Sitting in a restaurant today I realized how much trouble we are in for

[NNN0LHI]

Was looking at the waiter at a local restaurant today. He is the first male waiter I have ever seen in this restaurant. He is a good kid too. I like him a lot. Be proud to have him as my own son. That good of a kid. My daughter was a waitress at this same restaurant when she was 16 and still in high school. Doesn't pay anything. My daughter made enough there to live home at no cost and make a small car payment and her car insurance. That is it. Got millionaire farmers who come there and have their coffee cups filled and be waited on hand and foot for hours on end and leave a nickel tip. Those farmers are still coming in there. They still leave a nickel. Now I see this adult waiter doing the same thing my daughter did when she was a kid for that same nickel.

This kid is old and healthy enough to be loading hoods at an auto plant. That is what he would have been doing 30 years ago. Hard work. But good money and benefits. Now I see this kid waitering making shit money and ask myself is this who we are going to be depending on to fund social security, medicare for the old folks and pay our government employees and their retirement benefits in a few years?

Then it hit me. This just isn't going to work. No matter how bad we want it to work, it just isn't going to work.

Now multiply what this kid is doing times millions more kids just like him all across America.

See what is about to happen?

Don

[Cleita]

1. Perhaps a gratuity should be added to the bill.

You know those kids have to claim 8% of their patron's bills as tips on their taxes whether they get the tips or not. I used to work as a restaurant bookkeeper doing payroll and they had to do this. I don't think the law as changed. The gratuity should be built in either as an add on or a hidden item on the patron's bill. If they leave something besides the 8%, that's fine, however, I believe the 8% should be part of the bill and the waiters should get actually get 8% of the bill as part of their wages. Better than that maybe they should have to pay 15%. That way the kitchen staff can augment their wages too. Considering the farm subsidies and other protection the farmers get from the government, I believe they can afford this.

[Cirque du So-What]

4. I don't believe tips will make up for the disparity

in income between a waiter's salary and what he could be making from a manufacturing job.

[Cleita]

5. No, but they sure would help.

The OP was saying how cheap the farmers are. Most city people will tip 15% or 20%.

[Cirque du So-What]

14. Still a pittance

First, assume that he's making minimum wage (which is a stretch, as restaurants aren't required to pay minimum wage) and working 40 hours a week (also a stretch) and that he's making 20% in tips consistently (a Stretch Armstrong-worthy stretch):

40 x $7.25 x 120% x 52 = $18,096 per annum

I still feel that's being overly optimistic, but I'm not getting any more complicated than this...for now.

If he was working at a manufacturing job that pays $15/hour, that works out to:

40 x $15 x 52 = $31,200 per annum

That's not at all unrealistic - and is probably on the low side for a good manufacturing job.

The difference:

$31,200 - $18,096 = $13,104 per annum

Multiply that by an estimated number of high-tech manufacturing jobs lost since 2000:
http://articles.chicagotribune.com/2012-01-18/business/ct-biz-0118-tech-jobs-20120118_1_high-tech-manufacturing-jobs-job-losses-research

That's not counting the LOW-tech manufacturing jobs that vanished.

$13,104 x 687,000 = $9,002,448,000 per annum

Next, see how much is lost to Social Security coffers:

$9,002,448,000 x 4.8% = $432,117,504 per annum

I believe this 'conservative' estimate is actually much higher, and that's just for one year. It's not taking into account that the loss of manufacturing jobs is never likely to return to previous levels, despite recent gains.

[Cleita]

17. What are you basing the 120% on, his salary?

That's not the way the IRS figures it. It's 20% of the restaurant receipts that figure into it. A high end restaurant, where a bill could be $30 to a $100 would get better gratuities percentage wise than a coffee shop. I haven't bought a cup of coffee in a coffee shop in years, but I'm going to assume that an ordinary cup of coffee these days is $1. That would give the waiter $.15 or $.20 in tip per coffee served, which is a whole lot more than a nickel.

[Cirque du So-What]

22. Not sure what your point is

Multiplying by 120% is multiplying by 1.20, which is what a 20% tip would generate.

Back to the math...

40 x $7.25 x 120% x 52 = $18,096 per annum

That's if he got an average of 20% tips.

40 x $7.25 x 105% x 52 = $15,834 per annum

That's for an average of 5% tips.

The difference:

$18,096 - $15,834 = $2,262 per annum

$2,262 x x 687,000 (high-tech manufacturing jobs lost) = $1,553,994,000 per annum

Now for Social Security:

$1,553,994,000 x 4.8% = $74,591,712 per annum

The percentage gained from boosting tips from 5% to 20% amounts to:

$432,117,504 - $74,591,712 = $357,525,792 per annum

Admittedly, that's nothing to sneeze at, but it hardly makes a dent in the disparity due to the shortfall caused by loss of manufacturing jobs.

[Cleita]

26. Yes, but the 20% gratuity comes from the receipts, not the wages he earns

So if a waiter sells $100.00 worth of meals in an hour, like say lunch and that can be done easily in a coffee shop, he should get $20.00 in tips. His wage, usually less that minimum wage because they dock meals, whether you eat them or not, has nothing to do with the gratuity.

[Cirque du So-What]

48. Sorry for missing the point about restaurant receipts

All I can say is 'brain fart.'

[HiPointDem]

70. It's not really anything to do with meals. it's to do with the assumption of tips.

For example:

Both the FLSA and the Pennsylvania Minimum Wage law provide for a "tip credit." The tip credit essentially allows a restaurant owner to rely on tips received by the employee to make up a portion of that individual's minimum wage.

...a Pennsylvania restaurant owner must use the Pennsylvania tip credit which requires him to pay a direct wage of $2.83 per hour, while relying on tips to make up the balance of the State minimum.


$2.83 per hour. Nothing to do with meals, but with the expectation that $2.83 + tips will = minimum wage. Effectively a subsidy to restaurant owners.

http://www.buteralaw.com/newsletters.asp?c=88&id=597


And in states without tip credit laws which allow owners to legally pay less than the minimum wage:

Even when they are paid the state minimum, certain classes of employees (servers and hairdressers among them) are taxed at a higher rate than minimum wage employees, under the theory that there is a large amount of unreported income that comes to these employees in the form of tips.

Servers are taxed based on a percentage of their sales, which are reported to the federal government (e.g. "Timmy made $100 this week in salary and he sold $100 this week, so that means we can assume he made $100 + an unknown percentage of those sales in tips. We will therefore tax him at the rate for people making ($100 + tips), instead of $100.&quot

The government assumes a blanket tip rate -- when I was serving, it was 8 percent (so the calculation above for Timmy would be $100 in salary and $8 in tips -- Timmy is taxed as if he made $108, regardless of whether he actually made that $8). This blanket rate has likely changed since then; it probably went up.

Therefore, whenever you tip someone below the going rate (i.e. you stiff them), you're actually punishing them in a far greater way than you presume. It's not just the opportunity cost you're hitting them with. You're actually taking money out of their pockets.

http://ask.metafilter.com/147182/Tipping-when-waitstaff-get-paid-minimum-wage


Federal Minimum Wage

As of 2011, the federal minimum wage for wait staff is $2.13 per hour plus tips, and the general federal minimum wage rate is $7.25. If the total of your tips plus your hourly base rate do not equal at least the federal minimum of $7.25 per hour your employer must make up the difference.

In addition, your employer may not classify you as a tipped employee if you receive less than $30 in tips per month. If you do not qualify for tipped employee classification, the minimum amount your employer can pay you is $7.25 per hour.

Read more: Minimum Wage for Wait Staff | eHow.com http://www.ehow.com/info_7968577_minimum-wage-wait-staff.html#ixzz1qsAsUJqp


About 20 states have minimum wages for tipped employees that are under the federal minimum. Utah is lowest at $2.13/hr. So the employee needs to make over $5/hr in tips just to get to minimum.

[Cleita]

107. Those laws should be struck down. Apparently, they have become worse since I did restaurant p/r.

Relying on the public to tip for good service is nonsense. Any of us who ever waited bar or table knows that the best service in the world will not earn you decent tips from most customers. If I had a restaurant, my model would be minimum wage, not an adjusted minimum wage to be paid weekly and at least 8% gratuity added to the bill to be taken by the server at the end of the day, however 15% would be better. If anyone thinks that they had great service, they can feel free to leave more, but don't hold your breath that they will all be Frank Sinatra (I was told by servers at Chasen's in Beverly Hills that he was a great tipper).

[unapatriciated]

76. regarding docking for meals.

It depends on what state you live in. In some states (California) you are allowed to opt out and the employer can not dock your pay for meals that you do not eat. Right to work states are the ones with the least protections for the service industry. See my post #75 regarding how taxes and 8% percent of sales are supposed to be applied.

[dmallind]

45. Which ONLY makes sense if all his tables' tabs total $7.25 every hour

In which case the restaurant would be insane to hire a waitperson.

Tips are on bills, not paychecks.

[Cirque du So-What]

47. You're right

My bad.

[nanabugg]

69. The real problem is the attitude of the millionaire farmers...who probably aren't growing a damn

thing but being subsidized heavily by the government thanks to their Agri Congress-critters passing laws to that make them wealthy while doing little to benefit the country. Their cheapskate attitude on their gratuity is the new norm for American "haves" and those that think they are "haves." I be they pay little or no taxes and will insist on collecting social security even though they won't need it and are probably against any kind of healthcare reform.

[Boudica the Lyoness]

96. Let me tell you about farmers.

We farm. Some of our neighbors really know how to play the system for all it's worth. In our state some of our neighbors are on the top recipient list for hand-outs. These same people are multimillionaires. They sent their children to private schools, top universities, have fun all winter going to Europe, Hawaii and skiing. They own more than one home. Mexicans do the hard work for them.

I have to laugh when city people think farmers are dumb, ignorant hill billies. And it pisses me off when these same farmers go on rants about 'welfare Queens'.

BTW; the above mentioned farmers are big players in the Republican party. They are very much against healthcare reform.

You might find this interesting. http://farm.ewg.org/

[Lydia Leftcoast]

56. Some states DO require restaurants to pay minimum wage, but

Republicans keep trying to overturn those laws.

[unapatriciated]

77. True and California is one of them.

It's the Right to Work states that have loopholes and less protections for workers in the service industry.

[pnwmom]

24. The difference is between $8 an hour and $20 an hour, for a good manufacturing job.

So the tips won't help a whole lot.

[Cleita]

27. I didn't say that but it's still better than getting a nickel.

[hfojvt]

15. depends on the manufacturing job

Back in the 1990s, I had a manufacturing job, making satellite dishes, for $5.40 an hour. For full time work, that was $11,232 a year. The woman who worked as Mainstreet manager also had a job waitressing on the weekends, where she said she made $12,000 a year - just working two days a week.

The problem with the OP is that I do not believe that the good paying factory jobs he describes were ever the norm. Some people got them, it is true, but most people did not, not even in the good old days of the 1960s. In 1963, for example, which might be considered as part of the glory years for American manufacturing - the poverty rate was 15.9%. In 1973, the bottom 40% only got 14.7% of the national income, compared to 43.6% for the richest 20% and 16.6% for the richest 5%.

There are still people with good paying jobs, paying most of the taxes because they get most of the money. It's just that this kid is not one of them.

[Cleita]

28. All the good manufacturing jobs that paid well were union jobs.

Other than that you stand no rights to better wages and benefits without the bargaining rights that unions provide.

[bvar22]

109. That is not true.

Before our manufacturing jobs were sent overseas (by Republicans AND Democrats), employers had to compete for
good workers. Even non union shops had to pay good wages and benefits to attract and keep good workers.

[Cleita]

110. You are very right. However, it was because of the union competition that

they had to, however, none of those non-union shops paid as well as the union shops. I know. I lived in that era. The best workers got hired by the union shops, and the inexperienced and not so good workers worked elsewhere hoping they could get a union job as soon as one opened up due to attrition. But when the union busting and outsourcing started, then things went rapidly down hill. Hey, I just lost my $12 an hour job because the boss found someone willing to work for $10 an hour.

[dotymed]

32. Sadly, these days even manufacturing jobs usually pay crap wages

and with little or no benefits. Even the ones lucky enough to be Unionized have had to accept low wages in order to "compete" with the profit margin that these multi-nationals can realize in third world countries. Today it is all about using labor to line the pockets of the elite. When we did actually have substantial taxes on profits, the elites would pay the workers a decent wage, if for no other reason than to lower their tax obligation.
"We" are now their property to use and dispose of "at will." Of course, that is basically what "at will" employment states are all about. Employees have no rights and are employed or terminated at the whim of their "betters." Fortunately (not for Americans) Europeans are mostly protected by their Unions (like Americans used to be) and also have universal health care, that America has never had, because the for-profit health insurance industry has always made sure to grease the palms of the right politicians.
America has become a feudalistic society and it it is getting worse daily.
In Europe, Feudalism was a long part of their national history. They learned long ago that the peasants will not tolerate it for long. That is what must happen in America. We must overthrow our masters and claim what is ours. Life, Liberty and the Pursuit of Happiness is only what the wealthy in America are allowed to pursue. They do so with the same relish that a mean child pulls the wings off of flies.
Until our government fears us instead of us fearing our government, it will only get worse.

[Maine-ah]

54. a server's salary

can be very good...can also be very bad. It's a crap shoot. I've been in the business for 17 years. I now work at a seasonal, on the water, incredible food restaurant. Last summer I was pulling about $200 a shift, which was a six hour shift. If I had been able to work five nights a week, I'd be making $1k a week.

I've worked in places like the one in your OP. Had days where I only made $5-10 on a full shift. For server's, it's much like real estate...location, location, location.

Usually in the low tip restaurants (places like Applebee's, where I moved from server to management) you get treated like shit on top of having crap tips.

It's a hard job. Usually no insurance, unless it's corporate, and even then it's pretty crappy insurance, but better than none.

[Cirque du So-What]

58. I confess to being clueless about what servers earn

I even goofed in figuring tips as a percentage of hourly wage, although I know better than that. I cannot explain how I made such a flagrant error in setting that up. Still, I was flying blind when I used the minimum wage, since I realize that some make less than minimum wage and others make more than minimum wage. I can only go by what I personally leave for tips, which is a bare minimum of 15%, even if the service was not very good, and 20-30% if it was good-to-excellent.

I tell ya, I've done some hot, dirty, dangerous jobs in heavy industry, but I admire the guts it takes to deal with some of the dickweeds I've seen browbeat the waitstaff in some restaurants. My hat's off to you!

[madrchsod]

16. that`s why my wife leaves cash if at all possible

she was waitress on and off most of her adult life ...she`s looking for a part time waitress job this week

[quakerboy]

49. Or we should just let the minimum wage be the minimum wage

and tipping be a voluntary extra for good service rather than an assumed portion of income. It irks me greatly that they can pay servers less than minimum some places.

[TransitJohn]

50. My point of view is that since the IRS taxes tips

then the worker should have to make federal minimum wage. Fair is fair.

[quakerboy]

53. I would agree with that

There should not be exceptions to the minimum wage law.

Not for servers who get tips, not for "managers" or certain other classes of workers who can be put on salary at 11 something an hour, then worked 70 hours, and thus paid under minimum. Not for kids or the handicapped or prisoners or H1b workers or illegal immigrants. Not for nothing. Minimum is minimum.

[Maine-ah]

55. I'd rather take tips than minimum wage.

even on a bad day, I still make more than minimum wage. Here in Maine, if by the end of your work week, your total tips and wages do not meet minimum wage, the employer has to make up the difference. It's pretty rare that you don't make at least minimum. But, the job is very hard, you put up with a lot of crap which is not worth 7.50 an hour.

[Cleita]

60. This is where the thinking is wrong.

People do not pay for good service when it's warranted. Some people are generous and others tightwads. When I worked as a waitress some of the most difficult and demanding customers left nothing. Yet, a customer that demanded little more than an extra cup of coffee with normal service would leave a generous tip.

Remember that the restaurant can't really afford to pay $20.00 an hour for wages. There are slow days and busy days as well as slow and busy times of the day. If they did, your meals would cost triple what they cost now. So they way servers make money is on the tips they receive during the busy times. If people don't tip then they are stiffed.

[unapatriciated]

75. Yes that is still the law but not quite as you say.

If you keep a daily record of tips including charge tips in a journal you will pay taxes only on the tips received. You also record what percentage is tipped out to busboys, cooks and host (you do not have to declare those payouts as income) When the law first went into effect many perceived it to require you to be taxed on 8% of your sales, not true (that was just a guideline). if you kept a daily record (and most servers do) you pay taxes based on your records not 8% of your sales. Truth be told a lot of servers made more than 8% of their sales. Those that did not worked in coffee houses or smaller family style restaurants like the one my mother owned. She was audited by the IRS regarding tips the first year the law went into effect in California. She won based on her daily journal record. It did cost her a grand to hire a tax attorney, but she was never audited again after that first year.

I was in the industry when the law was enacted and worked as a server for many years after that. Many single (divorced) mothers (like myself) worked and supported their children as servers.

[former9thward]

2. Social Security and Medicare are in deep trouble.

For the many reasons you mention. But I read countless posts here on DU wherre people simple ignore that fact and say that SS and Medicare are in good shape for years to come.

[Cleita]

7. Because they are.

Go to the Social Security website instead of Fox News and you will see that SS is solvent until 2034. Medicare only needs to get rid of the Republican, big PhRMA backed privatized Medicare Advantage and part D that is draining the fund into Wall Street, to get it back on track. There is oodles of information out there from the sources. The Social Security and Medicare are in big trouble meme comes directly from the Heritage Foundation who gets it directly from the Koch Brothers who pull the misinformation right out of their asses.

[former9thward]

13. Despite your well known and feeble attempts to slander posters by using terms

like "Fox News" and "Heritage Foundation" I get my information from the SS/Medicare Board of Trustees. I trust them infinitely more than you.

Projected long-run program costs for both Medicare and Social Security are not sustainable under currently scheduled financing, and will require legislative modifications if disruptive consequences for beneficiaries and taxpayers are to be avoided.

The financial challenges facing Social Security and Medicare should be addressed soon. If action is taken sooner rather than later, more options and more time will be available to phase in changes so that those affected can adequately prepare.

http://www.ssa.gov/oact/TRSUM/index.html

[Cleita]

25. Because you phrase those memes exactly like they do. It makes me think that this is where

you are getting your information.

Here is what the SS link you provided also has to say:

Social Security expenditures exceeded the program’s non-interest income in 2010 for the first time since 1983. The $49 billion deficit last year (excluding interest income) and $46 billion projected deficit in 2011 are in large part due to the weakened economy and to downward income adjustments that correct for excess payroll tax revenue credited to the trust funds in earlier years. This deficit is expected to shrink to about $20 billion for years 2012-2014 as the economy strengthens. After 2014, cash deficits are expected to grow rapidly as the number of beneficiaries continues to grow at a substantially faster rate than the number of covered workers. Through 2022, the annual cash deficits will be made up by redeeming trust fund assets from the General Fund of the Treasury. Because these redemptions will be less than interest earnings, trust fund balances will continue to grow. After 2022, trust fund assets will be redeemed in amounts that exceed interest earnings until trust fund reserves are exhausted in 2036, one year earlier than was projected last year. Thereafter, tax income would be sufficient to pay only about three-quarters of scheduled benefits through 2085.

The payroll tax holiday has something to do with this because the funding needed is chopped off. There is a remedy for this. Raise the cap on those with higher salaries. Also this is what one of the trustees Charles Blahous has to say the effect of the PR tax holiday, which seems to be the problem:

http://www.npr.org/2011/12/07/143241709/how-payroll-tax-cut-affects-social-securitys-future

Charles Blahous, whom Obama appointed last year to be one of the six trustees of Social Security and Medicare, thinks it's a far greater danger than most people anticipate. He too says the payroll tax break might be harming Social Security's long-term solvency.

"I mean, I'm a Republican and I'm a conservative, and if you were to ask me at a first approximation, do I want lower taxes or higher taxes, then obviously I want lower taxes," Blahous says. "The problem here is that I'm also a public Social Security trustee, and so I'm honor-bound to identify when this causes a change or a difficulty for the Social Security program, which it does."

That's because Social Security has long been considered self-financing and thus politically immune from budget cuts. But that could change, Blahous says, now that employees are no longer paying their full share into Social Security because of the payroll tax holiday.

"This could be the beginning of the end of the idea that this is an earned benefit, [and] where benefits enjoy a certain amount of political protection because of a notion that they have been paid for in the past by the beneficiaries," he says.

There's anxiety among Democrats as well about the prospect of prolonging the payroll tax cut. Nancy Altman, co-director of Social Security Works, a Washington-based advocacy group, says she's been alarmed to see a Democratic administration dipping into Social Security's revenue stream to stimulate the economy.

"Democrats were the ones that created Social Security and the ones that were the strongest champions over its 76 years," Altman says. "So to have a Democratic president proposing to undo the dedicated revenue ... it's a fundamental change that supporters of the program, I think, should oppose."

Altman worries the payroll tax cut has become so popular it will be hard to end it, and that's one reason why she opposed it in the first place.

"Many of us at the time said that it's no way this is just going to last one year. And sure enough, we're back now talking about expanding it," she says.

Some lawmakers do say the tax break is worrisome, including Rhode Island Democratic Sen. Sheldon Whitehouse.

"I think one more year should be about the limit," Whitehouse says, "because of the nature of Social Security."

A program that, until now, has always paid its way

So you can see if the tinkering with the program is stopped and the cap raised, it will be fine. I'm confident that we will take back Congress in November and get rid of all the right wing Tea Party crap that is undermining our system and our safety nets.

[sad sally]

39. Sorry, but not all of us have the confidence you have. The Trustees Report also says...

"... such illustrations assume that the full effect of legislation takes place immediately, with no phase-in or lead time. Perhaps even more importantly, the benefit examples assume that legislators would be equally willing to reduce support for current beneficiaries as to restrict the growth of benefits to future participants. In the past, policy makers have been reluctant to significantly reduce the benefits of those who have already begun to collect them. In a practical sense, therefore, changes adversely affecting younger generations are likely to be much more severe than indicated in these simple illustrations. The costs that will be borne by younger generations will grow significantly each year that a new cohort of baby boomers joins the benefit rolls.
-----
Even in advance of these deliberations, we believe that the essential message conveyed by these reports is clear and will not change, absent legislation: that the vital Social Security and Medicare programs face real and substantial challenges, and that elected officials will best serve the interests of the public if financial corrections are enacted at the earliest practicable time."
(the above is at the end of the report)
#####

With the new court-drawn congressional maps (which mostly favor R's), it's going to be an uphill fight to pick up the 25-31 seats needed to gain back the majority in the House. There are 23 Democratic Senate seats up and only 10 Republican ones, so they may reduce our majority there.

Even with President Obama serving a second term, without a majority House and a weakened Senate the chance of not tinkering with the program and letting the "payroll holiday" end are slim. The idea that the two parties will work together "immediately" and enact "corrections at the earliest time" are not realistic in the political climate we live in. Besides, it would be seen as a tax hike, not what it really is - the defunding and destruction of the Social Security system.

[Cleita]

59. It's not broken yet, unless you allow them to break it.

They will not work with us. That is a given and the sooner the President gets it the better. The Occupy movements and this is part of it, will not go away. They will have to do the will of the people or we will have civil war. I'm certain of it. Tampering with these two programs more than anything else will bring it on. In previous decades even the most hard core right winger knew that both these programs are sacred cows and not to be tampered with. But now we have the stupid rising to power and they are playing with fire.

[Selatius]

71. I think there'll be a civil war before the right-wing breaks and gives in, in the grand scheme.

The one thing you must admire about the right-wing in the United States is that once they have gained ground on a certain issue or topic, they do not willingly give it up unless there is the political equivalent of blood and teeth on the floor, and it takes a burly type of Democrat who isn't afraid to call a spade a spade to fight that kind of battle. The campaign money that makes Republicans strong in this manner acts like kryptonite to Democrats whenever they scratch around for donors to their campaigns. It's why powerful Democrats like Max Baucus moved away from ideas like the Public Option, for instance. He got a huge chunk of his campaign cash from pharmaceutical and health insurance companies, he and plenty of other Democrats in the Senate and House. It's why the idea of a Public Option was destroyed in the Senate.

It is true that an informed citizenry is a necessary prerequisite to have a functioning republic, but if the people are constantly misinformed or poorly informed about issues affecting them from news outlets owned by the 1%, I would submit that such a republic would not long endure before collapsing and being replaced by the "comfort" and "strength" of a dictatorship or oligarchy that has simple and easy answers to problems that a population can no longer answer because they've been so poisoned by erroneous propaganda. It's why plenty of working class people willingly vote for people like George W. Bush, repeatedly.

By no means am I saying a second civil war is imminent, but if we're talking about the next 100 years or a longer timeframe, I could easily see the United States torn apart by an armed, internal struggle over the future course of the nation.

[HiPointDem]

72. Are you aware that the projections change every year?

For example, here are some of the dates when the Trustees have predicted that the Trust Funds will be exhausted:

1996: 2029
1999: 2034
2004: 2042
2007: 2041
2011: 2036

What's the difference? The prevailing economic conditions and the assumptions the Trustees make about birth rates, immigration, death rates, productivity, etc.

Do you know that the Trustees actually make three forecasts, but the only one you hear about is the intermediate forecast, even though the "optimistic" forecast has usually been more accurate in the short-run?

Do you know who the SS Trustees are? For example, in 2011, Tim Geithner was one.

Do you know what the 75-year actuarial shortfall is, assuming the Trustees predictions are right as rain? Depends on the year, but about 2% or less of taxable payroll. Which means a 1% increase each on the employer and employee. That's about $40 a month if you make $50K.

Why do you think there was a payroll tax holiday, really? Only the employed got it, and of those, the highest-paid people got the most benefit. Oh, and employers. So it wasn't that effective as a stimulus (stimulus is most effective when it goes to the bottom).

But it's sure going to screw up this year's SS projections.

Never underestimate the degree to which the ruling class selects the evidence they present to you in order to get what they want.

[HiPointDem]

74. "Legislative modifications" = rate increase, as has been done many times in the past.

There is no reason to do ANYTHING "sooner rather than later" except rescind the stupid payroll tax "holiday" and start repaying the borrowed $2.5 trillion.

1. There is currently sufficient income to pay out benefits.

2. The US government owes $2.5 trillion dollars to the program. It mostly went to fund income tax cuts for rich people, and it should be repaid from income taxes (which are mostly paid by the rich and by capital, not labor) before any additional taxes or cuts are taken from labor.


The key facts, which are developed in detail on the following pages, are below:

The deterioration in the 75-year actuarial balance of Social Security that has occurred since 1983 has been caused overwhelmingly by economic developments, trends in disability incidence, and programmatic changes to Social Security.

Sixty percent of the current shortfall would be eliminated by a reversal of two adverse economic trends that have emerged since 1983: sluggish growth in average (real) wages and erosion of the tax base due to rapid growth in the inequality of earnings.

Reversing the demographic change most commonly identified with placing strain on the Social Security system—declining mortality rates—would eliminate less than 5% of the current shortfall.

The essential argument made by those who support radically overhauling Social Security through private accounts and the reduction of its guaranteed benefits is that demographic trends will result in fewer workers supporting each retiree, making the economic burden of caring for retirees too great for workers in the future. This falling worker-to-retiree ratio is identified as the primary cause of the long-run financing shortfall facing Social Security. However, this focus is misplaced; in fact, the lion’s share of the current actuarial deficit is the result of unfavorable economic trends, especially slow real wage growth and a rapid increase in wage inequality that resulted.

http://www.epi.org/publication/ib207/

[Pholus]

62. They were in trouble the MOMENT our manufacturing went offshore. nt

[HiPointDem]

73. No one who actually delves into the history and the numbers for themself can actually believe that.

In today's highly polarized political environment, and with four of the six Social Security Trustees political appointees of the Bush Administration, it was inevitable that the Trustees' 2005 report, released yesterday, would sound the administration's themes: we are facing big trouble; we need to act soon. What is surprising is how difficult it remains to make that case. It is almost enough to keep hope alive that at its core, our government is staffed by competent, honest people crunching the numbers.

Yesterday's report moves the date at which trouble will arrive one year sooner. We have until 2041, not 2042 to make corrections to the system to keep it running smoothly. Even with "only" 36 years left, it seems likely we will be able to make the minor adjustments necessary to give our premier social insurance system another century of undisturbed life. And considering that the Trustees in 1997 predicted that the system would run into financial difficulties in 32 years (in 2029), we are justified in treating the calls to action with a grain of salt.

In fact, the Trustee's predictions have been consistently too pessimistic. Since a new Trustee's Report is prepared every year, we have a history of annual predictions to look back on. We ended 2004 with $1,687 billion in the trust funds. How did the Trustee's do over the past decade in predicting this number? The answer is that the Trustees' "intermediate" forecast of reserves at the end of 2004 was on average 5.7% too low. The "high cost" forecast, which is the Trustees' pessimistic forecast, was 15.3% too low. The best record was produced by the Trustees' "low cost," optimistic forecast, which was 2.8% too high. The Trustee's optimistic forecast was on average closest to the actual outcome. Six out of the past ten years, the optimistic forecast was in fact the most accurate.

There is no more pressure today to act hastily to change Social Security than there was in 1995 or 2000. The difference is not in the numbers. These continue to show that we have at least nine more presidential terms to meet the challenges of financing Social Security in the distant future before there is a financial crunch in the system. Nine presidential terms in the other direction places us in Nixon's first term. That is how long we have to make changes to the system to keep it sound. In fact, the last major adjustment to Social Security took place in 1983, just about half way through the Nixon-George W. Bush period. Even if we wait another ten years to make adjustments, we will still have plenty of time left.

http://tcf.org/commentary/2005/nc942

[wendylaroux]

3. without a middle class

bad news for social anything.

[Hawkowl]

6. Oh it's good for some things

Social disruption. Social revolution. Socialism.

The US has a volatile mix of second amendment, religous fanatics, extreme wealth inequality, with a legal system of pillaging and looting instead of a justice system.

That is a social time bomb.

If you examine other societies' revolutions, they mostly appear to be started by over-educated youths who have no options or opportunities.

This revolution is coming. That is what "Yes, we can!" was SUPPOSED to be about. Obama didn't have the skills or desire to harness this energy, so it will be up to another. But this energy will come out, controlled and constructive, or otherwise.

[truedelphi]

21. I have said that same thing for over eighteen months.

It's not my desire to see the country go up in flames - but history shows us that when the Bankers or "noblesse oblige" are allowed to bankrupt the other members of the social strata, times get very wicked.

The banking bailouts, and the Too Big Too Fail have taught most Americans that we here in the USA have a "noblesse oblige." And one of the most ardent proponents of that new nobility is one Tim Geithner, who sits in his office down the hall form the Oval Office.

Obama considers Tim his "good Buddy."

And the article about Bank of America from Matt Taibi has a very telling comment buried two thirds of the way through the report: Bank of America is planning on using pension funds to bolster up its failing financial "bets" - to the tune of fifty five trillion dollars.

I will repeat that sentence, and no the "trillion" is not a typo:
Bank of America is planning on using pension funds to bolster up its failing financial "bets" - to the tune of fifty five trillion dollars.

[leeroysphitz]

33. Steinbeck said that when property is gathered in too few hands it is taken away.

Property has indeed been gathered in too few hands and shall indeed be taken away and redustributed.
The leech class is about to be ripped off it's ailing host.

[quakerboy]

51. I don't know if that can happen quite that way anymore.

There are more people than there were for historical equivalents. And we are more dependent than people were for historical equivalents. How many people do you know who could go off grid at a months notice? How many who could grow their own food, move back to the farm, live in the woods, etc? I know too many people that don't even know how to make food not from a box to feel sanguine about it.

Everything going up in flames would be highly disruptive. While it would eventually come round again, the immediate toll would be huge in terms of lives lost. And in terms of the environment, I suspect. If you tear down the system, who is going to hang around to make sure the electricity stays on? And when it goes, so do all the trees at the first sign of winter. And thats without getting into things like water in LA, infrastructure along the gulf(who pays for the next hurricane to hit Florida or NOLA.

I suppose its possible to have a rapid "up in flames" that ends relatively bloodlessly, where the rich lose their power, and all the rest of society keeps trucking along with only minor inconvenience. But it superbly unlikely to me. And I don't think things are overall bad enough that people are willing to pay that price just to get their revenge.

[truedelphi]

111. Occupy Wall Street is currently occupying the

Senate building, with Senators fleeing to the House of Reps' locale.

http://my.firedoglake.com/tpau/2012/04/01/emergency-alert-ows-occupies-the-us-congress/

You make a good point, but the isolation of the top two or three percent doesn't mean that things won't flame out on the bottom levels.

Decades ago, when discussion came up under Nixon as to helping the national deficit by cutting back on Food Stamps or AFDC, Nixon's advisers let him know that cutting those programs would cost the nation more, as entire areas of the country would indeed go up in flames. (Don't know if you' re old enough to remember when areas of Watts,LA, and Detroit and other places burned for days.)
Now we have only conservatives running things. Obama is not a socialist - he is totally happy to give the rich their Bush Tax Cut Extensions, and I haven't heard him defend Food Stamp programs. I know he has helped people get Food Stamps, but if the Republicans ask him for cuts to social programs, will he differ from the way he as acted in the past and draw a line in the sand, or will he give them what they want?

Obama was so busy reading the life of Lincoln, that I don't know that he is aware of why Nixon left the social netting in place.




I think those in the suburbs, who are living on their stock dividends, their inheritances, and what not,a re wlell isolated from all of this. When I lived in Sausalito, Calif outside the SF area, it amazed me that many neighbors were never home. They were in Bali, Fiji, France, skiing the Swiss Alps, but never home.

[LuvNewcastle]

8. It's amazing to me that people ever fell for

the idea that we can all make a living waiting on each other; no one need make a thing. As we have seen, an economy like that is too easy to be brought down.

[BB_Troll]

78. The minute we stopped being a country that created and made things

was the minute we began to fall. We have go to bring those jobs and skills back or we will forever be at the mercy of those who don't have our best interest at heart.

[Arkansas Granny]

9. Everyone sees that the employment figures as getting better, but that's not the whole story.

At the same time median income in the lower and middle class workers is going down. Maybe more people are working, but they aren't making as much money as they did in the past. Those in the upper class, however, continue to see their incomes rise.

[Cleita]

11. I once read a story about Calcutta, India.

It seems that the population is about 99% employed, yet a large portion of the residents live in the streets because they can't afford to pay rent and eat too. This is what will happen to us.

[Denninmi]

10. Yes, Madame DeFarge is certainly knitting.

Too bad the people in power can't or won't see what we see. And, more than that, it's too bad that so many of the "ordinary" people can't see it, either. Always fall for the right wing BS hook, line, and sinker.

[madrchsod]

12. my wife works with and for mentally and physicality challenged adults

last night she worked with a gentleman who said he was laid off from a factory job. since he`s older my wife assumed that`s what he did all his working life. so he goes from making widgets to cleaning up shit.he`s not the only person she has run across who used to have good paying jobs with good benefits.

my wife used to make 14 an hour being a roll tender on a printing press before she was let go. today she has 4 years seniority and is the sec-treasurer of her union. although she now makes 12 an hour she`s happy to be there and have a job. her former employer just shut down the printing plant leaving 290 people to find another job. some of those people will never find another job and those that do will have a big pay cut.

my daughter has had a steady job for the last 9 yrs.she`s worked for two companies that has ,i guess, both have seen that she is a good worker and has enough brains to understand how to problem solve when things go wrong. she`s making 14 an hour and overtime. what does she do? she makes air filters for heavy equipment. her employer is looking forward for the federal government investment plans. if it comes through more people will be hired. interesting how that works isn`t?

so maybe that guy my wife talked to can get a job if we start investing in america...maybe that kid will too.

[KG]

18. reaganomics reached its full maturity.

hard work down at the factory doesn't pay shit anymore either...

[southernyankeebelle]

19. My son is a cook at a chain restaurant. He has been there since it openned. He has done

most of the jobs in that place except be behind the bar. I think the best job he likes to do is be a waiter. He is a big heavy guy but boy can he move. The customers really like him. He goes out of his way to show that he really is interested in them. He has a pretty good sense of humor and and customers like it. The other waitress love it when he is there because they all make good tips. He says sometimes they waitress don't take the time to really take care of the customers. Sometimes it's just how you treat a person. We live in this little rural town and he is able to make at least $100 a night during the payday weekends. Not everyone is so bubbly and sometimes they work all day and make only $25.00 or $50.00. That isn't much when you figure they make a minimum wage of $2.25 per hr. All I say is when people go out to eat please take the time to realize that a waiter and waitress work really hard for that tip and remember some of these people have families at home. They are doing the best they can.

[baldguy]

20. The middle class workers who built the American economy in the early 20th century

Were set up to compete with workers in third world countries who were paid a pittance. Of course such a situation is unsustainable, as we have seen. It will inexorably lead to either a peaceful political upheaval if we are fortunate, or a violent revolution if we aren't.

[truedelphi]

23. There is another thing to consider:

The good paying jobs, that were handled by large corporations, largely go to people imported to this country from other nations.

Many people in Iowa and Nebraska used to make decent union-scale wages at meat packing plants. Now those jobs are handled by people deliberately brought up over the Mexican border and hired on for less than nine bucks an hour. With no benefits. And if one of these folks is disabled, the local County has to pick up the medial tab, as the employer doesn't have health insurance.

Same thing has happened with - get this - airline mechanics. They are hired from recruiting efforts posted all over the world. And speaking English is not a requirement - even though the maintenance manuals and repair guides are printed up only in English. So the mechanics are now Turkish, Pacific Rim Islanders, and others who know no English, and may only have the most precursory mechanical training.

Then the American public is wondering the roofs of our planes are floating away in mid air flights?

[Ikonoklast]

29. And you know what the bestest thing of all of that is?

The government takes tax money from that kid waiting tables and GIVES it to those millionaire farmers.

See: http://farm.ewg.org/

Chances are, the bigger the operation, the more likely they got a boatload of Federal tax dollars delivered to their bank accounts.

The smaller farms get squat.

[Yo_Mama]

30. That's what I think too

The jobs base has been eroded so far that it is the source of our fiscal problems.

And it's just a joke to think housing values can stabilize when so many of the younger people are facing such poor employment prospects, rising expenses, and are burdened with student debt on top of it.

I pulled some stats from BLS.

Full time jobs - as of Feb, 114,408,000. As of March 2001, 114,006,000,
but the population has increased by at around 10%.
2001, 285 million, 2012, estimated 313 million.

Part time workers:
Feb 2012, 27,576,000
Feb 2001, 23,542,000

20-24 year-olds working (in any type of employment):
Feb 2012, 13,395,000
Feb 2001, 13,449,000

25-54 year-olds working at all:
Feb 2012, 94,056,000
Feb 2001, 98,729,000

55 and over working:
Feb 2012, 30,187,000
Feb 2001, 18,516,000

We don't have the replacements coming up behind us to take over the load, and it's because there aren't decent jobs for them. Everywhere I go for years now, I see middle-aged and younger adults working jobs that teenagers used to do.

Workers aged 16-19:
Feb 2012, 4,371,000
Feb 2001, 7,038,000

I guess we pushed them right out the door!

If you go to the Census historical income tables, in 2010 dollars per capita incomes did not increase at all for a decade, even discounting the last two years of income drops:
http://www.census.gov/hhes/www/income/data/historical/people/

This is some frightening stuff. The reason social benefits are rising so quickly is because we're a rapidly aging society without adequate jobs for the young:


When the non-government income base goes up so much more slowly than social needs, you get a crunch:


Obviously the solution has got to be to build the underlying economy.

[xtraxritical]

67. The solution is VOTE A STRAIGHT DEMOCRATIC BALLOT IN NOVEMBER.

Democrats know that Keynesian economics (i.e. trickle up) is the only (proven) answer. Right Wing (nut) Reagan/Greenspan trickle down economics is a (proven) failure. Greenspan even admitted this when interrogated by Congress. Get these republican norquist robots out of government and watch how quickly things will improve.

[indepat]

31. Don, the fruits and joys of living in a society in which most public policy is driven by a

cynically cruel and warped RW agenda are evident in every fabric of our society: and it ain't a pretty sight.

[handmade34]

34. no easy answers...

...my son (great kid, good worker, responsible, smart)... about to graduate from UVM (May 20)... he bought a hot dog cart so he feels like he has a chance of supporting himself

but... just manufacturing isn't necessarily the solution either... this is a big problem and will need a big (outside the box) solution...

[Coyote_Bandit]

35. I was the kid of one of those "millionaire farmers"

Everybody thought we were rich because we farmed a good size chunk of land. But it was mortgaged. There were also payments to be made on the farm equipment - all of which we bought used (and yes we did our own repairs as necessary). Mom made all of my clothes that were not hand me downs or from Goodwill. We raised our own veggies - and canned and preserved them for the winter. We butchered out our own beef and pork and chicken. Income was uncertain at best. I qualified for free meals in our small little school - but my parents were too proud to accept the assistance. Sometimes things are not what they appear.


But you're right. It isn't going to work.

I'm 50ish and don't expect to recoup my SS contributions. I haven't seen a doctor in nearly 15 years and I don't expect that to change even if the SCOTUS upholds ACA. If I happen to live long enough to qualify for Medicare I expect that whatever care I might receive will be rationed.

If I were young I would save my pennies and buy my way out of this fucked up country. There are far, far better opportunities elsewhere. The United States is badly broken and I see no indication the we have either the personal or political will to do what is necesary to mend the tattered fabric of our nation.

[Quantess]

36. There are many different opportunities to look around you and reach the same conclusion.

This is unsustainable.

He's a young guy, and he probably is optimistic that he will get a better paying job soon. But what happens when he (or other people in his shoes) reach 30, 35, and they are still barely scraping by? And at 30 they probably will have accrued some debt, too.

[NRaleighLiberal]

37. We see it coming - financial issues, just like global warming, just like....but we can't think big

anymore. No political will to think beyond the next election. I've seen it in the companies I've worked for (big pharma) - the issues and opportunities are there, but the reward system for the big wigs is just the next financial update - and bonuses that follow.

The only way that issues get solved now is for the shit to hit the fan then go into band aid/panic mode.

[Auggie]

38. We are witnessing Disaster Capitalism at work ...

Premeditated sabotage of social programs and the U.S. economy designed to make radical, free-market solutions more appealing to a desprrate populace.

[safeinOhio]

40. In 1972 I started at the auto factory flipping hoods

onto the paint line. Killer hard work, but I made enough in one week to pay my rent with some money left over. I still had 3 weeks pay left over. I thought I had died and went to heaven.
Retired 10 years ago, got bored and took a part time job at the gas station a year ago making minimum wage. A fast pace job that they kept adding more "task" to every week. So, last week I turned in my 2 week notice.
Some weeks I work 38 hrs and the checks for a week wouldn't pay anyones rent. I'm lucky in that my house and cars are paid for. I get my pension check, SS and a little dividend check every month. With out those I'd have to work 80 hrs to survive. I work for a major oil company that makes billions. For my Christmas bonus, stapled to my pay check was a coupon for a free 99 cent coffee. I work alone at night and do about 4 to 5 thousand in sales every night and get about $61 in return, before deductions. After the store got robbed late at night I ask the district manager if the company would install a flood light on the back of the store to discourage crime. She said the company can't afford it. Employs are not allow to be armed. I have a CCW and hardly ever carry, but I do now at work. Because they made no changes after the robbery, I thought let them fire me and I'll see em in court.

But things in this city are picking up. They are having a hard time finding anyone to take my job. Last night, talking to a customer I was asked if I'd like to put in an application for a job at a nonprofit that pays good. I have a degree. Felt like I might have hit the lottery. A job offer the week before I'm done. I don't need a job to survive, but I like working. Can't go fishing everyday.

[RB TexLa]

41. How do you know this is his only job? Maybe he works another job and this one trying to make as

much money as he can.

[EmeraldCityGrl]

42. I can't help but wonder if the OP

lives in a smaller rural community. Young adults leave those towns for the very reason
he stated, working in a cafe for nickel tips. Iowa was facing such a decline in population for
this very reason, I read somewhere they were trying to develop programs to keep their young
adults there.

[hunter]

43. It's not difficult to imagine an economic system that works...

... and many "first world" nations have achieved something close to that.

The U.S.A. is not a "first world nation."

To build an economy that works you first need a generous social safety net. You pay for this safety net by taxing the wealthy.

We might divide the population into five groups:

The "low income people" would be full time college and trade students of all ages, the chronically unemployable, people who can only work part time, people who have retired from lower middle class jobs, etc.. ALL OF THEM, like every other citizen, would be entitled to to excellent food, public health care, free education, and safe, secure places to live, places that they can call their own, places where they can paint the walls whatever color they want, places where they can settle down for years if they want to.

The lower middle class would begin at full time minimum wage employment. This would be a much greater minimum wage than now exists in the U.S.A.. Education and health care would still be free, as with all the other groups. Housing options might be public or private. This lower middle class would pay no income tax.

The middle class would pay income taxes sufficient to support their own aggregate use of public services, mostly health care and education with some small surplus. This would be the largest group of workers, and might graciously consider themselves unsubsidized and "self-supporting."

The upper middle class would pay progressively greater taxes, but not so much as the wealthy class, maybe 40-50% on everything exceeding what a full time minimum wage job pays.

The wealthy class would be taxed to such an extent that their share of the national wealth would never exceed 20%, by a combination of income and wealth taxes. The "one percenters" as we now know them would simply be taxed out of existence. The shares of giant mega-corporations would be spread across a much larger base of shareholders, and these corporations might even be nationalized to some extent.

The only truly just economies are "trickle up," where money is created for the benefit of the poor and middle classes, where money is taxed off the top, from the wealthy classes, and recirculated before it has a chance to stagnate and become a source of political and economic corruption.

[SATIRical]

84. So according to you

"The U.S.A. is not a "first world nation."

To build an economy that works you first need a generous social safety net. You pay for this safety net by taxing the wealthy. "

The US has never been a "first world nation" and has never had an "economy that works"?

Interesting perspective that is cleanly removed from reality....

[hunter]

100. Apparantly it works for you...

... and you don't notice the homeless people in the streets.

Maybe you've never experienced a COBRA running out, long term unemployment, etc., etc., etc.

Maybe you're not stuck in a minimum wage job, living in a dangerous neighborhood, and taking the bus to work...

Or maybe, if you are stuck in low paying work that's grinding you down, maybe you think you'll be winning some sort of career lottery and joining the upper classes. If so, sorry to say, the odds are it won't happen.

The U.S.A. is less like the "first world" nations of Canada or Western Europe, and more like the other "developing" nations of the Americas than we care to imagine. There are major divisions between the wealthy class of the U.S.A. and those who are struggling to stay afloat, and it's getting worse. The rich are getting richer and everyone else is falling behind. The wealthy have cut us loose from the engines of prosperity and more and more of us are becoming wage slaves.

[SATIRical]

103. I'll wait for your answer

before addressing your comments.

"The US has never been a "first world nation" and has never had an "economy that works"? "

[TheKentuckian]

44. Yup, our systems were not designed to work based on high unemployment or shrinking wages.

Which is why we see deficits right now but even when the unemployment becomes more manageable, the two generations of wage destruction will still kill us and will continue to do so for a long time.

We have to really reverse the entire trend.

[Initech]

46. The more I look around the more I think we're headed for an economic revolt in the not too distant future.

It's scary to think what the millionaires and billionaires of society are doing to us and they don't know when to quit - they're addicted to their wealth - what does one person need $25 billion for? What are they doing with it? Starting their own space program? Their addiction is not going to stop until we rise up as one and take what's rightfully ours back.

[Egalitarian Thug]

52. This is where, IMO, the Democrats need to focus.

Since we no longer have any choice than to grapple with the worst idea in the history of America, the New World Order, globalism, or whatever you want to call this disaster, the minimum wage will become the wage. So, if there is to be any help or hope for the majority of us going forward, we need to ensure that this wage provides a living beyond subsistence.

[Snake Alchemist]

57. Can't he work in the new Toyota plant.

I hear they're the best.

[Sarah Ibarruri]

61. We need the jobs back in the U.S., not in China. We need tariffs or something

I'm not sure how to fix the f'd up mess Wall Street created and we were sold on, but it's got to be undone.

[Major Nikon]

64. We don't even value the jobs we do have

Why does someone who waits tables or is a short order cook have to work for shit wages and shit benefits? Why does someone who punches a cash register at Wal-mart have to work for shit wages and shit benefits? The reason is because those jobs are subsidized by the government in the form of social safety nets. It's just another way that the government subsidizes the wealthy.

[Major Nikon]

63. The reason why the auto industry jobs paid well and had good benefits was because of unions

It's not a matter of the type of work, it's the mistaken belief that some work is more valuable than other work. There's no good reason why waiting tables shouldn't be a job that pays well and has good benefits. Go to Germany and you'll find that people who wait tables have good jobs with good pay and good benefits.

[TahitiNut]

90. Yup. In France, servers in restaurants earn "upper middle class" incomes.

Personal services are not demeaned. Germany is even better in its treatment of the skilled trades than just restaurant servers. There is a culture that respects craftsmanship ... and an economy that's still highly influenced by the 'repair and renovate' attitude instead of discard-and-replace. Our culture has almost destroyed shoe-repair, watch-repair, and a host of maintenance and repair trades. When the 'new' is imported from China .. and has a steadily-decreased life expectancy, we're in an economic death spiral.

[Major Nikon]

92. This is the direction the US needs to go

Whether we like it or not, our economy has transformed from an industrial economy to a service economy, yet we still place little value on service workers. That's why the middle class is stagnant and has been for many years. As the middle class goes, so does the country, rich and poor.

[Sarah Ibarruri]

97. I agree. In Spain, where I lived for many years, waiters are paid a living wage

And tips are added into the bill. Waiting tables there is a career, not a job where one is forced to practically beg for tips.

[Phlem]

65. Exactly!

My recent post in another thread of brain dead was to try and capture the reality of our situation.

My step father had no high school diploma, was sorely lacking in the critical thinking arena, retired as a Tech Sargent in the Air Force, hooked up with Boeing and retired, is not the future I have even with more education.

I cannot retire.

I've been working since the day I met him around 2 yrs old. That abusive f^ck had me on my toes for years.

Now I don't get the chance to rest.

I do the best for my wife and little girl and keep upbeat, but damn, I don't want my girl supporting us! Period! Not in a million years!

I know I'm not alone, and yes we are fucked!

I've drawn the line with my republican relatives and as far as I'm concerned they can get bent.

-p

[DonCoquixote]

66. Not all farmers are bad, but

Down south, I actually heard some of them say that since Ten percent is good enough for the lord's tithe, no waitress should get a higher tip.

[Kennah]

68. Shithead attitude is everywhere

I nearly picked a fight with an asshole in the USPS a year plus ago. He was being a shithead to the workers and patrons.

Was at a fastfood place last week, and watched a customer being a shithead to the cashier. He wasn't yelling and screaming, but I was close enough to hear him mouthing off how "I spoke clear enough. Why don't you listen?"

Postal worker used to be a good job, until the republiCONs took off after USPS with the 75 year pre-funding bullshit intended to destroy the biggest public sector union.

Fast food jobs, like other server jobs, used to be the realm of kids in high school or college. Now I'm seeing more people who are likely retired and just trying to survive by working a fast food job.

I agree with the OP. It's not sustainable.

[libtodeath]

79. Capitalism has failed.

we need to admit that and move on to a democratic socialist society.

[The Wizard]

80. To restore the manufacturing base

we have to make things the market will buy. Solar panels, wind mills, any form of renewable energy and high speed rail might be a good start. Refined gasoline and war are currently our biggest exports.That will have to change.
Imagine traveling coast to coast by rail without having a government agent do a full body cavity search or getting finger printed or DNA checked just to use public transportation.
We could manufacture electric cars and have battery exchanges across the country. There are several ways to restore the middle class. Reducing the vast majority to low income labor isn't a good model for success.
We have to eliminate the next quarter bottom line profits as the primary business objective. We use to ridicule the communist bloc for having five and ten year plans. We now use the three month plan with no long range thought. And that is why we're failing.
The gap between the 1% and the rest of us is widening, creating a caste system that has always been an example of what we rejected in the past.

[Javaman]

81. About to happen? it's been happening for 30 years.

it's just now reaching it's lowest point.

The observation now is: what do we recover to? Answer: something a little worse but will be triumphed as something better.

When you have to eat crap to get by, eating dirt seems better.

See how it works? It's all relative.

[KurtNYC]

82. We need more alignment between schooling and today's jobs

Colleges are grinding out debt slaves like a giant sausage grinder. High schools are graded based on how many kids they send to college -- not how many are employed 5 years later.

Teenagers need more help in figuring out how to get the skills and connect with the jobs that pay something. They shouldn't just mindless stumble off to college to get $40K to $80K of debt and a worthless degree. At least they could consider the option of getting the technical training to become an electrician ($80k), MRI technician ($75k+), auto mechanic ($55k+) or something similar.

The college obsession is just one of the ways we as a nation continue to try and live in the 1950s. Meanwhile germany is the #2 exporting country in the world -- they work fewer hours for more money and more benefits. Germany is full of tech schools and they do well for their children by offering a range of realistic options to them early in their schooling.

[SATIRical]

86. Cue the "post-secondary schooling should be about

finding yourself and making yourself a better person, not training your for a job" crowd....

But I agree with with you.

[abelenkpe]

87. All those I know from my graduating class who decided

To become plumbers, mechanics, and electricians are out of work and on assistance. Maybe we should just do something about bleeding away all the good paying middle class jobs so they can get work again.

[davidthegnome]

83. A nickel?

That sort of misery is bizarre. I can't say I'm terribly surprised. Recently I had a job working for a local restaurant, washing dishes. I was lucky enough to have a decent Boss who paid eight dollars an hour, I would have worked for minimum wage and even told him that up front. It's a small Italian place in a small Maine town, I've watched the Waitresses work their butts off, a couple of them working almost full time hours and at times making less than 100 on a given week (particularly the very slow weeks). Often it's because people don't tip fairly or at all. It shames me to admit that I'm guilty of this, but not because I didn't appreciate the service, rather because I was too broke to pay for much more than a soda and a cheese burger. Whatever I have left is usually the tip - some times quite generous, but some times less than 15%. Nonetheless, I always leave more than a nickel, if I couldn't afford to leave at least a couple dollars I wouldn't eat out at all.

I didn't realize that giving less than 15% was really stiffing the wait staff. In the future, I'm going to make sure I have enough to leave at least a 15% tip when I eat out.

As for my position, on a busy night it was really tough, even though I'm fairly young (27) and in reasonable physical condition. A lot of people don't realize that dish washers don't just wash dishes. They also run around for the cooks, opening cans, getting supplies, helping out with prep work. There's also usually cleaning work involved, for me it was always the basement that looked like a tornado had hit it (had to get rid of all freight boxes after my shift - they build up to a lot on a busy week). I had two nights a week that would give me anywhere from 3-10 hours, Friday and Saturday nights. No way I could survive on that alone, which is why I live with my parents.

The majority of jobs available in my neck of the woods are in the service industry. There's dish washing, prep help for cooks, some telemarketing and a few fast food jobs. Usually these jobs now get a fair number of applicants, even from college grads. I don't see so much what is about to happen, but what IS happening. People are working very hard for very little, it's not right and it's not fair, but our society is not evolved enough to address the problem seriously.

[marshall gaines]

85. ?

hmmmm

[FarCenter]

88. What is "loading hoods at an auto plant"

I'm pretty sure that the hoods are picked up by a robotic arm that is then guided into place by a worker who then uses a power tool to drive the fasteners.

Last time I went through an auto assembly plant there was relatively little lifting of heavy parts.

[NNN0LHI]

89. Pretty much the same way these workers are loading floor pans at 3:00 minutes into this video

See how they are loaded into the racks and slid into the little rubber slots to keep them in place for shipping? Then one of the loaders has to install another bar with the same little rubber guides onto the front side of the rack. Then they are ready to be shipped to the assembly plant. This job is generally an hour on with a half hour off with three people rotating. I used to do similar jobs at the stamping plant I worked at. They never could automate these jobs. Too many variables. Plus the loaders are doing quality control while they are loading. Don't want to end up with a few racks of scrap because of one missing hole.

&feature=player_detailpage

[DaveJ]

91. Good jobs come and go...

If there is not longer a job that existed 30 years ago, I suspect that job loading hoods did not exist 30 years prior to that either. The job market changes.

Is there any chance he could work for one of the millionaire farmers? I suspect they would pay for work that they deemed valuable.

It sucks, but we are still in a flawed Have/Havenot society, where the Havenots need to do hat the Haves want. This is not all that different from the rest of history. Most the greatest artists, for example, were commissioned by kings and queens and other financial sponsors, to create work that was not their own vision but the vision of their employers. There are opportunities for self employment, but then your employer becomes the masses. Either way, it's a matter of adjusting what you do to suit what the Haves deem important.

[Marrah_G]

101. ............

[DaveJ]

105. Sorry you disagree, but without further input or discussion, it is hard to

formulate any other analysis of the situation. What am I supposed to say? Keep serving coffee, and keep complaining until that particular job returns in 30 more years? It was Clinton who said the people need to prepare themselves for higher tech jobs, that they will not be able to count on blue collar jobs anymore, and I have no heard any discussion on whether the farmers are in need of services.

[Marrah_G]

108. Most people serving coffee aren't doing so because they are lazy

There seems to be a real disconnect with the realities of the lives of the working poor and those viewing the working poor from up the ladder.

When you are just getting by, paycheck to paycheck, working multiple jobs, trying to raise your kids as best you can, there just isn't any opportunity to hop into a high tech career. The job market is in bad shape, employers are paying less, many do not even offer full time employment. Job stability is a thing of the past.

We need to bring back manufacturing, we need to stop making education unaffordable, stop allowing companies to make huge profits on the backs of workers making minimum wage.

[truedelphi]

115. The thing I think you may not be realizing is that for many of us who

Are really examining everything that is going on - the outsourcing of jobs that were once done by Americans is DELIBERATE.

And it is all for corporate profit.

Our household got a call from Sallie Mae about four months ago. the person was speaking maybe Tagalog? They could barely speak English. Now the Sallie Mae student loan repayment scenarios are very complicated. To expect Americans who owe money on the student loans to pay them back, complex legal concepts have to be explained.

Why in the heck is some third world person being given this job? They don't have the minimal abilities that are required to do this. No wonder so many of us are unemployed - if Americans cannot even work this type of job what in the world is going on?

I was just reading a business consulting book written twenty years ago. In the book, there is an account of how the accountants at Ford motor company, way back in the seventies, decided to close down two auto plants, one in Texas and the other in maybe Indiana.

And then a third plant was suggested as costing too much. At the time, the guy who was the VP at Ford decided to hold a meeting with his top people.

And around the conference table, as they discussed shutting down the third auto plant, one of the executives was gutsy enough to call out, "Heck, let's not just shut down this third plant, and save some money! Let's shut down all of these plants,and save a huge amount!"

His point was well taken, and everyone laughed and the third plant remained open.

But now the pencil pushers have taken over. The jobs that are still needed are poutsourced. We don't build autos in our country much any more. We don't build auto parts. It's all done in Mexico and Bangladesh, and Trinidad, and China. We don't even give anyone in our economy the ability to even hold down the job where they collect on the damn student loans! the jobs all go to the third world.

then all of us end up on Food Stamps and County MediCal, and we can't buy anything, and the economy, except for those at the top, is horrid. Sure,there is a "recovery" but with forty nine cents out of every dolalr being made as profit going to banks, what does that mean about our society? (In the eighties, only eight to fifteen cents of profits went to banks!) And since the people at the top areas till going after the money available - we are in a deep shit load of trouble.

Matt Taibbi's latest story on Bank of America has an interesting "aside" - there are fifty five TRILLIONS of dollars sitting on BoA's books that are bad investments. But BoA is about to use the pension monies it has in various accounts to clean that up!

We are being swindled left and right. We have few choices in the "free elections." I can vote for a man who has allowed Geithner and his friends to bleed the country dry, for the sake of the man's billionaire friends, or I can vote for a man who will replace Geithner with someone just like him, AND make me wear my underpants on top of my head, while denying contraception and abortion rights to young women.

[Glaisne]

93. Welcome to the world

of cheap labor conservatives.

Defeat the Right in Three Minutes

"Cheap labor". That's their whole philosophy in a nutshell – which gives you a short and pithy "catch phrase" that describes them perfectly. You've heard of "big-government liberals". Well they're "cheap-labor conservatives".

"Cheap-labor conservative" is a moniker they will never shake, and never live down. Because it's exactly what they are. You see, cheap-labor conservatives are defenders of corporate America – whose fortunes depend on labor. The larger the labor supply, the cheaper it is. The more desperately you need a job, the cheaper you'll work, and the more power those "corporate lords" have over you. If you are a wealthy elite – or a "wannabe" like most dittoheads – your wealth, power and privilege is enhanced by a labor pool, forced to work cheap.

[ProSense]

94. Someone needs

to do something about it. Here's an excellent proposal.

Dave Jamieson

Raise Minimum Wage By 35 Percent, Peg It To Inflation: Senate Dem

WASHINGTON -- Legislation introduced by Sen. Tom Harkin (D-Iowa) on Thursday included a litany of measures aimed at boosting income for low-wage workers, most notably raising the minimum wage significantly and pegging it to inflation.

Along with spending on school modernization and renewable energy development, the Rebuild America Act calls for raising the minimum wage from the current federal level of $7.25 to $9.80 -- a 35 percent hike -- over the course of two and a half years, then indexing it so it rises with the cost of living. For restaurant servers and other tipped employees, the minimum wage before tips would leap from the current $2.13 to $6.86, and then track at 70 percent of the normal minimum wage.

The bill would also require employers to offer their workers paid sick days, make more white-collar workers eligible for overtime pay that they're currently exempted from, and give more workers the right to join a union.

In short, Harkin's bill, pitched as a prescription to rebuild the American middle class, hits all the right notes for worker advocates who say low- and middle-income earners are falling behind. The package was quickly praised by groups such as the AFL-CIO federation of labor unions; the National Employment Law Project, which advocates for low-wage workers; and the Restaurant Opportunities Center United, a national group representing restaurant employees.

- more -

http://www.huffingtonpost.com/2012/03/29/minimum-wage-tom-harkin_n_1389457.html

Harkin’s Rebuild America Act Builds Economy for 99%

Mike Hall

Saying there can be no economic recovery without the recovery of the middle class, Sen. Tom Harkin (D-Iowa) today introduced the Rebuild America Act. The legislation would, says AFL-CIO President Richard Trumka:

achieve shared prosperity by putting America back to work, rebuilding our infrastructure, repairing our safety net and insisting that shared sacrifice start at the top—with Wall Street and the wealthiest Americans.

<...>

The Rebuild America Act, says Trumka, “addresses many unmet needs that have been ignored for far too long.”

The bill would revive the manufacturing sector so we can make things in America again, increase Social Security benefits and restore the minimum wage’s purchasing power. Sen. Harkin recognizes that fairness requires us to ensure workers don’t lose overtime protections to inflation, discourage rampant speculation on Wall Street, alleviate the cost of child care for working families and other overdue reforms.

Harkin says his legislation “will ensure that all workers have a right to join together and stand up for fair wages and working conditions and that employers face real penalties for violating that right.”

Robert L. Borosage, co-director of the Campaign for America’s Future, says the bill:

offers strong medicine for what ails America—and a stunning rebuke both to those who say we can’t afford to invest in our future and to those who would cut vital investments to the bone.

http://www.aflcio.org/Blog/Political-Action-Legislation/Harkin-s-Rebuild-America-Act-Builds-Economy-for-99

Harkin bill would revive the American Dream

by Lawrence Mishel and Ross Eisenbrey

Iowa Sen. Tom Harkin, the Chairman of the Senate Committee on Health, Education, Labor and Pensions, has introduced a bill that shows the way to a better economic future for most Americans. The Rebuild America Act tackles many of the biggest problems that hold back the American economy and shut off opportunity for working families.

It’s an omnibus bill that will increase employment by making big infrastructure investments, developing renewable energy systems, addressing unfair foreign trade practices, providing assistance to state and local governments to retain police, firefighters and teachers, ending tax breaks that encourage companies to move jobs offshore, and promoting manufacturing in the United States.

It will help workers get a decent return on their education and their work by strengthening the minimum wage and overtime laws, better protecting the right to join a union and bargain collectively, enhancing retirement security, and guaranteeing paid sick leave.

<...>

We want to particularly applaud Sen. Harkin for his courage in swimming against the tide in two critical areas: Social Security and labor policy. The Rebuild America Act rejects the notion that Social Security is too expensive and that we can’t afford to meet the promises we made to America’s workers: That if they worked hard for a lifetime, they could retire with guaranteed benefits and inflation protection. Too many other politicians are ready, if not eager, to cut Social Security’s cost of living protection and to reduce benefits by raising the retirement age, no matter that such changes have the biggest impact on the retirement security of women and blue-collar and low-income workers, many of whom have seen little or no increase in life expectancy. By contrast, Sen. Harkin knows workers need more help, not less; that fewer and fewer workers have pensions; that 401(k) accounts are insufficient and undependable sources of retirement income; that Social Security is steadily replacing less and less of pre-retirement income; and that the Social Security COLA is not too generous, but rather too skimpy to keep up with the cost of health care inflation that drives the spending of older workers.

The Rebuild America Act therefore replaces the Social Security COLA formula with one that better accounts for cost inflation in the products and services that older workers pay for. It raises benefits across the board. And it pays for these improvements and addresses the program’s long-term revenue shortfall by “scrapping the cap” – eliminating the loophole that shelters incomes above $110,100 from Social security taxes.

- more -

http://www.epi.org/blog/harkin-bill-revive-american-dream/

Wouldn't it be great if this passed?

[barbtries]

95. a general strike?

bastille day for the USA?
i just don't think we are all going to fade away, and settle for shit lives. there has to be a way to right this ship.

[chervilant]

98. It IS happening,

even as we blog about it. Our global economy is about to blow, and this is but one reason for the catastrophe.

Hope everyone who's counting on Social Security and other 'entitlements' has a Plan B.

[raouldukelives]

99. K&R

[Marrah_G]

102. 41 years old and living the American dream!!!!!!!

Primary job gutted to part time hours thanks to the housing crash, 2nd part time job making minimum wage at a soul sucking retail establishment. Putting 2 boys through college with the help of the National Guard. Praying for the day the boys can move out on their own so I can move in with friends and maybe afford to take a day off now and then before I die.

Meanwhile the rich keep taking and taking and taking....

[truedelphi]

112. My hat is off to you as

You keep on keeping on.

And don't forget there are people out there who understand what you' re saying - today they took action:

http://my.firedoglake.com/tpau/2012/04/01/emergency-alert-ows-occupies-the-us-congress/

[Marrah_G]

113. I do love the Occupiers

They speak for me and everyone like me.

I wasn't able to occupy myself, so I just brought in food and plan to again.

XOXO to all of you Occupying!

[midnight]

104. I think the 1% running this country will get rid of the Social Security and then those working these

slave wage jobs will be off the hook....

[louis-t]

106. "Millionare farmers" that probably sit around complaining about Obama all day.

[99Forever]

114. Thanks Don,

I feel as if you were putting my thoughts into your post. I fear for the future of this Nation if we keep heading down our current course, moving ever further and further to the right, with all of it's self-centered greed and inhumanity to our fellow beings. Thom Hartman closes his show with "... despair is not an option." For some of us, it's pretty hard not to think it is. The decline of our caring society has moved steadily for over thirty years, I see almost nothing to slow it. There is no political party with our interests truly as their first priority. America has lost it's conscience and it cannot survive without it.