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Crane Paper, located in the Berkshires where I used to live, is the sole remaining paper manufacturing company in what was once a thriving paper manufacturing area. It would be struggling if not for one little thing it has going for it … it manufactures the paper used to print U.S. Currency.

It seems their non-currency business is struggling:

Crane & Co. has signed an exclusive partnership agreement with the Neenah Paper Co. that will allow the Georgia-based firm to manufacture, market and distribute five of Crane’s fine business paper brands.

An extension of an agreement that Crane and Neenah originally formed in 2007, the partnership will allow Neenah to distribute the five Crane brands. But it will also lead to the elimination of 13 positions at Crane by the end of the year.

But there is a silver lining:

However, Crane is also planning to add eight new positions in its currency division, which unlike stationery, has become stronger this year, according to Crane President and CEO Charles J. Kittredge.

I do not believe that these workers are counted in the BLS statistics on government employment. I would love to see the figure for the number of American workers that work directly for federal, state and local governments, as well as those that work indirectly for them in capacities such as these. The BLS reports that roughly 23 million people work in the public sector. If these workers are members of a typical household, they represent roughly 50 million Americans. While the share of public sector employment as a share of total employment has remained relatively stable over the past 50 years, I do not believe you can say that the importance of government employment has fallen or remained stable. Many private sector workers are “protected” by occupational licensing. Many more workers are working for places like Crane, Lockheed Martin, Halliburton, Grumman, and various other agencies that rely on government contracts to remain profitable. It would be nice to see someone do the research on just how deep this reach is. My priors would place it at nearly 100 million Americans having family members work directly for, or in companies dependent on, the government.

This trend is every bit as dangerous as the supposed increase in inequaltiy that is demonized by politicians of all stripes. We have a class of specially privileged workers benefiting at the expense of the rest of us. We have a class of workers with powerful interests in maintaining the status quo, no matter how costly or inefficient. We have a class of special interest corporations pleading on behalf of these same workers – and encouraging the lay person to consider that “capitalism” at work. And the biggest reason this concerns me is that this class of specially privileged workers represents enormous transitional difficulties even if a majority of Americans began to veer away from supporting unprofitable ventures and corportist boondoggles.

One Response to “Who Benefits from the Helicopter Drop?”

  1. Harry says:

    Eliminating just thirteen? This is hardly an achievement, unless you are talking about, say, a company with ninety people, four of whom are managers, two who work in production control, one in the warehouse, two clerks, one in shipping, and three on the line.

    Regarding your frustration with the BLS, I’ve never trusted any of their numbers. I’m not sure whether the BLS has access to form 940. Rather, I would hope that they do not, since that tells them how much money employers pay to whom, and what their SSN’s are, etc.

    But you can bet whatever data the BLS publishes, it probably understates government payrolls by a few percent, which are tens of billions of dollars.

    True, Lockheed-Martin, Grumman, Halliburton, and others employ many who do government work. When the federal government consumes such a large proportion of our output (who knows how those figures are determined, speaking of statistics?), it is inevitable that we have people buliding airplanes and supporting the military. But Halliburton does oil-field services too, a decidedly productive enterprise.

    The number of people employed by the government directly and indirectly is vast, and that’s a big problem. To the public school teachers’ monopoly, the Crane Company is a penny-ante player.

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