as a public school teacher, should count as "serving one's country" and qualify people for veteran's benefits following an honorable discharge.

[Patricia Shannon]

Anne, it's up to you to find and join a community group. United Way might be able to direct you to some you would be interested in.

says...

I prefer the old-school term "Ward Heeler".

[anne]

Interesting thinking about the United Way. Several years ago I was told by my department head to handle the fund raising drive, which is after all the sort of thing a woman needing security can be told. The idea of asking people some of who I knew well and some not for money for charity, could not be more distasteful to me. But, I did as I was told in giving out the cards with a begging look. What astonished me was that I turned in only the cards with pledges, and was immediately told the everyone had to turn in a card whether they pledged or not. Well, I did no such thing and I turned in no card for myself being that kind of rotten uncharitable person. So much for the United Way and me.

[pope pious]

Yes, the United Way is most certainly and evil and dastardly organization. Only an elitist, who has never known true hunger and/or poverty could hold this view, “The idea of asking people some of who I knew well and some not for money for charity, could not be more distasteful to me.” The idea is that one would solicit contributions on behalf of the United Way, to avoid having those that are truly in need be reduced to begging. You have to always been rich to think like this is the first place.

“…giving out the cards with a begging look”, it’s not begging if you’re soliciting aid for others. As stated, begging is when someone who truly has known poverty has no other option but to ask for assistance. However that requires one to swallow a great deal of pride, and doubt you have the throat for it. Anne, just put your Palin button on and move to the right.

[Liz]

If you look at all the $150K jobs posted on employment sites, youd think this was a boom time...

http://www.linkedin.com
http://www.indeed.com
http://www.realmatch.com

There are attractive jobs out there for people if they know where to look.

[Patricia Shannon]

Liz,

Please give more specific info for finding these jobs. Eg., job titles.

I remember several years ago when I was applying for jobs that I was fully qualified for. Recruiters said I had an impressive resume and references. In fact, a couple said that some supervisors and co-workers were "intimidated" by my abilities, although I deliberately try to be non-"intimidating". And I couldn't get an interview, much less a job.

[Patricia Shannon]

Actually, I already know that you can get good-paying jobs if you are willing to work as a contractor in Iraq.

[Jordan]

Despite the stats, I see so many high paying jobs posted on employment sites -

www.linkedin.com (networking)
www.indeed.com (aggregated lists)
www.realmatch.com (matches you to jobs)

I see 75K, 100K and 150K jobs