Cross-posted at Montclair SocioBlog.

According to an op-ed in the Times, America is the global leader in broadband, with high speeds and great service. And it’s all because the government restrained “onerous” regulation and let companies like Verizon do what they want and charge what they want.

It was written by the CEO of Verizon, Lowell McAdam.

I pay Mr. McAdam’s company about $115 each month for my land line, wi-fi, and cable (all FIOS).  Mr. McAdam compares the U.S. favorably with Europe, “where innovation and investment in advanced networks have stagnated under an onerous regulatory regime.”  I asked a friend who lives in Paris what he pays for his FIOS phone, wi-fi, and cable.  The monthly bill:  39.90€ ($52) or half of what I pay Verizon.  Maybe there’s an upside to stagnant and onerous.

There’s nothing wrong with getting what you can afford, and it occurred to me that U.S. broadband is the best because we can afford more.  Onerous regulations or no, most other countries are not as rich as the U.S.  What if you looked at broadband and per capita GDP?

The OECD did just that with data from June 2012 (their several spreadsheets on this are here). The purple bars are broadband penetration and the bumpy red line is GDP per capita. Do you see a correlation?

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Consider France: As of a year ago, the country had greater broadband penetration despite a lower per capita GDP than the U.S. ($35,133 vs. $46,588); that’s 25% more broadband on 33% less income and at half the cost to consumers.

If you re-rank the OECD countries factoring in per capita GDP, the line-up changes.  Notably, the U.S. and Luxembourg drop well below the OECD average, despite being among the wealthiest countries.

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Of course, not all broadbands are equally broad.  Verizon sold me on fiber-optic with their assurance that it was dazzlingly faster than their DSL that I had been clunking along on. This graph breaks down broadband into its various incarnations.

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The U.S. is slightly above average on all broadband, but when it comes to a high fibre diet, we are ahead of several other countries that have greater total penetration.  On the other hand, the Scandinavian countries are ahead of us, as are, impressively, the Asian countries.

This is not to deny U.S. advances.  TechCrunch summarizes more recent data from Akamai on these changes:

the U.S. is currently second in the price of broadband for entry-level users. The nation is also third in network-based competition, second in the fiber-optic installation rate, first in the adoption of next-generation LTE, ahead of Europe in broadband adoption, and doing quite well in Internet-based services.

Still, the U.S. lags behind other, less wealthy countries.  InnovationFiles, using Akamai data for different variables, has a less congratulatory view.

  • The U. S. has picked up one place in the “Average Peak Connection Speed” that’s the best measurement of network capacity, rising from 14th to 13th as the measured peak connection speed increased from 29.6 Mbps to 31.5 Mbps.
  • In terms of the “Average Connection Speed,” widely cited by analysts who don’t know what it means, the U. S. remains in 8th place world-wide. but we’re no longer tied for it as we were in the previous quarter; Sweden is right behind us on this one.
  • In terms of “High Speed Broadband Adoption”, the proportion of IP addresses with an Average Connection Speed greater than 10 Mbps, we remain in 7th place, but now we’re tied with  Sweden.

The title of CEO McAdam’s op-ed is “How the US Got Broadband Right.”  Given the content, I  guess “We’re Number 13!” wouldn’t have been appropriate.  Even “We’re Number Seven (Tied With Socialist Sweden)!” doesn’t quite have that affirmative zing.

Jay Livingston is the chair of the Sociology Department at Montclair State University. You can follow him at Montclair SocioBlog or on Twitter.

In the early 1990s, Bill Moyers began following two Milwaukee families, the Neumanns and the Stanleys, as they struggled to keep a foothold in the middle class in the face of economic changes that largely destroyed the city’s decently-paid, unionized manufacturing jobs. An earlier documentary, Surviving the Good Times, showcased the two incredibly hard-working families’ efforts to adapt to the new economic reality. Their stories highlight the difficulty of trying to achieve the American Dream on a series of jobs that rarely pay a living wage or offer any benefits.

And how about now? Twenty years after he first started following their lives, Moyers returned to Milwaukee to see how they had fared during the housing bubble and subsequent economic crisis. Two American Families shows the increasing economic precariousness each family experiences over two decades and the impacts this has on the opportunities they can provide their children. It’s a heartbreaking look at the effects of large-scale economic changes on individual families.

Watch Two American Families on PBS. See more from FRONTLINE.

PBS has also posted interviews with a few of the family members about why they participated in the new film, as well as an update on how they’re doing since they were last filmed. And you can find a number of charts on the changing economy and its impacts on families here, and some data about Milwaukee specifically here.

Gwen Sharp is an associate professor of sociology at Nevada State College. You can follow her on Twitter at @gwensharpnv.

Cross-posted at Reports from the Economic Front.

Media and policy-makers seem anxious to convince us that the economy is in strong recovery mode, therefore, no further significant policy interventions are needed.

Their optimism appears to rest heavily on the recent acceleration in consumer spending.  After all, there are strong reasons for concern with the other major sources of growth:  government spending on all levels is being cut, exports face a weakening world economy, and business investment remains largely stagnate.

But there are also strong reasons to challenge this optimistic view of consumer spending as a growth engine.  The charts below, from a Wall Street Journal article, highlight some of the most important.

As we see below, while consumption spending is indeed accelerating, after tax personal income is falling.  In other words, there appears little reason to believe that there is a solid foundation for sustaining this trend.

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Additionally, after four years of recovery we still have 2.4 million fewer jobs than we had at the start of the recession.  Moreover, as we see below, there has been no real wage growth.  In fact, real average wages have fallen for most of the so-called expansionary period.

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Yes, housing values are finally starting to rise and household debt payments as a share of after-tax income are declining.  But to a large extent the new burst in consumption spending has more to do with renewed borrowing than solid gains in job creation and income.

Unfortunately, there is little reason for us to have confidence that the economy is gathering strength in ways that will be sustainable or benefit the great majority of working people.

Martin Hart-Landsberg is a professor of economics at Lewis and Clark College. You can follow him at Reports from the Economic Front.

While the stereotype of the college professor might still be an elbow-patched intellectual cozied up in an office, it might be more accurate to place him in his car.  A new report from the American Association of University Professors finds that more than 40% of college instructors are part-time, often driving from campus to campus to cobble together enough classes to enable them to pay rent.  These types of employees far outnumber tenured and tenure-track faculty, who make up less than a quarter.

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This data suggest that the term “precariat” applies well to a significant proportion of college and university professors. Coined by economist Guy Standing, the term is meant to draw attention to the economic fragility of many lower wage workers in today’s labor market.  It’s a combination of the word “precarious” and “proletarian,” a word that is used to refer to the working class under capitalism.

Part-time faculty count as part of the precariat because their jobs are contingent (renewed semester to semester), low paid, and bring little or no benefits.  Let me put it this way.  I just finished my first year as a tenured professor after six years on the tenure track.  I teach five classes.  An adjunct at a public research university would have to teach more than twenty-three classes to earn my salary (average pay is $3,200/class); someone teaching at community colleges would have to teach more than thirty-three (at $2,250/class).  Of course, my salary also reflects research and institutional service, but my hourly wage is obviously far out-of-proportion to that of part-time faculty.  Plus I get a wide range of benefits; adjuncts usually get nothing.

When government funding of higher education shrinks, colleges and universities respond by cutting corners where they can.  Hiring adjuncts is one way to do that.  It’s important to remember, then, that funding cuts hurt not only students; they also hurt jobs.

See also How Many PhDs are Professors?

Via Jordan Weissman at The Atlantic. Cross-posted at Pacific Standard.

Lisa Wade, PhD is a professor at Occidental College. She is the author of American Hookup, a book about college sexual culture, and a textbook about gender. You can follow her on Twitter, Facebook, and Instagram.

Cross-posted at Montclair Socioblog.

We got another reminder last week that despite complaints about federal government programs that give money to the poor, when it comes to taxes, the government is much more generous to the wealthy.  The news came from a report from the Congressional Budget Office on tax expenditures.

These are the ways that the government uses the tax system to give money to people. Some expenditures are tax credits, which can take the form of cash payments.  Others are tax breaks — taxing people less than the going rate. For example, if I am in the 35% tax bracket, but the government charges me only 15% on the $100,000 I made playing the stock market, the government is giving me $20,000 it could otherwise have had me pay in taxes. That’s an expense. The preferential rate for my luck in the market costs the government $20,000.

The justification for these expenditures is that they are a way the government can encourage people to do something that it wants them to do.  With tax breaks, the government is basically paying people by not charging them full tax fare — encouraging them to buy a house or give to charity or get health insurance at their work.  Similarly with the tax credits that go mostly to the poor. We want people to hold a job and to care for their kids.  The child tax credit gives people more money to care for their children.  The Earned Income Tax Credit pays them for working, even at jobs that pay very little.  By the same logic, the government is paying me to invest my money in companies — or put another way, to play the stock market.

This government largesse, however, benefits some people more than others:

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About half of all tax expenditures go to the top quintile (top 20% of income earners).  The bottom 80% of earners divide the other half.  And within that richest quintile, the top 1% receive 15% of all tax expenditures (this distribution of tax breaks roughly parallels the distribution of income). Were you really expecting Sherwood Forest?

Here is a breakdown of the costs of these different tax expenditures:

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The Earned Income Tax Credit, which benefits mostly the poor, costs less than $40B.  The tab for the low tax on investment income (capital gains and dividends) is more than twice that, and nearly all of that goes to the top quintile.  More than two-thirds goes to the richest 1%.

Dylan Matthews at the Washington Post WonkBlog regraphed the numbers to show the total amounts overall plus the amounts in each category for each income group:

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The point? People complain about government payments to the poor, but tax breaks are also payments, though less obviously so, to the rich.  And those tax breaks cost the government a lot more money.

Jay Livingston is the chair of the Sociology Department at Montclair State University. You can follow him at Montclair SocioBlog or on Twitter.

American companies that once looked to places like Mexico and China for cheap labor are bringing those jobs back to the U.S.  Why? Because prison labor is much, much cheaper.  Paid between 93¢ and $4.73 per day, and collecting no benefits, prisoners are a cheap labor source for about 100 companies (source).

What does this have to do with you?

If you have insurance, invest, use utilities, have a bank, drive a car, send a child to school, go to a dentist, call service centers, fly on planes, take prescription drugs, or use paper, you might be benefiting from prison labor.

If you’ve bought products by or from Starbucks, Nintendo, Victoria’s Secret, JC Penney, Sears, Wal-Mart, K-Mart, Eddie Bauer, Wendy’s, Proctor & Gamble, Johnson & Johnson, Fruit of the Loom, Motorola, Caterpiller, Sara Lee, Quaker Oats, Mary Kay, or Microsoft, you are part of this system.

When prisoners are in state and federal prisons, the U.S. taxpayer is subsidizing low wages and corporate profits, since they are paying for prisoners’ room, board, and health care.  When prisoners are in private prisons, prison labor is a way to make more money off of the human beings caught in the corrections industry.  In other words, prison labor is an efficient way for corporations to continue to increase their profits without sharing those gains with their employees.

For an extensive list of the companies contracting prison labor, click here.  You might also find interesting the video clips, embedded in this news story, of promotional videos by prison corporations that attempt to sell the idea of prison labor to companies:

Lisa Wade, PhD is a professor at Occidental College. She is the author of American Hookup, a book about college sexual culture, and a textbook about gender. You can follow her on Twitter, Facebook, and Instagram.

While some austerity advocates really fear (although incorrectly) the consequences of deficit spending, the strongest proponents are actually only concerned with slashing government programs or the use of public employees to provide them.  In other words their aim is to weaken public programs and/or convert them into opportunities for private profit. One measure of their success has been the steady decline in public employment.  Floyd Norris, writing in the New York Times notes:

For jobs, the past four years have been a wash.

The December jobs figures out today indicate that there were 725,000 more jobs in the private sector than at the end of 2008 — and 697,000 fewer government jobs. That works into a private-sector gain of 0.6 percent, and a government sector decline of 3.1 percent.

In total, the number of people with jobs is up by 28,000, or 0.02 percent.

How does that compare? It is by far the largest four-year decline in government employment since the 1944-48 term. That decline was caused by the end of World War II; this one was caused largely by budget limitations.

The chart below, taken from the same post, also reveals just how weak private sector job creation has been over the past 12 years (compare the top three rows — the presidencies of Obama and Bush — w job changes This graphic from the New York Times highlights just how significant the decline in public employment has been in this business cycle compared with past ones.  Each line shows the percentage change in public sector employment for specified months after the start of a recession.  Our recent recession began December 2007 and ended June 2009.   As you can see, what is happening now is far from usual.

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It is also worth noting that despite claims that most Americans want to see cuts in major federal government programs, the survey data show the opposite.  For example, see the following graphic from Catherine Rampell’s blog post. economix-22pewwhattocut-blog480 As Rampell explains:

In every category except for “aid to world’s needy,” more than half of the respondents wanted either to keep spending levels the same or to increase them. In the “aid to world’s needy” category, less than half wanted to cut spending.

Not surprisingly, this assault on government spending and employment will have real consequences for the economy and job creation. All of this takes us back to the starting point — we are talking policy here.  Whose interests are served by these trends?

Martin Hart-Landsberg is a professor of economics at Lewis and Clark College. You can follow him at Reports from the Economic Front.

Cross-posted at Montclair SocioBlog.

The Washington Post has provided some data on medical costs across a selection of countries (Argentina, Canada, Chile, and India in grey; France, Germany, Switzerland, and Spain in blue; and the U.S. in red). The data reveal that American health care is very expensive compared to other countries.

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No wonder the US spends twice as much as France on health care.  In 2009, the U.S. average was $8000 per person; in France, $4000.  (Canada came in at $4800).  Why do we spend so much?  Ezra Klein quotes the title of a 2003 paper by four health-care economists:  “it’s the prices, stupid.”

And why are US prices higher?  Prices in the other OECD countries are lower partly because of what U.S. conservatives would call socialism – the active participation of the government.  In the U.K. and Canada, the government sets prices.  In other countries, the government uses its Wal-Mart-like power as a huge buyer to negotiate lower prices from providers.  (If it’s a good thing for Wal-Mart to bring lower prices for people who need to buy clothes, why is it a bad thing for the government to bring lower prices to people who need to buy, say, an appendectomy? I could never figure that out.)

There may also be cultural differences between the U.S. and other wealthy countries, differences about whether greed, for lack of a better word, is good.  How much greed is good, and in what realms is it good?  Klein quotes a man who served in the Thatcher government:

Health is a business in the United States in quite a different way than it is elsewhere.  It’s very much something people make money out of. There isn’t too much embarrassment about that compared to Europe and elsewhere.

So we Americans roll along, paying several times what others pay for medical procedures, doctor visits, and drugs.

Jay Livingston is the chair of the Sociology Department at Montclair State University. You can follow him at Montclair SocioBlog or on Twitter.