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You know your generation’s screwed when even Monopoly is mocking you.

Back in 2016, I argued that Millennials were in fact generation screwed.

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For example, in 2010 (when some of them were 20 to 24 years of age), their unemployment rate was 17.2 percent, much higher than the already high national average of 9.9 percent.*

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Partly because of the difficulty they had finding jobs, but also because they have been saddled with high student and healthcare debt, the typical Millennial family lost ground between 2010 and 2016, falling further behind the typical wealth lifecycle than any other birth cohort. According to the Federal Reserve Bank of St. Louis (pdf), a typical 32-year-old family respondent in 2016 (born in 1984) was 34 percent ($12,000) below the 32-year-old benchmark established by earlier generations.

No wonder Hasbro decided to lampoon their inability to purchase real estate.

Still, the authors of the report thought there were grounds for optimism, since “These families have many more years to earn, save and accumulate wealth.”

Except now, according to Vox (first in early April and now in May), Millennials have been screwed again.

As someone on the tail end of the millennial generation, I was lucky enough to still be in school when the 2008 recession hit. Yet financial anxiety has been an omnipresent part of how I see the world. It feels as though the one-time hallmarks of adulthood — buying a house, having kids, stability, even thinking about these things — are no longer milestones, but irresponsible dreams. Meanwhile, millennials older than me, many of whom are in their 30s and began their job searches in the thick of the 2008 recession, are even more financially fragile.

In fact, Millennials have every reason to be concerned, about their present and their future. They (and the next younger cohort) appear to have been most affected by furloughs, layoffs, and pay cuts in the midst of the current economic crisis. Moreover, we know that those making less money and those working in certain sectors (such as hospitality, restaurant services, and retail trade) have been more likely to be laid off than other, often older workers. And yet still Millennials have to continue to pay off their student loans and healthcare debts and make their rent payments.

The last time I analyzed the situation of Millennials, I discovered they were more inclined to identify as members of the working-class (and not, for example, as middle-class) and more critical of capitalism than previous generations.

I wonder now, when they’re being screwed a second time in their short lives, how they will identify and what economic and social arrangements they will end up criticizing.

Millennials still have plenty of time, if not to accumulate wealth, at least to change the world.

 

*For the sake of comparison, the difference between the two unemployment rates in 2007 was only 2.8 points.

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Jean-François Millet, “The Gleaners” (ca. 1855–56)

We already had high food insecurity in this country and now we are putting another layer of need on top of it.

Kevin M. Fitzpatrick

One of the many irrational characteristics of capitalism is that billions of tons of food go to waste while hundreds of millions of people struggle with hunger on a daily basis. And like all the other senseless attributes of the way the economy is currently organized, the mismatch between the enormous quantity of food that is available for human consumption but is not consumed and the vast number of people who are food insecure has been highlighted and heightened by the COVID-19 pandemic—especially in the United States.

Even before the pandemic, the Food and Agriculture Organization of the United Nations reported that approximately 30 percent of food produced for human consumption around the world is either lost (from post-harvest to distribution) or wasted (at retail and consumption levels) each year—while an estimated 821 million people (just below 11 percent of the world’s population) were undernourished (pdf).* And in the United States? According to the National Resources Defense Council (pdf), the degree of food waste was even higher—between 39 and 43 percent of the total U.S. food supply. At the same time, according to the U.S. Department of Agriculture (pdf), more than 37 million Americans (13.9 percent of households) suffered food insecurity—and less than one-third of the food that was thrown out would be enough to feed this population completely.

This senseless combination of widespread food waste and food insecurity in the United States has only worsened in recent months. On one hand, with job losses skyrocketing because of the response to the novel coronavirus pandemic, hunger is a growing issue for millions of Americans. On the other hand, farmers aren’t able to harvest and sell the food they’re growing.

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We’ve all seen the photos and read the stories: American workers and their families are lining up outside understocked food banks while animals are being culled, mountains of produce are rotting in the fields, and crops are being plowed under.

Clearly, the capitalist food system has failed. It certainly didn’t function well before the pandemic. And now its irrationality is even more evident, as it discards tons of food while more and more workers and their families go hungry.

But there are alternatives, outside of capitalism.

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Frank Döring, cafeteria of an elementary school in Vanceburg, KY

For example, many schools are continue to prepare and making available, for pick up or delivery, free meals to needy students. But the “grab-and-go process,” without much more government assistance, becomes difficult the more remote the schools and the populations they serve are. Moreover, the free meal stations and deliveries put those who travel to work, prepare the food, and deliver it at additional risk for exposure to the coronavirus.

Food pantries and food banks are also providing free food (Feeding America estimates that demand has increased an average of 70 percent, and 40 percent of those being served are new to the system) but, across the country, they’re underfunded, understaffed, and understocked. Meanwhile, farmers are donating many tons of food but they’re finding it costly to harvest and distribute the food they can’t sell.

The Agriculture Department could step in to purchase the surplus food from farmers and deliver it to needy families. However, within the Trump administration, Secretary Sonny Perdue has been very slow to respond. As a result,

The scale of produce waste is staggering. Farmers in Florida, which provides much of the fresh produce to the eastern half of the U.S. during the winter and spring, left about 75 percent of the lettuce crop unharvested, along with significant portions of the state’s sweet corn, cabbage and squash. Up to 250 million pounds of tomatoes could end up left in the fields, according to the Florida Department of Agriculture & Consumer Services. Florida officials estimate produce growers there have taken a half a billion dollar hit. In California, the industry is projected to lose more than $1 billion per month.

A fourth possibility is for an army of volunteers to pick and pack food that is ripening in the fields. And that’s what they’re beginning to do in Florida—they’re gleaning. For example, farmer Hank Scott

invited volunteer pickers with the Society of St. Andrew, a Christian hunger relief organization, to glean as much produce as they could and donate it to nearby food banks. Anything green they left behind will likely be plowed back into the ground, feeding no one and adding to the farm’s ballooning losses. . .

As the gleaners rescue vegetable after vegetable, they are both a final lifeline for desperate families and a sign of just how badly the novel coronavirus has kneecapped the systems that are supposed to keep everyone fed.

 

Because of that story, I was reminded of French Avant-garde filmmaker Agnes Varda, who focused her lens on the activity of gleaning in her remarkable 2000 film, The Gleaners and I. Beginning with Jean-François Millet’s famous depiction of “The Gleaners,” Varda documents the history (dating back to a 1554 French law that allows “the poor, the wretched, the deprived” to enter the fields once the harvest is over, and take what they wish) and current forms of gleaning (collecting the odd-shaped potato, the overripe fig, or the damaged apple and “dumpster-diving” for the supermarket product whose “sell by” date has passed). She also ruminates on her own activity as a filmmaker who, during the course of making the film, gleans from and with her diverse subjects, including rural drifters, homeless alcoholics, gypsy families living in trailers, a chef who gleans because he “likes to know where his food comes from,” and young punks who live on the street. These are all people who insist on finding a use for what capitalism has determined it has no use for.

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As it turns out, the Center for Agriculture and Food Systems at Vermont Law School has created the National Gleaning Project, a clearinghouse for gleaning and food recovery-related information. They have compiled information on gleaning and food-recovery organizations in 46 states plus the District of Columbia, along with a directory of relevant federal and state laws, and conducted a series of research reports. While the two terms are often conflated, and there are many different activities included under the rubric of gleaning and food recovery, the Project emphasizes

the main intent of the practice [which] is to recover surplus food for distribution to food insecure populations, meaning there is a charitable dimension to the act.

It’s that charitable dimension—the gift, if you will—that takes gleaning and other related activities (including field gleaning, wholesale produce salvage, perishable and prepared food rescue, and non-perishable food donations, collection, and recovery) beyond capitalism.** They are all ways of reducing waste and providing food to those who need it outside a system based on private property, wage-labor, and markets. In other words, gleaning and food recovery serve both to challenge the irrationality of the capitalist food system and to create a real alternative.***

And right now, in the midst of the senselessness of widespread hunger and massive amounts of food going to waste, we need more than ever to question and escape the logic of capitalism and make sure Americans get the food they need.

 

*Considering all people in the world affected by moderate levels of food insecurity together with those who suffer from hunger, it is estimated that over 2 billion people do not have regular access to safe, nutritious, and sufficient food, including 8 percent of the population in Northern America and Europe.

**In France, since 2015, supermarkets are required by law to be charitable—to donate all unsold but edible food to charities for immediate distribution to the poor.

***There is one glaring exception: gleaning will not solve the Jungle-like problems in American meat plants. As I see it, the only alternative is to give workers a say in how meat is processed and how their labor is organized.

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What the hell is Georgia Governor Brian Kemp doing, deciding to reopen the state’s economy?

Georgia was one of the last states to close, and has now adopted the most aggressive plan to reopen. But the mayors of the state’s major cities—such as Atlanta, Athens, and Savannah—are certainly opposed to the idea. As is Dr. Anthony S. Fauci, the director of the National Institute of Allergy and Infectious Diseases. Even “raring to go by Easter” Donald Trump thinks (or at least said, at the urging of Dr. Deborah Birx) Kemp’s decision was too hasty!

As of yesterday afternoon, Georgia (according to the Johns Hopkins Coronavirus Resource Center) had tested only 88, 425 of its 10.74 million residents, with 20,740 confirmed cases of COVID-19 and 798 deaths. Moreover, expected coronavirus peaks—of hospital use (1 May) and deaths (3 May)—are still are still more than a week away.

So, what the hell is going on?

Well, according to George Chidi, a Georgia journalist and former staff writer for the Atlanta Journal-Constitution (via American historian Heather Cox Richardson [ht: lw]), it’s pretty straightforward:

“It’s about making sure people can’t file unemployment,” he wrote.

The state’s unemployment fund has about $2.6 billion. The shutdown has made claims skyrocket—Chidi says the fund will empty in about 28 weeks. There is no easy way to replenish the account because Georgia has recently set a limit on income taxes that cannot be overridden without a constitutional amendment. It cannot borrow enough to cover the fund either, because by law Georgia can’t borrow more than 5% of its previous year’s revenue in any year, and any borrowing must be repaid in full before the state can borrow any more.

By ending the business closures, Kemp guarantees that workers can no longer claim they are involuntarily unemployed, and so cannot claim unemployment benefits. Chidi notes that the order did not include banks, software firms, factories, or schools. It covered businesses usually staffed by poorer people that Kemp wants to keep off the unemployment rolls.

That makes a lot of sense.

But to my mind it’s not just about state finances, since the federal government (according to the CARES Act) is picking up the extra amount ($600) for unemployment claims. It’s about disciplining and punishing low-income workers.

As it turns out, unemployment benefits are—by U.S. standards, which admittedly is a very low bar—pretty generous right now. At least until the end of July, when the additional payments expire.

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Taking the national average unemployment insurance benefit of $377.97 as the baseline, the new amount of the average unemployment check should (until the act expires) be around $978 ($600 + $378). This amount is equal to the average weekly earnings in the private (nonfarm) sector in the United States, and exceeds the average weekly paycheck for at least some of the industries (such as retail and leisure and hospitality) hit the hardest by COVID-19, as seen in the table I compiled above.

Now, that’s not enough (as conservative critics have complained) for workers to find a way of getting fired from their jobs, in order to collect unemployment. They’d still have to worry about the loss of any benefits (such as health insurance) from their employers, and they’d eventually have to begin the search for a new job. But it certainly does create a floor under their pay and allow them some space to do the only sane thing workers should be doing right now: staying home.

Kemp’s decision, to make “sure people can’t file unemployment,” follows a very different logic. It makes Georgian workers desperate, which forces them to have the freedom to sell their ability to work to employers, regardless of the consequences.

That, alas, is the way the modern equivalent of slavery works—in Georgia and across the United States. It’s not whips and chains; it’s the need to work for someone else, to get a wage to purchase the commodities necessary for survival.

Right now, workers who are being forced to have the freedom to go to work also means spreading the contagion, thereby endangering themselves and the communities in which they live.

And perhaps die.

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In retrospect, I can now recognize that we were both right and wrong, as is always the case when one tries to look into the future.

— Henning Mankell

Regular readers of this blog know two things about me: I don’t make predictions. And I use these posts not to pronounce firm conclusions or solutions, but to try to work through the issues and clarify my thinking.

So, think of this as an exercise in trying to make sense of the ongoing debate concerning the shape of the recession and the speed of the recovery from the severe economic crisis induced by the response—by U.S. corporations, banks, workers, various levels of the government, and others—to the novel coronavirus pandemic. Nothing more.

Moreover, I don’t have or offer a single theory of capitalists crises, no set of “laws of motion” that inexorably (at least in the last instance) work themselves out to produce every recession, depression, or other economic meltdown within capitalism. For me, every crisis is a singular event, which requires a conjunctural analysis—and this one is no different.

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That said, I think we can all agree that the current crisis is severe—in terms of a variety of indicators, from the projected decline in Gross Domestic Product to the current and projected additional rise in unemployment. It’s probably the most dramatic since the first Great Depression of the 1930s, and therefore worse than any of the eight other economic downturns (including what I have called the Second Great Depression) since 1960.*

The big question is, how long will it last—that is, will American capitalism rebound and how quickly will that occur?

That’s the question that seems to be on everyone’s minds these days, from Donald Trump and the right-wing anti-shutdown protestors through businesses and banks both large and small to the millions of workers whose lives have been decimated either by being laid off or being forced to have the freedom to continue to work under conditions that imperil their health and lives.

And the stakes couldn’t be higher. In Trump’s case, for example, a quick recovery increases his chances of reelection in November—although that might not work out exactly as he hopes if reopening the economy prematurely means thousands more American deaths. A longer downturn, on the other hand, calls into question capitalism’s resilience, highlights even more the grotesque levels of inequality that characterize the United States, and serves to legitimize more generous government-sponsored social programs (including, e.g., a universal or unconditional basic income) to mitigate the effects of the crisis on workers, their families, and their communities.

So, what will the COVID-19 recession look like: will it be V-shaped, U-shaped, or W-shaped (to use the alphabet soup most recently discussed by David Rodeck)?

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One possibility is for a relatively quick, V-shaped downturn and recovery such as occurred in the early 1990s (starting with a recession that lasted for 8 months, from July 1990 to March 1991, followed by a relatively speedy recovery).

It’s a rosy forecast that has been offered by such theoretical and politically different economists as Gregory Mankiw (putting on his optimist cap) and Dean Baker, as well as a couple of my friends (in private communications). The basic idea is that the crisis was caused not by capitalism’s “inner workings” (such as the bursting of a speculative bubble or a decline in the profit rate), but by the pandemic and the government-mandated shutdown of businesses. So, the logic goes, as soon as the shutdowns are lifted, businesses will reopen, workers who were furloughed or laid off will head back to their employers, and spending (both consumption and investment) will rebound.

In other words, capitalists will be able to bury the bodies (both literally and figuratively) and get back to business as usual—although it’s quite possible, even then, that U.S. capitalism itself will look quite different (with increased concentration, especially in the retail sector, and even more inequality).

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A second, less-optimistic picture is a U-shaped cycle, with a prolonged downturn and extended trough, and thus a delayed recovery—something like the United States experienced during the Second Great Depression (the so-called Great Recession itself lasted 18 months from peak to trough). Here, we’re talking about a much longer decline in economic growth (comprising 5 quarters of negative real GDP growth, from early 2008 to mid-2009) with soaring unemployment (reaching a peak of 10 percent), and, of course, an almost complete meltdown of the financial sector.

We don’t yet know how severe economic growth is or will be (although the authors of a recent National Bureau of Economic Research working paper forecast a year-on-year contraction in U.S. real GDP of nearly 11 percent as of the fourth quarter of 2020, while the 90-percent confidence interval extends to a nearly 20-percent contraction) but unemployment is already at an alarming level (18 percent, by my estimate) and will no doubt increase in the coming months.** Moreover, it’s quite possible that many of the workers who have been furloughed or laid off will not soon be reintegrated into their previous jobs or find, at least in the medium term, new jobs. That’s because many businesses will not reopen or will be acquired, as happens during every capitalist crisis, and the remaining businesses will resume with smaller workforces (e.g., because of automation and speed-ups). And, of course, certain sectors (such as transportation and any activity that involves large gatherings, such as professional and collegiate sports) will likely reopen very slowly.

In addition, a recent study suggests that forecasters (both researchers and government agencies) tend to be too optimistic about when recession recoveries will begin, which means the return to a normal economy could be slower and bumpier than many economists are currently predicting.

Finally, we still don’t know the likely trajectory of the pandemic, both within and across countries. Especially as tentative steps are being taken to reopen the U.S. economy, it’s quite possible, without widespread testing and an effective vaccine, that we’ll see a second or third wave of COVID-19, which will require new shutdowns.***

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That leaves us, then, with a third possibility: a W-shaped recession and recovery, such as took place in the early 1980s, with an initial downturn (from January to July 1980) followed in short order by a second, more severe one (from July 1981 to November 1982).

Such a double-dip recession, with a short recovery inbetween, might occur if the economy is reopened and pent-up demand (for everything, from cars to the commodities in brick-and-mortar stores and restaurants) leads to a surge in consumption, but the initial recovery is disrupted by households attempting to rebalance their finances (e.g., to pay for healthcare and to make up for foregone paychecks) and businesses that, after selling off their inventories, curtail both new purchases and longer-term investment projects in the face of considerable uncertainty. That would mean a new round of furloughs and layoffs, even without new waves of the pandemic.

Of course, if the novel coronavirus does get out of control again (e.g., as recently happened in Singapore), either because of its spread from one region to another the United States or because of outbreaks abroad (which in coming months may be experiencing only the initial stages of the pandemic), then the likelihood of a W-shaped cycle would increase.

As I wrote at the top, I don’t make predictions, and I have no idea which of these three possibilities is most likely. What I do know is that the existing way of organizing economic and social life in the United States, which was already inflicting its pains and punishments on most of the American people while favoring a tiny group at the top, has proven to be even more poorly equipped to handle a pandemic. The public healthcare system, notwithstanding the heroic work of its workers, has clearly come up short. And the way the system has stranded workers and the owners of small businesses, who have barely benefited from the bailouts that have mostly favored large banks and corporations, has made a terrible situation even worse.

Regardless of the depth of the recession and the speed of the recovery, the real debate in the months ahead will center on one question: what fundamental changes need to be made so that, in moving forward, the grotesquely unequal imposition and shifting of burdens favored by American economic and political elites can finally be eliminated?

 

*The designation of a recession is the province of a committee at the National Bureau of Economic Research. Contrary to popular belief, which equates a recession with two consecutive quarters of negative GDP growth, an NBER recession is a monthly concept that takes into account a number of monthly indicators—such as employment, personal income, and industrial production—as well as quarterly GDP growth. And just to be clear, the NBER does not have or utilize a separate category or metric for capitalism’s depressions.

**According to a newly released poll from the Pew Research Center, 43 percent of American adults say their households have suffered a job loss or a cut in pay since the start of the coronavirus crisis, marking a 10-point increase from a month ago. Among lower-income adults (with annual incomes less than roughly $37,500), an even higher share (52 percent) say they or someone in their household has experienced this type of job upheaval.

***The CDC is now warning that a second wave of the novel coronavirus later this year may be far more dire because it is likely to coincide with the start of flu season.

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This is from an analysis by the Joint Committee on Taxation (pdf) of the distributional effects for 2020 of the tax changes Republicans managed to add to the CARES Act. Basically, the provision allows for a temporary suspension of the limitation on tax losses for owners of businesses known as pass-through entities. Before (from 2017 onward), owners of these entities could deduct a maximum of $250 thousand in losses from non-business income, such as stocks and bonds.

As is clear in the table above, more than 80 percent of the benefits from the tax law change will go to people making $1 million or more annually in 2020. Overall, 95 percent of individuals who benefit from the change make $200 thousand or more.

What’s the slogan of disaster capitalism? Never let a serious crisis go to waste. . .