Enough with this income inequality nonsense

[Dragon]

the answer is quite simple.

Over the years people have lost the drive to fend for themselves. We are now in a world where we can live quite well without having to rissk all we have to get there.

Put aside how what I am about to say imay sound like rhetoric....in other words, hear what I am saying....

When I was young, my parents had to work hard to earn enough for a car, a TV, a/c, etc..

Now? The poor have what my parents strove for when they were middle class.

No, they don't.

I don't know how old you are, but when I was a boy, my father, working on a blue-collar job, could not just own a car and a few electronic toys. He could own a home. He could have a non-working spouse. He could send me and my sister and brother to college. He could save for retirement. Poor people can't do any of these things. The reason they can often own a TV, a cell phone, etc. is because these electronic toys have dropped dramatically in price, and because free items are often available from various charity sources.

Oh, and my father didn't just own a car, he owned more than one NEW car. Can't do that today if you're poor.

Now, aside from reasoning from theory without real data, do you have any actual evidence that the American work ethic has declined over the last 30 years? Are people working fewer hours or more? Are more or less of them working two jobs? Are there more or fewer multiple-income households today than there used to be? Has the productivity of American workers declined or increased?

Since the answers to all of these questions suggest to the contrary of your hypothesis, are you prepared to discard it?

 

[PredFan]

As noted in my last post, what I'm saying is that the problem here isn't that income inequality EXISTS -- i.e., is greater than zero. The problem is that, over the past 30 years, it has grown enormously. The richest people now take a much GREATER share of the nation's income than they did in 1980. That they take a disproportionate share is only another way of saying that they're rich, but the problem is how much they do, and how much more that is than it used to be.

There is a wide range of behaviors and circumstances behind where one falls on the economic scale. All else being equal (which it isn't), more effective economic behavior will net one a higher income. That's the reason why income inequality EXISTS. But over the past 30 years, economic behavior that used to result in a middle-class income has changed to resulting in a lower-class income, while economic behavior that used to result in merely being rich has changed to resulting in being mega-rich.

The bar of success has gotten higher, as have the rewards for the highest levels of success. The question that needs answering is why that has happened -- not the much simpler and less significant question of why there is any income inequality at all.

The problem is that the difinition of Middle class has changed. The middle class used to be the people between the really rich and the really poor. This included terms that you don't hear much anymore like Upper Middle Class, and Lower Middle Class. the Middle Class has been redefined to suit political purposes and the goal posts are shifted to favor a partisan argument.

There are still a great many people that earn between the very rich and the very poor. they are what used to pass as the middle class. Redefining middle class is what has happened in the lst 30 years.

 

[Jarhead]

the answer is quite simple.

Over the years people have lost the drive to fend for themselves. We are now in a world where we can live quite well without having to rissk all we have to get there.

Put aside how what I am about to say imay sound like rhetoric....in other words, hear what I am saying....

When I was young, my parents had to work hard to earn enough for a car, a TV, a/c, etc..

Now? The poor have what my parents strove for when they were middle class.

No, they don't.

I don't know how old you are, but when I was a boy, my father, working on a blue-collar job, could not just own a car and a few electronic toys. He could own a home. He could have a non-working spouse. He could send me and my sister and brother to college. He could save for retirement. Poor people can't do any of these things. The reason they can often own a TV, a cell phone, etc. is because these electronic toys have dropped dramatically in price, and because free items are often available from various charity sources.

Oh, and my father didn't just own a car, he owned more than one NEW car. Can't do that today if you're poor.

Now, aside from reasoning from theory without real data, do you have any actual evidence that the American work ethic has declined over the last 30 years? Are people working fewer hours or more? Are more or less of them working two jobs? Are there more or fewer multiple-income households today than there used to be? Has the productivity of American workers declined or increased?

Since the answers to all of these questions suggest to the contrary of your hypothesis, are you prepared to discard it?

Your dad was middle class....you were not poor...so that debunks that whole theory of yours.

I did not say the work ethic has decreaed.

I guess you dont know what the definition of work ethic is.

What I said was that people of today...even the poor...have all of the needs met and many more of their wants than their parents did.

So they do not need to do what their parents did...which was bust their ass at the expense of family time...nowadays, you can work 40 hours, have your personal time as yuou should...and still put a roof over your head, a car in the garage, a tv in every room, a phone, AC and a refirg....and new clothes when you need it.

I am not knocking the American Worker.

I am applauding America greatness.....our poor dont have to live like animals nor do our poor have to scarifrice their private lives.

 

[Dragon]

Now, why is that there are no longer jobs that pay a middle-class income without an advanced degree?

Becuase those jobs have been replaced by technology.

Or by outsourcing. But that's to argue that the old unionized manufacturing jobs were paid more than today's service jobs because the work done was actually worth more. How, then, do you explain the fact that, prior to the workplace revolution of the 1930s, those same jobs paid shit?

Back in the day, a skilled lathe turner would sit at his lathe and put out quality work..and he was paid according to his talent.

Oh, he turned out quality work, all right, but I disagree that he was paid "according to his talent." He was paid, as were and are all workers, what the company had to pay him in order to keep him working for it.

To work a lathe or other skilled manufacturing job requires no more skill than what's exhibited by a mid-range service job, such as a secretary, a bank teller, or a retail salesperson. (If you think that's not true, try doing any of those jobs when you have no training or experience at them. It ain't as easy as you might think.) Yet the service jobs that have replaced the old high-paying manufacturing work do not pay nearly as much. Why is that? There's an obvious answer, and it is NOT lack of required skill.

 

[Jarhead]

Now, why is that there are no longer jobs that pay a middle-class income without an advanced degree?

Becuase those jobs have been replaced by technology.

Or by outsourcing. But that's to argue that the old unionized manufacturing jobs were paid more than today's service jobs because the work done was actually worth more. How, then, do you explain the fact that, prior to the workplace revolution of the 1930s, those same jobs paid shit?

Back in the day, a skilled lathe turner would sit at his lathe and put out quality work..and he was paid according to his talent.

Oh, he turned out quality work, all right, but I disagree that he was paid "according to his talent." He was paid, as were and are all workers, what the company had to pay him in order to keep him working for it.

To work a lathe or other skilled manufacturing job requires no more skill than what's exhibited by a mid-range service job, such as a secretary, a bank teller, or a retail salesperson. (If you think that's not true, try doing any of those jobs when you have no training or experience at them. It ain't as easy as you might think.) Yet the service jobs that have replaced the old high-paying manufacturing work do not pay nearly as much. Why is that? There's an obvious answer, and it is NOT lack of required skill.

I am sorry. I cant debate this witrh you. Your assumptions are childish and your understanding of the business mind is obviously lacking.

For example....you say this....

He was paid, as were and are all workers, what the company had to pay him in order to keep him working for it.

What you dont get is....YES.....they are paid for their value...they are paid whatever the company had top pay them to keep them. And guess what....if the worker put out shit work, they wouldnt care to pay him and would likely let him go. And if he put out great work...they would pay him well for the last thing they want is for him to go to the competition.

But overall...I cant really respond...

I wouldnt even know how to respond to you. You are way off in left field with what you say....

 

[Dragon]

Your dad was middle class....you were not poor...so that debunks that whole theory of yours.

No, it doesn't. What I'm saying is that the same effort that made a person middle-class then, makes a person poor today. My father was good at his job, but he wasn't a hard-driver or big winner by any means. He was just a machinist who made oil-drilling tools for Hughes.

Yes, he was middle-class. That IS my point: that being a machinist paid a middle-class income. Today, there's nothing comparable. My father did not have an advanced degree. He did have a bachelor's degree (which he got on the GI Bill as a World War II-era vet), but in a field that had nothing to do with what he did for a living.

Someone with a bachelor's degree today, who puts in the same effort as my father did then, will be a lot poorer. The bar to success has risen. You can still earn a middle-class income in some types of work, but increasingly it's limited to the professions: medicine, law, accounting, engineering, etc.

I did not say the work ethic has decreaed.

What I said was that people of today...even the poor...have all of the needs met and many more of their wants than their parents did.

So they do not need to do what their parents did

But if you're saying that this is the reason for the increase in income inequality, then that can only mean you're saying that, BECAUSE people can meet their needs more easily than before, THEREFORE their work effort has suffered and they're slacking. The reality is that, while it may be easier to get by if you're really, truly poor now than it used to be, it takes a lot more effort now to rise out of poverty into the middle class.

 

[Jarhead]

Your dad was middle class....you were not poor...so that debunks that whole theory of yours.

No, it doesn't. What I'm saying is that the same effort that made a person middle-class then, makes a person poor today. My father was good at his job, but he wasn't a hard-driver or big winner by any means. He was just a machinist who made oil-drilling tools for Hughes.

Yes, he was middle-class. That IS my point: that being a machinist paid a middle-class income. Today, there's nothing comparable. My father did not have an advanced degree. He did have a bachelor's degree (which he got on the GI Bill as a World War II-era vet), but in a field that had nothing to do with what he did for a living.

Someone with a bachelor's degree today, who puts in the same effort as my father did then, will be a lot poorer. The bar to success has risen. You can still earn a middle-class income in some types of work, but increasingly it's limited to the professions: medicine, law, accounting, engineering, etc.

I did not say the work ethic has decreaed.

What I said was that people of today...even the poor...have all of the needs met and many more of their wants than their parents did.

So they do not need to do what their parents did

But if you're saying that this is the reason for the increase in income inequality, then that can only mean you're saying that, BECAUSE people can meet their needs more easily than before, THEREFORE their work effort has suffered and they're slacking. The reality is that, while it may be easier to get by if you're really, truly poor now than it used to be, it takes a lot more effort now to rise out of poverty into the middle class.

forget the rest ...

The line in bold....delete that. I never said anything of ther kind and I resent you for saying otherwise.

The American Worker is not slacking in any way shape or form.

Becuase AMerica is great, the American worker can offer his family a comfortable lifestyle without having to compromise his private time with his family.

As for your father...

If there was a man that had a job of turning on and off the lights in his machine shop...should he be paid the same as your dad?

I ask becuase your dads job has likely since been replaced by CNC....and the hired employeee NOW only turns the machine on and off.....

 

[Dragon]

He was paid, as were and are all workers, what the company had to pay him in order to keep him working for it.

What you dont get is....YES.....they are paid for their value...they are paid whatever the company had top pay them to keep them. And guess what....if the worker put out shit work, they wouldnt care to pay him and would likely let him go. And if he put out great work...they would pay him well for the last thing they want is for him to go to the competition.

Let me illustrate what I'm saying here. Prior to the 1930s, when the manufacturing sector became largely unionized in this country, people were paid low wages -- working-class wages, not middle-class -- for the same work that they were paid middle-class wages for in the 1940s and for decades thereafter.

Yes, a company will pay more to worker A, who is very good, than to worker B, who is not so good. That was as true in the 1940s and thereafter as in the 1920s. But it was also true that in the 1920s, worker A was paid LESS than, in the 1940s, worker B was paid. Why? Was worker B in the 1940s worse than worker A in the '20s? No way. A was better. But because of the differential in bargaining power, the company didn't have to pay A the same or better than, in the 1940s, the same company had to pay worker B -- and so didn't.

Worker A in the '40s was paid the most.
Worker B in the '40s earned less than worker A.
Worker A in the '20s was paid a lower wage than worker B in the '40s.
Worker B in the '20s was paid less than worker A in the '20s.

That's how it works.

 

[PredFan]

For most of my childhood, we were lower middle class. we had a black and white TV and lived on military housing. When my dad retired from the Navy in 1970, we moved to Florida and he got a job running heavy equipment for a non-union construction company. We bought our first home, and my mother has never worked. My dad retired in 2000.

Blue collar job, single income earner, owns home.

the problem is that many would rather suckle at the government tit than get an actual job and the number of people who are choosing that "occupation" are increasing. This is one of the main reasons for the gap.

 

[Katzndogz]

The poor today aren't like our parents were poor and knew the value of delayed gratification and sacrifice. The poor today generally piss their money away. Did you see those people rioting to but $180.00 Air Jordan's? They aren't rich. They did spend $180.00 on a pair of sneakers.

The poor have their needs met. They are not starving, or cold, or too hot. Now they have only their envy and desires.

 

[Dragon]

The American Worker is not slacking in any way shape or form.

Becuase AMerica is great, the American worker can offer his family a comfortable lifestyle without having to compromise his private time with his family.

That's simply not true, unless you're defining "comfortable lifestyle" a hell of a lot differently than I do.

As for your father...

If there was a man that had a job of turning on and off the lights in his machine shop...should he be paid the same as your dad?

I ask becuase your dads job has likely since been replaced by CNC....and the hired employeee NOW only turns the machine on and off.....

That's not really the relevant question here. The relevant question is this. Suppose that my dad's job was replaced by something computerized, and he got laid off. (Didn't happen to him, but happened to many afterwards.) He had to get a job as, let's say a customer-service agent for a bank.

What was there about the machining my dad did, that deserved a higher salary than what he would have done for the bank?

 

[Jarhead]

He was paid, as were and are all workers, what the company had to pay him in order to keep him working for it.

What you dont get is....YES.....they are paid for their value...they are paid whatever the company had top pay them to keep them. And guess what....if the worker put out shit work, they wouldnt care to pay him and would likely let him go. And if he put out great work...they would pay him well for the last thing they want is for him to go to the competition.

Let me illustrate what I'm saying here. Prior to the 1930s, when the manufacturing sector became largely unionized in this country, people were paid low wages -- working-class wages, not middle-class -- for the same work that they were paid middle-class wages for in the 1940s and for decades thereafter.

Yes, a company will pay more to worker A, who is very good, than to worker B, who is not so good. That was as true in the 1940s and thereafter as in the 1920s. But it was also true that in the 1920s, worker A was paid LESS than, in the 1940s, worker B was paid. Why? Was worker B in the 1940s worse than worker A in the '20s? No way. A was better. But because of the differential in bargaining power, the company didn't have to pay A the same or better than, in the 1940s, the same company had to pay worker B -- and so didn't.

Worker A in the '40s was paid the most.
Worker B in the '40s earned less than worker A.
Worker A in the '20s was paid a lower wage than worker B in the '40s.
Worker B in the '20s was paid less than worker A in the '20s.

That's how it works.

All you say here is 100% correct.

But what you have left out of the formula is competition.

Before the 30's...if you were GREAT at what you did and the guy next to you sucked ass.....there was very little you can do becuase your employer knew you had no where else to use yopur talent. The closest company that would want your exact talent was 500miles away.

However, since then, we find competitors right next door from each other.....and if you are great at what youy do, you are paid much better for your empoloyer doesnt want to lose you to the competition.

Andf that is why the higher level people get paid so well...

But, becuase of technology, you cant stand out anymore at the "lower levels"...I mean....how much "value" can you show when your job is to tuirn on a machine and turn it off when the stock is fully turned? How do you stand out from the rest in a job like that.

It used to be that a receptionist that could handle 20 incoming lines with professionalism and personality was a gold mine.....Now? The recptionist is there for the voice mail overflow.....she rarely gets to show her talent as a quality receptionist. So now she is paid a basic salary as her responsibilities are much less than they used to be.

 

[PredFan]

That's not really the relevant question here. The relevant question is this. Suppose that my dad's job was replaced by something computerized, and he got laid off. (Didn't happen to him, but happened to many afterwards.) He had to get a job as, let's say a customer-service agent for a bank.

What was there about the machining my dad did, that deserved a higher salary than what he would have done for the bank?

Assuming that he did make less than a machinist, i would have to answer that it is a lot easier to train someone off the street to be a customer service agent than a machinist. His value to the machine shop would be a lot more than his value to the bank.

 

[Jarhead]

The American Worker is not slacking in any way shape or form.

Becuase AMerica is great, the American worker can offer his family a comfortable lifestyle without having to compromise his private time with his family.

That's simply not true, unless you're defining "comfortable lifestyle" a hell of a lot differently than I do.

As for your father...

If there was a man that had a job of turning on and off the lights in his machine shop...should he be paid the same as your dad?

I ask becuase your dads job has likely since been replaced by CNC....and the hired employeee NOW only turns the machine on and off.....

That's not really the relevant question here. The relevant question is this. Suppose that my dad's job was replaced by something computerized, and he got laid off. (Didn't happen to him, but happened to many afterwards.) He had to get a job as, let's say a customer-service agent for a bank.

What was there about the machining my dad did, that deserved a higher salary than what he would have done for the bank?

It is not what he did as a mcahinist...it was the years that he did it.

About 10 years ago, before my client went CNC.....they were starting machinists at 9 an hour.....yet they had machinists earning 30 an hour due to tenure.

Well.....using your dad as an example....

If he started at 9 an hour...and by year 20 he was at 30 an hour.....and then he was laid off....

Why should the bak start him at 30 an hour? He would know no more about bank CSR work than a trainee right out of high school...who deserves 9 an hour....

So why should they pay your dad 30 and hour when the work can be done by a recent HS grad at 9 an hour?

 

[Dragon]

the problem is that many would rather suckle at the government tit than get an actual job and the number of people who are choosing that "occupation" are increasing. This is one of the main reasons for the gap.

Let's check the facts on that. Would you agree that the following people should not be considered as "suckling on the government tit"?

Social Security recipients
Government employees

Both of those categories are living on money that comes from the government, but the first bunch are due it because of work they did and taxes they paid in the past, while the second bunch are working for it now.

What does that leave? Recipients of unemployment compensation and general assistance, basically.

Here's a WSJ article on the increase in welfare cases due to the recession and people running out of unemployment: Numbers On Welfare See Sharp Increase - WSJ.com

Scroll down a bit and you'll find a graph that shows how the number of people on TANF increased to 520,000 in the state of California in 2009. California has a total population of 37,691,000. If we assume half of these to be in the labor force, which is a reasonable rule of thumb, that give us a total labor force for the state of just shy of 19 million. With half a million on welfare, that represents about 2.5% of the work force or a little more.

Are you suggesting that having 2.5% of the work force drawing welfare instead of working -- and that's setting aside the question of whether they would be working without it, i.e. whether there are jobs available that they could do -- accounts for the vast increase in income inequality since the 1930s?

 

[Dragon]

All you say here is 100% correct.

But what you have left out of the formula is competition.

Before the 30's...if you were GREAT at what you did and the guy next to you sucked ass.....there was very little you can do becuase your employer knew you had no where else to use yopur talent. The closest company that would want your exact talent was 500miles away.

However, since then, we find competitors right next door from each other.....and if you are great at what youy do, you are paid much better for your empoloyer doesnt want to lose you to the competition.

Andf that is why the higher level people get paid so well...

As you said in another post, it's not just what you do but when you do it. But let me question your idea here of why that's so.

First off, let's say you're an automobile worker. Here's Wikipedia's article on the auto industry in the U.S. just for general info: Automotive industry in the United States - Wikipedia, the free encyclopedia

According to this, the auto industry began in this country in the 1890s. By the late 1920s, it was going great guns. The main change came with Ford's introduction of the assembly-line method in 1913, which allowed mass-production of cars that could be afforded by people with less money. Ford's competitors caught up with Ford over the 1910s and 1920s gradually, and the industry reached a peak in terms of sales just before the Great Depression threw it a curve ball.

Now what that means is that Ford had a virtual monopoly on lower-priced cars in the early 1920s, losing that monopoly in the late '20s. So in 1921, an assembly-line auto worker had fewer places to work at than in 1928. Your prediction would be that wages would go up between those two years, and they did somewhat, which bears out your idea being one that works -- to a point. (Which makes sense; it's simple supply-and-demand stuff.)

But then the Depression hit, and a lot of American automakers went bankrupt. The Big Three survived and a few smaller companies (like Packard and Studebaker). So in the 1950s, there were actually fewer companies making cars than in the late 1920s. Concentration wasn't much of a factor between the two; the auto industry was concentrated in and around Detroit, Michigan in both eras. (Not so much so today.) So how can the availability of alternatives account for the difference in pay and benefits between 1928 and, say, 1955? I don't see how it can.

The obvious (to me anyway) answer is that in the 1930s, the auto industry and most other manufacturing was unionized. What that meant was that, as productivity increased, the labor force was in a good bargaining position to demand a good share of the proceeds of that productivity increase.

It used to be that a receptionist that could handle 20 incoming lines with professionalism and personality was a gold mine.....Now? The recptionist is there for the voice mail overflow.....she rarely gets to show her talent as a quality receptionist. So now she is paid a basic salary as her responsibilities are much less than they used to be.

I can see this, but to me, the changes to any one job are less important than the changes to the employment picture overall. Basically, reception work has dropped from being a demanding, skill-intensive job to being a low-skill job, but there is still a spectrum of low- to high-skill jobs. My point here is that the high-skill jobs (which aren't the same as they used to be) pay less these days than high-skill jobs used to pay. That's true until you get into the very-high-skill or professional area, and even there, salaries have been held down, e.g. in the software engineer area, through creative use of government.

 

[Jarhead]

All you say here is 100% correct.

But what you have left out of the formula is competition.

Before the 30's...if you were GREAT at what you did and the guy next to you sucked ass.....there was very little you can do becuase your employer knew you had no where else to use yopur talent. The closest company that would want your exact talent was 500miles away.

However, since then, we find competitors right next door from each other.....and if you are great at what youy do, you are paid much better for your empoloyer doesnt want to lose you to the competition.

Andf that is why the higher level people get paid so well...

As you said in another post, it's not just what you do but when you do it. But let me question your idea here of why that's so.

First off, let's say you're an automobile worker. Here's Wikipedia's article on the auto industry in the U.S. just for general info: Automotive industry in the United States - Wikipedia, the free encyclopedia

According to this, the auto industry began in this country in the 1890s. By the late 1920s, it was going great guns. The main change came with Ford's introduction of the assembly-line method in 1913, which allowed mass-production of cars that could be afforded by people with less money. Ford's competitors caught up with Ford over the 1910s and 1920s gradually, and the industry reached a peak in terms of sales just before the Great Depression threw it a curve ball.

Now what that means is that Ford had a virtual monopoly on lower-priced cars in the early 1920s, losing that monopoly in the late '20s. So in 1921, an assembly-line auto worker had fewer places to work at than in 1928. Your prediction would be that wages would go up between those two years, and they did somewhat, which bears out your idea being one that works -- to a point. (Which makes sense; it's simple supply-and-demand stuff.)

But then the Depression hit, and a lot of American automakers went bankrupt. The Big Three survived and a few smaller companies (like Packard and Studebaker). So in the 1950s, there were actually fewer companies making cars than in the late 1920s. Concentration wasn't much of a factor between the two; the auto industry was concentrated in and around Detroit, Michigan in both eras. (Not so much so today.) So how can the availability of alternatives account for the difference in pay and benefits between 1928 and, say, 1955? I don't see how it can.

The obvious (to me anyway) answer is that in the 1930s, the auto industry and most other manufacturing was unionized. What that meant was that, as productivity increased, the labor force was in a good bargaining position to demand a good share of the proceeds of that productivity increase.

It used to be that a receptionist that could handle 20 incoming lines with professionalism and personality was a gold mine.....Now? The recptionist is there for the voice mail overflow.....she rarely gets to show her talent as a quality receptionist. So now she is paid a basic salary as her responsibilities are much less than they used to be.

I can see this, but to me, the changes to any one job are less important than the changes to the employment picture overall. Basically, reception work has dropped from being a demanding, skill-intensive job to being a low-skill job, but there is still a spectrum of low- to high-skill jobs. My point here is that the high-skill jobs (which aren't the same as they used to be) pay less these days than high-skill jobs used to pay. That's true until you get into the very-high-skill or professional area, and even there, salaries have been held down, e.g. in the software engineer area, through creative use of government.

Let me put it to you ths way...

If you pesent a differential from the others that is adventageous to your employer, your employer will always pay you to stay.

Most refuse to understand this very basic premise....if your employer sees you as indsipensible, s/he will pay you what you demand...until such pay is no longer adventageous.

And sadly...technology has made it so that one has very little chance to show ones differential...

Except for those positions that require a higher level of intelligence/education...where you must apply your intelligence.

Using a mcahinist.....when a machinist became skilled, he or she would strive to truly understand the machine and work his/her way up to "set-up" man...which demands a higher salary. And when you are a set up man, you have a chance to show your dfifferential....for your accuracy is impoirtant as is your expertise and knowledge of the machine itself.

Nowadays? The poor guy inserting stock into the lathe and tunring it on....and then turning it off when the stock is done...he can not learn to be a set up man...for there is no need for a set up man.....for now the need is for a computer programmer....a college job..

You see my point?

 

[Jarhead]

And now for the point where I will get neg repped by every liberal out there...

But the truth is the truth...

Over the past 5 decades....those in the workforce have increased dramatically due to more women entering the workforce.

IN essence, there are likely 100% more people in the workforce now than there were in 1960.

Yet, the population did not double...meaning that the available jobs did not double becuase the demand for goods did not double.

So what happens when there is a greater supply than demand?

When it comes to goods? Lower prices.

When it comes to labor? Lower salaries.

Now...before you jump on that old...."that's the point...business owners should not look to minimize wages" thing...

Dont you look to minimize YOUR costs?

 

[PredFan]

the problem is that many would rather suckle at the government tit than get an actual job and the number of people who are choosing that "occupation" are increasing. This is one of the main reasons for the gap.

Let's check the facts on that. Would you agree that the following people should not be considered as "suckling on the government tit"?

Social Security recipients
Government employees

Both of those categories are living on money that comes from the government, but the first bunch are due it because of work they did and taxes they paid in the past, while the second bunch are working for it now.

What does that leave? Recipients of unemployment compensation and general assistance, basically.

Here's a WSJ article on the increase in welfare cases due to the recession and people running out of unemployment: Numbers On Welfare See Sharp Increase - WSJ.com

Scroll down a bit and you'll find a graph that shows how the number of people on TANF increased to 520,000 in the state of California in 2009. California has a total population of 37,691,000. If we assume half of these to be in the labor force, which is a reasonable rule of thumb, that give us a total labor force for the state of just shy of 19 million. With half a million on welfare, that represents about 2.5% of the work force or a little more.

Are you suggesting that having 2.5% of the work force drawing welfare instead of working -- and that's setting aside the question of whether they would be working without it, i.e. whether there are jobs available that they could do -- accounts for the vast increase in income inequality since the 1930s?

No, I said "one of the reasons".