Who Are You Going to Believe -- Tim Geithner or Your Own Lying Eyes?
Monday, August 9, 2010 at 02:00PM Huffington Post
The jobs situation stinks, even as corporate profits keep rising. Another 131,000 jobs were lost to the economy in July, according to the Labor Department's latest report released Friday. The measured unemployment rate stayed stuck at 9.5 percent.
The only reason it wasn't worse was because more workers gave up looking for nonexistent jobs, leaving a smaller labor force to measure against the meager supply of work. Small comfort.
Meanwhile, another important government report, by the Social Security Trustees, showed only a trivial improvement in the gap between what Social Security owes the next generation of retirees and the tax receipts that it can expect.
There is, of course, a direct connection between rising unemployment, declining wages, and the condition of Social Security. That's because Social Security is funded by payroll taxes.
If wages had continued to rise with the growth of the economy's productivity, instead of profits and bonuses taking an ever larger share, Social Security would be enjoying an endless surplus.
Based on recent trends and a dismally pessimistic projection of our economic future, Social Security's Trustees assume wage growth of just 1.2 percent a year. But that can be changed by better policies.
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