Italian automaker Fiat SpA announced Wednesday that it reached an agreement to acquire the remaining shares of Chrysler for $3.65 billion in payments to a union-controlled trust fund. Fiat already owns 58.5 percent of Chrysler's shares, with the remaining 41.5 percent held by a United Auto Workers union trust fund that pays health care bills for retirees. Under the deal, Fiat will make an initial payment of $1.9 billion to the fund, plus an additional $1.75 billion upon closing the deal. Chrysler will also make additional payments totaling $700 million to the fund as part of an agreement with the UAW...
Full story at http://www.sfgate.com/news/article/Fiat-to-pay-3-65B-for-remaining-Chrysler-shares-5106928.php
Sunday, January 5, 2014
Monday, December 16, 2013
U.S. ranks near bottom among industrialized nations in efficiency of health care spending.
UCLA, McGill study also shows women fare worse than men in most countries.
By Carla Denly December 12, 2013
http://newsroom.ucla.edu/portal/ucla/weak-u-s-health-care-system-ranks-249652.aspx
A new study by researchers at the UCLA Fielding School of Public Health and McGill University in Montreal reveals that the United States health care system ranks 22nd out of 27 high-income nations when analyzed for its efficiency of turning dollars spent into extending lives.
The study, which appears online Dec. 12 in the "First Look" section of the American Journal of Public Health, illuminates stark differences in countries' efficiency of spending on health care, and the U.S.'s inferior ranking reflects a high price paid and a low return on investment.
For example, every additional hundred dollars spent on health care by the United States translated into a gain of less than half a month of life expectancy. In Germany, every additional hundred dollars spent translated into more than four months of increased life expectancy.
The researchers also discovered significant gender disparities within countries.
"Out of the 27 high-income nations we studied, the United States ranks 25th when it comes to reducing women's deaths," said Dr. Jody Heymann, senior author of the study and dean of the UCLA Fielding School of Public Health. "The country's efficiency of investments in reducing men's deaths is only slightly better, ranking 18th."
The study, which utilized data from 27 member countries of the Organization for Economic Cooperation and Development collected over 17 years (1991–2007), is the first-known research to estimate health-spending efficiency by gender across industrialized nations.
"While there are large differences in the efficiency of health spending across countries, men have experienced greater life expectancy gains than women per health dollar spent within nearly every country," said Douglas Barthold, the study's first author and a doctoral candidate in the department of economics at McGill University.
The report's findings bring to light several questions. How is it possible for the United States to have one of the most advanced economies yet one of the most inefficient health care systems? And while the U.S. health care system is performing so poorly for men, why is it performing even worse for women?
The exact causes of the gender gap are unknown, the researchers said, thus highlighting the need for additional research on the topic, but the nation's lack of investment in prevention for both men and women warrants attention.
"The most effective way to stop people from dying prematurely is to prevent them from getting sick in the first place," Heymann said.
Last year, the U.S. spent a tiny fraction of its $2.65 trillion annual health care budget on prevention. Health care spending is a large — and ever-increasing — portion of government budgets, particularly in the U.S. Therefore, allocating the necessary resources for prevention and improving overall efficiency are both critically important to preventing premature deaths and wiser spending, the researchers stressed.
Additional authors included assistant professor Arijit Nandi and researcher José Mauricio Mendoza RodrÃguez of McGill University.
Daniel J.B. Mitchell
By Carla Denly December 12, 2013
http://newsroom.ucla.edu/portal/ucla/weak-u-s-health-care-system-ranks-249652.aspx
A new study by researchers at the UCLA Fielding School of Public Health and McGill University in Montreal reveals that the United States health care system ranks 22nd out of 27 high-income nations when analyzed for its efficiency of turning dollars spent into extending lives.
The study, which appears online Dec. 12 in the "First Look" section of the American Journal of Public Health, illuminates stark differences in countries' efficiency of spending on health care, and the U.S.'s inferior ranking reflects a high price paid and a low return on investment.
For example, every additional hundred dollars spent on health care by the United States translated into a gain of less than half a month of life expectancy. In Germany, every additional hundred dollars spent translated into more than four months of increased life expectancy.
The researchers also discovered significant gender disparities within countries.
"Out of the 27 high-income nations we studied, the United States ranks 25th when it comes to reducing women's deaths," said Dr. Jody Heymann, senior author of the study and dean of the UCLA Fielding School of Public Health. "The country's efficiency of investments in reducing men's deaths is only slightly better, ranking 18th."
The study, which utilized data from 27 member countries of the Organization for Economic Cooperation and Development collected over 17 years (1991–2007), is the first-known research to estimate health-spending efficiency by gender across industrialized nations.
"While there are large differences in the efficiency of health spending across countries, men have experienced greater life expectancy gains than women per health dollar spent within nearly every country," said Douglas Barthold, the study's first author and a doctoral candidate in the department of economics at McGill University.
The report's findings bring to light several questions. How is it possible for the United States to have one of the most advanced economies yet one of the most inefficient health care systems? And while the U.S. health care system is performing so poorly for men, why is it performing even worse for women?
The exact causes of the gender gap are unknown, the researchers said, thus highlighting the need for additional research on the topic, but the nation's lack of investment in prevention for both men and women warrants attention.
"The most effective way to stop people from dying prematurely is to prevent them from getting sick in the first place," Heymann said.
Last year, the U.S. spent a tiny fraction of its $2.65 trillion annual health care budget on prevention. Health care spending is a large — and ever-increasing — portion of government budgets, particularly in the U.S. Therefore, allocating the necessary resources for prevention and improving overall efficiency are both critically important to preventing premature deaths and wiser spending, the researchers stressed.
Additional authors included assistant professor Arijit Nandi and researcher José Mauricio Mendoza RodrÃguez of McGill University.
Daniel J.B. Mitchell
Friday, December 13, 2013
China is seeking to reform its pension system as its population ages
Published on Dec 10, 2013
China is seeking to reform its pension system as its population ages. The just-concluded CPC third plenum vowed to address concerns of pushing back the retirement age and closing the pension gap between state and non-state employees.
http://www.youtube.com/watch?v=66R19j2y3jI
China is seeking to reform its pension system as its population ages. The just-concluded CPC third plenum vowed to address concerns of pushing back the retirement age and closing the pension gap between state and non-state employees.
http://www.youtube.com/watch?v=66R19j2y3jI
Tuesday, December 3, 2013
The Supreme Court on Monday declined to wade into the constitutionality of Obamacare’s employer mandate.
The high court rejected a petition from Liberty University, which challenged the law’s employer coverage requirements, individual mandate and contraception coverage requirements. A lower court upheld the law in Liberty’s case...
Full story at http://www.politico.com/story/2013/12/liberty-university-health-law-challenge-supreme-court-100531.html
Full story at http://www.politico.com/story/2013/12/liberty-university-health-law-challenge-supreme-court-100531.html
Tuesday, November 26, 2013
Is Walmart's request of associates to help provide Thanksgiving dinner for co-workers proof of low wages?
CLEVELAND, Ohio -- The storage containers are attractively displayed at the Walmart on Atlantic Boulevard in Canton. The bins are lined up in alternating colors of purple and orange. Some sit on tables covered with golden yellow tablecloths. Others peer out from under the tables.
This isn't a merchandise display. It's a food drive - not for the community, but for needy workers. "Please Donate Food Items Here, so Associates in Need Can Enjoy Thanksgiving Dinner," read signs affixed to the tablecloths.
The food drive tables are tucked away in an employees-only area. They are another element in the backdrop of the public debate about salaries for cashiers, stock clerks and other low-wage positions at Walmart, as workers in Cincinnati and Dayton are scheduled to go on strike Monday. "That Walmart would have the audacity to ask low-wage workers to donate food to other low-wage workers -- to me, it is a moral outrage," Norma Mills, a Canton resident, told the Plain Dealer...
Kory Lundberg, a Walmart spokesman, said the food drive is proof that employees care about each other...
http://www.cleveland.com/business/index.ssf/2013/11/is_walmarts_request_of_associa.html
J B Mitchell
This isn't a merchandise display. It's a food drive - not for the community, but for needy workers. "Please Donate Food Items Here, so Associates in Need Can Enjoy Thanksgiving Dinner," read signs affixed to the tablecloths.
The food drive tables are tucked away in an employees-only area. They are another element in the backdrop of the public debate about salaries for cashiers, stock clerks and other low-wage positions at Walmart, as workers in Cincinnati and Dayton are scheduled to go on strike Monday. "That Walmart would have the audacity to ask low-wage workers to donate food to other low-wage workers -- to me, it is a moral outrage," Norma Mills, a Canton resident, told the Plain Dealer...
Kory Lundberg, a Walmart spokesman, said the food drive is proof that employees care about each other...
http://www.cleveland.com/business/index.ssf/2013/11/is_walmarts_request_of_associa.html
J B Mitchell
Tuesday, November 12, 2013
Institutions Matter: Assaulting Labor Institutions only Harms the Economy
Economics has long been divided into two warring camps: the neoclassical economists who argue that wages are set by supply and demand in competitive markets and heterodox economists who maintain that wages are also determined by the power dynamics between workers and management. In the neoclassical model, market clearing wages are achieved when the demand for labor is exactly equal to the supply of labor.
In such a market, there is no such thing as unemployment because wages either rise or fall until the demand for labor is exactly equal to the supply of labor. At the wage at which demand equals supply, all those willing and able to work at that wage will be employed. If more people are willing to work, the wage will fall further, thereby inducing firms to hire more workers, with the result being that the supply of labor will once again be equal to demand. Conversely, firms that are unable to hire as many workers as they would like are forced to raise wages as an inducement for additional workers to enter into labor market until supply and demand are again equal.
Unemployment, according to this model, is the result of market interventions, whether in the form of social programs like public assistance and unemployment insurance that causes moral hazard or wage floors and labor laws that promote collective bargaining because they artificially inflate wages above market clearing levels, thereby limiting the flexibility of workers to demand less. The heterodox, or at times referred to as the institutional, model categorically rejects this position.
On the contrary institutions, particularly labor market institutions, do matter. To paraphrase Bill Clinton’s winning campaign slogan in 1992: “It’s institutions stupid”!!! Employers are effectively able to pay their workers less, especially those lacking in skill, because they do not have market power. Institutions like labor unions give their members a measure of bargaining power which, in the absence of organizing, they would not have. Similarly, a wage floor or minimum wage offers unorganized workers in the low-wage labor market a measure of market power too. Conversely, right-to-work laws, which we might refer to as anti-labor market institutions, work to suppress wages.
Data from the Current Population Survey for 2012 shows that median individual income in the U.S. was $31,000 a year. In right-to-work states median individual income was only $30,000, while it was actually $32,000 in high union density states. On the face of it, median individual earnings in high union density states is 6.7 percent higher than in right-to-work states. Now consider that in 1992 the median individual income was $17,000 with median income being $15,200 in right-to-work states and $18,335 in high union density states. In 1992 when union density was greater overall (16.0 percent) than in 2012 (11.3 percent), median wages were 20.6 percent higher in high union density states than in right-to-work states.
This too would suggest that the 29.4 percent decline in union density from 1992 to 2012 had the effect of decreasing wages in high union density states relative to right-to-work states. Stated differently, the increase in median wages between 1992 and 2012 was 89.9 percent in high union density states compared to 97.4 percent in right-to-work states. Although it is speculation, it might be reasonable to speculate nonetheless that had there not been a drop in union density the percentage increase in median wages would have been much higher in high union density states.
Institutions also affect levels of income inequality. Income inequality was lower on the basis of the ratio of the 90th percentile to the 10th percentile in high union density states in 1992 than the nation as a whole. Although income inequality increased 21.9 percent from a 90/10 ratio of 10.5 in 1992 to 12.8 in 2012, income inequality tended to be lower in high union density states. Data for 1992 and 2002 shows the 90/10 percent ratio to be lower in high union density states than in low union density states. In 2012, the 90/10 percent ratio was higher in high union density states than in low union density states, which may be attributable to diminished union density. In 2002 union density was still 13.5 percent, which was 19.5 percent higher than it was in 2012. Of particular interest, however were the 50/10 percent ratios. These ratios also dropped between 1992 and 2012, but again they were lower in 1992 and 2002 in high union density states than in low union density states. And again they were higher in high union density states in 2012 than in low union density states, which again may be attributable to declining union density overall.
Although this is a rough cut presentation of data, more statistical testing does show that states with high union density are more likely to have lower levels of income inequality than the country as a whole, at least during 1992 and 2002 when unions were stronger. It is quite telling, then, that states with high union density are likely to have higher inequality in 2012 when unions appear to be at their lowest level over a two decade period of time.
If we want to boost the wages of working Americans, we need to reinvigorate those labor market institutions that make a difference. Unions are but one form of wage policy; minimum wages, of course, are another. Workers need a constituency that will speak for their interests and afford them a measure of market power necessary to redress the power imbalance that is inherent to the labor-management relationship. But it isn’t just a question of redressing a power imbalance, but of strengthening the economy overall. The assumptions of the neoclassical model, which have lead to the pursuit of a low-road strategy, at the end of the day cannot lead to job creation. Rather job creation stems from the grassroots level whereby workers are able to demand more goods and services because their incomes are rising. Unemployment is the result of declining demand for goods and services; not labor inflexibility. Institutions, in other words, matter.
Oren M. Levin-Waldman, Ph.D.
Professor, Graduate School for
Public Affairs and Administration
In such a market, there is no such thing as unemployment because wages either rise or fall until the demand for labor is exactly equal to the supply of labor. At the wage at which demand equals supply, all those willing and able to work at that wage will be employed. If more people are willing to work, the wage will fall further, thereby inducing firms to hire more workers, with the result being that the supply of labor will once again be equal to demand. Conversely, firms that are unable to hire as many workers as they would like are forced to raise wages as an inducement for additional workers to enter into labor market until supply and demand are again equal.
Unemployment, according to this model, is the result of market interventions, whether in the form of social programs like public assistance and unemployment insurance that causes moral hazard or wage floors and labor laws that promote collective bargaining because they artificially inflate wages above market clearing levels, thereby limiting the flexibility of workers to demand less. The heterodox, or at times referred to as the institutional, model categorically rejects this position.
On the contrary institutions, particularly labor market institutions, do matter. To paraphrase Bill Clinton’s winning campaign slogan in 1992: “It’s institutions stupid”!!! Employers are effectively able to pay their workers less, especially those lacking in skill, because they do not have market power. Institutions like labor unions give their members a measure of bargaining power which, in the absence of organizing, they would not have. Similarly, a wage floor or minimum wage offers unorganized workers in the low-wage labor market a measure of market power too. Conversely, right-to-work laws, which we might refer to as anti-labor market institutions, work to suppress wages.
Data from the Current Population Survey for 2012 shows that median individual income in the U.S. was $31,000 a year. In right-to-work states median individual income was only $30,000, while it was actually $32,000 in high union density states. On the face of it, median individual earnings in high union density states is 6.7 percent higher than in right-to-work states. Now consider that in 1992 the median individual income was $17,000 with median income being $15,200 in right-to-work states and $18,335 in high union density states. In 1992 when union density was greater overall (16.0 percent) than in 2012 (11.3 percent), median wages were 20.6 percent higher in high union density states than in right-to-work states.
This too would suggest that the 29.4 percent decline in union density from 1992 to 2012 had the effect of decreasing wages in high union density states relative to right-to-work states. Stated differently, the increase in median wages between 1992 and 2012 was 89.9 percent in high union density states compared to 97.4 percent in right-to-work states. Although it is speculation, it might be reasonable to speculate nonetheless that had there not been a drop in union density the percentage increase in median wages would have been much higher in high union density states.
Institutions also affect levels of income inequality. Income inequality was lower on the basis of the ratio of the 90th percentile to the 10th percentile in high union density states in 1992 than the nation as a whole. Although income inequality increased 21.9 percent from a 90/10 ratio of 10.5 in 1992 to 12.8 in 2012, income inequality tended to be lower in high union density states. Data for 1992 and 2002 shows the 90/10 percent ratio to be lower in high union density states than in low union density states. In 2012, the 90/10 percent ratio was higher in high union density states than in low union density states, which may be attributable to diminished union density. In 2002 union density was still 13.5 percent, which was 19.5 percent higher than it was in 2012. Of particular interest, however were the 50/10 percent ratios. These ratios also dropped between 1992 and 2012, but again they were lower in 1992 and 2002 in high union density states than in low union density states. And again they were higher in high union density states in 2012 than in low union density states, which again may be attributable to declining union density overall.
Although this is a rough cut presentation of data, more statistical testing does show that states with high union density are more likely to have lower levels of income inequality than the country as a whole, at least during 1992 and 2002 when unions were stronger. It is quite telling, then, that states with high union density are likely to have higher inequality in 2012 when unions appear to be at their lowest level over a two decade period of time.
If we want to boost the wages of working Americans, we need to reinvigorate those labor market institutions that make a difference. Unions are but one form of wage policy; minimum wages, of course, are another. Workers need a constituency that will speak for their interests and afford them a measure of market power necessary to redress the power imbalance that is inherent to the labor-management relationship. But it isn’t just a question of redressing a power imbalance, but of strengthening the economy overall. The assumptions of the neoclassical model, which have lead to the pursuit of a low-road strategy, at the end of the day cannot lead to job creation. Rather job creation stems from the grassroots level whereby workers are able to demand more goods and services because their incomes are rising. Unemployment is the result of declining demand for goods and services; not labor inflexibility. Institutions, in other words, matter.
Oren M. Levin-Waldman, Ph.D.
Professor, Graduate School for
Public Affairs and Administration
Saturday, October 12, 2013
The China Syndrome: Local Labor Market Effects of Import Competition in the United States
The China Syndrome: Local Labor Market Effects of Import Competition in the United States
David H. Autor, David Dorn and Gordon H. Hanson
American Economic Review. Oct 2013, Vol. 103, No. 6: Pages 2121-2168
Abrstract: We analyze the effect of rising Chinese import competition between 1990 and 2007 on US local labor markets, exploiting cross- market variation in import exposure stemming from initial differences in industry specialization and instrumenting for US imports using changes in Chinese imports by other high-income countries. Rising imports cause higher unemployment, lower labor force participation, and reduced wages in local labor markets that house import-competing manufacturing industries. In our main specification, import competition explains one-quarter of the contemporaneous aggregate decline in US manufacturing employment. Transfer benefits payments for unemployment, disability, retirement, and healthcare also rise sharply in more trade-exposed labor markets.
http://pubs.aeaweb.org/doi/pdfplus/10.1257/aer.103.6.2121
David H. Autor, David Dorn and Gordon H. Hanson
American Economic Review. Oct 2013, Vol. 103, No. 6: Pages 2121-2168
Abrstract: We analyze the effect of rising Chinese import competition between 1990 and 2007 on US local labor markets, exploiting cross- market variation in import exposure stemming from initial differences in industry specialization and instrumenting for US imports using changes in Chinese imports by other high-income countries. Rising imports cause higher unemployment, lower labor force participation, and reduced wages in local labor markets that house import-competing manufacturing industries. In our main specification, import competition explains one-quarter of the contemporaneous aggregate decline in US manufacturing employment. Transfer benefits payments for unemployment, disability, retirement, and healthcare also rise sharply in more trade-exposed labor markets.
http://pubs.aeaweb.org/doi/pdfplus/10.1257/aer.103.6.2121
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