John Deere Dismissing 15% of Workforce
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Interestingly this is one of those things that gets spun as bad no matter which side of the argument you find yourself on. The effect here is deflation in food prices.
Here's a story from Feburary talking about the effect, but not making the connection: https://www.reuters.com/markets/commodities/us-farm-income-s...
There was a HUGE SPIKE in farm income in 2021-22 to the tune of like 60% owing to the pandemic effects on prices (mostly due to transport and not agriculture per se, as I understand it). It was level in 2023 and is now crashing back to something approximating a baseline level.
Everyone complained like crazy about this and we had all those doomsday articles about inflation. Now it's reversing, and... it's still bad. Economics discussion can't win, pessimism rules.
As far as John Deere, it just looks to me like they staffed up too hard over the boom and are having to correct.
Food distribution is currently consolidating and rolling-up rapidly (ex: the Albertsons/Kroger merger). The result will be low farm income and high supermarket prices.
I understood that supermarkets are always changing prices semirandomly, so that consumers never really know what the price "should" be.
The US did grow its public debt by 50%, from 22 trillion to 34 trillion in... Four years. +12 trillion in... Four. Years.
The cost of servicing the US debt is going to be the most important government spending two years from now.
US debt has to be something like 135% of the GDP now (roughly 100% public and 35% foreign).
Care to share some of your optimism on these issues?
There was indeed a very large increase in 2020-21 due to pandemic assistance programs. But the actual cost of the debt remains about half of what it was in the mid-80's under the Reagan economy (where the absolute size of the debt was smaller but the interest rates required to service it were higher).
I think we came out of the 80's just fine. We'll survive this too.
>The manufacturer is also moving skid steer and compact track loader manufacturing units from Dubuque, Iowa, to Mexico to curb its manufacturing costs.
I can appreciate snark and irony, but many of the comments here are of the same vein.
I think the expectation of more money = reward for behavior, less money = punishment is a flawed expectation. I dont see any correlation to that, I dont see any reason why there should be a correlation to that, I’m familiar with the mentality but prosperity preaching is a form of control not an economic theory.
I am not OP but yes - I would prefer a different outcome - specifically a cut in compensation for the CEO, the executive and upper management assigned to execute this plan. Sink with the ship philosophy.
I recognize this cannot be accomplished with current corporate structures but there is a reason why calls for unionization are rising.
I'm absolutely tired of pretending like there's simply nothing we can do to discourage this behavior. Wake up the regulators and make the companies like John Deere regret trying to abuse the market.
Holding them accountable for their failures isn't too much of an ask.
Or maybe they are, who knows? Maybe they hire private security?
Unless you can rationalize that into causing a large drop in ag markets (which is much more likely the results of trade wars, resulting govt bailouts for farmers, and the resulting issues that always fallout from such ham-handed trade wars).
seeing layoff after layoff after layoff over the past few years, yet theyre selling the economy as GREAT because theres a ton more low paid jobs and part time jobs.
IT IS TOO LATE FOR US
WREAK HAVOC ON THE MIDDLE CLASS
- Disco Elysium
This is a broader trend in the US economy that will self-correct as regulators become less recalcitrant.
https://www.numbeo.com/cost-of-living/rankings_current.jsp?d...
For example I live in Asuncion, Paraguay where the median wage is $420/month.
Vancouver, Canada has a purchasing power index that is 220% as high. Eg. The average person in Vancouver makes as much as a Paraguayan making $840/month living in Asuncion.
You could also compare NY to Cali, Colombia where NY has a score of 100 (by definition) and Cali has a score of 48. So the average Colombian is 1/2 as wealthy as the average New Yorker, or 1/3 the average Austinite with a score of 170.
The American middle class is doing amazingly well by moving to where they are exporting everyone’s jobs to. They double their income by not paying taxes anymore, and then compound that with a 1/3rd cost of living.
If by destroyed, you mean shrinking from 61% in 1971 to 51% of households now, then yes, there is data for that.
But that 10% decline was ~8% moving into above middle class and ~2% moving below middle class.
So yes, the middle class shrunk, because more people got richer. I'd also hardly call it destroyed - more like the % of people in various age groups has shifted, and people stay in education longer (meaning a higher % below middle), but those people over a lifetime will likely also become above middle class.
When you do the simple math that in 1970 about 25% of 18-24 were in college, and that % is now around 50%, and you factor that in, you can compute (or check Census/BLS reports for the same) to see outside people staying in school longer, the middle class is shrinking due to people getting richer.
I guess things aren't at negative as you imply.
https://www.newsweek.com/america-middle-class-shrinking-1913...
At any rate, imo for stability to exist, every generation must _feel_ better off than the previous on average.
Thanks for clarifying this.
How difficult is it to escape the lower class.
Here's [1] plenty of data and graphs illustrating mobility over different time frames
[1] https://www.frbsf.org/research-and-insights/publications/eco...
When famous economist Chetty et. al. [1] at the Harvard Equal Opportunity project went to prove this, they were surprised to find it's not true. They obtained never before access to lifetime IRS income statements to see how people moved over time, and they found that social mobility has not changed from around 1960 on. (Other studies had already shown this to be true for the first half of the 20th century). Other studies since theirs have obtain similar results. Here's a summary article about their results [2].
[1] https://scholar.google.com/scholar?hl=en&as_sdt=0%2C15&q=che...
[2] https://www.cfr.org/blog/new-harvard-study-us-social-mobilit...
1) true there are more people in lower middle class than before and less in the middle
2) even for those who moved “up” to upper middle class, the buying power has been stripped by rapidly rising housing prices, medical, and education costs. So even with a high income, disposable income has likely decreased. Those items have far exceeded inflation for years
3) much of the ability of families to move to UMC has been on the backs of two working parents. Which itself entails expensive childcare (often more than the mortgage), and a huge decrease in family leisure time and sleep. But with those rising expenses in 2), a single earner is not feasible.
In general, be wary of Newsweek articles, this is not the magazine we grew up with: https://www.thedailybeast.com/how-newsweek-has-gone-down-the...
Yes, because as I pointed out more people stay in college longer ( poor now but not for long), more people retire early due to good stock markets (simply read BLS/Census data).
Here's a simple way to check the rough argument: Suppose on avg it takes 5 years to post HS education. A working career is about 50 years. So 10% of a college student is spent poor with near certainty.
25% of people went in 1970. That accounts for (1/4)*(1/10) = 2.5% of the population being in poverty, yet they will mostly do quite well over a lifetime.
Now about 50% go to college. That's a 2.5% increase in the poverty rate, yet in reality people over a lifetime are going to be richer.
Do the same thing to retirees, to early retirement due to stock growth, early retirement from COVID where many people also decided to retire early since they could afford it, and your increase in the poor evaporates.
Also, US poverty rate puts one in the top 15% of world incomes, so our poverty rate is a pretty nice income. And poverty is measured pre-govt transfers, which provides a lot more income.
I just gave you the stats, and you can check them. Stop repeating things for which I pointed out solid and provably correct reasons your interpretation is wrong. If you want to refute there are more people in college, or that people aging into retirement or retiring early are not increasing then do so.
Simply do the math, or read Census or BLS data.
> the buying power has been stripped by
Inflation adjusted median wages has risen significantly [1]. So no, buying power has not been stripped. When you pick only a few items but ignore the overall purchasing power of an income you are making reasoning errors. This is also true of you break it down by decile or quintile - BLS/FRED/Census again has all the data you need. You continually cherry pick the extreme edges of things and ignore the actual data for the entire thing.
> much of the ability of families to move to UMC has been on the backs of two working parents
Individual income, as shown above, has greatly increased relative to inflation. The reason people use two incomes is they have more than twice as much stuff as 1970: median house sizes have more than doubled, more cars per family, more TVs, massively more entertainment expenses, more of everything. If a family wanted to live like 1970 then one income now is more than enough (provably so, since again, inflation adjusted wages since 1970 have increased significantly).
>In general, be wary of Newsweek articles
Nothing in that article is different than you can source yourself from the root data sources for all this knowledge: Census, BLS, FRED, and a few other stats gathering agencies. If you dispute the stats in the article, present your stats and sources. Stop pretending cherry picked anecdotes replaces analysis of the entire dataset.