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Profits Are Booming. Why Aren’t Jobs?
New York Times ^ | January 8, 2011 | Michael Powell

Posted on 05/31/2011 7:05:20 PM PDT by khnyny

To gaze upon the world of American corporations is to see a sunny place of terrific profits and princely bonuses. American businesses reported that third-quarter profits in 2010 rose at an annual rate of $1.659 trillion, the steepest annual surge since officials began tracking such matters 60 years ago. It was the seventh consecutive quarter in which corporate profits climbed.

Staring at such balance sheets, you might almost forget that much of the nation lives under slate-gray fiscal skies, a place of 9.4 percent unemployment and record levels of foreclosures and indebtedness.

And therein lies the enduring mystery of this Great Recession and Not So Great Recovery: Why have corporate profits (and that market thermometer, the Dow) spiked even as 15 million Americans remain mired in unemployment, a number without precedent since the Great Depression? Employment tends to lag a touch behind profit growth, but history offers few parallels to what is happening today.

“Usually the business cycle is a rising-and-falling, all-boats-together phenomenon,” noted J. Bradford DeLong, an economics professor at the University of California, Berkeley, and a deputy assistant secretary for economic policy in the Clinton Treasury Department. “It’s quite a puzzle when you have this disjunction between profits on the one hand and unemployment.”

A search for answers leads in several directions. The bulls’ explanation, heard with more frequency these days, has the virtue of being straightforward: corporate profits are the economy’s pressure cooker, building and building toward an explosive burst that will lead to much hiring next year.

The December jobs numbers suggest that that moment has yet to arrive, as the nation added just 103,000 jobs, or less than the number needed to keep pace with population growth. The leisure industry and hospitals accounted for 83,000 jobs; large corporations added a tiny fraction.

(Excerpt) Read more at nytimes.com ...


TOPICS: Business/Economy; Front Page News; Government; News/Current Events
KEYWORDS: bhoeconomy; business; depression2point0; economy; freetrade; freetraitors; getreadyhereitcomes; greatestdepression; greatestrecession; greatrecession; incorporation; michaelpowell; obamanomics; preparedness; preppers; profits; survival; survivalping; unemployment
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To: khnyny

Maybe they figured out their payrolls were bloated and people figured out to stay in a job they actually needed to put in 8 hours work for 8 hours pay. Plus O’s policies for business, I wouldn’t be hiring either.


121 posted on 06/01/2011 5:11:13 AM PDT by Qwackertoo (New Day In America November 03, 2010)
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To: chuckee

I am reminded of an old saying - “Every problem has a very simple answer ..... and it’s usually wrong”. Before we all leap onto the tariff bandwagon, it might be worth weighing the possible repercussions and unintended consequences.

Has anyone pondered the potential consequences of retaliation (which I guarantee will come as surely as night follows day)?

And, at the end of the day, why should we expect investment to be committed to domestic manufacturing when the major discouragement to such investment are the totally unpredictable and capricious effects of federal regulatory and political interventions into the economy. Who is crazy enough to invest in such an atmosphere?


122 posted on 06/01/2011 5:15:25 AM PDT by Senator John Blutarski
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To: dalereed
“Big corporations have no interest in helping the USA economy.”

No one in business large or small has any interest in helping the US or any other economy!!!

The only reason to be in business is profit!

That exactly summarizes the basic problem that now exists in the USA. The term "corporate citizenship", when business was in partnership with the USA, is a philosophy from a bygone era. Today the GE's, Goldmans, Wal-Marts, the former Bell System, Apple, etc are all looking out for international shareholders and bonuses for CEOs only and not the economic viability of the USA. We're just another market that they see as declining and have contributed to the decline.

The USA was a powerhouse because the country and business were in partnership as patriots, instead of today where China and other nations are just as important to GE, etc. The Citizens United election funding decision allows these international companies to control our government and work to eliminate our sovereignty. Illegal immigration and amnesty will be one byproduct. Conservatives will rue the day that the Supreme Court made the ruling that international corporations can use unlimited money to fund our elections. If you believe that such a ruling will benefit America and conservative causes, I've got a bridge to sell you.

123 posted on 06/01/2011 6:17:32 AM PDT by apoliticalone (Honest govt. that operates in the interest of US sovereignty and the people, not global $$$)
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To: khnyny

Because there is no need for the jobs. If profits are booming with the reduced work force, why hire?


124 posted on 06/01/2011 6:31:55 AM PDT by redgolum ("God is dead" -- Nietzsche. "Nietzsche is dead" -- God.)
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To: khnyny

This writer doesn’t understand. The NYT’s clings to their top-down elitist view of the world. The corporations he cites do not hire new workers. When they shed workers during recession, these big companies re-hire few of them when things turn around.

It is small or new companies that create new jobs and they have no reason to hire now.

this is just more evidence that Gov’t is encouraging the polarization of the American economy.


125 posted on 06/01/2011 6:43:50 AM PDT by PGR88 (I'm so open-minded my brains fell out)
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To: khnyny

It is called uncertainty. Businesess do not invest in people unless they think they can get a return. With Obamacare on the horizon, taxes possibly going up, unknown regulatory changes, etc, businesses are reluctant to invest.


126 posted on 06/01/2011 6:58:37 AM PDT by taxcontrol
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To: apoliticalone

You’re out to lunch!!


127 posted on 06/01/2011 7:05:22 AM PDT by dalereed
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To: apoliticalone

Nothing stopping you from starting your own business.


128 posted on 06/01/2011 7:06:37 AM PDT by VanDeKoik (1 million in stimulus dollars paid for this tagline!)
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To: apoliticalone

Corporations hate the concept of a republic and 50 little countries with their own silly laws and borders. “We need a national law” is their mantra. What that leaves us with is a leviathan central government, a dead republic and corps loyal to the “global establishment”.


129 posted on 06/01/2011 7:13:07 AM PDT by central_va ( I won't be reconstructed and I do not give a damn.)
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To: khnyny

Jobs are booming in China.

Wake up America. “Free trade” is destroying the United States.


130 posted on 06/01/2011 7:15:06 AM PDT by Cringing Negativism Network (BUY AMERICAN. The job you save will be your son's, or your daughter's)
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To: dalereed
The only reason to be in business is profit!

Unbridled, corporations will do things that are bad for the republic. There needs to be checks and balances. There are none. Govt is totally in bed with Corporate America. This government-business model is better known as fascism.

131 posted on 06/01/2011 7:16:04 AM PDT by central_va ( I won't be reconstructed and I do not give a damn.)
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To: khnyny

They are — offshore. Duh.


132 posted on 06/01/2011 7:26:33 AM PDT by 57 Red States
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To: JDW11235
Do me a favor, and don’t get back to me. I already understand you have little understanding of freedom, nor economics, merely a shady view of how to maximize exploitation for the profitability of a few. No thanks. That’s not what patriotism, Constitutional Government, nor strong Sovereignty is about.

Most of the Free Traitors around here are graduates of the Judas Iscariot School of Business.

133 posted on 06/01/2011 7:29:28 AM PDT by central_va ( I won't be reconstructed and I do not give a damn.)
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To: Senator John Blutarski
Has anyone pondered the potential consequences of retaliation

That's the beauty of it, it is impossible for our trading partners to retaliate as they already tariff the hell out of everything made in the USA.

134 posted on 06/01/2011 7:33:15 AM PDT by central_va ( I won't be reconstructed and I do not give a damn.)
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To: norwaypinesavage

Oh wait, but he can mandate that we all have health insurance? /s =.=


135 posted on 06/01/2011 7:51:56 AM PDT by cranked
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To: khnyny
Profits Are Booming. Why Aren’t Jobs?

Two words: Illegal aliens.

As the economic downturn shed 4.3 million American jobs, employment for illegals added 1.1 million. It really is as simple as that. And it is why the Chamber of Commerce has become the enemy of the American worker.

136 posted on 06/01/2011 7:55:22 AM PDT by FreepShop1 (SECURE THE DAMN BORDER! http://www.StandWithArizona.com)
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To: khnyny

Who wants to hire when there are:
Increasing energy and raw materials costs
Obamacare on the horizon
Global warming legislation
Potential for forced unionization
All the above affecting your customer base


137 posted on 06/01/2011 7:58:02 AM PDT by Thunder90 (Fighting for truth and the American way... http://citizensfortruthandtheamericanway.blogspot.com/)
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To: dalereed; apoliticalone
You’re out to lunch!!

Insults are the refuge of those who lack facts! how alinksy of you, Dalereed.
138 posted on 06/01/2011 7:58:54 AM PDT by algernonpj (He who pays the piper . . .)
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To: apoliticalone
"In response to :The only reason to be in business is profit!"

That exactly summarizes the basic problem that now exists in the USA. The term "corporate citizenship", when business was in partnership with the USA, is a philosophy from a bygone era. Today the GE's, Goldmans, Wal-Marts, the former Bell System, Apple, etc are all looking out for international shareholders and bonuses for CEOs only and not the economic viability of the USA. We're just another market that they see as declining and have contributed to the decline.

The USA was a powerhouse because the country and business were in partnership as patriots, instead of today where China and other nations are just as important to GE, etc. The Citizens United election funding decision allows these international companies to control our government and work to eliminate our sovereignty. Illegal immigration and amnesty will be one byproduct. Conservatives will rue the day that the Supreme Court made the ruling that international corporations can use unlimited money to fund our elections. If you believe that such a ruling will benefit America and conservative causes, I've got a bridge to sell you.


Spot on!
139 posted on 06/01/2011 8:00:34 AM PDT by algernonpj (He who pays the piper . . .)
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To: scooby321
So he's "opening 300 restaurants" but "would not put a penny in a new business".

I'm confused. Is he opening them without putting any money in? Nice trick. I'd like to know how to do that.

140 posted on 06/01/2011 8:16:18 AM PDT by DannyTN
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