In his on-line Economic Reporting Review, Dean Baker comments on a New York TIMES article by Sylvia Nasar: >The article also asserts that increased competition due to the deregulation of industries such as airlines, railroads and telecommunications has been a major factor in keeping prices down. This claim seems dubious, since corporations have managed to increase their profit margins considerably in the last two decades. In 1978, at the profit peak of the late '70s business cycle, the capital share (profits plus interest) of corporate income was 19.1 percent. By comparison in 1997, the profit peak in the current cycle, the profit share of corporate income had risen by more than two and a half percentage points to 21.6 percent. The fact that firms have been able to significantly increase their profit margins seems inconsistent with the claim that they are feeling greater competitive pressures.< It's not inconsistent with the claim that businesses are feeling greater competitive pressures if labor is feeling _even greater_ competitive pressures. US businesses, especially import-competing ones, are suffering from increased international competition, but they are more than able to get labor to pay for it. This shouldn't be surprising, given deunionization, increased threat of movement of capital to Mexico, etc. Jim Devine [EMAIL PROTECTED] & http://clawww.lmu.edu/Faculty/JDevine/jdevine.html
