[boriscleto]

This Is Why The Private Sector Is 'Doing Fine' But You Don't Feel It - The Winning Words Project

[Rondec]

This article doesn't explain that the private sector is fine. It explains that the private sector isn't as bad as it could be. Times are rough for many people, particularly in rural areas. The economy is very uneven, with certain parts of the country pretty much back to where they were prior to the recession and other parts in really bad shape still.

[boriscleto]

The private sector has 1.9 Trillion dollars in the bank. Profits were up 37%. The private sector is doing fine. That is when you define the private sector as being big corporations. Small businesses are still struggling for the reasons laid out in the info graphic. There is no demand because the corporations are hoarding all the money.

[VoiceOfReason]

I could use a raise.

[wildman]

This is why the private sector is 'doing fine' but you don't feel it

No. This is just a symptom of something else...

... and that is these folks who work for the corporations have come to believe that their economic self interest is more or less identical to the corporations they work for and have voted accordingly in the last 30 years and they have gotten exactly what one would expect.

It is not all that complicated.

[kswier]

I read an article about a year ago that discussed the large corporate profits. The article made the case that the profits were partially caused companies decreasing their overhead and streamlining operations during the financial crisis. Thus we have companies that have made moved to increase efficiency, while being able to retain their best employees while shedding their worst employees. Since demand for products has not increased quickly, they have not had to do a lot of hiring.

Additionally, growth seems to be hurt by uncertainty. There are a lot of companies who are keeping large amounts of cash on their books instead of investing it in new areas (that could create jobs). I suspect this is due to the uncertainty of the economy as a whole and the uncertainty of government contracts. I believe the best way to help common workers is to increase demand and certainty. The best way to increase demand is getting money into the hand of those who spend a lot (i.e. lower and middle class). In other words, I do not think that cooperate profits are bad. What is bad is that they are not investing their money in activities that create jobs (because of lack of demand and uncertainty).

Also, I do not think that cooperate profits are the problem when it comes to income fairness. Remember that a lot of people in the middle class have their retirement money in 401k accounts. These accounts increase when corporations are doing well. I think the problem occurs when investors who have large amounts of money (i.e. the warren buffetts of the world) can pay a lower percentage of taxes (and thus grow their money really fast), just because they earn their money from investments instead of a job.

[boriscleto]

Additionally, growth seems to be hurt by uncertainty. There are a lot of companies who are keeping large amounts of cash on their books instead of investing it in new areas (that could create jobs). I suspect this is due to the uncertainty of the economy as a whole and the uncertainty of government contracts. I believe the best way to help common workers is to increase demand and certainty. The best way to increase demand is getting money into the hand of those who spend a lot (i.e. lower and middle class). In other words, I do not think that cooperate profits are bad. What is bad is that they are not investing their money in activities that create jobs (because of lack of demand and uncertainty). .

Ah yes, "uncertainty". If we just get rid of social safety net and all those communist regulations the corporations would be falling all over themselves to hire. The unemployment rate would be so low we would be begging people to immigrate just to fill the jobs. The Very Serious People from the corporate media will tell us the only way to achieve "certainty" is to get rid of corporate taxes all together and make sure the middle class pays their fair share, while getting rid of Social Security, Medicare, environmental and workplace regulations and maybe even child labor laws.

Everything has to be privatized and made profitable. Schools, roads, prisons, maybe even the military. All of the support functions of the military are already privatized, why not the combat troops.

[kswier]

Ah yes, "uncertainty". If we just get rid of social safety net and all those communist regulations the corporations would be falling all over themselves to hire. The unemployment rate would be so low we would be begging people to immigrate just to fill the jobs. The Very Serious People from the corporate media will tell us the only way to achieve "certainty" is to get rid of corporate taxes all together and make sure the middle class pays their fair share, while getting rid of Social Security, Medicare, environmental and workplace regulations and maybe even child labor laws.

Everything has to be privatized and made profitable. Schools, roads, prisons, maybe even the military. All of the support functions of the military are already privatized, why not the combat troops.

I don't see how lowing taxes or getting rid of the safety net decreases uncertainty. I don't quite understand how you made that leap from my post.

Uncertainty can be decreased by making sure there is a steady base of consumers (i.e. there is not another big round of layoffs coming...the safety net helps with this), and communicating what the governments intent is (i.e. what contracts are likely to continue, and what the taxes/regulations will be).

Right now business are holding onto a mountain of cash. Before releasing this cash (for research, development, and creating new products), companies will want to make sure that they will not get burned (because the economy goes south again, or because of cut government contracts), and that there is sufficient demand to merit their investments. Its similar to what an individual would do if they were unsure if they will have their job in six months. They will stockpile money instead of spending it on the new roof they need, a better car, or a new camera. Furthermore, if an individual does not have anything they want, they are likely to safe their money until they find something that looks worthwhile (similar to low demand corporations are dealing with),

[boriscleto]

Daily Kos: "The Only Real Job Creators Are Consumers"

[gokenin]

ok i don't know if i am reading this wrong but this is an attack on the idea that corporations are considered the private sector and that since they are doing fine then the comment that the private sector is doing fine would be correct? Does that mean that President Obama then thinks that corporations are "people" as this is who normally makes up the private sector? I thought that only those evil,corrupt,despicable,hate mongering republicans thought that corporations are "people" I could be wrong but i am not sure as i often am wrong according to everyone on this site

[Nesster]

Obama was talking about employment trends and where growth was happening - his point was that the private sector was 'doing fine' in that profits are up and there are jobs being created, in contrast to the public sector which is still shedding jobs and facing revenue shortfalls on the state and local levels.

The Republicans seized on this to say Obama is clearly out of touch with reality, as the private sector is not in fact creating new jobs at the rate it ought to be.

However I don't believe the obstacles the Republicans have identified - high taxes, too much regulation, too much government - are the primary reasons why the private sector economy isn't taking off better. As we've seen, corporate profits are high, but these profits are not translating into demand and jobs. Taxes are historically low, and furthermore there have been several easements and regulatory reductions passed, aimed at small businesses.

The daily kos article is right on the money.