Phyphor said median income has kept pace with inflation, which is also what your graph shows, since the original claim was "Income growth is unable to keep pace with inflation"
It's a nitpick, because yes technically income growth has kept pace pretty exactly with inflation. Which is a good way of winning the argument while missing the point, imo.
Phyphor said median income has kept pace with inflation, which is also what your graph shows, since the original claim was "Income growth is unable to keep pace with inflation"
It's a nitpick, because yes technically income growth has kept pace pretty exactly with inflation. Which is a good way of winning the argument while missing the point, imo.
Yes, the correct way to phrase it is "Median Income hasn't kept up with GDP per capita." But with 99% of the people in my life, if I said that to them, I would then have to explain both median income and how it differentiates from mean, as well as what GDP and per capita means.
Periodic recessions require continuous course correction to avert full-scale depression
Here's the list of US recessions in the current and previous banking era
1836, 1839, 1845, 1847, 1853, 1857, 1860, 1865, 1869, 1873, 1882, 1887, 1890, 1893, 1896, 1899, 1902, 1907, 1910, 1913, 1918, 1920, 1923, 1926, 1929, 1937, 1945, 1949, 1953, 1958, 1960, 1969, 1973, 1980, 1981, 1990, 2001, 2007
3 recessions in 30 years is fantastic by historical standards. There are also a few full on depressions in that list
Politics is ridden with scandals; the people begin to care less and less about them as they desperately seek relief while simultaneously exhibiting ironic enthusiasm (it was the best of times; it was the worst of times)
If this were true and not just a reaction to very recent events I'm sure you can find examples of people wallowing in existential despair on these boards from 2008-2016?
Income growth is unable to keep pace with inflation
This isn't true. Median household income has grown at slightly under inflation + 1% on net over the last 30 years - with peaks and valleys due to recessions but on net an upward trend. You can certainly argue that it should be higher, but it's not negative https://fred.stlouisfed.org/series/MEHOINUSA672N
Partisanship reaches an all-time high
I think people were still pretty partisan before, there just was a convenient external boogeyman to unify people more
For those not wanting to click through, look at the chart below. Since 2000, GDP per capita has increased by 50% while median wage has only increased by 1.8%, and median wage has only recently arrived at a point at which it exceeds cost adjusted median wage for 2000.
Think of it this way. In 2000, it would have taken a team of 3 people to complete a task. Now it only takes two, but those two still receive the same wages as if they were on the three person team. What happened to that third persons wage? It's going to the rich. For everyone else, buying power has stagnated.
Since the claim was from 1990 that's what I used; 2000 was a local maximum for household income too. GDP per capita has increased 50%, household income by 15% since 1990. It's true there has been almost no growth since 2000 - however GDP growth per capita since 2000 has also only been 20% not 50%
Periodic recessions require continuous course correction to avert full-scale depression
Here's the list of US recessions in the current and previous banking era
1836, 1839, 1845, 1847, 1853, 1857, 1860, 1865, 1869, 1873, 1882, 1887, 1890, 1893, 1896, 1899, 1902, 1907, 1910, 1913, 1918, 1920, 1923, 1926, 1929, 1937, 1945, 1949, 1953, 1958, 1960, 1969, 1973, 1980, 1981, 1990, 2001, 2007
3 recessions in 30 years is fantastic by historical standards. There are also a few full on depressions in that list
Politics is ridden with scandals; the people begin to care less and less about them as they desperately seek relief while simultaneously exhibiting ironic enthusiasm (it was the best of times; it was the worst of times)
If this were true and not just a reaction to very recent events I'm sure you can find examples of people wallowing in existential despair on these boards from 2008-2016?
Income growth is unable to keep pace with inflation
This isn't true. Median household income has grown at slightly under inflation + 1% on net over the last 30 years - with peaks and valleys due to recessions but on net an upward trend. You can certainly argue that it should be higher, but it's not negative https://fred.stlouisfed.org/series/MEHOINUSA672N
Partisanship reaches an all-time high
I think people were still pretty partisan before, there just was a convenient external boogeyman to unify people more
For those not wanting to click through, look at the chart below. Since 2000, GDP per capita has increased by 50% while median wage has only increased by 1.8%, and median wage has only recently arrived at a point at which it exceeds cost adjusted median wage for 2000.
Think of it this way. In 2000, it would have taken a team of 3 people to complete a task. Now it only takes two, but those two still receive the same wages as if they were on the three person team. What happened to that third persons wage? It's going to the rich. For everyone else, buying power has stagnated.
All of that may be true but it’s not what was claimed. No one is disputing that people should receive more of the economic gains of increased productivity, should get a bigger piece of the higher profits. We are disputing the OPs claim about the relationship between income and inflation.
Referencing median household income is bullshit as far as determining how the country as a whole is doing, because just one billionaire skews the median way higher.
i think youre thinking of mean
fat-tailed distributions like wealth/income have distorted arithmetic means but median is telling you what the lad in the middle of the distribution is making
Referencing median household income is bullshit as far as determining how the country as a whole is doing, because just one billionaire skews the median way higher.
You're thinking of the mean. Agreed, the mean income is worthless.
Median, however, is resistant to those sorts of effects.
The devil in the details of median household income is that it now takes two incomes to survive where before it took one. And those two incomes are increasingly precarious, as detailed by folks up-thread. Household formation is also down significantly because jobs suck, student debt sucks, and (on a positive note) fewer people are getting married because they feel forced into it due to the early presence of children.
Phyphor said median income has kept pace with inflation, which is also what your graph shows, since the original claim was "Income growth is unable to keep pace with inflation"
It's a nitpick, because yes technically income growth has kept pace pretty exactly with inflation. Which is a good way of winning the argument while missing the point, imo.
Yes, the correct way to phrase it is "Median Income hasn't kept up with GDP per capita." But with 99% of the people in my life, if I said that to them, I would then have to explain both median income and how it differentiates from mean, as well as what GDP and per capita means.
Understood, however "real income growth is negative" and "real income growth is low" are two very different things. The first is what actually happened in the gilded age, income levels took 30+ years to reach where they once were after a 30% fall. In our recessions real income falls by 10% or less and recovers relatively quickly, it's just overall growth is low
Both education and health care have exploded in cost compared to other things like wages or inflation.
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MayabirdPecking at the keyboardRegistered Userregular
The first Gilded Age was also the "nadir of American race relations" (line from historian Rayford Logan). Right after the Civil War through Reconstruction enormous reforms went through for black Americans, nearly all of which was reversed throughout the Gilded Age. The "Great Migration" was largely motivated by what's basically the successful ethnic cleansing campaign waged across the south, the endless lynchings and oppression; Mississippi was a majority black state until so many people had to flee for their lives.
And while not as absolutely terrible as before, we are seeing echoes of that now. Police killings of black suspects, the border wall BS and the concentration camps for children, and especially the general spike in racism in regular society since Trump was elected. It's not a perfect parallel of course, but what is? We're repeating a lot of history as farce right now.
“It’s not as bad as the gilded age because of modern conveniences” sounds suspiciously close to “you can’t be poor if you own a refrigerator or TV”
If we accept that the baseline for our society's regular, unexceptional people is sharing rent on a 2-4 bed room apartment and making minimum wage until they die of a disease they can't afford treatment for, then our society is doing fine.
If that isn't acceptable, then something is terribly wrong.
}
"Orkses never lose a battle. If we win we win, if we die we die fightin so it don't count. If we runs for it we don't die neither, cos we can come back for annuver go, see!".
In its most recent survey of college pricing, the College Board reports that a moderate college budget for an in-state public college for the 2017–2018 academic year averaged $25,290.
The following table is illuminating, given that it provides all costs in constant dollars:
Years - average cost for a 4 year public school
* 1985–86 - $8,449
* 2005–06 - 14,499
* 2015–16 - 19,189
Note that these costs are exclusive of room and board. When I was last in school, all in cost to attend a 4 year university as an in-state student was in the range of ~$25K-33K per year. Costs were lower at non-oriented institutions, but it was still in the 20-25K range IIRC.
In particular, the data for 1976-1977, total for room, board, and in-state tuition, average of all 4-year institutions in current dollars (not constant dollars):
* 1963-64 - $929 for room, board, and tuition at all public 4 year institutions in constant dollars
And for 1965 (the easiest accessible year for me with a few seconds of searching), I'm showing:
* $5812 average income (median not available with a quick search)
Just doing some simple math here, the cost of a college education, per year, at a 4 year degree-granting institution as a percentage of household income was:
* in 1964 ~16% of household income per year
* in 1976 ~20% of household income per year
* in 1996 ~20% of household income per year
* in 2005 ~26% of household income per year
* in 2015 ~34% of household income per year
* in 2017 ~32% of household income per year
As of 1964, college was a burden, but one bearable with some margin. Through 1996, it was again a burden, but one that was matched by the increase in income so at least it wasn't getting worse. Following the dotcom crash, it has ballooned significantly. 32% of household income is now approaching maximum suggested rent by income. So where is that money coming from? Debt. Which will follow the students around until they get a sufficiently decent job, or until they die.
Orca on
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OrcaAlso known as EspressosaurusWrexRegistered Userregular
This isn't quite apples to apples since it's using the median family income, which is somewhat higher than the median household income, but it's what I could get my hands on with data going back to 1963 in current dollars (instead of constant dollars).
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OrcaAlso known as EspressosaurusWrexRegistered Userregular
It is a consequence of the definitions of family and household. The U.S. Census Bureau writes (citation):
A family consists of two or more people (one of whom is the householder) related by birth, marriage, or adoption residing in the same housing unit. A household consists of all people who occupy a housing unit regardless of relationship. A household may consist of a person living alone or multiple unrelated individuals or families living together.
Median family income is typically higher than median household income because of the composition of households. Family households tend to have more people, and more of those members are in their prime earning years; as contrasted with members who have lesser incomes because they are very young or elderly.
Areas with a wide disparity between the two measures have an excess of nonfamily households: single persons or otherwise. (The CPS excludes young adults in group quarters, and counts college students in dormitories as living in the parental home.)
The drawback to using family income measures is that they disregard persons living in nonfamily households, who tend to be disproportionately young or old.
Conversely, in some situations it is appropriate to exclude nonfamily households: for example, housing affordability. It is based on family income rather than household income, because nonfamily households are not typically buyers.
Phyphor said median income has kept pace with inflation, which is also what your graph shows, since the original claim was "Income growth is unable to keep pace with inflation"
It's a nitpick, because yes technically income growth has kept pace pretty exactly with inflation. Which is a good way of winning the argument while missing the point, imo.
Yes, the correct way to phrase it is "Median Income hasn't kept up with GDP per capita." But with 99% of the people in my life, if I said that to them, I would then have to explain both median income and how it differentiates from mean, as well as what GDP and per capita means.
Understood, however "real income growth is negative" and "real income growth is low" are two very different things. The first is what actually happened in the gilded age, income levels took 30+ years to reach where they once were after a 30% fall. In our recessions real income falls by 10% or less and recovers relatively quickly, it's just overall growth is low
So, should we be ok with the fact that overall growth is low and falls well behind increases in GDP, with all of those increases going to the rich? Or should we get upset and doing something about it?
I feel like half the participants in this thread want to spend their time niggling over details and scoring internet points, while the rich will just keep on getting richer.
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OrcaAlso known as EspressosaurusWrexRegistered Userregular
“It’s not as bad as the gilded age because of modern conveniences” sounds suspiciously close to “you can’t be poor if you own a refrigerator or TV”
If we accept that the baseline for our society's regular, unexceptional people is sharing rent on a 2-4 bed room apartment and making minimum wage until they die of a disease they can't afford treatment for, then our society is doing fine.
If that isn't acceptable, then something is terribly wrong.
I've been thinking about this because I have lived this life. In high cost of living areas, even when you're making what could otherwise be decent wages, you still are forced into the shared living situation.
Let's take grocery clerks, a job that is increasingly going to go away as self-checkout and efforts like Amazon's automation chip away at them: it's an industry that is still heavily unionized, and as a consequence has at least some rules around requirements for full and part time work, as well as being paid for doing whatever level of work you're doing. My experience was specific to the southern California area. You're going to start a bit over minimum wage, but once you hit grocery clerk, with enough time in-grade (4-ish years IIRC) you would hit ~$20/hour. If you're fortunate enough to make full time (not at ALL guaranteed) that's a nice tidy $40K/year gross with a couple weeks of vacation and the potential to earn more if you end up working holidays or overtime. The part timers might end up with only 24 hours a week, swapped between stores as needed--but at least there is a floor. Thank you unions.
$40K/year isn't really enough to live on your own though; depending on where you are in California, an apartment might run you $20K/year or more.
So you have to live with other people that are also likely working full time.
I worked with many, many people who were living in apartments, driving shitty old cars at 30, 40, 50 years old because that's all they could afford. The people with the nice cars were usually the kids who were getting their first taste of money--and after a few years they inevitably would learn their lesson and sell off their expensive-to-operate BMW or what-have-you. I worked with people who worked through chronic injuries, just trying to make it long enough to retire with a full pension (yes, this is one of the few jobs where that's still a thing, though the pension is significantly under-funded). I worked with people that were held hostage by the managers who if they wanted to punish a recalcitrant employee could put them on nights, take away hours (if they weren't full time), give them shifts with the minimum downtime allowed by contract, and otherwise run right up against the protections the union provided them. I worked with people who commuted hours every day because that's the only way they could afford to raise a family on their meager incomes.
All the while, destroying their bodies to do so.
It's not the coal mines, but long term it will wreck your body. I have chronic injuries of my own dating back to the years I spent working the grocery store. I still don't know how much time all those years of working the graveyard shift took off my own lifespan.
So yes, it's not literal slavery, but it's a far cry from tech work where a single income will generally easily afford you a solo apartment unless you're in the most expensive parts of the country.
And I feel we can do better by those people doing the ugly invisible jobs. They too should be able to enjoy the fruits of the increases in productivity, instead of merely scraping by while the drive for ever more efficiency steadily grinds away until they're inevitably forced out of their jobs by the next step in automation.
I think the main similarities between the Gilded Age and our current economic condition have more to do with the technological changes that have come about moreso than anything else. There's been some research on the idea that productivity and wages have been decoupled primarily due to skill-biased technological change (technologies replace the skillsets of people in ways they aren't able to adjust to), and I'm inclined to believe a lot of our current issues are caused by this and we just haven't seen the right policy/regulatory regime in place to solve them.
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OrcaAlso known as EspressosaurusWrexRegistered Userregular
I think the main similarities between the Gilded Age and our current economic condition have more to do with the technological changes that have come about moreso than anything else. There's been some research on the idea that productivity and wages have been decoupled primarily due to skill-biased technological change (technologies replace the skillsets of people in ways they aren't able to adjust to), and I'm inclined to believe a lot of our current issues are caused by this and we just haven't seen the right policy/regulatory regime in place to solve them.
I would restate that as productivity and wages have become decoupled due to skill-based technological change, and the bulk of the increase in productivity has been absorbed by capital and the owners of capital.
I think the main similarities between the Gilded Age and our current economic condition have more to do with the technological changes that have come about moreso than anything else. There's been some research on the idea that productivity and wages have been decoupled primarily due to skill-biased technological change (technologies replace the skillsets of people in ways they aren't able to adjust to), and I'm inclined to believe a lot of our current issues are caused by this and we just haven't seen the right policy/regulatory regime in place to solve them.
I would restate that as productivity and wages have become decoupled due to skill-based technological change, and the bulk of the increase in productivity has been absorbed by capital and the owners of capital.
That's...basically what I said, yeah?
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OrcaAlso known as EspressosaurusWrexRegistered Userregular
I think the main similarities between the Gilded Age and our current economic condition have more to do with the technological changes that have come about moreso than anything else. There's been some research on the idea that productivity and wages have been decoupled primarily due to skill-biased technological change (technologies replace the skillsets of people in ways they aren't able to adjust to), and I'm inclined to believe a lot of our current issues are caused by this and we just haven't seen the right policy/regulatory regime in place to solve them.
I would restate that as productivity and wages have become decoupled due to skill-based technological change, and the bulk of the increase in productivity has been absorbed by capital and the owners of capital.
That's...basically what I said, yeah?
It's implicit in your statement. I just wanted to make the connection explicit! So yes, that is basically what you said, hence why it's a restatement rather than a rebuttal.
I think the main similarities between the Gilded Age and our current economic condition have more to do with the technological changes that have come about moreso than anything else. There's been some research on the idea that productivity and wages have been decoupled primarily due to skill-biased technological change (technologies replace the skillsets of people in ways they aren't able to adjust to), and I'm inclined to believe a lot of our current issues are caused by this and we just haven't seen the right policy/regulatory regime in place to solve them.
I think this vastly underestimates the effect of uncompetitive labour markets. The monopoly power of employers has only been getting stronger these many stagnant decades.
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It's a nitpick, because yes technically income growth has kept pace pretty exactly with inflation. Which is a good way of winning the argument while missing the point, imo.
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Yes, the correct way to phrase it is "Median Income hasn't kept up with GDP per capita." But with 99% of the people in my life, if I said that to them, I would then have to explain both median income and how it differentiates from mean, as well as what GDP and per capita means.
Since the claim was from 1990 that's what I used; 2000 was a local maximum for household income too. GDP per capita has increased 50%, household income by 15% since 1990. It's true there has been almost no growth since 2000 - however GDP growth per capita since 2000 has also only been 20% not 50%
All of that may be true but it’s not what was claimed. No one is disputing that people should receive more of the economic gains of increased productivity, should get a bigger piece of the higher profits. We are disputing the OPs claim about the relationship between income and inflation.
Gah, yes, apologies.
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Understood, however "real income growth is negative" and "real income growth is low" are two very different things. The first is what actually happened in the gilded age, income levels took 30+ years to reach where they once were after a 30% fall. In our recessions real income falls by 10% or less and recovers relatively quickly, it's just overall growth is low
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As a whole, we are being saddled with more and more student debt for less and less return on that investment.
Rock Band DLC | GW:OttW - arrcd | WLD - Thortar
And while not as absolutely terrible as before, we are seeing echoes of that now. Police killings of black suspects, the border wall BS and the concentration camps for children, and especially the general spike in racism in regular society since Trump was elected. It's not a perfect parallel of course, but what is? We're repeating a lot of history as farce right now.
If we accept that the baseline for our society's regular, unexceptional people is sharing rent on a 2-4 bed room apartment and making minimum wage until they die of a disease they can't afford treatment for, then our society is doing fine.
If that isn't acceptable, then something is terribly wrong.
"Orkses never lose a battle. If we win we win, if we die we die fightin so it don't count. If we runs for it we don't die neither, cos we can come back for annuver go, see!".
AFAIK the same is true for housing prices, which is where a huge amount of people's wealth is tied up.
The following table is illuminating, given that it provides all costs in constant dollars:
https://nces.ed.gov/fastfacts/display.asp?id=76
Note that these costs are exclusive of room and board. When I was last in school, all in cost to attend a 4 year university as an in-state student was in the range of ~$25K-33K per year. Costs were lower at non-oriented institutions, but it was still in the 20-25K range IIRC.
See related table for 2015-2017: https://nces.ed.gov/programs/digest/d17/tables/dt17_330.20.asp?current=yes
See also earlier tables from 1995 report: https://nces.ed.gov/programs/digest/d95/dtab306.asp
In particular, the data for 1976-1977, total for room, board, and in-state tuition, average of all 4-year institutions in current dollars (not constant dollars):
* 1976-77 - $2,577
If we search for the median household income in 1976, we find that it's $12,690.
The median household income as of 2015 was $56,516.
Ooh, and the raw 2015 table has earlier data: https://nces.ed.gov/programs/digest/d15/tables/dt15_330.10.asp
* 1963-64 - $929 for room, board, and tuition at all public 4 year institutions in constant dollars
And for 1965 (the easiest accessible year for me with a few seconds of searching), I'm showing:
* $5812 average income (median not available with a quick search)
Just doing some simple math here, the cost of a college education, per year, at a 4 year degree-granting institution as a percentage of household income was:
* in 1964 ~16% of household income per year
* in 1976 ~20% of household income per year
* in 1996 ~20% of household income per year
* in 2005 ~26% of household income per year
* in 2015 ~34% of household income per year
* in 2017 ~32% of household income per year
As of 1964, college was a burden, but one bearable with some margin. Through 1996, it was again a burden, but one that was matched by the increase in income so at least it wasn't getting worse. Following the dotcom crash, it has ballooned significantly. 32% of household income is now approaching maximum suggested rent by income. So where is that money coming from? Debt. Which will follow the students around until they get a sufficiently decent job, or until they die.
So, should we be ok with the fact that overall growth is low and falls well behind increases in GDP, with all of those increases going to the rich? Or should we get upset and doing something about it?
I feel like half the participants in this thread want to spend their time niggling over details and scoring internet points, while the rich will just keep on getting richer.
I've been thinking about this because I have lived this life. In high cost of living areas, even when you're making what could otherwise be decent wages, you still are forced into the shared living situation.
Let's take grocery clerks, a job that is increasingly going to go away as self-checkout and efforts like Amazon's automation chip away at them: it's an industry that is still heavily unionized, and as a consequence has at least some rules around requirements for full and part time work, as well as being paid for doing whatever level of work you're doing. My experience was specific to the southern California area. You're going to start a bit over minimum wage, but once you hit grocery clerk, with enough time in-grade (4-ish years IIRC) you would hit ~$20/hour. If you're fortunate enough to make full time (not at ALL guaranteed) that's a nice tidy $40K/year gross with a couple weeks of vacation and the potential to earn more if you end up working holidays or overtime. The part timers might end up with only 24 hours a week, swapped between stores as needed--but at least there is a floor. Thank you unions.
$40K/year isn't really enough to live on your own though; depending on where you are in California, an apartment might run you $20K/year or more.
So you have to live with other people that are also likely working full time.
I worked with many, many people who were living in apartments, driving shitty old cars at 30, 40, 50 years old because that's all they could afford. The people with the nice cars were usually the kids who were getting their first taste of money--and after a few years they inevitably would learn their lesson and sell off their expensive-to-operate BMW or what-have-you. I worked with people who worked through chronic injuries, just trying to make it long enough to retire with a full pension (yes, this is one of the few jobs where that's still a thing, though the pension is significantly under-funded). I worked with people that were held hostage by the managers who if they wanted to punish a recalcitrant employee could put them on nights, take away hours (if they weren't full time), give them shifts with the minimum downtime allowed by contract, and otherwise run right up against the protections the union provided them. I worked with people who commuted hours every day because that's the only way they could afford to raise a family on their meager incomes.
All the while, destroying their bodies to do so.
It's not the coal mines, but long term it will wreck your body. I have chronic injuries of my own dating back to the years I spent working the grocery store. I still don't know how much time all those years of working the graveyard shift took off my own lifespan.
So yes, it's not literal slavery, but it's a far cry from tech work where a single income will generally easily afford you a solo apartment unless you're in the most expensive parts of the country.
And I feel we can do better by those people doing the ugly invisible jobs. They too should be able to enjoy the fruits of the increases in productivity, instead of merely scraping by while the drive for ever more efficiency steadily grinds away until they're inevitably forced out of their jobs by the next step in automation.
I would restate that as productivity and wages have become decoupled due to skill-based technological change, and the bulk of the increase in productivity has been absorbed by capital and the owners of capital.
That's...basically what I said, yeah?
It's implicit in your statement. I just wanted to make the connection explicit! So yes, that is basically what you said, hence why it's a restatement rather than a rebuttal.
Also I tend to eschew Marxist turn of phrase, but I recognize that's mainly my prerogative
Yes, that is what I meant. I was thinking more Picketty than Marx but...
I think this vastly underestimates the effect of uncompetitive labour markets. The monopoly power of employers has only been getting stronger these many stagnant decades.
It certainly gives some insight into why he’s the spokesman for the propaganda network furthering this disaster of an Age