All “growth” in gdp seems to go to rich people. Normal people have seen stagnant wages and increased costs from the owners.
Why should I care if gdp isn’t increasing when I don’t see any gains whether it does or not?
Why should I care if gdp isn’t increasing when I don’t see any gains whether it does or not?
That's categorically not true. Adjusting for inflation, wages today are up 6.8% compared to 2008.
The original comment makes no mention of CPI. It only mentions that certain categories of goods have outpaced wage growth. Of course you're going to get that result if you cherry pick your basket.
To bring things back a bit, the argument was that
> housing and other costs like childcare have increased astronomically during that period negating any real gains
Yet, gruez is downvoted while citing CPI-adjusted wage growth showing the contrary. CPI, for everyone's information, includes rental and housing costs in its indexing, as well as child care and many other services.
Of course, it's just one (financially significant) formula, but it was a good faith rebuttal and the only comment in this thread citing anything close to objective evidence.
A study by the San Francisco fed in 2022 [0] calculated that based on Zillow market data, the rent component of the CPI is to increase by about seven percent each year in 2022 and 2023:
> Our model confirms that an increase in current asking rents or current house prices can push up the CPI rent index for a typical MSA for as long as 24 months into the future. Given the currently elevated levels of Zillow asking rent inflation and Zillow house price inflation averaged across all MSAs, the model predicts that CPI rent inflation will increase by about 3.4pp for both 2022 and 2023, relative to its historical average rate of 3.7%.
[0] https://www.frbsf.org/economic-research/publications/economi...
And that's fine, because the CPI is for the whole country. Not everyone is a renter looking for a place right now. Some people do indeed have houses and therefore their housing costs are locked in perpetuity. If you take nominal wages, and deflate that using cpi-with-market-rents, that would indeed more accurately describe the plight of someone who's renting, compared to normal cpi. However, it would also make it the situation look worse than it is for someone who owns their home, because their housing costs are essentially fixed. You might empathize more with the former and think their plight deserves more attention. That's fine, but the specific claim being made was for the economy/country as a whole, not for a specific demographic.
What kind of an argument is this? Clearly the OER must be a current indicator (i.e. not lagging) if it is based on current rental expenses. The small section of the population that is in the market for a new place to live should not be taken as the average for the entire population. If anything the market rents are just an indicator of future OER.
If you were tracking the inflation of banana prices and the market price for bananas went up 10% year over year, does someone having a fixed price contract from a year ago affect the actual inflation of banana prices?
More jobs are only good if they actually provide a living wage.
This is false if you spend even a few seconds thinking about it.
Not all jobs are intended to "live" off of. Most of your entry-level jobs were supposed to be for highschool and college kids working part time.
The problem is we have more and more people never graduating out of entry level positions, and today we have folks demanding those entry level positions support a comfortable lifestyle.
You're supposed to graduate out of entry level work after you acquire skills, training, and/or education. Why are people not "moving up" is the real problem...
This is some soft language hiding some bad assumptions.
"supposed to be" - what does this mean? because it's a lot more interesting...low skilled jobs, are probably what we're going to be talking about. However, it's not the 1950s anymore. eg Staffing a movie theater is not a part-time job (which you would know if you have ever worked one), even post-covid.
Targeting for graduates (or current students) is reserved for economies like college towns, historically. Those places have also experienced wages rising noticeably over, at least, the last 2 decades. Industrial and metropolitan areas don't have enough "school labor" to staff all the unskilled positions, regardless.
> Not all jobs are intended to "live" off of
If you have a fulltime job, the minimum wage is intended to allow you to survive^. The main issue is that places with fulltime positions open to unskilled labor, have living costs that outpace the minimum wage...all the way out to the most rural of US towns. The financial guidelines for employees from McDonalds, Wallmart, etc are telling.
^Claiming that jobs that pay minimum wage and only allow working 30 hours a week, aren't intended to "live" off of, is cherry picking exploitative employers. This is not compelling, nor the common case, so we can focus the discussion on the issues that the majority of the economy deal with.
This is the issue - the idea that minimum wage is supposed to be "livable" is a modern notion.
Unskilled labor probably shouldn't be livable. If someone can be trained to replace you in a few minutes (i.e. unskilled labor), then the truth is your labor is not worth a lot.
We need more people moving up into skilled labor. It's really hard to imagine someone working 30+ years at a job and not developing skills... yet that is what's happening more often today than ever before.
Highschool and College kids don't need a living wage. They need flexible hours, and schedules that fit their available time (night shift, swing shift, whatever...).
The only way for that to work is to have a slave population, because why should a living and breathing human being waste their time and their life with work that doesn't even sustain them? The concept of "unskilled labour" is a lie. Otherwise you could hire dead people from the graveyard.
> Highschool and College kids don't need a living wage.
Do you have any good arguments as to why you should be allowed to have a living wage?
A notion that dates back centuries and one specifically enshrined in law in Australia, a G20 country, since 1902 (ish).
I dare say other G20 countries also support this notion (aside from any antiquated holdouts still clinging to non SI units).
Need? No. Would it be better for society? Maybe. This is not really something that people disagree with. Dispensing with the repetition will save the distraction.
> the idea that minimum wage is supposed to be "livable" is a modern notion.
https://en.wikipedia.org/wiki/Living_wage - back to 1604, or earlier or later; what does it matter?
> Unskilled labor probably shouldn't be livable.
Why? Arguing the economic consequences are not a reasoning.
There will always be humans who are incapable of skilled labor (of any note) beyond newly educated students. eg The Calculator profession and other forms of industrial collapse as well as immigrants (legal or otherwise) and the disabled. It's not clear what you think is the obvious way to keep these people alive. Welfare/socialism or pretending they don't exist, relegating them to a slave class, or exile?
That doesn’t sound right. To me it seems obvious the problem is these jobs used to provide more purchasing power than they do today. The increased grievance would be because of this drop in purchasing power, not because people are suddenly demanding a “comfortable” (<- loaded word) lifestyle out of the blue.
Did McDonalds used to be closed during weekdays when all their cooks and register staff were in school? I don't remember that.
Also, extremely uneven economic distributions tend to be bad for large segments of the population due to inherently limited resources like desirable beach front property as well as artificially limited resources like city apartments.
A rising tide obviously raises all ships, including the nation's poorest.
To create vast wealth generally requires vast resources, which requires vast amounts of people. Behemoths the size of Amazon, Walmart, Microsoft, Google, et al employ significant chunks of the population - and not just directly.
Trickle-down doesn't mean everyone will be a millionaire by doing nothing... instead, it means a ton of smaller companies are boosted while servicing larger companies, and so on - spreading wealth around in terms of employment and providing people with a living they can fairly earn.
I don’t mean to trivialize the complicated nature of the matter, with the effects of the world wars and globalization + many other factors, it is hard to separate things, but it really does not seem all that difficult to argue that trickle down economics is not better than what we were doing before and to do so in good faith.
Of course, the actual goal of trickle down economics was to concentrate wealth and power into the hands of a few and in that regard it is undeniably a success.
[0]: https://www.pewresearch.org/short-reads/2018/08/07/for-most-...
The nation's poorest are not provided with a fairly-earned living. They are working themselves to death while not even earning enough to survive, and they can't get any other job because those "smaller companies" have been killed by the behemoths outcompeting them by using exploitative labor practices.
[0] https://www.cbsnews.com/news/tax-cuts-rich-50-years-no-trick...
Complete nonsense. You can look at the real-world effects.
Or the economists, who have done so and do not support it at all: https://en.wikipedia.org/wiki/Trickle-down_economics#Economi...
The citations that you want are linked there. Are you seriously saying that the whole "Economics" section of the Wikipedia article on trickle-down economics is "not good faith"?
Trickle down is a failure at its stated aims. It does not work. It never worked, and now people have noticed.
> A rising tide obviously raises all ships
A metaphor proves nothing. I might as well say "when money is concerned, no it doesn't: it's every man for himself" and leave it at that.
Let me ask you one thing in addition: can you explain why "trickle-down" economics is superior to "trickle-up" economics: where the money goes directly to those poorest who need it, cutting out the middle-men; and then when they spend it until it inevitably trickles up to businesses and the more well-off?
How does does "trickle-down" economics compare to that?
To throw a wrench in that tired metaphor: a rising tide may raise all ships, but a fat lot of good that does to the poor, if it's only the well-of that can afford to buy a boat.
Even the poor do better when there's more jobs available, more job mobility, more housing, more stores, etc. All things that are created by wealthy companies and individuals.
Everyone, including our poorest, benefit from a growing economy.
We just have to examine our average poverty-level person, and compare them to poverty-level persons of other nations to understand this point.
Only if those jobs offer a livable wage. If instead they are McJobs that result in workers spending more than they earn (e.g. SNAP), then poor people are doing worse, and it's a net-negative on society.
Why are people stagnating instead of moving up? That's a really good question.
If you are not "supposed" to earn a living wage, then the job should not exist. It's a simple matter of supply and demand: if you can't afford to pay your laborers a living wage, you have obviously failed as a company because you are unable to exist without slave labor.
> This misses the reason so-called McJobs don't pay a "living" wage.
Yes, this reason is called "profit". They pay so little because it is legal to do so, and people would rather work three jobs than see their kids starve.
> You're supposed to develop skills and move up in the working world.
If everyone moves up, who is going to do those jobs? And how exactly are you supposed to develop those skills if you have to work three jobs just to survive? There are only so many hours in a day, you know.
And most importantly, how do you account for the fact that in the U.S. there are about 53 million people in low wage jobs, but only about 33 million high school and college students? What are those other 20 million workers “supposed to” be?
It's a difficult question to answer thoroughly, but there should be a few obvious factors. Most of the labor market is effectively priced out of acquiring higher valued skills/degrees that would improve their career. Their opportunities for advancement are laughable.
So, then, why is that?
Also parent: Why are people stagnating instead of moving up? It's a real puzzle.
No I'm not. I know exactly the point you were making. I'm disputing it.
The problem is the devil is in the details, and both the tired metaphor and your defense of it leave those details unspecified.
There is no good faith argument that exists to prove this incorrect.
> other economic articles, statistics, etc
Ah well, you're wrong. "other economic articles, statistics, etc" clearly do not support this.
I mean, "what can be asserted without evidence can also be dismissed without evidence." but lets bring the citations:
> trickle-down economics has never been advocated by any economist
https://en.wikipedia.org/wiki/Trickle-down_economics#Economi...
Did you know that?
Oh how far we’ve come since the economy of the 1960s.
That decline is an anomaly. The majority of it is attributable to covid, and a significant minority attributable to fentanyl: https://www.cdc.gov/nchs/pressroom/nchs_press_releases/2022/...
I do agree that the "rising tide raises all boats" rhetoric is largely bunk. But I don't think that this one particular measure, taken at an anomalous time, is sound footing for a counterargument.
Btw obesity is rising in Europe as well.
Palm oil is in everything in the US, in France there's a lot more lighter oils and butter.
Obesity is a side effect of having so much food that calories are cheap and plentiful. That’s why obesity rates are rising everywhere in the first world. It’s also something virtually unprecedented in human history.
>Here’s another statistic on dynamic equality in America: 10% of Americans will spend at least one year in the top 1% of income earners, and more than half of all Americans will spend at least a year in the top 10% of income earners. Since what we’re trying to do is allow the market to reward those who contribute to society, greater turnover among the rich in the United States is a sign of fairness.
https://www.shortform.com/blog/types-of-inequality/
https://medium.com/incerto/inequality-and-skin-in-the-game-d...
And that’s with the poverty level being a moving target.
- Your access to mRNA vaccines
- Your access to cleaner air due to electric car adoption
- Ditto for energy security and renewable sources of electricity
- Your chance of dying in a car going down due to new safety features
- Your access to crazy advanced cancer treatments that are making progress at almost miraculous paces
- Your much improved ability to work from home, cutting out ~2 hours of commuting each day
By every metric, the world is DRAMATICALLY better today for virtually everyone than it was in 1960, and the same from 1960 to 1900, and so on.
The pace things are improving is exponential.
If you think we're all worse off, maybe you're depressed. Or maybe you actually are worse off - but most people aren't...
If things were improving "exponentially" like you claim, our lifespan would be accelerating and these "miraculous" treatments would allow us to live 100s of years. What's actually happening is our lifespan is not increasing, and in some years has been decreasing.
>>maybe you're depressed
But if these "miraculous" "exponential" medical improvements were real, we would expect to see less and less people who were depressed every decade. Instead, depression rates have been increasing.
One might also suggest if the world were DRAMATICALLY better as you claim, depression rates would be going down, not going up.
Now if you get leukemia in 2023, it's something close to a 70% survival rate over 5 years with significantly better treatments.
That seems dramatic to me.
It's drug overdoses, addiction, car accidents.
Unless your definition of rich is literally everyone in the US and Europe (which could be a fair definition) - then I disagree.
You're off your tree.
Coal usage is at an all time high while the climate is collapsing. We're living on an exponential growing crisis is maybe what you should be saying.
For the vast majority of people in the world hasn't changed enough to have any noticeable impact on their lives.
By your metrics, it'd be hard to argue that things aren't getting worse in last decade. I'm not arguing things are worse now, just that you chose bad measures.
However, just because it's good, doesn't mean it couldn't be better. I think this all the time - why can't the rich be rich without inflicting cruelty and suffering on people? You can have your millions, just give us healthcare, housing, public transit, vacation time, and fair pay, and stop dumping chemicals in the water, torturing animals, warming the planet, addicting folks to opioids, and promoting guns and the use of personal vehicles.
We don't have to imagine or fantasize about improvements the US could make - we have an example right in front of us with many social democracies in Europe. When a car backfires, the French don't assume it's an active shooter. When a Dane gets into an accident, they don't take a taxi to hospital. When your CEO gets trolled on Twitter and decides to fire 70% of the staff, you don't have to worry about it because you have an employment contract, and he simply can't.
We have to do better.
If you're staying "stagnant" and the world is getting better, you're better off.
Even if you're declining, you can be better off.
If you think poor people in the US and Europe have it rough today, you should read up about what it was like to be a normal person in the 1600s in Europe.
If you think poor people have it rough today in California, you should read up on what it was like being poor in California in the 80s and 90s.
Etc.
The average lower middle class family today has it better off than nobility in the 1700s.
The fact that we're better off than people in the 1600s does not contradict what I wrote.
> The average lower middle class family today has it better off than nobility in the 1700s.
But in many countries is worse off than a couple of decades ago.
[0]: https://dqydj.com/average-median-top-individual-income-perce...
>Median individual income in the United States was $46,001. It is up from $44,225 in 2021.
The graph shows 2022 with a median income of $46,001. That means the 2022 data hasn't been "adjusted for CPI" because duh. When you adjust for CPI you choose a reference year which can't be anything but nominal and other years are brought to the same price level. This means that the $44,225 from 2021 have been adjusted upwards to $46,303. You can disregard the 2021 numbers, just as clipsy did (he only posted numbers for 2022), and just click your way to the 2021 post if you want the nominal numbers for 2021.
Ain't disputing that, but that's an outlier because it's a government provided thing, at least where I live.
But look at the rest of those things from a POV of people from lower and middle classes:
> - Your access to cleaner air due to electric car adoption
Yeah someday, maybe; right now it only means my perfectly good car is no longer good, and I have to somehow find money to replace it - and since this tech is new, there aren't many cheap used replacements available.
> - Ditto for energy security and renewable sources of electricity
Energy security? That's not what TV says. Renewables? You mean like those PV scam companies popping up everywhere? Or government forcing me to replace my cheap heat source with an expensive one?
> - Your chance of dying in a car going down due to new safety features
Feels like a pretty remote risk at this point (if it weren't, people wouldn't be driving at all). But sure, nice that safety improves over time, even if I'm always 10-20 years behind on the features.
> - Your access to crazy advanced cancer treatments that are making progress at almost miraculous paces
US: what access? Can't exactly afford it.
EU: what access? The queues are so long I'll die before my appointment comes up.
> - Your much improved ability to work from home, cutting out ~2 hours of commuting each day
That's thanks to COVID dragging the market kicking and screaming into this new reality, and with the pandemic over, the businesses are trying to decide which jobs to force back into office, and which to offshore. Neither is really a win.
(Also, it was hardly an ability - everyone was forced into it. Commute doesn't look all that bad compared to two working parents and all the kids trying to simultaneously remote-work and remote-learn in an apartment not sized for this.)
> By every metric, the world is DRAMATICALLY better today for virtually everyone than it was in 1960
What about it no longer being possible for most couples to live on a single income?
> maybe you're depressed
Funny you should mention depression - yes, support for dealing with it is better than ever, but it's also not accessible to most.