1947-1979 v 1980-now

[Toro]

Interesting chart. Thoughts, criticisms, comments?

http://www.nytimes.com/2011/09/04/o...llow-a-strengthening-of-the-middle-class.html

 

[jillian]

it explains the increasingly large gap between the haves and have-nots.

it isn't healthy for our society.... which is kind of what we've been saying. yet the right complains about even minimum wage and anything that sets standards for pay, with their ire particularly focused on unions.

frankly, it also explains our falling educational position in the world and slowing social mobility since you can't focus on education when you're trying to subsist.

and the economy can't recover when the majority of people can't afford the goods produced.

 

[expat_panama]

it explains the increasingly large gap between the haves and have-nots...

--exactly as today's Marxists would have us believe.

The flaws/distortions in the NYT rant are too numerous to list in a single post but for with those who care about what's going on, no analysis is necessary and for those that don't no analysis is acceptable.

 

[william the wie]

Toro, I suspect you have read "The Great Inflation", I know you have looked over at least Rogoff and Reinhardt but what I have to wonder is how much of this is the result of "legacy" agencies created by various presidents sucking the money out of pre-existing agencies. The Patent office no longer has the money to do its job and it is a very small agency. The Madoff Ponzi scheme lasted so long because the SEC budget was cut so much that it didn't have the resources to investigate.

Part of what has been going on since 1979 has been pruning away antiquated agencies and duplication of effort but a lot of it has been the eating up of needed resources for necessary agencies in order to create monuments of various sorts.

 

[uscitizen]

it explains the increasingly large gap between the haves and have-nots.

it isn't healthy for our society.... which is kind of what we've been saying. yet the right complains about even minimum wage and anything that sets standards for pay, with their ire particularly focused on unions.

frankly, it also explains our falling educational position in the world and slowing social mobility since you can't focus on education when you're trying to subsist.

and the economy can't recover when the majority of people can't afford the goods produced.

In the 80's we became a debtor nation and a consumer spending driven economy.
THAT was the beginning of the end when combined with free/world trade and globalization.

Blame Obama or even Bush if you want but they were just playing the game that has been going on for 30 years.

 

[Modbert]

Keynes: The Return Of The Master by Robert Skidelsky does a very good job of making a similar argument to this article.

Though his dates are 1951-1973 and 1980-October 2008.

Some highlights as I type from my book in front of me:

"The growth rate during the Bretton Woods years was on average higher than during the Washington Consensus period at 4.8% compared to the 3.2% growth rate after 1980."

"If the world economy had grown at 4.8% rather than 3.8% from 1980 until today, it would have been more than 50% larger."

"The world did not record a single year with less than 3% growth between 1951 and 1973."

"GDP per capita grew by an average of 4.0% in France, 4.9% in Germany, 8% in Japan, 2.5% in U.K, 2.2% in the U.S during the Bretton Woods age. Meanwhile, during the Washington Consensus it shrunk to 1.6% in France, 1.8% for Germany, 2.0% for Japan, 2.1% for the UK, and 1.9% for the US.

Unemployment was also more down during the Bretton Woods age across the board.

There is also the issue of wealth inequality. Right now, we're at the level of inequality that was present right before the Great Depression. Take that as you will.

As for the article you posted Toro, it was extremely interesting and a good read.

 

[Wiseacre]

I think at least one of the major reasons for the increase in productivity without the corresponding increase in wages was the advances of technology. US companies found ways to do more with less people, labor being a very costly resource and growing more costly all the time.

 

[sparky]

Most telling of all, Washington deregulated Wall Street while insuring it against major losses. In so doing, it allowed finance — which until then had been the servant of American industry — to become its master, demanding short-term profits over long-term growth and raking in an ever larger portion of the nation’s profits. .

Spot on

~S~

 

[sparky]

I think at least one of the major reasons for the increase in productivity without the corresponding increase in wages was the advances of technology. US companies found ways to do more with less people, labor being a very costly resource and growing more costly all the time.

errrruhm.....


But starting in the late 1970s, and with increasing fervor over the next three decades, government did just the opposite. It deregulated and privatized. It cut spending on infrastructure as a percentage of the national economy and shifted more of the costs of public higher education to families. It shredded safety nets. (Only 27 percent of the unemployed are covered by unemployment insurance.) And it allowed companies to bust unions and threaten employees who tried to organize. Fewer than 8 percent of private-sector workers are unionized.

More generally, it stood by as big American companies became global companies with no more loyalty to the United States than a GPS satellite.

 

[rightwinger]

What happened in 1980???

 

[Wiseacre]

So, another left wing columnist in a left wing newspaper with one more diatribe over income inequality. Do you think it's possible that the inequality grpah shows pre tax income, so the top earners maybe didn't make quite as much money. And the low enders, the graph doesn't show the gov't payments that are not added onto their incomes either. IOW, the gap may not be as great as many would whine about.

 

[Jroc]

Fro some reason it's always the people that have no idea what it is like to live in the lower income brackets. They seem to have all the good ideas on how to equalize the playing field, They want the government to get involved, to try to achieve that goal which only screws things up worst. How does higher food and energy prices help lower income people? All these big government do gooders have left this country with 10s of trillions in unfounded liabilities, but still that is not enough for liberals. Sorry but I'm not even going to waste my time reading a Robert Riech opinion piece

 

[Jroc]

What happened in 1980???

You dropped out of highschool?

 

[Toro]

So, another left wing columnist in a left wing newspaper with one more diatribe over income inequality. Do you think it's possible that the inequality grpah shows pre tax income, so the top earners maybe didn't make quite as much money. And the low enders, the graph doesn't show the gov't payments that are not added onto their incomes either. IOW, the gap may not be as great as many would whine about.

I wondered about the compensation and wage lines in the graph. I'm not sure if I believe them.

 

[boedicca]

When did we go off the gold standard?

The Fed has been allowed to destroy our currency, and induce a series of boom and bust cycles which only benefit the "global" wealthy.

Thanks Fed!

 

[elvis]

What happened in 1980???

John Lennon was shot. You partisan hack.

 

[Trajan]

it explains the increasingly large gap between the haves and have-nots.

the article/chart explained that, how so?

it isn't healthy for our society.... which is kind of what we've been saying. yet the right complains about even minimum wage and anything that sets standards for pay, with their ire particularly focused on unions.

how so?exactly?

and as far as wages and ire and unions goes.....example-

Postal Service Is Nearing Default as Losses Mount
By STEVEN GREENHOUSE
Published: September 4, 2011

snip-

At the same time, decades of contractual promises made to unionized workers, including no-layoff clauses, are increasing the post office’s costs. Labor represents 80 percent of the agency’s expenses, compared with 53 percent at United Parcel Service and 32 percent at FedEx, its two biggest private competitors. Postal workers also receive more generous health benefits than most other federal employees.

http://www.nytimes.com/2011/09/04/o...a-strengthening-of-the-middle-class.html?_r=1

frankly, it also explains our falling educational position in the world and slowing social mobility since you can't focus on education when you're trying to subsist.

so which came first? the lack of education (that is in total control of democratic influence) or some statistic I am unaware of, as there are RECORD numbers of kids in college?


whats "social" mobility btw?

and the economy can't recover when the majority of people can't afford the goods produced.

yes, and???????

 

[elvis]

it explains the increasingly large gap between the haves and have-nots.

it isn't healthy for our society.... which is kind of what we've been saying. yet the right complains about even minimum wage and anything that sets standards for pay, with their ire particularly focused on unions.

frankly, it also explains our falling educational position in the world and slowing social mobility since you can't focus on education when you're trying to subsist.

and the economy can't recover when the majority of people can't afford the goods produced.

It's free trade. Yes it increases GDP, but they don't tell you who gets the increases. As for unions, a machinist making $25 an hour at booming GM shouldn't have been paid the same amount at barely-holding-on Chrysler... but they were... and I can show you some videos of what Detroit looked like in 1965 vs. what it looks like now.

 

[Trajan]

What happened in 1980???

John Lennon was shot. You partisan hack.

 

[uscitizen]

What happened in 1980???

Our govt debt was under 1 trillion, and govt overspending went went wild is one major thing that happened.
"Reagan proved that defecits did not matter".