Economic Problems notes outline



Economic Problems Lecture outline

Lecture (& Some group discussion points):

Economic trends -- various data on income, wealth distribution, etc.(D&B Ch.s 2 & 3), know trends, not necessarily specific #s. Increasing Economic Inequality key theme, & too much is a problem…

Income inequality increases since 1979, flat wages for most workers, but much more income for wealthy; Stats. on increasing income and wealth inequality, esp. since late 1970s. (D&B Ch. 2 & 3; Tavernise et al web rdg.; Perrucci and Wysong in C&V)

Income vs. wealth – how unequal and definitions of each (D&B ch 2).

Labor Theory of Value (LTV)– (An explanation for Economic Inequality)

What creates all wealth / value? Value of product split 3 ways – Fixed costs, Variable costs & Surplus Value. Also, key concept is Exploitation & degree of it, makes economic inequality greater or lesser

Examples: Historical conditions in US factories in early industrialization (D&B Ch. 3); Apple computers made overseas vs. in US (Duhigg web rdg.), [See also History of US Labor, brutal early conditions (D&B ch. 3)]; & Sean Jean T-shirts made in Honduras…

Companies moving jobs overseas to reduce labor costs and increase profits, like Apple (Duhigg web rdg.; see also Perucci and Wysong in C&V)

Commodity Fetishism – definition and how Apple’s products & our fascination with them fits that idea (what about workers who made these products & labor-management systems used? Do we think of that much?)

Crisis of Over-production in Capitalism & how that relates to current economic crisis: Consumer demand key part of economy. When workers can’t afford products, demand goes down…[ Middle-class squeeze, can’t afford to buy as much]

Problems in Production of Mac IPhones, etc. in China and advantages for the company as well as problems for workers—hours, working conditions, pay, etc. Compared to production in US. (Duhigg et al. web rdg.)How this fits with Marx’s ideas above.

Increasing US poverty and downward class mobility (people falling out of middle class) while corporate CEOs egt richer and corporations pay less taxes (sometimes none) as they continue to cut US jobs (Tavernise et al web rdg.)

Increasing Economic Inequality due to Globalization – Intl trade and Movement of industries out of US to other countries. Aided by new changes in global communications technologies, US deindustrialization, lay-offs, and this increases economic inequality within the US, diminishes middle class, esp. those without higher educaiton -- [See also, “privileged class” vs. “Core workers” “Temp. Workers” and Contingent Workers] (Perrucci and Wysong rdg. 6 in Charon & Vigilant; Dolgon and Baker Ch 3;)

Increasing need for higher education to achieve middle class econ

Poverty Explanations -- Cultural / Behavioral Vs. Social Structural / Economic – main general ideas of each (Rodgers rdg. 8 in C&V)

US govt. bail out AIG—reasons for and amount. Where did govt. $ to AIG spent (bonuses even). (Nocera et al web rdg.) [Socialize the losses Vs. privatize the profits]

Govt. assistance for corporations [also known as “corporate welfare, see D&B Ch. 2] –e.g., corp. tax breaks as example (Tavernise et al. web rdg.) & Govt. bail out of big banks rewarding very risky, unsuccessful & unethical (& illegal) practices by AIG and others All govt. assit. to corps. given with few conditions/restrictions and limited positive impact for tax payer and workers… Bonuses paid to executives of failed firms (Nocera et al web rdg., Johnson web rdg.).

US Financial Industry excessive political influence distorting US economic policy, led to crisis and lack of effective response. This is bad for the economy, ultimately… Rewarding risky, unsuccessful behavior makes it likely it will happen again… Solution--limit size of banks “too big to fail” (Johnson web rdg.)

Occupy Movement (Gupta et al. web rdg.) – what are main grievances and issues of concern, and what are they doing in response?

Other key Issues not covered in class, or not much, but that you should know about:

-- Poverty—Rate overall, and changes over time & who is more likely to be poor. (Tavernise et al. web rdg. and D&B ch. 2)

More on economic Shifts over recent decades (to increase corp. profits) – Deindustrialization in US and more Service economy, more inequality, Unionization & Wages—trends over prior decades. (D&B ch. 2& 3; Perrucci and Wysong #6 in C&V, Duhigg et al. web rdg.). [Know general pattern, not exact #’s]

Human Agency (vs. Social Structure) concept from Ch. 1 of D&B in “Intro” topic section. Where is there Human Agency in Econ. problems readings-- Occupy Movement (Gupta et al. web rdg.) – what are main grievances and issues of concern, and what are they doing in response?

Case Studies in D&B ch. 2 as examples of Human Agency --“Welfare Warriors” fighting stereotypes of poor (reframe debate) and policies that make lives harder; Homeless youth writing project and expressing their lives; E St. Louis Farmers Market project to improve access to healthy foods in very poor community – (All D&B Ch. 2).

Ch. 3 Case studies as examples of Human Agency--Student Action with Farm workers –services to very needy group, youth leadership development and college; Southampton College Coalition for Justice fighting outsourcing of custodial jobs (like Harvard case also); Pomona Day Labor Center – worker needs & empowerment. (D&B ch. 3). Also SLAM group at Harvard protests against outsourcing of security guards. Also, History of labor in US in Ch. 3 has lots of examples of human agency…

See also: Group Discussion Questions

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