Re: "The Great Risk Shift"

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Well, ok. My thesis over at CT was that in the long run liberalism, by its very nature cannot really ensure against risk. I think liberalism assumes a certain level of consensus and shared assumptions, and when faced with a closely divided society, a plurality of which wants to eliminate the safety net, liberalism will actually increase risk by increasing uncertainty. Democrats cannot guarantee I will have Social Securty, because they cannot, may not as a matter of principle, guarantee that a Right-wing regime will not gain power and destroy SS.

At CT I used Katrina/NO as an example. Clinton ran a good FEMA, Bush ran a horrible FEMA, I am told to vote Democratic so President Edwards can run a good FEMA again. What kind of FEMA will Houston and Miami have in 2026? Hacker and Klein really have no clue.

The citizens of New Orleans were ill-served by liberalism. Most power being centralized, and Democrats being out of power, Republicans were able to kill an entire city. I don't think there is anything the Tapped Symposium can say that can reassure me that it will not happen again.


Posted by: bob mcmanus | Link to this comment | 10-29-06 4:57 PM
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Bob, the opposition you want to draw is between, on the one hand, liberalism, and on the other a form of government not including elections? A form of government with more constrained options for the electorate? I can't tell if this sounds snarky, it's not really meant to be.


Posted by: washerdreyer | Link to this comment | 10-29-06 5:00 PM
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Dictatorship of the proletariat, man. No, seriously, I don't get it either -- while I'd like a system of government that assured that no one I disagreed with ever got into power, I can't imagine how to be sure of that.


Posted by: LizardBreath | Link to this comment | 10-29-06 5:03 PM
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A system in which you had all the power, contingent on your being alive, would ensure that no who disagreed with you ever got into power during your lifetime.


Posted by: washerdreyer | Link to this comment | 10-29-06 5:07 PM
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2,3:Devolution, federalism, Urban socialism, syndicalism. At CT I mentioned the Bushco dispersed the NO residents as quickly as possible, because I think they understand there are more political tools and weapons than only parties and elections.

500k NO residents grab the shipping and energy assets(refineries) and hold them hostage against decent reconstruction. Big government liberalism actually impedes and discourages local organization and initiative. In NO, actively got in the way, preventing Canadian water trucks and the Red Cross from entering town.

I don't want to prevent national elections, I want them to matter much less.


Posted by: bob mcmanus | Link to this comment | 10-29-06 5:12 PM
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No govt. on earth can promise the kind of security you seem to be referencing, bob.


Posted by: SomeCallMeTim | Link to this comment | 10-29-06 5:12 PM
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I'm actually good with that. I think I'd be a just yet kindly ruler, so long as no one pissed me off.


Posted by: LizardBreath | Link to this comment | 10-29-06 5:12 PM
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7: You might have had my backing for your benevolent dictatorship, LB, until the mask slipped this weekend. I have seen the Iron Fist in the velvet glove.

What are the basic things your grandparents had that you'd like effectively promised today?


Posted by: SomeCallMeTim | Link to this comment | 10-29-06 5:14 PM
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I'd go even stronger than LB's post. Upward mobility, decreasing inequality means bupkus if you don't have security. I don't think these goals are necessarily in tension, mind. If everyone has equal access to health care, you'll feel more secure in that if you lose your job, you won't have to worry that maybe Johnny's cough will go away.

We're all shaped by personal experiences, of course, but now we're not allowed to mention them because that's unfair like Ann Coulter, or something. Suffice it to say the stresses in the Calahousehold growing up weren't due to income alone, but fluctuating money that makes it impossible to plan a life or save or relax.


Posted by: Cala | Link to this comment | 10-29-06 5:18 PM
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It's a matter of odds, rather than guarantees. They were fairly certain that they weren't going to be laid off -- they knew that they had jobs securely untill retirement. I'm not saying that that's easy to provide in our [insert boilerplate about how things are just different now] economy, but it's important to recognize that losing that security is a real loss, and that someone who has to provide their own cushion against job loss needs a lot more money in the good times.

Even corrected for inflation, $50K a year now isn't the same as $50K with lifetime employment and a pension.


Posted by: LizardBreath | Link to this comment | 10-29-06 5:19 PM
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10: There are a fair number of people, I think, who have discussed income insurance. Maybe DeLong will pop in with a pointer.

"Lowering the odds" seems at least akin to a guarantee. I can't really tell if you're saying that people need to make a lot more money, or if you're saying that the odds should be better through govt. regulation.

Absent more information, I continue to withhold my support for the LB Overlordship. (I should note that I haven't read Hacker, or the Prospect pieces, save Schmitt's.)


Posted by: SomeCallMeTim | Link to this comment | 10-29-06 5:26 PM
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Don't many government jobs still basically provide life time employment and a pension?


Posted by: James B. Shearer | Link to this comment | 10-29-06 5:29 PM
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I'm just saying that I'd rather have $30,000 + health insurance a year for twenty years than $0 one year, $15K the next, $120,000 the next, $25,000 the next. You might end up making more, but in the lean years it's all about credit cards and debt and draining savings.

I have no idea how to structure an economy so that stability is more likely, but that's why we have an economics department.


Posted by: Cala | Link to this comment | 10-29-06 5:32 PM
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10:"insert boilerplate about how things are just different now"

Things are different now in large part because of federal policies, fiscal and monetary. Corporations are focused on short-term gains and stock prices in part because of tax policy and weak anti-trust enforcement. Weak labor protection and, yes, the federal safety net. Without SS and Medicare unions would have to play a tougher game, and workers of all classes would have greater solidarity.


Posted by: bob mcmanus | Link to this comment | 10-29-06 5:35 PM
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Once again I'm at the point where I can't even see the boundary of my knowledge in the rear view mirror, but ignorance is no bar to idiocy, so here I go.

It's my impression that insecurity makes people crazy; that the feeling of being a helpless victim with no control of one's own fate, leads to bad things. When fate does sneak up behind one the result can be PTSD. Insecurity can lead to abuse (spousal, child, whatever) and self-destructive behavior (drugs, etc.). I have a vague recollection (possibly a false memory) of a study of primates (or rats?) which showed that food insecurity leads to hoarding, greed, antisocial actions, and a breakdown of social bonds.

In other words, I agree with Cala, and with Hacker's point that a certain level of security is necessary for any economic risk taking and investment - and without that risk taking and investment there's no mobility.


Posted by: Michael H Schneider | Link to this comment | 10-29-06 5:37 PM
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"food insecurity leads to hoarding, greed, antisocial actions, and a breakdown of social bonds."

All I got so far is Tuchman, but in the 14th century famine or overtaxation repeatedly led to peasant organization and revolts, answered with immediate repression, followed by long-term liberalization.


Posted by: bob mcmanus | Link to this comment | 10-29-06 5:45 PM
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Hey, LB, if I'm not mistaken, your parents had a union. Good for them. Be nice if more folks nowadays did.

As to Social Security, pardon me but I need to rant. I hear more whining and doomsaying about the program than I can believe. A little perspective: the entire projected shortfall in Social Security Old Age, Survivors and Disability Insurance out 75 years is smaller than the size of the Bush tax cuts. And, of course, that's the projection. All kinds of things can happen. For example, we're growing faster than we thought we would, which keeps shrinking the deficit. And all of the immigration that gives the Minutemen the vapors is making the country younger year by year, and so easing the demographic bulge of the baby boomers.

Point of the story -- there is no damn reason at all that Social Security can't be there for you and me just like it has been for, oh, seventy years now. And when Republicans like W go after it, people catch on quick -- it's still the third rail of American politics, with good reason. It works exactly as it is supposed to, with minimal waste and massive public support. Jeebus, can't liberals be proud of this tremendous accomplishment?

Is Social Security perfect? No. It's a human institution. For instance, it's based on a payroll tax with a flat rate, and it bites harder into the incomes of wage workers than CEOs. But even taking that into account, its net effect is to redistribute a great deal of income from downward -- in fact, it does more to redistribute income downward than every other federal government program *combined*. And it has completely changed what it means to be elderly.

Jake Hacker's onto some important things, which could significantly improve the system for a new economy and have a real prospect of becoming law if we can just get some Democrats into power. It'd be a damn good thing from any number of perspectives, and we really don't have to wait for the triumph of revolutionary syndicalism.


Posted by: dammitman! | Link to this comment | 10-29-06 5:55 PM
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bob, unions were incredibly weak and vulnerable in the US until federal legislation was liberalized and allowed effective organization (in jobs and industries that weren't predominantly populated by African Americans; that was the price of support from Southern Democrats).

Once efforts to unionize those latter jobs and the South generally began to yield some results, the Southern Democrats broke off from the New Deal coalition and joined Republicans in weakening labor options and strength.

But I don't see how having more power devolved to the states at that time would have helped achieve labor goals. And strong federalism (i.e. local state control) certainly didn't help African Americans in the South attain voting rights, curtail lynching, and achieve other important civil rights.

Democrats cannot guarantee I will have Social Securty, because they cannot, may not as a matter of principle, guarantee that a Right-wing regime will not gain power and destroy SS.

What can guarantee that you'll have Social Security, bob?


Posted by: M/tch M/lls | Link to this comment | 10-29-06 6:02 PM
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Mitchy, can't Bob just say that while you're correct about that historical moment, you're wrong about what would be best for this one?


Posted by: washerdreyer | Link to this comment | 10-29-06 6:05 PM
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11: I'm not making a detailed policy prescription in this post. I'm just saying that, of two people, the one making $45K with a pension and a reasonable belief that she's got a job for as long as she wants it is further from poverty than the one making $60K with a 401K she can make contributions to and a reasonable expectation that she's going to have to find a new job sometime in the next five years. Distance from poverty can't be measured purely in terms of income.


Posted by: LizardBreath | Link to this comment | 10-29-06 6:08 PM
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"What can guarantee that you'll have Social Security, bob?"

I would feel a lot safer in Sweden, Germany, England, Austria. Those majority socialist populations were not born, it is not genetic or geographic, they were created, mostly one city at a time.

I think part of the difference is in aspirations. Europe had gone thru enough varieties of hell that they wanted security, even at the expense of opportunity. Fewer millonaires, fewer homeless. The WWII/depression generation accepted that bargain, but we have fallen back into cargo cult lottery politics.

"we really don't have to wait for the triumph of revolutionary syndicalism"

I have no doubt that the American economy will crash and burn soon. Great Depression II. But New Deal II will not be an option, and we need to have an alternative to save the saner areas of the country.


Posted by: bob mcmanus | Link to this comment | 10-29-06 6:20 PM
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Distance from poverty can't be measured purely in terms of income.

I'd just like to point out that you're using a very informal definition of "poverty" here- one in which "poverty" is something loosely akin to "having severe economically difficulties", I think. Which may be fine as an idea, but it's a relatively loose concept.

Strictly speaking, you can of course measure poverty purely in terms of income. "Poverty" is an income level below three times the expected cost of food. I don't think I'm being purely banal when I say your point would be better expressed not in terms of "poverty" but in terms of "economic well-being".


Posted by: Brock Landers | Link to this comment | 10-29-06 6:22 PM
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Great Depression II. But New Deal II will not be an option

Any reason why?


Posted by: Brock Landers | Link to this comment | 10-29-06 6:24 PM
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20: Right. Some of this, though, is transition: we're still working out how to structure everything. Some of the broader national fears are, I think, mistaken: I seem to recall seeing a reference to a paper that examined the amount of time people spent with a single employer as compared to the same measure in the past, and found not much difference. (Though note that I don't really know what I'm talking about, most people (inc. you) probably do, and Hacker absolutely does.) I'm not denying either that the underlying facts have changed as you suggest, or that something does need to be done to address it. I just suspect it's fairly complicated, and that there have been some real benefits to the changes along the way.


Posted by: SomeCallMeTim | Link to this comment | 10-29-06 6:25 PM
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Strictly speaking, you can of course measure poverty purely in terms of income.

I think the sticking point here is that you're thinking of "distance from poverty" in terms of how far a given current state of economic affairs is from a state of actual poverty, while LB seems to be talking about something more like "how close are you to the precipice?"


Posted by: redfoxtailshrub | Link to this comment | 10-29-06 6:28 PM
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It's probably best to keep 'poverty' more narrowly defined, especially because it's less easier to caricature as 'Democrats are so out of touch they think someone making $45K a year is on the edge of poverty! Silly Democrats! They don't believe in personal responsibility. And they kill babies.' But LB's point is clear.

'Economic blood pressure' or 'economic well-being' is good.


Posted by: Cala | Link to this comment | 10-29-06 6:31 PM
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"Any reason why?"

Solid Republican South and other Red areas, think T Frank. Taxophobia. Lack of social organization and shared interests on the left. Massive gov't and personal debt.

As I said I think Congress will be staring at a trillion dollar deficit during a recession, and Republicans will either be completely intransigent on tax increases, or demand catastrophic entitlement cuts. Democrats will cave.

This has been the plan since at least the 80s. Cato and Greenspan were determined to kill the New Deal, and I think they are going to succeed.


Posted by: bob mcmanus | Link to this comment | 10-29-06 6:31 PM
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25- I think the sticking point is that I'm thinking of poverty, which is a standardized government measure, and LB seems to be talking about something more like economic well-being, which is much broader, and certainly includes as one factor the risk that one might next year be in poverty, which is her point.


Posted by: Brock Landers | Link to this comment | 10-29-06 6:32 PM
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Mitchy?


Posted by: M/tch M/lls | Link to this comment | 10-29-06 6:34 PM
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But isn't it also true that you're "closer" to poverty, strictly defined, if you are at great risk of soon falling into it?


Posted by: redfoxtailshrub | Link to this comment | 10-29-06 6:37 PM
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Greater, I meant.


Posted by: redfoxtailshrub | Link to this comment | 10-29-06 6:37 PM
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I see a severe economic depression as changing the calculus for many of the factors in 27. It's not as if we have to tackle the depression with everyone's political sensibilities frozen constant where they are now. Nothing like hunger to focus the mind. I mean, it's not like the New Deal could have passed last time in the absense of the Depression.


Posted by: Brock Landers | Link to this comment | 10-29-06 6:39 PM
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Rereading the original post, with its talk of insecurity itself being a kind of poverty, I see better where you're coming from, Brock.


Posted by: redfoxtailshrub | Link to this comment | 10-29-06 6:40 PM
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30- well, I guess, if by "closer" you mean "having a greater risk of falling into." As in, assuming an $18k poverty threshold, someone making $45k with a 50% chance of making only $15k next year is "closer" to poverty than someone making $20k with only a 10% chance of falling into poverty next year. I'm not sure this is a particularly useful definition of "closer" in this context, and anyway it makes your statement a tautology. "You're "closer" to poverty, strictly defined, if you are at great risk of soon falling into it" --> "You're at greater rick of falling into poverty if you're at greater risk of soon faling into it." Hard to dispute.


Posted by: Brock Landers | Link to this comment | 10-29-06 6:45 PM
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34 posted before I saw 33.


Posted by: Brock Landers | Link to this comment | 10-29-06 6:45 PM
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I mostly agree with LB and Bob. I don't think that inequality and insecurity are competing concerns; I think that Hacker was putting his finger on an aspect of inequality that isn't part of the standard economics reports. It is true that if insecurity is taken as the key word, then middle class insecurity gets lumped in with poor-people insecurity.


Posted by: John Emerson | Link to this comment | 10-29-06 6:45 PM
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It's not a tautology, because what I am saying is that this is a completely normal use of the metaphor of closeness and distance.


Posted by: redfoxtailshrub | Link to this comment | 10-29-06 6:46 PM
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"Strictly defined" was meant to modify "poverty", not "closer", by the way. Sorry that wasn't clearer.

Anyway, aside from this point, I think it's worth observing that "poverty" is a word with a rich history and set of meanings aside from its definition as a term of art, where it is defined solely in terms of the ratio of income level to prevailing costs of food. Insecurity is a kind of poverty; it's a lack, an impoverishment, of a real and economic kind. I do see the value of steering clear of "poverty" because the income-level definition is so prominent; perhaps "impoverishment" or something of the sort would do better? Things like "economic well-being" seem a bit too rhetorically flaccid.


Posted by: redfoxtailshrub | Link to this comment | 10-29-06 6:54 PM
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I'm pretty sure it was a tautology the way I wrote it. (Which may not have been the best way to write it, but in that case I'm not really sure what you were getting at.)

I feel like I'm sort of being an asshole right now, totally inadvertantly and despite my best efforts. Which probably means I should go to bed.


Posted by: Brock Landers | Link to this comment | 10-29-06 6:58 PM
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Once again, 39 before I saw 38. Which clarifies, I think.


Posted by: Brock Landers | Link to this comment | 10-29-06 6:59 PM
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Okay, 38 doesn't clarify, but that's unimportant. What's important is that the second paragraph of 38 is really good and I agree completely. I don't off the top of my head have any suggestions, although I think is a "impoverishment" is not a bad start.


Posted by: Brock Landers | Link to this comment | 10-29-06 7:03 PM
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39: It's not that you're being an asshole, but the point that I was trying to make by saying 'closer to poverty' is that, as redfoxtail says, that's a reasonable English language way of saying 'more likely to fall into poverty' and that as a matter of public policy it is a more useful way to think about it.

To drag out my grandparents again, their concern with poverty was in organizing charitable giving to the poor through their church; poverty was other people. A modern-day family with a higher income in some particular year may nonetheless be concerned with poverty because they rationally are concerned that they themselves will be poor; poverty is themselves. The second family may have an income that's further from the poverty line, but they themselves are closer to poverty.


Posted by: LizardBreath | Link to this comment | 10-29-06 7:15 PM
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Because I think that dead horses deserve beatings too, here is what I was trying to say in 30: I think it's pretty reasonable to describe the state of being at a greater risk of falling into poverty as "being closer to poverty."' It was a meta-talk claim about the appropriateness of using language about closeness and distance to describe risk. This is why it's not surprising that it came out as tautological once you enacted the substitution of terms.

Anyhow, I didn't think you were being an asshole, and I also care more about what I said in the second half of 38, so I'm glad you agree.


Posted by: redfoxtailshrub | Link to this comment | 10-29-06 7:15 PM
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I generally have room in my brain for one rock star crush and one blog crush. Recently, my rock star crush has moved from Carrie Brownstein of S-K to Barbara Brousal, who plays children's music in Dan Zanes' band. My blog crush has also been slowly moving from Bitch Ph.D to LizardBreath.

Security is vital to well being for those who don't have access to a lot of material wealth. You can adjust psychologically, to a huge amount of material deprevation, but you can't adjust to having your fate change randomly. This is a raw psychological fact. Its why economically stable but impoverished parts of India report much higher levels of well being than significantly richer parts of the world.


Posted by: rob helpy-chalk | Link to this comment | 10-29-06 7:20 PM
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Okay I think I understand now. For the record I have absolutely no quibble with the idea that, given two families with identical incomes but one with less security and thus higher risk of having poverty-level income in the future, the less-secure family could fairly be described as "closer to poverty". I think it would be odd, if not exacly incorrect or unfair, to describe the less-secure family as "closer to poverty" if the less-secure family also had a higher income -- it's using one of two possible definitions of "closer", and the one than seems less intuitive in context.

But I certainly wouldn't have bothered to quibble with something as trivial as that. My criticism was with LB's characterization of insecurity itself as "poverty", which I think makes abstract a term that, in current discourse at least, is (and ought to be) very precise.


Posted by: Brock Landers | Link to this comment | 10-29-06 7:35 PM
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Hrm. Would you take it amiss if I dragged some thoughts about what you've been saying here (and the other day, when we talked about the relationship between 'the economy' and 'GDP') into a post? I think you're making an error in your use of language, but an interesting and common one that's worth picking apart and talking about explicitly. I'd like to think about it and write something up, but I don't mean to be picking on you -- just using you as a springboard.


Posted by: LizardBreath | Link to this comment | 10-29-06 7:50 PM
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You prefer Mitchie?


Posted by: washerdreyer | Link to this comment | 10-29-06 7:57 PM
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I think that LB is absolutely right here. In some forms (pensions) security is a form of wealth in the strict sense. In the sense of "right to a job" (with civil service or union protection, or with a loyal employer), it isn't legally property, but functions something like property. If either one were salable, it would have a cash value (the way NYC cab licences actually are salable). And when someone chooses a job, this is one of the material things that rational people will think about (not an intangible, but economic in a strict sense).

So I don't know exactly where the threshold is, but it's easy for me to say that someone earning #30,000 a year with no security might be poorer than someone who's earneing $20,000 with full security. The latter would be comparable someone who's cash-poor but who owns real property. or has savings. Security is like an asset, even though it's not spendable income.


Posted by: John Emerson | Link to this comment | 10-29-06 8:02 PM
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Oh come on, Liz, pick on him. You'll never achieve world domination if you keep being nice to people.


Posted by: John Emerson | Link to this comment | 10-29-06 8:03 PM
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I think there are two orthogonal axes of confusion (?!).

First, poverty is oft times taken as a proxy for general quality of life. For example, poverty colloquially can mean having ill fitting false teeth because one couldn't afford dental care, or an increased risk of dying of breast cancer because one couldn't afford health insurance.

In that sense, the insecure person is closer to poverty because they suffer the effects - mental stress and craziness, perhaps bad dentures acquired during the hard years, etc.

Second, wealth is oft times taken as a proxy for power to act on one's desires. Having money means being able to do what you want. Being insecure means having to stick with that lousy situation because otherwise the risk of homelessness and hunger are overwhelming. Insecurity can imply a poverty of options, even if one may have money at the moment.


Posted by: Michael H Schneider | Link to this comment | 10-29-06 8:40 PM
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12 asks, Don't many government jobs still basically provide life time employment and a pension?

I think that the short answer is No. The federal government’s "pension" plan is now basically a 401-K. People who were hired under the old Civil Service Retirement System still get the old plan. Folks who came on board in the last 20 years or so get the new Federal Employees Retirement System. Plus they can collect Social Security. A big goal was to make civil servants' pensions portable (like 401-K). But since many government jobs were being outsourced this was somewhat necessary.

The outsourcing has added more insecurity to the federal workplace. Sometimes it isn't formal outsourcing (e.g., A-76 competitions) as much as attrition and shifting of "support" to contractors. I work for a government contractor and as citizen I get annoyed watching my company get a contract then lose it at a 3 year recompete and then get it back after another 3 years. Really, either company that won would be fine. The cost to us is lots of churn and loss of institutional memory (my company fires people when we don't have work for them) and yet a core of independent subcontractors usually carries over from prime to prime as they are the people who the client considers essential. Sometimes the wining bid has factored in their price and sometimes the bid was low-balled. You get really weird situations where a program management office can have 2 civil servants and 20 contractors. Who is running the show?

For those civil servants who remain, the system is becoming more game-able by upper management with the transition from the GS to pay band systems (as in DoD).

So, I'd say being a federal civil servant become less secure in the past few decades and not necessarily to the nation's benefit. It does benefit the owners of the contracting companies.


Posted by: md 20/400 | Link to this comment | 10-29-06 9:26 PM
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51, I was thinking more of state and local government jobs (like lizardbreath's grandparents had). For example public school teaching. Aren't these sorts of jobs still generally quite secure with pensions?

Another thing, three of my four grandparents died well before I was born when my parents were still dependent on them. This form of insecurity seems less common today (although I guess divorce may be more common).


Posted by: James B. Shearer | Link to this comment | 10-30-06 2:26 AM
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Recently, my rock star crush has moved from Carrie Brownstein of S-K to Barbara Brousal, who plays children's music in Dan Zanes' band.

Barbara Brousal is hott. So is Cynthia Hopkins, who used to play in Dan's band (I believe she recently moved on.)


Posted by: JL | Link to this comment | 10-30-06 5:42 AM
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46- please, go ahead- I'd love to hear your thoughts. Although I reserve the right to disavow any statement I've made that seems silly in retrospect, which is not at all unlikely, since few of my comments are well thought out in advance. Also, I want my fair share of any ad revenues generated while the post is up on the main page.


Posted by: Brock Landers | Link to this comment | 10-30-06 7:03 AM
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testing


Posted by: Becks | Link to this comment | 11-17-06 9:05 PM
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Becks!


Posted by: SomeCallMeTim | Link to this comment | 11-17-06 9:09 PM
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Becks is confused, ignore her.


Posted by: ogged | Link to this comment | 11-17-06 9:11 PM
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But we never see her around here anymore. I thought maybe is we reminded her that sometimes you want to go where everybody knows your fake name....


Posted by: SomeCallMeTim | Link to this comment | 11-17-06 9:17 PM
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This is the real Becks. Just for Timbot.


Posted by: Becks | Link to this comment | 11-17-06 10:03 PM
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My blog crush has also been slowly moving from Bitch Ph.D to LizardBreath.

Hey!


Posted by: bitchphd | Link to this comment | 11-17-06 10:57 PM
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Ignore him; he's not worth your time.


Posted by: teofilo | Link to this comment | 11-17-06 11:07 PM
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That came out a little harsh, didn't it? Sorry, Rob!


Posted by: teofilo | Link to this comment | 11-17-06 11:17 PM
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