Tuesday, March 8, 2016

A shocker: given the prison system, where is the progress about unemployment and wages?

      In the current campaign, Hillary Clinton brags that Bill Clinton's administration produced prosperity as an answer to the correct claim that Clinton helped spur on jailing - the 2.3 million currently incarcerated (Michelle Alexander) - and hurt the most vulnerable by cutting off welfare (the states did it even more than the Federal Government which "left it up to them").  The latter points are made by Bernie Sanders.  Black unemployment is triple white and Clinton's policies were a decisive move in this direction.


        Just how bad the falsifying of statistics by mass imprisonment currently is can be seen from a post at Black Lives Matter 5280 on a fine blog article from the Washington Post Wonkblog (not yet in the main paper...but that this article appears in the Post at all shows the impact of the Black Lives Matter movement, and the sharp response in the Democratic campaign, particularly the usually suppressed - by the elite media  - role of Sanders).  I have a series of posts earlier this year on the despair of white people whose parents had an industrial jobs and they have not.  This is shown by  high meth addiction rates, suicides and early deaths.  For as Angus Deaton and his wife have shown, death rates among white males 49-54 are rising - alone among all populations in the advanced industrial countries (in Europe, they are still in a depression and yet, in a larger welfare state, no comparable changes), and even compared to blacks and chicanos (higher death rates, death at an earlier age, but the overall death rate going down between ages 49-54).  See here and here.


   As I have long emphasized, the "official" unemployment rate in which 5% unemployment is treated as "full" employment by the Bureau of Labor Statistics - these are some 10 million people these official exclude from counting as human beings...But the official rate also excludes those who do not report themselves to an agency as looking for work - i.e. all those who have been discouraged through long job searches or just don't have the time or transportation to get to the agency - and those who are working part-time but would gladly take a full time job.  So real unemployment is roughly double official unemployment.

  But Guo's figures provide an entirely new way of looking - seeing the racism of the prison system (note: this also affects the chicano, native American and white unemployment and wage rates...) -
which makes clear that real unemployment is dramatically higher - "full" employment as "5%" jobless is really about 15% unemployment...


"Much of the debate about prisons has focused on disparities in the justice system, and rightly so, Western says. The problem begins there. But when a large chunk of the working-age population vanishes from public life, the repercussions spread.
One in nine black children has had a parent behind bars. One in thirteen black adults can't vote because of their criminal records. Discrimination on the job market deepens racial inequality. Not only does a criminal record make it harder to get hired, but studies find that a criminal record is more of a handicap for black men. Employers are willing to give people second chances, but less so if they're black."


America has locked 



many black 


it has 
warped our sense 
of reality
Resize Text

For as long as the government has kept track, the
economic statistics have shown a troubling racial
gap. Black people are twice as likely as white
people to be out of work and looking for a job.
This fact was as true in 1954 as it is today.
The most recent report puts the white
unemployment rate at around 4.5 percent.
The black unemployment rate? About
8.8 percent.
But the economic picture for black
Americans is far worse than those statistics
indicate. The unemployment rate only
measures people who are both living at
home and actively looking for a job.
The hitch: A lot of black men aren't living
at home and can’t look for jobs —
because they’re behind bars.
Though there are nearly 1.6 million
Americans in state or federal prison,
their absence is not accounted for in
the figures that politicians and
policymakers use to make decisions.
As a result, we operate under a distorted
picture of the nation's economic health.
There's no simple way to estimate the
impact of mass incarceration on the jobs
market. But here's a simple thought
experiment. Imagine how the white and
black unemployment rates would change
if all the people in prison were added
to the unemployment rolls.
According to a Wonkblog analysis of
government statistics, about 1.6
percent of prime-age white men
(25 to 54 years old) are
institutionalized. If all those
590,000 people were recognized as
unemployed, the unemployment rate
for prime-age white men would
increase from about 5 percent to 6.4 percent.
For prime-age black men, though, the 
unemployment rate would jump from 11 
percent to 19 percent. That's because a 
far higher fraction of black men — 7.7 
percent, or 580,000 people — are 
Now, the racial gap starts to look like
 a racial chasm. (When you take into
account local jails, which are not
included in these statistics, the
 situation could be even worse.)
“Imprisonment makes the disadvantaged
literally invisible,” writes Harvard sociologist
Bruce Western in his book, "Punishment
and Inequality in America." Western was
among the first scholars to argue that
America has locked up so many people
it needs to rethink how it measures the economy.
Over the past 40 years, the prison population
 has quintupled. As a consequence of
disparities in arrests and sentencing, this
 eruption has disproportionately affected
black communities. Black men are imprisoned
at six times the rate of white men. In 2003,
the Bureau of Justice Statistics estimated
that black men have a 1 in 3 chance of going
 to federal or state prison in their lifetimes. For
some high-risk groups, the economic
consequences have been staggering. According
to Census data from 2014, there are more young
 black high school dropouts in prison than have jobs.
The economic data sweeps these people
under the rug, making the situation look
 far too optimistic for African-Americans.
Western started writing about this problem
 in the early 2000s with Becky Pettit,
a sociologist at the University of Texas,
Austin. They’ve published reports in top
journals, and have each authored books on the subject.
It’s taken a long time for this blind spot to
be recognized. Much of the debate about prisons
has focused on disparities in the justice system,
and rightly so, Western says. The problem begins
there. But when a large chunk of the
working-age population vanishes from public
 life, the repercussions spread.
One in nine black children has had
 a parent behind bars. One in thirteen black
adults can't vote because of their criminal
records. Discrimination on the job
market deepens racial inequality. Not
only does a criminal record make it
harder to get hired, but studies find
that a criminal record is more of a
handicap for black men. Employers are
willing to give people second chances, but
 less so if they're black.
“Jim Crow and slavery were caste systems.
So is our current system of mass incarceration,”
wrote civil rights lawyer Michelle Alexander
in her 2010 book "The New Jim Crow."
These consequences entangle the broader
 economy. Yet, many people who study employment
and the job market haven't been paying
attention to the criminal justice system.
That's a big mistake, according to Western.
“From my point of view," he says, "mass
incarceration is so deeply connected to
American poverty and economic inequality."

A look at the troubling data

To see Western’s point, consider the statistics
for people at high risk of arrest — young men
(aged 20-34) who never finished high school.
Let's set aside for a moment the
unemployment rate, which is a blinkered
measure of the economy. Only people who
have recently looked for a job are considered
unemployed. Instead, economists often focus
 on a different number, the fraction of people
who have jobs. This is called the
"employment-population ratio."
Overall, about 60 percent of young white
dropouts and 36 percent of young black
dropouts were employed in 2014, according
to the Census's Current Population Survey.
 But there's a caveat to that number.
It excludes people in prison or otherwise
The Census separately measures this
population. According to that data, about
7.6 percent of these white men were
institutionalized in 2014. (Overwhelmingly,
this means jail, but it could also mean a
mental hospital or a nursing home.) For
black men, the fraction is so staggering,
it seems like a typo — 29 percent of
black male high-school dropouts
between the ages of 20 and 34 were
institutionalized in 2014.
When you add in all of the incarcerated,
the numbers become much bleaker and the
racial gaps much wider. In reality, only about
 54 percent of young white male high-school
dropouts had jobs in 2014. And only 25
percent of their black counterparts were employed.

As the above numbers indicate, there
are more young black male high school
dropouts behind bars than have jobs.
This is a very high-risk population.
 But even if we zoom out, the data
still are skewed.
Here are the same numbers for all
prime-age men in 2014. Officially,
84 percent of white men between
25-54 were working in 2014, compared
to 71 percent of black men. After
including the incarcerated, the fraction
of white men who have jobs hardly
changes. But the black
employment-population ratio drops
to 66 percent.

How incarceration has 

changed the economy

The prison boom has made such a dent
that recently, social scientists have
 completely reconsidered how much
progress the black community has made in recent decades.
Derek Neal, an economist at The
University of Chicago, and Armin
Rick, an economist at Cornell, argue
 that mass incarceration has masked a
lot of economic pain and a lot of inequality.
The official statistics are "very deceptive
when the trends in the fraction incarcerated
are changing,” Neal says. “You can actually
measure an increasing employment rate or
a falling unemployment rate simply because,
 over this period, we’ve put more of the people
who have trouble finding jobs in prison.”
Neal and Rick explored a slightly
different thought experiment. What
if all these men had never been arrested?
 What if they all had jobs? What if
they were earning wages on par
with similar men with similar
levels of education?
The effects are not all expected, or even
necessarily positive. According to Neal
and Rick’s calculations, if all these
prisoners were actually working, they
would drag down the median white wage
by just a little, but it would drag down t
he median black wage by a lot, since so
many black men are incarcerated.
The chart below shows the hypothetical
black-white wage gap compared to the
 actual black-white wage gap, among
 men who are 11-15 years out of school.
The 1960s and 1970s yielded incredible
 economic progress for black Americans
— dividends from civil rights reform.
But the trend stalled in subsequent decades.
Then, the financial crisis hit, wiping out
 much of those past gains.
Neal and Rick find that in 2010, black men
earned about 75 cents for every dollar
white men out of prison made. But if all the
men in prison also had jobs, there
would be a lot more inequality — black
men would only be earning about 65
cents on the dollar. Had all these people
 been on the job market instead of in
prison, they would have competed 
with other workers for jobs, driving
wages down.
“The growth of incarceration rates among
black men in recent decades,” they write,
“combined with the sharp drop in black
 employment rates during the Great
Recession have left most black men in
a position relative to white men that is
really no better than the position they
occupied only a few years after the Civil
Rights Act of 1965.”
Western and Pettit argue that the wages
for low-skilled black workers in the 1990s
rose in part because incarceration reduced
 the number of people competing for work.
As incarceration rates slowly start to fall,
there will be pressure on the economy to
absorb some of the most hard-to-employ
people in society. "Somehow we're going to
have to figure out how to address the really
severe employment problems of
low-skill men," Western says.
This will prove particularly difficult because
 mass incarceration's ill effects are concentrated
in places already in distress. Researchers
once estimated that, in some inner-city
neighborhoods, up to one-fifth of the young
black men are behind bars at any given moment.
In their absence, their communities start to
fracture. So when they get out, they find that
there are no jobs and no support networks.
"The impact of incarceration on communities
and the impact of communities on reentry
together create a pernicious cycle of decline,"
 professors Jeffrey Morenoff and David Harding
 wrote in the Annual Review of Sociology in 2014.
For now, there are still so many people behind
 bars that it continues to warp our sense of reality.
 Recently, politicians challenged Federal Reserve
chair Janet Yellen to recognize the vast racial
inequalities in the economy. They cited the
black unemployment rate — twice the
white unemployment rate. But however 
bad those numbers seem, the truth, after 
accounting for incarceration, is even worse. 
So perhaps the next time the jobs report 
comes out, there could be an extra chart to 
recognize the 1.6 million prisoners in America. 
They don’t show up anywhere in the 
government’s measurements of economic 
activity, but their absence is dearly felt.

Jeff Guo is a reporter covering economics,
domestic policy, and everything empirical. He's from Maryland, but outside the Beltway. Follow him on Twitter: @_jeffguo.

comment: Alan Gilbert This offers to others a shocking sense of the reality of exploitation of black folks - the one black people actually experience - and shows why racism and denial lead to the divisions which also enable the elite (less fiercely) to push many white people off the edge, economically and psychologically...

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