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Comment by rayiner | Hacker News Reader

I think Americans would disagree with the implication that the US has done particularly well over the last 15 years, even though going by nominal dollars that seems to be the case.

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That’s true, and it’s the point.

The reality is that there American system sucks by some metrics, and yet by others which are real and not BS, the US economy crushes.

In the end human flourishing, and life satisfaction are more important than GDP, but at the same time GDP is real and it does matter.

I think the issue is more than the divergence between what nominal GDP suggests and what people feel demonstrates that nominal GDP is not a useful metric. It essentially measures your ability to buy things denominated in USD. Some of those things are important and others are peripheral. But the purchasing power of most of the important USD-denominated goods is already reflected in the PPP adjustment. So that leaves the peripheral stuff. So for example, the standard of living in South Korea is probably closer to the country's $45,000 PPP GDP per capita, than to its $35,000 nominal GDP per capita. It doesn't really make a difference that South Koreans can purchase fewer MacBooks and must instead buy Samsung products.

It's similar to people who insist that folks in New York or San Francisco are better off than folks in Texas because of higher incomes, without adjusting for cost of living. If that was true, domestic net migration patterns wouldn't look the way they do. Yes, folks in New York or San Francisco can buy more MacBooks, but that's not a useful metric.

> at the same time GDP is real and it does matter.

At least such a huge difference will have practical effects.

Can we fund our welfare systems without growth? (Just imagine what we could do, if the budget was 2x)

Americans with wealth or property have done great for themselves. They currently feel that the economy is in the dumps, but that's just because talking heads on Fox are telling them that it is. They can't articulate why the economy is in the dumps.

Americans who are between the ages of 15 and 35 feel like the ladder has been pulled up out of their reach, and they've felt this way for the past decade. Mostly because property owners have reaped most of the benefits of the past two decades.

The top 10% of American households own 89% of US stocks, and the top 1% own 50% of US stocks. The benefits have almost entirely accrued to a small minority at the top. Some of the 35+ cohort are doing exceedingly well, but most just have a primary residence (with a mortgage), some limited retirement savings, and maybe a small investment account. Those people are still working for a living, and likely have experienced real wage stagnation or decline. So media pundits claiming "the economy is great!" really does not match up with the typical experience. The stock market is not the economy.

https://www.cnbc.com/2021/10/18/the-wealthiest-10percent-of-...

Since ~2012 disposable income for Americans has lapped that of Europeans. See for yourself.

https://dart.lisdatacenter.org/dart

I don't think anyone is disputing that the US had a really good run from 2014 until 2020, but real wages still have not recovered to pre-COVID levels. See eg. the BLS Employment Cost Index.

https://www.bls.gov/blog/2023/more-ways-to-look-at-wages-and...

The point of the convo is that Americans are much richer than Europeans. Which is true.

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