Muddling For Solutions

[26 Inf]

I’ll make this simple for you:

So what happens when people make more? They demand more. When there is more demand, price goes up. It’s simple. Purchasing power parity. It’s a thing.

Don't do me any favors, I'll try to keep up. People, in general, are not making more. Primarily, we are talking about hourly paid employees. Wages have moved a little recently, but....

Since the late 1970s, wages for the bottom 70 percent of earners have been essentially stagnant, and between 2009 and 2013, real wages fell for the entire bottom 90 percent of the wage distribution. https://www.epi.org/publication/caus...ge-stagnation/

Despite the strong labor market, wage growth has lagged economists’ expectations. In fact, despite some ups and downs over the past several decades, today’s real average wage (that is, the wage after accounting for inflation) has about the same purchasing power it did 40 years ago. And what wage gains there have been have mostly flowed to the highest-paid tier of workers. https://www.pewresearch.org/fact-tan...d-for-decades/

Ask someone how much of any increase in their wages has been swallowed up by increases in health insurance, as an example.

You simply cannot accept the truth of the economy and that our standard of living is the greatest it’s ever been and much better than anywhere else....because those managing capita seek profit. Once they cease to, we stagnate.

I am not saying that America does not have a high standard of living. I think you are looking at this from a short term perspective, rather than consider the long term.

One of the problems we are facing is too much profit taking. How to contain that is a problem beyond my pay grade.

[lsllc]

Don't do me any favors, I'll try to keep up. People, in general, are not making more. Primarily, we are talking about hourly paid employees. Wages have moved a little recently, but....

Since the late 1970s, wages for the bottom 70 percent of earners have been essentially stagnant, and between 2009 and 2013, real wages fell for the entire bottom 90 percent of the wage distribution. https://www.epi.org/publication/caus...ge-stagnation/

Despite the strong labor market, wage growth has lagged economists’ expectations. In fact, despite some ups and downs over the past several decades, today’s real average wage (that is, the wage after accounting for inflation) has about the same purchasing power it did 40 years ago. And what wage gains there have been have mostly flowed to the highest-paid tier of workers. https://www.pewresearch.org/fact-tan...d-for-decades/

Ask someone how much of any increase in their wages has been swallowed up by increases in health insurance, as an example.



I am not saying that America does not have a high standard of living. I think you are looking at this from a short term perspective, rather than consider the long term.

One of the problems we are facing is too much profit taking. How to contain that is a problem beyond my pay grade.

From your article:

After adjusting for inflation, however, today’s average hourly wage has just about the same purchasing power it did in 1978...

Why? Exactly what I stated would happen again...PPP. It will always be that way. An equilibrium will be reached. There may be short term fluctuations.

Wages reflect value added by the individual. This will always be the case in the long term outside of things like government intervention, union activity, etc.


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[jsbhike]

. This will always be the case in the long term outside of things like government intervention, union activity, etc.

Such as the bailouts as a recent example.

[26 Inf]

From your article:

After adjusting for inflation, however, today’s average hourly wage has just about the same purchasing power it did in 1978...

Why? Exactly what I stated would happen again...PPP. It will always be that way. An equilibrium will be reached. There may be short term fluctuations.

Wages reflect value added by the individual. This will always be the case in the long term outside of things like government intervention, union activity, etc.

How old are you? Because I was working 45 years ago:

In fact, in real terms average hourly earnings peaked more than 45 years ago: The $4.03-an-hour rate recorded in January 1973 had the same purchasing power that $23.68 would today.

Comparatively, things aren't as rosy now. About 'average hourly earnings:'

The chart, shown above, shows that 19% of workers make less than $12.50 per hour, 32% of workers make between $12.50 and $20 per hour, 30% make between $20 and $30 an hour, 14% make between $30 and $45 per hour, and 5% make over $45 an hour.

(It’s important to note that this includes all workers covered by the establishment survey, not just hourly workers; to convert annual pay to hourly pay, divide by 2080, for a standard 40-hour week.)

If you add it up over half the workers are making substantially less than that inflation adjusted $23.68.

I wasn't talking about this however, I was talking about the shrinking of the middle-class portion of the economy and increasing monetary power that fewer and fewer are exercising over the economy. Long-term, that is a recipe for disaster.

Tie a bow around it:

Wages reflect value added by the individual. This will always be the case in the long term outside of things like government intervention, union activity, etc.

In a world where fewer and fewer folks are actually determining the value added by the individual, I'm not so sure this is actual the case as it was seen by economic theorists.

The idea that the minimum wage is the price that a man will 'willingly' perform a task assumes some choice in the matter. It assumes labor market that needs to compete for his skills. In today's world that simply isn't true.

Nice arguing with you, but this has become pointless in my view.

[Firefly]

What’s the CPI?

[lsllc]

What’s the CPI?

Consumer price index


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[lsllc]

How old are you? Because I was working 45 years ago:

In fact, in real terms average hourly earnings peaked more than 45 years ago: The $4.03-an-hour rate recorded in January 1973 had the same purchasing power that $23.68 would today.

Comparatively, things aren't as rosy now. About 'average hourly earnings:'

The chart, shown above, shows that 19% of workers make less than $12.50 per hour, 32% of workers make between $12.50 and $20 per hour, 30% make between $20 and $30 an hour, 14% make between $30 and $45 per hour, and 5% make over $45 an hour.

(It’s important to note that this includes all workers covered by the establishment survey, not just hourly workers; to convert annual pay to hourly pay, divide by 2080, for a standard 40-hour week.)

If you add it up over half the workers are making substantially less than that inflation adjusted $23.68.

I wasn't talking about this however, I was talking about the shrinking of the middle-class portion of the economy and increasing monetary power that fewer and fewer are exercising over the economy. Long-term, that is a recipe for disaster.

Tie a bow around it:

Wages reflect value added by the individual. This will always be the case in the long term outside of things like government intervention, union activity, etc.

In a world where fewer and fewer folks are actually determining the value added by the individual, I'm not so sure this is actual the case as it was seen by economic theorists.

The idea that the minimum wage is the price that a man will 'willingly' perform a task assumes some choice in the matter. It assumes labor market that needs to compete for his skills. In today's world that simply isn't true.

Nice arguing with you, but this has become pointless in my view.

And just because you were working in 1973 means you understood what all people made then?

What were the same numbers, then?

You’re making assumptions.


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[26 Inf]

And just because you were working in 1973 means you understood what all people made then?

What were the same numbers, then?

You’re making assumptions.

Nope, at the worst I'm making informed SUBJECTIVE observations.

[lsllc]

Then you’ve observed that per capita, and total number of people that have escaped the middle class to the upper class has increased. You’ll recognize you really don’t know the numbers game from 1975.


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[ramairthree]

I don’t get the minimum wage babble above.

When federal minimum wage came out, it was the equivalent of $4 and hour, not counting the farm hand/waitress/etc. lower rate.
Post war it climbed for a few decades getting better and better, peaking at about the equivalent of 11 bucks and hour 50 years ago.

For the first twenty years ago it was lower than the current equivalent. Then it spent a decade equivalent to now. Then it spent two decades better than now. Then a couple od decades the equivalent or wore.

This is where a lot of the OK Boomer resentment comes in.
That beautiful post what 2 1/2 decades or so or Amercia literally on top of the world.
Great jobs and benefits with a HS diploma, competing with only about 10% of the population with a college degree that could be obtained in expensively, etc.

Then, Europe and Asia were back on the wagon, other issues came up, and their generation started importing H1Bs, moving manufacturing overseas, cutting benefits, etc. There was a cultural shift from individual responsibility and public shame and we had to start supporting free loaders way more. Advances in medicine have real cost increases. Expectations to live longer and get more care for things have gone up. Standards of living are much higher. Tons more money goes into administration, government, bureaucracy, insurance, regulations, compliance, environmental, etc. Himes are bigger. Cars are better. Entertainment and eating out and cloths and toys etc. are off the charts.

And, whiles jobs may be on the rise now, it is a lot of shit, dead end, no benefits jobs.


The picture being painted is that Scrooge McDuck and Mr. Burns are evilly hoarding billions and gleefully releasing the hounds on starving younger generations. And, frankly, sure, maybe 0.1 percent of the population may be like that.

But way more than that 0.1% are painted as some sort of evil, greedy, bad guy.

The former enlisted SEAL SOIDC that went to college on the GI Bill, med school on HPSP, paid that off as a DMO in the Navy and makes 400k a year now as a civilian is not preventing somebody else from doing that.

The pie of wealth is not a fixed size. The above guy could write a best selling tell all book about SEALs and make 800k next year instead of 400k and it didn’t steal wealth from anyone.

If you drop out of high school, pop out some kids, with baby daddies that don’t have jobs, live on welfare, burn medicare on all their ER visits, get in accidents without insurance, shop lift, etc. THEY are actually the ones dipping into the pie and taking other people’s stuff.

If you finish HS, knock out and engineering degree, get your Ph.D. In materials science, think rack up 500k a year in consultant money from saving clients 50,000,000 in manufacturing costs,
People are not starving and doing poorly because he makes so much.