A long, steep drop for Americans' standard of living

[mskafka]

America is in decline because our government for decades has refused to make the responsible choices they need to make. Of course, they've dodged this responsibility because the American people themselves have refused to adapt to a changing world. Our energy policies, labor policies, education system, environmental policies, regulatory environment, welfare policies, and tax policies have all contributed to this.

1. An interesting historical anomaly is the period 1945 through 1965, a golden age in many ways. This was the period after the war, when any of our potential competitors were rebuilding from the devastation, making it impossible for the United States economy not to thrive. Beneficiaries included the unions and blue collar high school graduates…who were assured of high paying jobs. That is no longer true, and probably won’t be again, short of a third World War.
H.W. Brands ,“American Colossus: The Triumph of American Capitalism, 1865-1900.”

2. That being said, standard of living is a function of two factors: amount of education one has, and the amount of work one is willing to do.

Do you know the the unemployment rate for college educated?


"However, if one examines the August BLS jobs report closely, one finds something interesting -- the unemployment rate for college graduates (that is, those holding at least a Bachelor’s degree) is only 4.3 percent. Moreover, this figure has slowly declined from 5.0 percent in August 2010.

Or, to put it another way, more than 95 percent of college graduates in the Unites States are working – in the aftermath of one of the worst recessions in living memory."
Institute for Economic Competitiveness | Despite Unemployment Worries, 95% of U.S. College Grads Have Jobs

For September, 2011, it is down to 4.2.


So, in the words of that great intellectual, Flavor Flav, 'Don't Believe the Hype."

I'm pretty sure that you have the data for the unemployed college educated from somewhere. I'm curious. What is it? And does it take into account what the individuals majored in?

 

[Care4all]

...The average American has $1,315 less in annual disposable income now than at the onset of the Great Recession...

Well, sort of. These are the numbers the wonk is talking about:

FRED Graph Observations
Federal Reserve Economic Data
Link: Federal Reserve Economic Data - FRED - St. Louis Fed
Help: Help and FAQs - FRED - St. Louis Fed
Economic Research Division
Federal Reserve Bank of St. Louis

2007-01 $32,651 ___ 2008-01 $33,140 ___ 2009-01 $32,785 ___ 2010-01 $32,057 ___ 2011-01 $32,666
2007-02 $32,683 ___ 2008-02 $33,220 ___ 2009-02 $32,365 ___ 2010-02 $32,084 ___ 2011-02 $32,678
2007-03 $32,730 ___ 2008-03 $33,248 ___ 2009-03 $32,251 ___ 2010-03 $32,157 ___ 2011-03 $32,668
2007-04 $32,710 ___ 2008-04 $33,054 ___ 2009-04 $32,348 ___ 2010-04 $32,345 ___ 2011-04 $32,648
2007-05 $32,663 ___ 2008-05 $34,609 ___ 2009-05 $32,768 ___ 2010-05 $32,508 ___ 2011-05 $32,636
2007-06 $32,608 ___ 2008-06 $33,716 ___ 2009-06 $32,155 ___ 2010-06 $32,568 ___ 2011-06 $32,700
2007-07 $32,656 ___ 2008-07 $33,163 ___ 2009-07 $31,980 ___ 2010-07 $32,563 ___ 2011-07 $32,598
2007-08 $32,675 ___ 2008-08 $32,867 ___ 2009-08 $31,868 ___ 2010-08 $32,628 ___ 2011-08 $32,479
2007-09 $32,779 ___ 2008-09 $32,802 ___ 2009-09 $31,854 ___ 2010-09 $32,552
2007-10 $32,778 ___ 2008-10 $32,820 ___ 2009-10 $31,680 ___ 2010-10 $32,620
2007-11 $32,748 ___ 2008-11 $32,964 ___ 2009-11 $31,750 ___ 2010-11 $32,604
2007-12 $32,877 ___ 2008-12 $32,763 ___ 2009-12 $31,916 ___ 2010-12 $32,660

Percapita disposable income is America's total private income divided by the entire population. We can truthfully say that average income dropped $1,315 ($32,479 from $33,794?), and we can also say that right now the average family of four has an income of $129,916.

Hmmm, we can also say that since Obama took office that the average income for a family of four has increased $912.

OK class, what's wrong with this whole line of thinking?

what's wrong is using average income vs median income.

 

[Samson]

American workers competing with cheap foreign labor will have a definite effect on our overall standard of living.

\And not in a positive way.

Apparently you don't appreciate HD flatscreen TV, or the internet, or your keyboard, or your computer, or your clothes.

Cheap imported goods are the only thing that keeps the standard of living from falling lower.

The major cause of the decline in standard of living is the increasing cost of gasoline and diesel.

 

[uscitizen]

Yes. Now that I can no longer afford those gorgeous shoes at the top...my life is over!

Seriously, yeah, I feel it. Most of my money now goes toward food and gas. Considering letting go of the cell phone, cable, internet, etc.., because I would much rather be able to go hiking, climbing, or kayaking than be able to receive obscene jokes on my phone, while standing in line at the local Kroger.

It's going to come down to necessities and priorities.

Great article.

I think for most people thats how it is now, after you pay for the rent/mortage, bills, food etc there is barely anything left over for the little extras, barely anyone takes vacations anymore except the rich and upper class, we are barely staying afloat.

Why do you think NV has one of the highest unemployment rates?
The state relies heavially on disposable income.

 

[expat_panama]

...Percapita disposable income is America's total private income divided by the entire population. We can truthfully say that average income dropped $1,315 ($32,479 from $33,794?), and we can also say that right now the average family of four has an income of $129,916.

Hmmm, we can also say that since Obama took office that the average income for a family of four has increased $912...

what's wrong is using average income vs median income.

Using average income isn't the problem. What's goofy here is saying that--

...The average American has $1,315 less in annual disposable income now than at the onset of the Great Recession...

--without also admitting that they mean the average American man, woman, child, unemployed, and retired person has an income of $32,479 per year which is only 1% below the pre-recession income of $32,778.

Back on the Planet Earth you and I know a child, unemployed, or retired person would have an income less than that, so there must be some really high income hot-shots that have been bringing the average up.

Bottom line here is the article's a crock.

 

[uscitizen]

The stats look even worse if you go by average wage.

 

[Brutus]

Think life is not as good as it used to be,

Yes, we are in a great recession. Its been in all the papers!

Whats important to know is that liberalism caused it with idiotic regulations and that we must get rid of liberalism to have economic growth and high employment again.

 

[rdean]

It started in the 70's. It accelerates any time Republicans hold office. Their policies are designed to help the rich and redistribute the wealth from the middle class to the top. It's who they are. They don't even really try to hide it.

 

[expat_panama]

...Ya' thinkin' that CSMonitor has an agenda?

Probably, and my guess it's to sound impressive without going to all the work of actually thinking. Judging by posters responses the CSM succeeded with a lot of people here.

 

[Care4all]

...Percapita disposable income is America's total private income divided by the entire population. We can truthfully say that average income dropped $1,315 ($32,479 from $33,794?), and we can also say that right now the average family of four has an income of $129,916.

Hmmm, we can also say that since Obama took office that the average income for a family of four has increased $912...

what's wrong is using average income vs median income.

Using average income isn't the problem. What's goofy here is saying that--

...The average American has $1,315 less in annual disposable income now than at the onset of the Great Recession...

--without also admitting that they mean the average American man, woman, child, unemployed, and retired person has an income of $32,479 per year which is only 1% below the pre-recession income of $32,778.

Back on the Planet Earth you and I know a child, unemployed, or retired person would have an income less than that, so there must be some really high income hot-shots that have been bringing the average up.

Bottom line here is the article's a crock.

yes, but this is why i said the problem was not using the median income......using a median household income vs an average, takes out the high earning and takes out the low earning....etc to get the median vs an average with takes everyone and divides it in to the total income.

 

[Samson]

The stats look even worse if you go by average wage.

"we can also say that right now the average family of four has an income of $129,916."



FUCK

 

[expat_panama]

The stats look even worse if you go by average wage.

That's true, because with the entire nation wages are just part of total incomes.

It's really amazing how the recession began in Dec. '07 with 4.7% unemployment, and even though unemployment's now doubled, our average incomes are still within 99% of what they were back then --even adjusting for inflation.

 

[BDBoop]

I think many more people are going to wind up like me, or my housemates (sharing their home so they can make ends meet).

It's a win/win for all of us. We get along well, especially since basically, I'm a hermit. We don't get in anybody's way.

We didn't think it would be long term, but as the economy continues to lag, I'll be here until at least next summer.

 

[expat_panama]

...this is why i said the problem was not using the median income......using a median household income vs an average, takes out the high earning and takes out the low earning....etc to get the median vs an average with takes everyone and divides it in to the total income.

They're all good tools, the problem is how they're used. The article's a crock because it just presented an average income drop to suggest we're all down $1,315 per year, and as we both know incomes are not distributed symetrically:

--but each tool has its own kind of distortion. Saying the median income is more typical is wrong too because it's still higher than the level most people earn, but it's way lower than what represents the nation's earning power.

My take is that talk about money is like money itself, to be used very very carefully...

 

[likeabird03]

The stats look even worse if you go by average wage.

That's true, because with the entire nation wages are just part of total incomes.

It's really amazing how the recession began in Dec. '07 with 4.7% unemployment, and even though unemployment's now doubled, our average incomes are still within 99% of what they were back then --even adjusting for inflation.

Because businesses don't usually do pay-cuts. They usually lay off workers. An extended period of high unemployment will continue to make wages fall behind inflation however. Why give raises in an economy where unemployment is 9%.

 

[likeabird03]

The whole situation really sucks. I'm saddened by it and I'm starting to not help but think that this whole situation we're in is an intentional act.

You people may find the below video interesting. It explains a lot of things very thoroughly.

[ame=http://www.youtube.com/watch?v=WSoq2whtbJY]American Cannibalism prequel - YouTube[/ame]

 

[expat_panama]

...the recession began in Dec. '07 with 4.7% unemployment, and even though unemployment's now doubled, our average incomes are still within 99% of what they were back then --even adjusting for inflation.

Because businesses don't usually do pay-cuts. They usually lay off workers. An extended period of high unemployment will continue to make wages fall behind inflation however. Why give raises in an economy where unemployment is 9%.

That's your guess. Before we guess again let's look and think more. We can see incomes are holding steady while employment has dropped--

--and since July '07 the number of employees has fallen 5% while average incomes has fallen just 1%.

Now we can guess that those still employed are making a lot more money because they get more done than those that couldn't hold a job. We can also guess that many are getting incomes from sources other than employment.

 

[High_Gravity]

I think many more people are going to wind up like me, or my housemates (sharing their home so they can make ends meet).

It's a win/win for all of us. We get along well, especially since basically, I'm a hermit. We don't get in anybody's way.

We didn't think it would be long term, but as the economy continues to lag, I'll be here until at least next summer.

Alot of single people or couples with no kids are already doing this in places like New York, Boston and Los Angeles because of the extremely high cost of living, married couples with kids will be hard pressed to find room mates because of lack of space and nobody will want to share a house with screaming crying rug rats and rude kids.

 

[Mr Natural]

...the recession began in Dec. '07 with 4.7% unemployment, and even though unemployment's now doubled, our average incomes are still within 99% of what they were back then --even adjusting for inflation.

Because businesses don't usually do pay-cuts. They usually lay off workers. An extended period of high unemployment will continue to make wages fall behind inflation however. Why give raises in an economy where unemployment is 9%.

That's your guess. Before we guess again let's look and think more. We can see incomes are holding steady while employment has dropped--

--and since July '07 the number of employees has fallen 5% while average incomes has fallen just 1%.

Now we can guess that those still employed are making a lot more money because they get more done than those that couldn't hold a job. We can also guess that many are getting incomes from sources other than employment.

No, they'll be making the same money just working a lot more hours for it.

 

[PoliticalChic]

America is in decline because our government for decades has refused to make the responsible choices they need to make. Of course, they've dodged this responsibility because the American people themselves have refused to adapt to a changing world. Our energy policies, labor policies, education system, environmental policies, regulatory environment, welfare policies, and tax policies have all contributed to this.

1. An interesting historical anomaly is the period 1945 through 1965, a golden age in many ways. This was the period after the war, when any of our potential competitors were rebuilding from the devastation, making it impossible for the United States economy not to thrive. Beneficiaries included the unions and blue collar high school graduates…who were assured of high paying jobs. That is no longer true, and probably won’t be again, short of a third World War.
H.W. Brands ,“American Colossus: The Triumph of American Capitalism, 1865-1900.”

2. That being said, standard of living is a function of two factors: amount of education one has, and the amount of work one is willing to do.

Do you know the the unemployment rate for college educated?


"However, if one examines the August BLS jobs report closely, one finds something interesting -- the unemployment rate for college graduates (that is, those holding at least a Bachelor’s degree) is only 4.3 percent. Moreover, this figure has slowly declined from 5.0 percent in August 2010.

Or, to put it another way, more than 95 percent of college graduates in the Unites States are working – in the aftermath of one of the worst recessions in living memory."
Institute for Economic Competitiveness | Despite Unemployment Worries, 95% of U.S. College Grads Have Jobs

For September, 2011, it is down to 4.2.


So, in the words of that great intellectual, Flavor Flav, 'Don't Believe the Hype."

I'm pretty sure that you have the data for the unemployed college educated from somewhere. I'm curious. What is it? And does it take into account what the individuals majored in?

1. "I'm pretty sure that you have the data for the unemployed college educated from somewhere. I'm curious. What is it?"
What are you asking here....?
...I'm pretty sure you can subtract 4.2% from 100%, which would tell that 95.8% of college grads are employed....
And that the 4.2% IS the " data for the unemployed college educated."
No?



2. "And does it take into account what the individuals majored in?"
Are you suggesting that a Physics or Computer Sci major stands a better chance of being employed that a "Bitter Women's Studies" or "Drum Majoretted" major.....
...well, Duh!