Canadian Politics Today

Beyond Canada => American Politics => Topic started by: cybercoma on February 07, 2017, 02:36:03 pm


Title: Incomes Collapsing in the US
Post by: cybercoma on February 07, 2017, 02:36:03 pm
In a recent study by economists include Thomas Pinketty, The distribution of pre-tax national income adjusted for inflation in the United States has fallen steadily over the last 40 years. The bottom 50% fell from a 20% income share in 1978 to just 13% today. In France, on the other hand, incomes grew by 39%. The authors of the study believe this implies that nation-specific public policies have a profound impact on income inequality in industrial nations.

Article: http://www.marketwatch.com/story/income-share-of-bottom-50-is-collapsing-finds-researchers-including-piketty-2017-02-07
Title: Re: Incomes Collapsing in the US
Post by: TimG on February 07, 2017, 03:32:24 pm
This concern over income equality needs to have a reality check. I assume that no one wants to live in a society where everyone is equally dirt poor which means income equality is not a problem in itself. It must combined with other statistics before you can say whether the numbers are a concern. Two immediate questions come to mind:

1) How does the US compare to France wrt income growth?
2) How much of the difference is due to rich French people simply leaving the country?

IOW, if *absolute* incomes for the lower 50% grew in the US but fell in France then we don't really care that the *share* of income held by the lower 50% dropped.

Similarly, French policies may discourage wealth accumulation but if that has the side effect of slowing job growth and business creation then that bad for France in the long term.

Title: Re: Incomes Collapsing in the US
Post by: cybercoma on February 07, 2017, 05:23:26 pm
This concern over income equality needs to have a reality check.
I'm sorry, but the reality check is all yours. Income inequality in OECD nations is linked to a ton of social and health issues. If you want to know how, this was the beginning of a ton of research on the topic. https://www.ted.com/talks/richard_wilkinson

Edit: If you don't give a **** about people's health and social welfare, then there's a ton of research from the OECD showing that inequality hurts economic growth. This has been corroborated by other researchers, whose articles are behind paywalls, so I haven't included them.

http://www.oecd.org/newsroom/inequality-hurts-economic-growth.htm
https://www.oecd.org/social/Focus-Inequality-and-Growth-2014.pdf
http://www.oecd-ilibrary.org/social-issues-migration-health/trends-in-income-inequality-and-its-impact-on-economic-growth_5jxrjncwxv6j-en
https://www.imf.org/external/pubs/ft/sdn/2015/sdn1513.pdf

Here's an article showing OECD income and labour share trends:
https://www.oecd.org/g20/topics/employment-and-social-policy/Income-inequality-labour-income-share.pdf
Title: Re: Incomes Collapsing in the US
Post by: cybercoma on February 07, 2017, 05:25:22 pm
More importantly, who just looks at the fact that literally half the US population is making less money and shrugs their shoulders? You miss the entire point if you think it's just a simple comparison between France and the United States and even if it were, you're ignoring the desperate situation that US health and education metrics have been in decline.
Title: Re: Incomes Collapsing in the US
Post by: TimG on February 08, 2017, 01:54:10 pm
More importantly, who just looks at the fact that literally half the US population is making less money and shrugs their shoulders? You miss the entire point if you think it's just a simple comparison between France and the United States and even if it were, you're ignoring the desperate situation that US health and education metrics have been in decline.
The data you linked to does not establish that incomes are dropping. It only claims that the *share* of income earned by the bottom half is dropping. There is a huge difference. For example, it the incomes of the bottom 50% have risen faster in the US than in France over the last 50 years, however, because France is so hostile towards the rich the share of the total income did not change in France. It is not clear to me that this means France is better for poor people. If anything, France's high youth unemployment rate and poor track record at integrating immigrants into the work force makes France a less attractive place to live than the US for anyone who don't have a guaranteed job in government or government protected industry.



Title: Re: Incomes Collapsing in the US
Post by: cybercoma on February 08, 2017, 02:46:01 pm
The data you linked to does not establish that incomes are dropping.
The original link to the economic study from Pinketty certainly does.
Title: Re: Incomes Collapsing in the US
Post by: TimG on February 08, 2017, 03:07:24 pm
The original link to the economic study from Pinketty certainly does.
And the claims in the link which are not backed up with charts and sources contradict data here:
https://www.advisorperspectives.com/dshort/updates/2016/09/15/u-s-household-incomes-a-49-year-perspective

Over the last 50 years real incomes for the bottom half have grown 25% to 30%.

More importantly - the headline and the focus of the link is on the share of total income which is totally irrelevant.
What matters is real income growth.
Provide data that compares real income growth in France vs US over time and you might have a point.
Title: Re: Incomes Collapsing in the US
Post by: cybercoma on February 08, 2017, 03:28:19 pm
Real income growth doesn't matter when the entire point I've been showing you is that income inequality has adverse effects on the economy, as well as health, education, and other social welfare issues. You can bring up all the red herrings you want. What I'm telling you is an established fact based on empirical evidence that you're ignoring.
Title: Re: Incomes Collapsing in the US
Post by: TimG on February 08, 2017, 05:49:55 pm
Real income growth doesn't matter when the entire point I've been showing you is that income inequality has adverse effects on the economy, as well as health, education, and other social welfare issues. You can bring up all the red herrings you want. What I'm telling you is an established fact based on empirical evidence that you're ignoring.
I could not care less about income inequality because it is irrelevant (despite the fact that it has become a bete noire for the left). The studies you reference are correlation studies which cannot establish any causal relationship because what matters is real income growth. If people are getting richer worrying about the fact that others are getting richer faster seems like jealousy. A society is not healthy if people are equally poor and getting poorer.

If you want to use statistics use statistics that have meaning. Real income growth has meaning.
Title: Re: Incomes Collapsing in the US
Post by: ?Impact on February 08, 2017, 06:02:28 pm
If people are getting richer worrying about the fact that others are getting richer faster seems like jealousy

You can have far more money today than 40 years ago, but be far, far poorer. The absolute amount of money is totally irrelevant, it is the buying power that is important. When basics like food and housing have skyrocketed, being able to buy a flat screen TV is totally meaningless.
Title: Re: Incomes Collapsing in the US
Post by: TimG on February 08, 2017, 06:06:47 pm
The absolute amount of money is totally irrelevant, it is the buying power that is important.
That is why I said *real* income. i.e. income after adjusting for inflation so your point is moot. Rising real incomes mean the buying power of poor people is increasing over time. If you have an issue with way the CPI is calculated then that is a different question. Perhaps you can find studies that use alternative ways of calculating real income that use something other than the CPI.
Title: Re: Incomes Collapsing in the US
Post by: cybercoma on February 08, 2017, 07:16:19 pm
I could not care less about income inequality because it is irrelevant (despite the fact that it has become a bete noire for the left). The studies you reference are correlation studies which cannot establish any causal relationship because what matters is real income growth. If people are getting richer worrying about the fact that others are getting richer faster seems like jealousy. A society is not healthy if people are equally poor and getting poorer.

If you want to use statistics use statistics that have meaning. Real income growth has meaning.
So you didn't read the reports that explain how inequality hurts the economy, did you? You keep saying it doesn't matter and it's explained very clearly what it does. Not only does it matter for those in the bottom 50%, but it's going to matter for those at the top as well.
Title: Re: Incomes Collapsing in the US
Post by: TimG on February 08, 2017, 07:36:54 pm
So you didn't read the reports that explain how inequality hurts the economy, did you? You keep saying it doesn't matter and it's explained very clearly what it does. Not only does it matter for those in the bottom 50%, but it's going to matter for those at the top as well.
I read those reports and, as I said, they look like correlation studies and offered no plausible causal link between income inequality and the various out comes you list. And the lack of a causal link is why I say it is irrelevant. My question is why are so resistant to the notion that rising real incomes is a good sign? What justification do you have for ignoring rising real incomes and focusing on the "inequality" stat?

A simple thought experiment should illustrate why I don't think we should care about income inequality: which society would you want to live in as a lower income person: 1) a society with rising real incomes for below median citizens and rising inequality? 2) a society with falling real incomes for below median citizens and falling inequality?

I think it should be obvious that 1) is a the better choice but that is me. The thought experiment also illustrates why inequality is an irrelevant metric.

Title: Re: Incomes Collapsing in the US
Post by: cybercoma on February 08, 2017, 08:44:00 pm
It's okay to admit you didn't understand what you read, but that doesn't mean it's wrong.
Title: Re: Incomes Collapsing in the US
Post by: TimG on February 08, 2017, 09:26:59 pm
It's okay to admit you didn't understand what you read, but that doesn't mean it's wrong.
Who says I don't understand it? For starters the studies in question say that income equality means faster GDP growth for developing countries but at some point when a society becomes "developed" it becomes negatively correlated with GDP.  The fact that the sign flips is pretty good evidence that this is not a very useful indicator. The argument made to salvage the premise is that in developed countries rising inequity means under investment in human capital but that is a huge stretch. At best inequality is a symptom of under investment in human capital - not the cause. The indicator also makes no mention of what is happening with real incomes of the lower 50% which I feel are much more important.

I also watched the TED talk with his argument that relative 'lower status' results all kinds of negative outcomes but I see any correlation of "status" on outcomes as a function of culture rather than income.  He mentioned that low social trust was common in societies with high inequality and I would argue that low trust is the cause - not the consequence of inequality and changing the level of trust in society requires a culture change. No tax regime is going to change this factor.

The reason I disparage the indicator because way too many people seem to think it is a justification for neo-communism where the government forces everyone to be equal. We know communism as an economic system failed so there is no reason to believe that neo-communism will fare any better. If we want to address problems in society we need to focus on those problems - not some abstract indicator that means nothing.
Title: Re: Incomes Collapsing in the US
Post by: cybercoma on February 09, 2017, 10:50:18 am
If you read the OECD reports on inequality, you'll see that it stifles economic growth. That's an indisputable fact now. Lower economic growth is a bad thing not only for those at the bottom of the wealth distribution, but also those at the top. It also means publicly funded services, you know, like the military, hospitals, police, fire, water treatment, food safety inspection, etc., are going to be more difficult to fund without deficit spending. Deficits, furthermore, are going to be more difficult to manage with a stagnant economy. The problem with inequality is that the movement of money is vital to the economy. Money is the lifeblood of the economy and when it's pooling in one place and not moving around, the economy dies. That is why inequality is a problem, regardless of whether the tide is rising in total. You've even outlined in your recap of the TED talk why the rising tide is irrelevant to a discussion of a country's well-being. GDP (everyone's income increasing) is not a measure of social health in developed nations, period. That's why I'm focusing on inequality and baffled as to why you're ignoring it.
Title: Re: Incomes Collapsing in the US
Post by: TimG on February 09, 2017, 11:12:31 am
If you read the OECD reports on inequality, you'll see that it stifles economic growth. That's an indisputable fact now.
No it is NOT a fact. It is opinion on causality inferred from a correlation analysis. You really need to learn what a fact is. A fact is they found a correlation. The assertion that one caused the other is an opinion. I have seen this BS in paper after paper where scientists keen to push whatever hobby horse they are flogging ignore such questions because they are inconvenient.
Title: Re: Incomes Collapsing in the US
Post by: cybercoma on February 09, 2017, 12:18:40 pm
Do you have a satisfactory confounding influence that explains the relationship? I have the feeling an army of economists would have considered that.
Title: Re: Incomes Collapsing in the US
Post by: TimG on February 09, 2017, 01:04:17 pm
Do you have a satisfactory confounding influence that explains the relationship? I have the feeling an army of economists would have considered that.
Ah yes - the "we can't think of anything else so our opinion must be  a fact" argument. Asserting that something is a fact requires evidence of causality backed up with repeatable experiments. Hypotheses derived from correlation studies can rarely meet that requirement but that does not stop career minded scientists from waving their arms and pretending - especially if the results are politically useful to people with money.

In this case, it makes no intuitive sense that relative changes in income would affect economic performance. It makes much more sense to say that a society that does not invest in human capital by providing reasonable access to education, healthcare and other services will experience slower growth. This in turn may CAUSE increasing inequality but inequality in itself causes nothing. It is only a symptom. You can also say that societies with rising GDPs tend to reduce inequality because growth provides resources to invest in human capital and that slower GDP growth increases inequality as people fight for a share of a smaller pie. In this case inequality is the effect - not the cause.

Another factor that is over looked in all of these analyses: the culture of different countries. Less equal countries tend to have started with a divided society and low social trust and these divisions widen over time. Equal societies tend to be homogeneous and have high social trust. This means a solution that works for high trust society like Sweden cannot be imposed on a low trust society like the US. It is simply naive to assume that increasing taxes and programs in places like the US would do anything to fix the low social trust. If anything such tactics would only make the divisions worse.

Title: Re: Incomes Collapsing in the US
Post by: Manob on February 09, 2017, 04:26:45 pm
New forum, same discussion, how comforting!

Personally TimG's point of view seems more plausible to me... high inequality is likely to be a symptom of various social/economic issues that also cause other downsides like slower growth. Inequality is inherently a measure of outcomes, not causes. You can't address inequality directly, what you can do is look at underlying causes like education systems, healthcare systems, infrastructure, etc.

Living and working in the US, it seems inescapably obvious that a huge portion of the population simply doesn't have useful skills that can be used to get a well-paying job. So of course they're incomes aren't rising when the simple tasks they can do are being replaced by machines or done elsewhere for much lower than US minimum wage. That's not something you can fix by redistributing money around on the back end, what you have to do to try to address this is totally change the culture and education system to make it easier and more tempting for people to learn useful skills. There's been a decades-long shortage of people going into technical fields and yet more people have an instinctive revulsion to math than ever, while religion is replacing science in classrooms in half the country.
Title: Re: Incomes Collapsing in the US
Post by: ?Impact on February 09, 2017, 04:39:49 pm
You can't address inequality directly, what you can do is look at underlying causes like

Greed
Title: Re: Incomes Collapsing in the US
Post by: Blueblood on February 10, 2017, 12:59:13 pm
I know this might seem a little off topic, but I'm going to enclose the ted Cruz - Bernie sanders debate on healthcare as it touches on themes of left vs right and capitalism vs socialism.

https://youtu.be/2ugBYg1zbuY

IMO Bernie didn't have a good night...
Title: Re: Incomes Collapsing in the US
Post by: kimmy on February 12, 2017, 01:40:55 pm
And the claims in the link which are not backed up with charts and sources contradict data here:
https://www.advisorperspectives.com/dshort/updates/2016/09/15/u-s-household-incomes-a-49-year-perspective

Over the last 50 years real incomes for the bottom half have grown 25% to 30%.

That's one way to summarize those graphs... an equally accurate summary would be that incomes for the bottom half grew substantially between the 1980s and 2000, but have fallen since.

Your premise is that everybody is getting richer so everybody should be happy, even if they're not getting rich as fast as others.  But your cite shows that everybody isn't getting richer. For the bottom quintile, they're poorer than in 1999. For the 4th quintile they're poorer than in 1999. For the middle quintile they're poorer than in 2000.  It appears that only the top 2 quintiles are actually getting richer.

As well, I'm curious about how "Household Income" is defined.  Does "income" include workplace benefits that have been increasingly chipped away in recent years?  If not, then it's not really an apples to apples comparison. If a job that paid $40k inflation-adjusted dollars 20 years ago pays $44k now, but no longer comes with a pension plan and benefits package, is isn't reasonable to say that income from that job has increase by 10%.

As well, I'm also curious about whether CPI calculations take into account things like increases to medical premiums (a BC example) or tuition fees.

 -k
Title: Re: Incomes Collapsing in the US
Post by: TimG on February 12, 2017, 02:16:25 pm
CPI basket is here: http://inflationcalculator.ca/cpi-basket/
Tuition and government fees are included.

Will response to other comments later.
Title: Re: Incomes Collapsing in the US
Post by: cybercoma on February 12, 2017, 05:39:52 pm
As well, I'm curious about how "Household Income" is defined.  Does "income" include workplace benefits that have been increasingly chipped away in recent years?  If not, then it's not really an apples to apples comparison. If a job that paid $40k inflation-adjusted dollars 20 years ago pays $44k now, but no longer comes with a pension plan and benefits package, is isn't reasonable to say that income from that job has increase by 10%.
 -k
Household income does not include workplace benefits. It includes literally those things that go into household income on your tax forms (pay, pension payments, disability, etc.).
Title: Re: Incomes Collapsing in the US
Post by: TimG on February 12, 2017, 07:07:13 pm
That's one way to summarize those graphs... an equally accurate summary would be that incomes for the bottom half grew substantially between the 1980s and 2000, but have fallen since.
1) I was addressing the suspect claim in the op. The range I quoted matches the op;
2) My argument in this thread was about how "inequality" is irrelevant. What matters is real income. And if real income is falling then that is a concern but it has nothing to with inequality. The real income of the riches quintiles fell by more during the 2008 crisis but have since recovered faster. This is largely due the massive amounts of money printed which seems to do nothing other that inflate the portfolios of the already rich.
3) There are many was to fuss with the numbers. The source I quoted is sympathetic to the notion that the poor are losing out but his data still shows a net increase over 50 years. The op claimed a decrease over the same period which is likely due to some extremely dubious statistics.

Most countries are on a path that will inevitably lead to declines in real income across the board because entitlement spending is growing faster than revenues. We are in the stage where we will be squabbling about scraps as the ship sinks. People who are wealthy enough to not depend on a particular country are not going to be affected no matter what policy makers do. If policy makers want to go after the next tier of high income earners they will be chasing a lot of public servants with rich pension plans an even richer benefit packages. IOW, the "rich" are not the type of people that are normally perceived as "rich'. It is not clear how much money can be extracted from this class of people. Whatever is extracted is not going to delay the inevitable
Title: Re: Incomes Collapsing in the US
Post by: kimmy on February 13, 2017, 12:53:44 pm
I think we can at least agree that not everybody's getting richer and not everybody should be happy to see the rich getting richer while half the country is making less (in real income) than they were 20 years ago.  I'd be interested to see equivalent statistics for Canada... my hunch is that it's not much different here.


Regarding the premise that income inequality itself isn't a problem: I conceptually have a hard time understanding how it couldn't be, in macroeconomic terms, a drag on growth.

Ultimately, our economy is driven by consumer spending. We have jobs because others are willing to pay for services we can provide.  But with so many people just not getting ahead financially, people aren't spending as much as they could. People are squeezing another year or 2 or 5 out of their car, they're delaying their home renovations, they're staying home and watching Netflix instead of going out to restaurants, and so on.  People would spend more money if they had more money.

And you can say "yes, but the money's still there, it's just in the hands of a smaller number of people"... but a handful of people can only eat so many meals, drive so many cars, and get their homes renovated so many times.

Take a billion dollars-- hypothetically the annual salaries and bonuses of 10 or 20 or 50 top CEOs and Wall Street bankers... imagine that billion dollars in the hands of 10,000 consumers instead.  From a macroeconomic standpoint, what creates more economic benefit: 20 already-wealthy people get $50 million each, or 10,000 average people get $10,000 each?  I strongly suspect that the latter would generate far more economic benefit, as people would start buying the things that are waiting on their "when I have more money..." list.

That's why I suspect that income inequality actually is, in itself, economically undesirable.  With all the growth in income going to a small portion of the population, consumer spending is being throttled back, and that can't be good for the economy. The engine that powers the economy is starved for fuel.

 -k
Title: Re: Incomes Collapsing in the US
Post by: Blueblood on February 13, 2017, 02:05:53 pm
I think we can at least agree that not everybody's getting richer and not everybody should be happy to see the rich getting richer while half the country is making less (in real income) than they were 20 years ago.  I'd be interested to see equivalent statistics for Canada... my hunch is that it's not much different here.


Regarding the premise that income inequality itself isn't a problem: I conceptually have a hard time understanding how it couldn't be, in macroeconomic terms, a drag on growth.

Ultimately, our economy is driven by consumer spending. We have jobs because others are willing to pay for services we can provide.  But with so many people just not getting ahead financially, people aren't spending as much as they could. People are squeezing another year or 2 or 5 out of their car, they're delaying their home renovations, they're staying home and watching Netflix instead of going out to restaurants, and so on.  People would spend more money if they had more money.

And you can say "yes, but the money's still there, it's just in the hands of a smaller number of people"... but a handful of people can only eat so many meals, drive so many cars, and get their homes renovated so many times.

Take a billion dollars-- hypothetically the annual salaries and bonuses of 10 or 20 or 50 top CEOs and Wall Street bankers... imagine that billion dollars in the hands of 10,000 consumers instead.  From a macroeconomic standpoint, what creates more economic benefit: 20 already-wealthy people get $50 million each, or 10,000 average people get $10,000 each?  I strongly suspect that the latter would generate far more economic benefit, as people would start buying the things that are waiting on their "when I have more money..." list.

That's why I suspect that income inequality actually is, in itself, economically undesirable.  With all the growth in income going to a small portion of the population, consumer spending is being throttled back, and that can't be good for the economy. The engine that powers the economy is starved for fuel.

 -k

The problem with that premise is that over time our standard of living has also improved dramatically with people classified as poor owning cell phones, computers, and tvs which used to be luxury items.  It's really hard to make that assessment of what poor is in our country.  With that being said, is it income inequality or is it just jealousy as our poor compared to the poor in Africa are in totally different circumstances. 

As for the giving a billion dollars to 10,000 or just a few people is disengeniius.  The 10,000 people can buy their trivial things and then the money dries up or the invest it.  Same goes for the wealthy person getting the billion dollars, they invest it or spend it.  Chances are more likely that the wealthy person invests it and creates more of that money vs buying stuff and watching it go to zero.

The problem is that there has been this war on the investment class for a long time resulting in them saying there is too much uncertainty, I don't know when the next regulation is coming in so I am either going to invest overseas or wait until a more friendly government comes in which let's me do business or worse yet emigrate the country.  Venezuela has tried that experiment by soaking the rich and the country is literally a disaster.  I can't for the life of me see why people time and time again try that experiment and endorse it when it has continuously failed.
Title: Re: Incomes Collapsing in the US
Post by: TimG on February 13, 2017, 03:19:15 pm
Regarding the premise that income inequality itself isn't a problem: I conceptually have a hard time understanding how it couldn't be, in macroeconomic terms, a drag on growth.
A thought exercise to illustrate why it does not matter. Which is a better society to be in:

1) A society where everyone's incomes are falling but inequality is dropping;
2) A society where everyone's incomes are rising but inequality is rising;

I would say 2) is better because the metric that matters is rising income, not inequality. Now rising inequality can be a symptom of dropping incomes but the problem is the dropping incomes and that is what we should talk about. Not the rising inequality. I personally find the inequality metric distasteful because of the neo-communist overtones  that "everyone should make the same wage". And, yes I know that people expressing concern about inequality aren't advocating communism that but the implication is there whether it is intentional or not.

Canada's inequality numbers are better that the US but that is because the big money makers (from actors to tech leaders) move to the US. The fact that the US is a draw for high income earners means its inequality numbers will be necessarily worse than countries that chase them away. This is another reason why 'targeting inequality' makes for bad policy.

That said, I don't see what can be done to stop the drop incomes because we are expanding entitlement spending faster than the economy. The current path we are on is going to end up with everyone getting poorer whether we like it or not. Increasing entitlement spending may offer short term relief to some but won't stop the long term decline.


Title: Re: Incomes Collapsing in the US
Post by: Squidward von Squidderson on February 13, 2017, 03:34:29 pm
Quote
...people classified as poor owning cell phones, computers, and tvs...

My disabled friend has these things and she is definitely poor.  She pays for her own cell bill, but we bought her the TV and computer and pay for her cable bill.  When someone is mostly house-bound due to a disability, having a couple "luxury" items is a necessity, and it doesn't make her not poor!  That's extremely judgmental to look at someone's meager stuff and claim they can't be poor.

She also earns a few extra dollars because she has a computer and is extremely intelligent, has a degree in science and can find a few things she can do at home.  To say a computer is a luxury item is also living in 1990...   it's pretty much a necessity these days.
Title: Re: Incomes Collapsing in the US
Post by: Blueblood on February 13, 2017, 03:58:50 pm
My disabled friend has these things and she is definitely poor.  She pays for her own cell bill, but we bought her the TV and computer and pay for her cable bill.  When someone is mostly house-bound due to a disability, having a couple "luxury" items is a necessity, and it doesn't make her not poor!  That's extremely judgmental to look at someone's meager stuff and claim they can't be poor.

She also earns a few extra dollars because she has a computer and is extremely intelligent, has a degree in science and can find a few things she can do at home.  To say a computer is a luxury item is also living in 1990...   it's pretty much a necessity these days.

That's the point of my post...  things that were luxuries are now commonplace.  They don't get that in Africa...

What is poor in relation to the rest of the world? 
Title: Re: Incomes Collapsing in the US
Post by: cybercoma on February 14, 2017, 06:33:44 am
My disabled friend has these things and she is definitely poor.  She pays for her own cell bill, but we bought her the TV and computer and pay for her cable bill.  When someone is mostly house-bound due to a disability, having a couple "luxury" items is a necessity, and it doesn't make her not poor!  That's extremely judgmental to look at someone's meager stuff and claim they can't be poor.

She also earns a few extra dollars because she has a computer and is extremely intelligent, has a degree in science and can find a few things she can do at home.  To say a computer is a luxury item is also living in 1990...   it's pretty much a necessity these days.
Some people don't understand poverty at all. They think you need to be living in a box underneath an overpass to be "poor." They've not read nor would they believe the research that shows just being in the bottom quintile income earners relates to poorer health, education, and other well-being outcomes. We're talking people who make up to $27,000 here. They don't look at these negative outcomes and see how they relate to poverty. They also don't see how poverty relates to their children's outcomes with poorer academic performance and greater risk of behavioural issues, as well as the other issues I mentioned for their parents. I guess the idea is if they're not living in a box under an overpass, they're not poor and government services are unnecessary. Thankfully, the people who study this stuff realize the kind of supports folks need and the government is at least somewhat willing to provide them.
Title: Re: Incomes Collapsing in the US
Post by: Squidward von Squidderson on February 14, 2017, 02:28:24 pm
Some people don't understand poverty at all. They think you need to be living in a box underneath an overpass to be "poor." They've not read nor would they believe the research that shows just being in the bottom quintile income earners relates to poorer health, education, and other well-being outcomes. We're talking people who make up to $27,000 here. They don't look at these negative outcomes and see how they relate to poverty. They also don't see how poverty relates to their children's outcomes with poorer academic performance and greater risk of behavioural issues, as well as the other issues I mentioned for their parents. I guess the idea is if they're not living in a box under an overpass, they're not poor and government services are unnecessary.

Agreed.  It's a very short-sighted view of poverty.  If they can afford a TV, then they aren't poor has to be one of the dumbest arguments for cutting services to poor people that I've ever heard.

Quote
... the government is at least somewhat willing to provide them.

This I disagree with.
My friend gets $1000 per month (same $$ as welfare).

She is supposed to provide her own housing
Provide her own food
Fight tooth and nail with the government to provide her the necessary medical treatments, which often go uncovered, or take months to get. 
And then use all the leftover money for her heating bill, electricity, TV, phone, etc.

She has friends who buy her groceries, and other things, otherwise she would be scrounging the expired crap from the food bank.  The government doesn't provide her with a level of income even close to what she actually needs.  And they rely on voters not to notice, or not caring enough, to make it an issue.  (or those like Blueblood who think the situation with my friend is just fine...  in fact, she should get less because she has a TV!)

Title: Re: Incomes Collapsing in the US
Post by: cybercoma on February 14, 2017, 03:02:46 pm
That's why I say "somewhat." We can debate if it's enough, but the government does provide something, as opposed to the early 20th century and prior when they provided literally nothing.
Title: Re: Incomes Collapsing in the US
Post by: Blueblood on February 14, 2017, 04:37:28 pm
Agreed.  It's a very short-sighted view of poverty.  If they can afford a TV, then they aren't poor has to be one of the dumbest arguments for cutting services to poor people that I've ever heard.

This I disagree with.
My friend gets $1000 per month (same $$ as welfare).

She is supposed to provide her own housing
Provide her own food
Fight tooth and nail with the government to provide her the necessary medical treatments, which often go uncovered, or take months to get. 
And then use all the leftover money for her heating bill, electricity, TV, phone, etc.

She has friends who buy her groceries, and other things, otherwise she would be scrounging the expired crap from the food bank.  The government doesn't provide her with a level of income even close to what she actually needs.  And they rely on voters not to notice, or not caring enough, to make it an issue.  (or those like Blueblood who think the situation with my friend is just fine...  in fact, she should get less because she has a TV!)

She gets a $1000 a month which is considerably more than others in other countries.  At the same time how much taxes should people be subsidizing her, 40%, 50%, 60%.  What sacrifices should families saving for their kids to go to university make?

Life sometimes isn't fair and she is fortunate enough to have a tv when truly poor people in other countries don't.  Unfortunately there isn't enough resources to have everyone living like upper middle class people off the backs of upper middle class people.  Unfortunately there is a limit.

The USA is in perpetual debt with the largest cost being social security.  The sad reality is, subsidizing poverty is unsustainable.
Title: Re: Incomes Collapsing in the US
Post by: Squidward von Squidderson on February 14, 2017, 04:49:55 pm
Quote
She gets a $1000 a month which is considerably more than others in other countries.

This has to be the stupidest reason not to help our own disabled citizens that I've ever heard.   ::)
Should we lower our standards to the levels of Ethiopia or Chad? 

Quote
At the same time how much taxes should people be subsidizing her, 40%, 50%, 60%.  What sacrifices should families saving for their kids to go to university make?

Whatever it takes to get people to be able to buy fresh food and afford medical expenses.  Cut the military.  Cut the gay pride parade.  Let your kids pay for school, like my friend did before she became disabled. 

Quote
Unfortunately there isn't enough resources to have everyone living like upper middle class people

A total red herring.  Now you're just making stuff up that I never said.  Nice try.
Title: Re: Incomes Collapsing in the US
Post by: JMT on February 14, 2017, 04:50:31 pm
Not 'subsidizing' poverty is also unsustainable.  Why do you think crime rates have fallen precipitously?
Title: Re: Incomes Collapsing in the US
Post by: cybercoma on February 14, 2017, 05:49:06 pm
Not 'subsidizing' poverty is also unsustainable.  Why do you think crime rates have fallen precipitously?
This is a good point. The social welfare systems in the west didn't come about out of some sort of benevolence. They came about because they got support from the upperclass trying to protect themselves from an increasingly angry and aggressive underclass. The alternative to a social welfare system is guillotines.
Title: Re: Incomes Collapsing in the US
Post by: TimG on February 14, 2017, 05:57:55 pm
Not 'subsidizing' poverty is also unsustainable.  Why do you think crime rates have fallen precipitously?
Because the population is aging and young men in their 20s make up a smaller percentage of the population. Support for poor people can never meet the demand because if government increased spending to meet current demand, demand would only go up as more people realize that government subsidies are preferable than working. The politicians demanding that we 'eliminate poverty' are selling snake oil because it can't be done.
Title: Re: Incomes Collapsing in the US
Post by: JMT on February 14, 2017, 07:19:50 pm
Because the population is aging and young men in their 20s make up a smaller percentage of the population. Support for poor people can never meet the demand because if government increased spending to meet current demand, demand would only go up as more people realize that government subsidies are preferable than working. The politicians demanding that we 'eliminate poverty' are selling snake oil because it can't be done.

You'd be surprised to know that I agree with your second point.  Your first point is flawed though.  Why do you think people are having less children overall today.  'Subsidizing' the poor has done amazing things for our society, even if I agree that there are far too many lazy capable men siting st home.
Title: Re: Incomes Collapsing in the US
Post by: TimG on February 14, 2017, 07:40:19 pm
Your first point is flawed though.  Why do you think people are having less children overall today.
The marginal economic cost of children is too large compared to the economic benefit they provide. I think we need programs to ensure people are not destitute but that should not be an excuse to ignore how human nature limits the practical size and scope of these programs.
Title: Re: Incomes Collapsing in the US
Post by: JMT on February 14, 2017, 09:06:08 pm
The marginal economic cost of children is too large compared to the economic benefit they provide. I think we need programs to ensure people are not destitute but that should not be an excuse to ignore how human nature limits the practical size and scope of these programs.

Like I said, I don't disagree overall.  I just don't think that it's right that letting people starve will make us better off.
Title: Re: Incomes Collapsing in the US
Post by: Blueblood on February 15, 2017, 01:09:46 am
This has to be the stupidest reason not to help our own disabled citizens that I've ever heard.   ::)
Should we lower our standards to the levels of Ethiopia or Chad? 

Whatever it takes to get people to be able to buy fresh food and afford medical expenses.  Cut the military.  Cut the gay pride parade.  Let your kids pay for school, like my friend did before she became disabled. 

A total red herring.  Now you're just making stuff up that I never said.  Nice try.

And how much are you willing to pay for it?  I don't think some people should be forced to pay over 50% of tax at gunpoint (which it essentially comes to). I'm saying the poor in Canada have it a lot better than other countries and they should be fortunate for even that.

There are charitable organizations that do a far better job of allocating funds than government.

Can't cut the military as we have commitments and it helps ensure sovereignty as well there are times it's needed.  Security first.  I would rather be able to pay for my kids to go to school than be soaked at tax time. 

The USA tried declaring war on poverty and it has been an abject failure.
Title: Re: Incomes Collapsing in the US
Post by: Blueblood on February 15, 2017, 01:13:35 am
Not 'subsidizing' poverty is also unsustainable.  Why do you think crime rates have fallen precipitously?

Crime rates fall due to an increase in the economy, innovation, and people getting older. 

Crim rates are high where the poor are.  How much should poverty be subsidized.  As someone from waterhen you know full well that flooding the poor with free money does nothing to help their situation.

Title: Re: Incomes Collapsing in the US
Post by: JMT on February 15, 2017, 09:00:18 am
Crime rates fall due to an increase in the economy, innovation, and people getting older. 

And why do you think that people live longer?  Do you think that funding their survival might have something to do with it?
Title: Re: Incomes Collapsing in the US
Post by: Blueblood on February 15, 2017, 12:18:33 pm
And why do you think that people live longer?  Do you think that funding their survival might have something to do with it?

Private industry has been much more effective at finding survival and increasing standard of living than centralized government.  Our poor here have a better standard of living than other places which leads me to believe poor is subjective. 
Title: Re: Incomes Collapsing in the US
Post by: JMT on February 15, 2017, 02:20:33 pm
Private industry has been much more effective at finding survival and increasing standard of living than centralized government.  Our poor here have a better standard of living than other places which leads me to believe poor is subjective.

That's a false contrast.  Our standard of living increased in an environment of private industry with heavy government influence and regulation.
Title: Re: Incomes Collapsing in the US
Post by: SirJohn on February 15, 2017, 02:47:27 pm
I think we can at least agree that not everybody's getting richer and not everybody should be happy to see the rich getting richer while half the country is making less (in real income) than they were 20 years ago.  I'd be interested to see equivalent statistics for Canada... my hunch is that it's not much different here.

I don't have those statistics, but it is noteworthy that according to the Paliamentary Budget officer income inequality in Canada also rose until about 2006, and has been falling since then.

Regardless of what measure of income you use (market, total or after-tax) or which threshold you use (top 10 per cent, five per cent, one per cent, 0.1 per cent, 0.01 per cent) you get the same answer: top-end income shares peaked in 2006 and have been declining since then.

http://news.nationalpost.com/full-comment/stephen-gordon-despite-what-the-attack-ads-say-incomes-at-the-very-top-have-fallen-since-harper-took-power (http://news.nationalpost.com/full-comment/stephen-gordon-despite-what-the-attack-ads-say-incomes-at-the-very-top-have-fallen-since-harper-took-power)

Mr. Stanford and Mr. Brennan rank the Harper government second-last on income inequality, based on the average share of income held by the top 1 per cent of Canadians between 2006 and 2012. But Statistics Canada reported that the top 1 per cent’s share peaked at 12.1 per cent in 2006, the year Mr. Harper took office, and declined thereafter to reach 10.3 per cent in 2012.

http://www.theglobeandmail.com/report-on-business/rob-commentary/judge-harpers-economic-record-by-the-hand-he-was-dealt/article25867267/ (http://www.theglobeandmail.com/report-on-business/rob-commentary/judge-harpers-economic-record-by-the-hand-he-was-dealt/article25867267/)

Title: Re: Incomes Collapsing in the US
Post by: Blueblood on February 15, 2017, 07:47:33 pm
That's a false contrast.  Our standard of living increased in an environment of private industry with heavy government influence and regulation.

It's not a false contrast.  Our standard of living would be more so without govt influence and regulation.
Title: Re: Incomes Collapsing in the US
Post by: cybercoma on February 15, 2017, 07:53:56 pm
I don't have those statistics, but it is noteworthy that according to the Paliamentary Budget officer income inequality in Canada also rose until about 2006, and has been falling since then.

Regardless of what measure of income you use (market, total or after-tax) or which threshold you use (top 10 per cent, five per cent, one per cent, 0.1 per cent, 0.01 per cent) you get the same answer: top-end income shares peaked in 2006 and have been declining since then.

http://news.nationalpost.com/full-comment/stephen-gordon-despite-what-the-attack-ads-say-incomes-at-the-very-top-have-fallen-since-harper-took-power (http://news.nationalpost.com/full-comment/stephen-gordon-despite-what-the-attack-ads-say-incomes-at-the-very-top-have-fallen-since-harper-took-power)

Mr. Stanford and Mr. Brennan rank the Harper government second-last on income inequality, based on the average share of income held by the top 1 per cent of Canadians between 2006 and 2012. But Statistics Canada reported that the top 1 per cent’s share peaked at 12.1 per cent in 2006, the year Mr. Harper took office, and declined thereafter to reach 10.3 per cent in 2012.

http://www.theglobeandmail.com/report-on-business/rob-commentary/judge-harpers-economic-record-by-the-hand-he-was-dealt/article25867267/ (http://www.theglobeandmail.com/report-on-business/rob-commentary/judge-harpers-economic-record-by-the-hand-he-was-dealt/article25867267/)


Just to help visualize that "collapse"

(https://canadianpoliticalevents.createaforum.com/proxy.php?request=http%3A%2F%2Fwww.macleans.ca%2Fwp-content%2Fuploads%2F2014%2F11%2Ffractiles_total_2012.png&hash=12f3794aa0a3355d71cd5ef92e242ae14cae86c3)

(https://canadianpoliticalevents.createaforum.com/proxy.php?request=http%3A%2F%2Fwww.macleans.ca%2Fwp-content%2Fuploads%2F2014%2F11%2Fmilligan_canusa1.png&hash=c993c9f1d717b795ac6fe17c98184308237dee0c)
Title: Re: Incomes Collapsing in the US
Post by: JMT on February 15, 2017, 08:22:20 pm
It's not a false contrast.  Our standard of living would be more so without govt influence and regulation.

That's not a provable assertion.  It also doesn't seem to jive with things that have actually happened.  Government regulation and by extension the 'welfare state' isn't something that has hampered our progress.
Title: Re: Incomes Collapsing in the US
Post by: Blueblood on February 15, 2017, 10:33:13 pm
That's not a provable assertion.  It also doesn't seem to jive with things that have actually happened.  Government regulation and by extension the 'welfare state' isn't something that has hampered our progress.

Compared to growth during the gilded age I would say that's up for debate.  Ireland has a low corporate tax and has grown rapidly and on top of that the USA is planning an overhaul on taxes to Jump start growth.
Title: Re: Incomes Collapsing in the US
Post by: JMT on February 16, 2017, 08:17:50 am
Compared to growth during the gilded age I would say that's up for debate.  Ireland has a low corporate tax and has grown rapidly and on top of that the USA is planning an overhaul on taxes to Jump start growth.

Ireland also has significant government regulation and a cradle to grave welfare state.
Title: Re: Incomes Collapsing in the US
Post by: Blueblood on February 16, 2017, 11:43:26 am
Ireland also has significant government regulation and a cradle to grave welfare state.

Yet less than other countries due to its low corporate tax rate and growth reflected in that.

The Dow is up almost 2000 points based on confidence that regulations will be cut and taxes cut.  Growth is best achieved when government reverts as close to its main purpose which is to be a neutral arbiter in disputes and provide an environment that facilitates growth.
Title: Re: Incomes Collapsing in the US
Post by: JMT on February 16, 2017, 01:29:08 pm
The Dow is up almost 2000 points based on confidence that regulations will be cut and taxes cut. 

The Dow has been on its way up for a while now.
Title: Re: Incomes Collapsing in the US
Post by: ?Impact on February 16, 2017, 04:27:17 pm
I don't have those statistics, but it is noteworthy that according to the Paliamentary Budget officer income inequality in Canada also rose until about 2006, and has been falling since then.


Let me help you by giving you the statistics from CANSIM 204-0002 (http://www5.statcan.gc.ca/cansim/a26?lang=eng&id=2040002), and the top 1%.

2006: $188,500
2014: $227,100

Unfortunately your allegation is not supported by the facts. There was a slight drop in 2009 from $202,600 to $198,000 but that was quickly made up and soared ever since.
Title: Re: Incomes Collapsing in the US
Post by: SirJohn on February 17, 2017, 06:01:46 pm

Let me help you by giving you the statistics from CANSIM 204-0002 (http://www5.statcan.gc.ca/cansim/a26), and the top 1%.

2006: $188,500
2014: $227,100

Unfortunately your allegation is not supported by the facts. There was a slight drop in 2009 from $202,600 to $198,000 but that was quickly made up and soared ever since.

My 'allegation' was accompanied by documented fact. Yours not so much.
Title: Re: Incomes Collapsing in the US
Post by: cybercoma on February 17, 2017, 06:02:50 pm
Statistics Canada data isn't a documented fact?
Title: Re: Incomes Collapsing in the US
Post by: SirJohn on February 17, 2017, 06:10:38 pm
Statistics Canada data isn't a documented fact?

A. His link doesn't work.
B. Stating, in isolation, that the average income of the top 1% had increased between 2006-2014 is largely irrelevant to the discussion.
Title: Re: Incomes Collapsing in the US
Post by: ?Impact on February 17, 2017, 10:43:10 pm
My 'allegation' was accompanied by documented fact. Yours not so much.

I don't think you can get a better documented fact than Statistics Canada in this country. Sorry the link didn't work, hopefully it is fixed now. A very simple google search on the CANSIM table I referenced would have taken you to it. I don't understand why you think it is irrelevant to the discussion, when you yourself introduced that topic: Regardless of what measure of income you use (market, total or after-tax) or which threshold you use (top 10 per cent, five per cent, one per cent, 0.1 per cent, 0.01 per cent) you get the same answer: top-end income shares peaked in 2006 and have been declining since then.


I picked one of the measures you suggested (total, 1%) and saw that it in fact did not peak in 2006 but continued to increase yearly with the exception of 2009 where it decreased only marginally and then started to soar back up.
Title: Re: Incomes Collapsing in the US
Post by: SirJohn on February 18, 2017, 11:19:48 am
I picked one of the measures you suggested (total, 1%) and saw that it in fact did not peak in 2006 but continued to increase yearly with the exception of 2009 where it decreased only marginally and then started to soar back up.

It said 'top end income shares' not 'total top end income'. You provided a figure which shows the total average income has increased over time but that in no way contradicts the statement that the share of the total income taken in by the 1% has fallen as compared to the whole.
Title: Re: Incomes Collapsing in the US
Post by: ?Impact on February 18, 2017, 11:37:49 am
It said 'top end income shares' not 'total top end income'. You provided a figure which shows the total average income has increased over time but that in no way contradicts the statement that the share of the total income taken in by the 1% has fallen as compared to the whole.

I see you are implying that unless the top 1% are taking more and more of the pie then something is wrong with the world. There is no opportunity to improve the lot of the rest.
Title: Re: Incomes Collapsing in the US
Post by: SirJohn on February 18, 2017, 11:46:21 am
I see you are implying that unless the top 1% are taking more and more of the pie then something is wrong with the world. There is no opportunity to improve the lot of the rest.

Uhm no. I'm saying that in a discussion on income inequality you need a comparison point. According to the information I and Cybercoma posted the share of total incomes the 1% have been taking has fallen (in Canada), not risen, in the last ten years.
Title: Re: Incomes Collapsing in the US
Post by: Blueblood on February 19, 2017, 10:11:45 am
I see you are implying that unless the top 1% are taking more and more of the pie then something is wrong with the world. There is no opportunity to improve the lot of the rest.

The pie also gets bigger...
Title: Re: Incomes Collapsing in the US
Post by: ?Impact on February 19, 2017, 10:22:29 am
The pie also gets bigger...

Yes, but to put in in context. Between 2006-2014, the top 1% increased their own income by more than the median income, and over 80% of the average income of everyone. You could say that while the guy at the bottom got a cherry on top of his slice, the 1% got another whole pie.
Title: Re: Incomes Collapsing in the US
Post by: Blueblood on February 19, 2017, 12:06:19 pm
Yes, but to put in in context. Between 2006-2014, the top 1% increased their own income by more than the median income, and over 80% of the average income of everyone. You could say that while the guy at the bottom got a cherry on top of his slice, the 1% got another whole pie.

So the 1% makes money?  The poor still have their tvs, food, internet, and computers.  By all means put it in context, the poor in Canada have a better standard of living compared to others in the world.
Title: Re: Incomes Collapsing in the US
Post by: TimG on March 25, 2019, 01:44:12 pm
Fascinating chart:

(https://canadianpoliticalevents.createaforum.com/proxy.php?request=http%3A%2F%2Fwww.aei.org%2Fwp-content%2Fuploads%2F2019%2F03%2FMiddleClass_2017-1.png&hash=0440d05eb6d29c026011a93cf72f4895e37124b7)
Title: Re: Incomes Collapsing in the US
Post by: cybercoma on March 25, 2019, 04:19:34 pm
Nice again you miss the point. Wealth polarity is BAD. Your chart shows an increasing DISPARITY, which is tied to a decline in social cohesion that leads to all sorts of disastrous outcomes from poorer health across the board to more social problems like crime. That trend you’re showing is not a good thing.
Title: Re: Incomes Collapsing in the US
Post by: TimG on March 25, 2019, 04:33:56 pm
Nice again you miss the point. Wealth polarity is BAD. Your chart shows an increasing DISPARITY, which is tied to a decline in social cohesion that leads to all sorts of disastrous outcomes from poorer health across the board to more social problems like crime. That trend you’re showing is not a good thing.
The chart shows the number of people at the *bottom* declining too (37% to 29%) so your narrative fails. The data seems to show pretty clearly that american householders are getting richer on average. 

Most of the charts you see will fix the upper tier as a % of the population and then report all sorts stats based on that fixed percentage. But those analyses hide the fact that the dividing line between the middle and upper tiers is increasing in time so the middle is wealthier too. This chart illustrates how much that line has risen. It is fascinating how different presentations of the same data can be used to draw radically different conclusions.
Title: Re: Incomes Collapsing in the US
Post by: JMT on March 25, 2019, 05:16:41 pm
The chart shows the number of people at the *bottom* declining too (37% to 29%) so your narrative fails. The data seems to show pretty clearly that american householders are getting richer on average. 

Apparently you're responding to someone else, because that in no way addresses what he said.
Title: Re: Incomes Collapsing in the US
Post by: TimG on March 25, 2019, 05:27:13 pm
Apparently you're responding to someone else, because that in no way addresses what he said.
There is nothing in that chart that supports the notion that wealth polarity is increasing. If anything it shows that wealth is becoming more evening distributed as more and more of the middle class move into upper income levels.
Title: Re: Incomes Collapsing in the US
Post by: cybercoma on March 25, 2019, 05:47:01 pm
“Dreamed up” because the research shows this is disastrous and you don’t want to believe it. Nobody in their right mind, no one who researches these things for a living anyway, would look at those charts and see a net positive. You’re looking at a society that’s becoming more polarized. There’s nothing positive about that—the consequences I’ve linked to in past. Absolute wealth is not protective against the effective of relative inequality. That’s a fact.
Title: Re: Incomes Collapsing in the US
Post by: Queefer Sutherland on March 25, 2019, 05:47:09 pm
It does seem like more people are either well-off or poor.  Guess this helps explain it.

Less poor people and more people making more than 100k seems like a good thing.  But we can't ignore what cyber is saying.  What negatives are we finding from this?

Here's one - US life expectancy has dropped for 3 years in a row for the first time in 100 years:

https://www.npr.org/sections/health-shots/2017/03/23/521083335/the-forces-driving-middle-aged-white-peoples-deaths-of-despair
Title: Re: Incomes Collapsing in the US
Post by: TimG on March 25, 2019, 06:03:16 pm
Less poor people and more people making more than 100k seems like a good thing.  But we can't ignore what cyber is saying.  What negatives are we finding from this?
It is all about narrative. Cyber favours certain policies and only cares about statistics and studies that support his predetermined policy choices. I am more interested in understanding what is going on with all of the contradictions and complexity that are an inevitable part of the real world (note I made no editorial statement on what the chart might mean - only that it was interesting). In this case, people are getting wealthier and there are fewer poor people but the super wealthy are getting wealthier faster. Is that a problem? I am not convinced as long as the poor are getting wealthier but these things can become self-fulling prophesies. i.e. if you spend enough time telling people that the things that their lives are bad and getting worse the more they believe it even if the facts don't support it.
Title: Re: Incomes Collapsing in the US
Post by: eyeball on March 25, 2019, 07:38:15 pm
This concern over income equality needs to have a reality check.
I'd do that by pointing to the unequal access to power and influence that wealth enjoys.  The concern over unequal outcomes is seriously misplaced, and probably intentionally  - it only distracts from where inequality really impacts our society the hardest.

I've said it before and will continue saying it till I die, outlawing in-camera lobbying would be a huge equalizer.  Redistribute power, wealth will just naturally follow.
Title: Re: Incomes Collapsing in the US
Post by: Queefer Sutherland on March 25, 2019, 08:50:55 pm
I am not convinced as long as the poor are getting wealthier but these things can become self-fulling prophesies. i.e. if you spend enough time telling people that the things that their lives are bad and getting worse the more they believe it even if the facts don't support it.

Well even though more people are getting over 100k, and less under 35 k, what are things like for the people making under 100k?  What is the cost of living compared to 30 years ago?  Housing affordability etc?

Cyber is right in that your perceived standard of living/income etc and overall how you're doing in your life compared to others has a major factor on psychological well-being, so that goes to what you say, some of it being a self-fulfilling prophecy.  There seems to be a lot of sentiment that the game is rigged, with wealthy elites wielding so much power in politics and policy while the avg person is still grinding & it often seems things go against them, 2008 mortgage crisis is a good example.

My impression is, we've never had so much stuff, but people don't seem as happy.  People are stressed, depressed, more socially isolated etc. It's a different society than what our parents & grandparents had, both good and bad.
Title: Re: Incomes Collapsing in the US
Post by: Michael Hardner on March 25, 2019, 09:03:41 pm

My impression is, we've never had so much stuff, but people don't seem as happy.  People are stressed, depressed, more socially isolated etc. It's a different society than what our parents & grandparents had, both good and bad.

Yes... less security, less fraternity, more anxiety.
Title: Re: Incomes Collapsing in the US
Post by: TimG on March 25, 2019, 09:41:51 pm
Well even though more people are getting over 100k, and less under 35 k, what are things like for the people making under 100k?  What is the cost of living compared to 30 years ago?  Housing affordability etc?
The numbers are adjusted for inflation so those questions should not affect the results. Of course, there are some big ticket items that have risen faster than inflation which people are going to notice a lot more than big ticket items that have risen more slowly or dropped. Human perception is funny that way. We fixate on the bad things while not noticing the good.

There seems to be a lot of sentiment that the game is rigged, with wealthy elites wielding so much power in politics and policy while the avg person is still grinding & it often seems things go against them, 2008 mortgage crisis is a good example.
When has that not been true? There have always been economic upheavals and people always think the the game is rigged. At a certain level they are correct that wealth does buy privileges. OTOH, the elites have never been under more scrutiny and find it much harder to get away with stuff that would have normal in the past.

My impression is, we've never had so much stuff, but people don't seem as happy.  People are stressed, depressed, more socially isolated etc. It's a different society than what our parents & grandparents had, both good and bad.
Perhaps it is social media that keeps winding people up with one atrocious story or another. In the past, people lived their life with minimal knowledge of what was going on elsewhere and what they did get was filtered by the newspaper or tv broadcaster. Never before have people been so directly exposed to the raw sewage of humanity.  I see that a more plausible explanation than simple jealously of richer people.
Title: Re: Incomes Collapsing in the US
Post by: ?Impact on March 26, 2019, 01:59:26 pm
In the past, people lived their life with minimal knowledge of what was going on elsewhere and what they did get was filtered by the newspaper or tv broadcaster. Never before have people been so directly exposed to the raw sewage of humanity.  I see that a more plausible explanation than simple jealously of richer people.

I didn't walk a mile in his shoes, because I choose to pretend he was doing ok.
Title: Re: Incomes Collapsing in the US
Post by: Michael Hardner on March 26, 2019, 06:48:15 pm
OTOH, the elites have never been under more scrutiny and find it much harder to get away with stuff that would have normal in the past.

What ?  No.  Just no.  Maybe you *could* say - they are more entitled and are not going to stop demanding squeezing more money from the system until a revolution.  But... yeah... no. 
Title: Re: Incomes Collapsing in the US
Post by: TimG on March 26, 2019, 09:01:21 pm
they are more entitled and are not going to stop demanding squeezing more money from the system
Not much of an argument. There are entitled SOBs at every strata of society who can only talk about what is owed to them. There is nothing special about the elites in that respect. They are simply a reflection of the culture that created them. A revolution would just be one set of entitled SOBs looking to replace the existing entitled SOBs while they screw the rest of the population.
Title: Re: Incomes Collapsing in the US
Post by: Queefer Sutherland on March 26, 2019, 11:29:20 pm
Not much of an argument. There are entitled SOBs at every strata of society who can only talk about what is owed to them. There is nothing special about the elites in that respect. They are simply a reflection of the culture that created them. A revolution would just be one set of entitled SOBs looking to replace the existing entitled SOBs while they screw the rest of the population.

Maybe my point is off-topic, but IMO incomes aren't even the main issue workers are having.  I'll put it this way:  your average workers are like a hamster running in wheel, it's been like that for a very long time.  Hamster spins the wheel, the owner gives them cheese.  Mutually beneficial relationship.  The amount and quality of cheese has been getting better over the years, which is good, but the owners have been making the hamsters run faster and faster.  Also, the likelihood the owner throws the hamster off the wheel to find a faster, cheaper hamster has increased.

So are the hamsters better off now, or in prior years?

To add: beforehand more hamsters used to get roughly similar amounts of cheese, now there's more hamsters that either get a lot of cheese, or a small amount of cheese.
Title: Re: Incomes Collapsing in the US
Post by: TimG on March 27, 2019, 12:33:33 am
the owners have been making the hamsters run faster and faster.  Also, the likelihood the owner throws the hamster off the wheel to find a faster, cheaper hamster has increased.
What driving this is intense competition from the rest of the world. 50 years ago there were a huge range of jobs that could only be done in wealthy countries. Now workers in India and China can do almost anything a worker can do here for a fraction of the cost. The only way businesses here can stay in business is to increase productivity and this leads to much greater pressure on workers AND business owners. In fact, business owners are probably much more stressed than their workers because their life savings are tied up in an enterprise that could be wiped because Xi or Trump get their knickers in a knot. This is why it is a mistake to cast this as an us vs. them question.

So are the hamsters better off now, or in prior years?
When you look at the data it is hard to make the definitive claim that people are, on average, are worse off than in the past. Now people may perceive otherwise but then the question is why are we having this conversation? Are we discussing the facts of whether people are better off or not or are we looking for ways to deal with the fact that peoples perceptions can create a reality that has to be dealt with even if the perceptions are wrong?
Title: Re: Incomes Collapsing in the US
Post by: Michael Hardner on March 27, 2019, 05:30:16 am
What driving this is intense competition from the rest of the world. 50 years ago there were a huge range of jobs that could only be done in wealthy countries. Now workers in India and China can do almost anything a worker can do here for a fraction of the cost.

To point out: relative costs are highly variable and here's how wages have changed only in the last 12 years.

(https://amp.businessinsider.com/images/52dff849ecad04e61952c533-750-505.jpg)

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When you look at the data it is hard to make the definitive claim that people are, on average, are worse off than in the past. Now people may perceive otherwise but then the question is why are we having this conversation? Are we discussing the facts of whether people are better off or not or are we looking for ways to deal with the fact that peoples perceptions can create a reality that has to be dealt with even if the perceptions are wrong?

I fully agree that you need to start with a purpose to the conversation when you're exploring complex issues.  I think the 'why' is tied to perceptions, as is the case with all politics.

But there are some new realities at the heart of this.  For example:

- it seems much harder for uneducated people to get a decent wage than 20, 40, 60 years ago
- trickle-down has resulted in a much better tax situation for the wealthy, as government services are cut
- housing costs are much higher, due at least in part to foreign investment & immigration
- public trust is lower

Most of these are more American things than Canadian but they affect us also.
Title: Re: Incomes Collapsing in the US
Post by: Michael Hardner on March 27, 2019, 06:08:05 am
More on the housing situation: the government is invested in keeping house prices as high as possible, which appears to be adding to a generational rift.  Boomers are counting on their home values increasing to help with retirement...
Title: Re: Incomes Collapsing in the US
Post by: eyeball on March 29, 2019, 03:12:38 pm
More on the housing situation: the government is invested in keeping house prices as high as possible, which appears to be adding to a generational rift.  Boomers are counting on their home values increasing to help with retirement...
How many of these retiring boomers also wish to reduce the numbers of immigrants to Canada?  Judging by the number of free homes available in Japan's immigrant-free economy these particular boomers should think very careful about what they wish for.
Title: Re: Incomes Collapsing in the US
Post by: Michael Hardner on March 30, 2019, 09:01:24 am
How many of these retiring boomers also wish to reduce the numbers of immigrants to Canada?  Judging by the number of free homes available in Japan's immigrant-free economy these particular boomers should think very careful about what they wish for.

A lot of them seem to, yes.
Title: Re: Incomes Collapsing in the US
Post by: guest18 on March 30, 2019, 09:52:17 am
Anecdotally,  my dad quit school at 15, bought a house for $6k (WWII soldier peacetime housing discount), a cottage at the beach for $600 (yes, really), and raised four kids on his income that was about $5k a year for years and years. He was pretty frugal though and saved his money when interest rates were high and wound up with the $250k house, $150k cottage and had over $100k in the bank in cash when he died.
But he never paid a cell phone bill in his life.
Title: Re: Incomes Collapsing in the US
Post by: Michael Hardner on March 30, 2019, 12:27:13 pm
Anecdotally,  my dad quit school at 15, bought a house for $6k (WWII soldier peacetime housing discount), a cottage at the beach for $600 (yes, really), and raised four kids on his income that was about $5k a year for years and years. He was pretty frugal though and saved his money when interest rates were high and wound up with the $250k house, $150k cottage and had over $100k in the bank in cash when he died.
But he never paid a cell phone in his life.

So - a lot of left-side Facebook posts do decry the loss of lifestyle to working people since the 1940s-50s-60s.  It's a tough one.  I think that should be a separate thread because it's pretty rich.

https://canadianpoliticalevents.createaforum.com/canada-discussion-forum/economic-status-of-working-people-in-decline-or-no/msg44136/?topicseen#msg44136
Title: Re: Incomes Collapsing in the US
Post by: wilber on March 30, 2019, 12:55:45 pm
More on the housing situation: the government is invested in keeping house prices as high as possible, which appears to be adding to a generational rift.  Boomers are counting on their home values increasing to help with retirement...

Those Boomers better get out pretty quick because I think it is going to be a buyer's market for some time.
Title: Re: Incomes Collapsing in the US
Post by: TimG on March 30, 2019, 02:07:58 pm
Those Boomers better get out pretty quick because I think it is going to be a buyer's market for some time.
Not with 300K-400K immigrants per year moving into Canada's big cities.
Title: Re: Incomes Collapsing in the US
Post by: Michael Hardner on March 30, 2019, 02:27:26 pm
Not with 300K-400K immigrants per year moving into Canada's big cities.

Scheer's base really thinks he's going to be cutting immigration.  Why the rural Canadian types give a **** is beyond me but...
Title: Re: Incomes Collapsing in the US
Post by: Queefer Sutherland on March 30, 2019, 06:39:13 pm
What driving this is intense competition from the rest of the world. 50 years ago there were a huge range of jobs that could only be done in wealthy countries. Now workers in India and China can do almost anything a worker can do here for a fraction of the cost. The only way businesses here can stay in business is to increase productivity and this leads to much greater pressure on workers AND business owners.

This doesn't explain it all though.  There's lots of companies and industries caught up in "making the hamster run faster and longer" that aren't in competition with foreign markets and can't offshore labour.

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When you look at the data it is hard to make the definitive claim that people are, on average, are worse off than in the past.

The only data we have in this thread is that there's less people maker lower incomes and more people making over 100k.  People being better off or worse has a lot of variables.  We need data on: how has output per worker changed?  Changes in hours per week worked, especially for those on salary?  How have work benefits changed?  Pensions?  How has job security changed?

Also, what are the psychological effects of families working off 2 incomes vs 1 income as in past?  What are the sociological and psychological effects for all involved re: the vast increase in single parents?  Or the vast increases in divorce rates?  Or the delay in adults having children, or not having kids at all?  Or children living with their parents for much longer than before?

Psychological diseases like depression and anxiety seem to be booming, why?
Title: Re: Incomes Collapsing in the US
Post by: Michael Hardner on March 30, 2019, 08:10:22 pm
This doesn't explain it all though.  There's lots of companies and industries caught up in "making the hamster run faster and longer" that aren't in competition with foreign markets and can't offshore labour.

We're talking about manufacturing here.  The labour market for services is similarly diluted.

Quote

The only data we have in this thread is that there's less people maker lower incomes and more people making over 100k.  People being better off or worse has a lot of variables.  We need data on: how has output per worker changed?  Changes in hours per week worked, especially for those on salary?  How have work benefits changed?  Pensions?  How has job security changed?

Why do you want those answers ?  To determine how productive workers are, or how well off they are or...

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Also, what are the psychological effects of families working off 2 incomes vs 1 income as in past?  What are the sociological and psychological effects for all involved re: the vast increase in single parents?  Or the vast increases in divorce rates?  Or the delay in adults having children, or not having kids at all?  Or children living with their parents for much longer than before?

Psychological diseases like depression and anxiety seem to be booming, why?

Are they though ?  Or are things being recognized more than in the past ?  I can't imagine anyone in the 1930s getting "stress leave".
Title: Re: Incomes Collapsing in the US
Post by: Queefer Sutherland on March 30, 2019, 11:03:51 pm
Why do you want those answers ?  To determine how productive workers are, or how well off they are or...

How well off.

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Are they though ?  Or are things being recognized more than in the past ?  I can't imagine anyone in the 1930s getting "stress leave".

I have no idea.  30's and 40's were very stressful times.  I'm talking post-WWII.
Title: Re: Incomes Collapsing in the US
Post by: Michael Hardner on March 31, 2019, 06:59:44 am
How well off.


Ok.  And I think someone objectively trying to find out such things would ask these questions.  My comments, specifically.

"how has output per worker changed?"

That shouldn't have much to do with how well-off workers are.  A higher number doesn't mean they are working harder.  Indeed, I might add some things here that you didn't: injuries in the workplace, what is acceptable as 'sick', eg. depression and mental health and so on.  Also what constitutes harassment and fair treatment.  (I assume you're looking at workplace conditions with that stat, output per worker)

" Changes in hours per week worked, especially for those on salary?  How have work benefits changed?  Pensions?  How has job security changed?"

Those are all related, and likely have gone worse for workers, although I think the last two are the most impactful.

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I have no idea.  30's and 40's were very stressful times.  I'm talking post-WWII.

Some things about them were a lot better than in the past, though.  But ok - we're acknowledging that 'progress' is a thing.  That's not a small deal.  Some will tell you that the masses have no right to expect improvement in their lot over time. 
Title: Re: Incomes Collapsing in the US
Post by: TimG on March 31, 2019, 07:47:52 am
Are they though ?  Or are things being recognized more than in the past ?  I can't imagine anyone in the 1930s getting "stress leave".
Some things to consider:

1) Drug companies have a financial incentive to turn normal human ups and downs into disorders that can be treated with drugs;
2) Psychologists have a financial incentive to assign a label to their patients so their fees will be covered by insurance;
3) Struggling people unconsciously like having a label so they can blame the label and not themselves for their problems.

In short, I doubt people were mentally better off in the past. We just have a society that loves labels.
Title: Re: Incomes Collapsing in the US
Post by: TimG on March 31, 2019, 08:00:16 am
" Changes in hours per week worked, especially for those on salary?  How have work benefits changed?  Pensions?  How has job security changed?"

Those are all related, and likely have gone worse for workers, although I think the last two are the most impactful.
I think you need to broaden your comparison from the mythical 50s and 60s. If you go back in time to 20s-30s workers were much worse off than today. The 50s and 60s were a unique time where North America benefited from the consequences of wars that were fought elsewhere. That made the US in particular the only place where many goods could be manufactured. On top of that, the population pressures we have today did not exist. This myth started to break down by the 70s with the oil crisis and with the rise of the global economy we wealth being distributed more fairly around the world at the expense of the lowest tier of workers in wealthy societies.

Lastly: as much as people complain about the rat race today how many would actually want to live in the 50s-60s with the racism, sexism and other social problems which we are managing better today.



 
Title: Re: Incomes Collapsing in the US
Post by: Michael Hardner on March 31, 2019, 08:56:40 am
Some things to consider:

1) Drug companies have a financial incentive to turn normal human ups and downs into disorders that can be treated with drugs;
2) Psychologists have a financial incentive to assign a label to their patients so their fees will be covered by insurance;
3) Struggling people unconsciously like having a label so they can blame the label and not themselves for their problems.

In short, I doubt people were mentally better off in the past. We just have a society that loves labels.

I don't think people were better off mentally.  But I think there's a spectrum of disorders that we live with, and not enough of them were recognized. 


I don't accept "grin and bear it" as a prescription for getting through life, especially when it's given by people who have fewer problems.  But I also respect the idea that getting help for problems also means helping yourself and making the tough choice to deal with those problems.
Title: Re: Incomes Collapsing in the US
Post by: Michael Hardner on March 31, 2019, 09:00:34 am
I think you need to broaden your comparison from the mythical 50s and 60s. If you go back in time to 20s-30s workers were much worse off than today. The 50s and 60s were a unique time where North America benefited from the consequences of wars that were fought elsewhere.

I think we have been saying exactly that.

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That made the US in particular the only place where many goods could be manufactured. On top of that, the population pressures we have today did not exist.

I don't know what 'population pressures' means.  More people isn't usually a problem - being unable to manage growth is the problem.  This to me is evidenced by people saying Canada, or Toronto have 'too many people' but they have less than America, New York, etc.

 
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Lastly: as much as people complain about the rat race today how many would actually want to live in the 50s-60s with the racism, sexism and other social problems which we are managing better today.

I forgot to mention that, and it's something that especially young Liberals don't understand.  There was no 'freedom' to date who you wanted, to say what you wanted, even to dress as you wanted.  There were no groups of like-minded people for you to fraternize with.

That's part of the balkanization of the political landscape, come to think of it: liberals and conservative groups connecting online.
Title: Re: Incomes Collapsing in the US
Post by: TimG on March 31, 2019, 12:31:10 pm
I don't know what 'population pressures' means.  More people isn't usually a problem - being unable to manage growth is the problem.  This to me is evidenced by people saying Canada, or Toronto have 'too many people' but they have less than America, New York, etc.
"Managing growth" means pushing people into higher density housing which then leads to complaints about how the standard of living is dropping because only the very rich can buy single family homes when in the past anyone with a job could do it. The cause of this particular problem is population growth - not globalization or outsourcing or automation.
Title: Re: Incomes Collapsing in the US
Post by: TimG on March 31, 2019, 12:36:20 pm
I don't accept "grin and bear it" as a prescription for getting through life, especially when it's given by people who have fewer problems.  But I also respect the idea that getting help for problems also means helping yourself and making the tough choice to deal with those problems.
The trouble is this idea is taken to absurd extremes where people use the label an excuse to not address the root causes of the problem but instead use it as stick to pressure other people to excuse their failures to adhere to accepted norms. The plague of "emotional support animals" in places where they don't belong is a good example.
Title: Re: Incomes Collapsing in the US
Post by: ?Impact on March 31, 2019, 02:59:45 pm
I think you need to broaden your comparison from the mythical 50s and 60s. If you go back in time to 20s-30s workers were much worse off than today. The 50s and 60s were a unique time where North America benefited from the consequences of wars that were fought elsewhere.

There was nothing mythical about the 50s and 60s.

Yes, North America benefited but so did the Soviet Union, Western Europe and East Asian countries. Germany, Austria, France, Italy, and even Greece did very well during that time. Japan and South Korea both experienced massive economic expansion.
Title: Re: Incomes Collapsing in the US
Post by: TimG on March 31, 2019, 03:10:01 pm
Yes, North America benefited but so did the Soviet Union, Western Europe and East Asian countries. Germany, Austria, France, Italy, and even Greece did very well during that time. Japan and South Korea both experienced massive economic expansion.
You won't find people in those countries nostalgic about the so called "golden age" of 50s/60s. (aside: adding South Korea to the list is bizarre given the war that was going on there at the time). In fact, Japan's emergence in the 70s and 80s as a threat to the US automakers was beginning of the necessary correction to the imbalances created by the war.
Title: Re: Incomes Collapsing in the US
Post by: Michael Hardner on March 31, 2019, 04:10:11 pm
The cause of this particular problem is population growth - not globalization or outsourcing or automation.

Yes, I said that... Managing growth.
Title: Re: Incomes Collapsing in the US
Post by: Michael Hardner on May 03, 2019, 07:20:06 am
Ah ... Incomes are finally coming up.  The NYT claims to have discovered why.

https://www.nytimes.com/2019/05/02/business/economy/wage-growth-economy.html
Title: Re: Incomes Collapsing in the US
Post by: Michael Hardner on May 03, 2019, 08:51:57 pm
TLDR; it's about those who weren't counted as unemployed finally finding work and there being an actual shortage of labour now.

Fill your boots, folks.  If you make $20/hr or $40K a year, you are now getting $400/year or roughtly $8/week extra above inflation but before taxes.

Title: Re: Incomes Collapsing in the US
Post by: TimG on May 03, 2019, 09:13:37 pm
The labour force participation rate has been a concern since it started to drop off since 2008:
https://tradingeconomics.com/united-states/labor-force-participation-rate

Back when Obama was around right wingers were using to it to dis Obama's record (yes including me ;-).
It is interesting how the number has stayed at historical lows through out Trumps tenure.
I would have expected it to pick up.

I think it is a good argument to say that the real unemployment rate is:
 the official rate + the labour force participation rate differential.

Title: Re: Incomes Collapsing in the US
Post by: Michael Hardner on May 04, 2019, 06:28:41 am
I double believe it is as bad as this graph says.  The fluctuations ar also only within a one percent band
Title: Re: Incomes Collapsing in the US
Post by: TimG on May 04, 2019, 07:11:59 am
I double believe it is as bad as this graph says.  The fluctuations ar also only within a one percent band
Not sure you are reading the graph right. You need to change the time scale to 10+ years to see my point. If the participation rate was the same as it was for the 30 years from 1980-2010 then the unemployment rate today would be doubled. That makes the participation rate an extremely significant factor that is generally ignored.
Title: Re: Incomes Collapsing in the US
Post by: Michael Hardner on May 04, 2019, 08:58:46 am
Sorry I meant to say that I DON'T believe it.  How could it still be so low?
Title: Re: Incomes Collapsing in the US
Post by: TimG on May 04, 2019, 10:52:33 am
Sorry I meant to say that I DON'T believe it.  How could it still be so low?
The data is from the US dept of statistics. I don't see any reason to question it. It is no less reliable than the unemployment numbers themselves.

As for the reason: the best theory I have heard is unskilled people losing their job late in life retire early and make do with government support programs and possibly a spouse that is still working.