Basic Facts about Wealth and Poverty

Doug Henwood dhenwood at panix.com
Tue Jun 9 11:28:12 PDT 1998


Wojtek Sokolowski wrote:


>But I do not want to quibble over details. Instead, I'd like to put things
>in a different perspective:
>-- do we have a real (as opposed to neoliberal propaganda) reason to belive
>that US employment rates are higher than in Europe? In other words, what
>is it about the US that Europe does not have (other than the invisible hand
>of providence) and that causes higher employment rates. Why are the US
>firms hire more people than their European counterparts?
>
>Until we identify such a _real_ cause, would it not be more prudent to
>assume that the observed differences are a statistical artifact?

It's not an artifact - it's real. Our government and social order are deeply fucked up, but we've got one of the best statistical apparatuses in the world, in its accuracy, openness, breadth, and timeliness.

A Marxist should have no problem accepting the part of the official explanation of high European jobless rates - high minimum wages, the generous welfare state, etc. That's not the whole story - Maastricht has a lot to do with it too - but in Germany the choice isn't a job with Domino's or starvation in quite the stark way it is in the U.S. There just aren't the Domino's in the first place. Max's EPI colleague Eileen Applebaum says she's studied the U.S. and German input/output tables and finds the major structural difference between the two economies is a higher U.S level of purchased household services, from Domino's to nursing homes. Those are precisely the high-growth low-wage sectors the U.S. excels at.

Doug



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