Well Mufasa and Matty, it’s nice to be back after a two year hiatus.
Wow…two years and you guys are still around. It’s good to see you but I wonder will this tight knit group ever change?
Ha
Thunder speaks the truth. Just having an ac unit, or being able to afford to get the kids a Playstation, doesn’t erase the income/wage gap issue. The problem has become too pronounced to ignore. I’m not making light of what you had to say Counting. I understand what you mean. But it doesn’t erase the separation we’re seeing. You can’t ignore that there is a sector of the global economy that has disproportionately profited from big-bank-finance/big-multi-national global business. That capital and the property to produce has increasingly been concentrated into relatively fewer and fewer hands…That relatively fewer are realizing the old American ideal of the self-employed small business man, but are now instead the employee-consumer of giant multinationals .
Now let’s start the usual libertarian (“fiscally conservative”) campaign promises of flat taxes, tax cuts for wealthy individuals, crying about the progressive income tax, etc., while simultaneously threatening to cut/dismantle programs. At a time when the rich really have gotten richer faster than anyone else…
Beans,
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Tax cuts can boost GDP, but they do not automatically or reliably do so, and overreacting on that effect is bad public policy. Just ask Kansas and their “bleeding” budget. This is why old conservatives - like Goldwater - were against them without corresponding spend in cuts or other revenue raising. The Reaganites abandoned that approach.
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I don’t think absolute wealth - as opposed to relative - is the best measure
People like to know that their work pays off in the system we have, and that they are sharing in the pie they help create. As such, absolute wealth - recognizing that the baseline of material security has improved - would be ok for assessing the non-working poor, perhaps. But for the working crowd, lower- and middle- class, whose working hours are going up, but the cost of important things keeps going up, all the while their wages stagnate while the income of the 1% goes up - well, the “absolute wealth has gone up” isn’t a satisfactory answer to these folks. Republicans attempt this at their peril. -
Republicans better start producing a platform that addresses these issues and suggests something other than “tax cuts for the wealthy”. Otherwise, they’ll squander the gift Democrats have them.
So, I want to know, if the GoP is still going to talk about too much power concentrated in Washington will it also begin to talk about the concentration of power (wealth) in the private sector?
Perhaps it’s time to talk about decentralization, and I don’t just mean in the realm of government?
[quote]Sloth wrote:
Thunder speaks the truth. Just having an ac unit, or being able to afford to get the kids a Playstation, doesn’t erase the income/wage gap issue. The problem has become too pronounced to ignore. I’m not making light of what you had to say Counting. I understand what you mean. But it doesn’t erase the separation we’re seeing. You can’t ignore that there is a sector of the global economy that has disproportionately profited from big-bank-finance/big-multi-national global business. That capital and the property to produce has increasingly been concentrated into relatively fewer and fewer hands…That relatively fewer are realizing the old American ideal of the self-employed small business man, but are now instead the employee-consumer of giant multinationals .
Now let’s start the usual libertarian (“fiscally conservative”) campaign promises of flat taxes, tax cuts for wealthy individuals, crying about the progressive income tax, etc., while simultaneously threatening to cut/dismantle programs. At a time when the rich really have gotten richer faster than anyone else… [/quote]
Great post.
[quote]Sloth wrote:
Thunder speaks the truth. Just having an ac unit, or being able to afford to get the kids a Playstation, doesn’t erase the income/wage gap issue. The problem has become too pronounced to ignore. I’m not making light of what you had to say Counting. I understand what you mean. But it doesn’t erase the separation we’re seeing. You can’t ignore that there is a sector of the global economy that has disproportionately profited from big-bank-finance/big-multi-national global business. That capital and the property to produce has increasingly been concentrated into relatively fewer and fewer hands…That relatively fewer are realizing the old American ideal of the self-employed small business man, but are now instead the employee-consumer of giant multinationals .[/quote]
Is the gap better or worse now than it was 100 years ago? 200? 400?
It’s better by every single measure. Today someone on government assistance has the same phone and the same brand name clothing that someone who makes 7 figures a year has on. They have the same personal transportation, while one car may be more luxurious, that isn’t relevant. 100 years ago those poor people would have homemade cloths, hand me down shoes and an equivalent mode of transportation would be laughable.
There has always been and always will be have’s and have not’s.
With that in mind, what is your solution that you’d like to see the GOP champion?
All tax cuts are “cuts for the wealthy”, as the only people paying taxes right now are the wealthy. The top 10% of wage earners, most of those people hardly wealthy, pay upwards of 70% of the tax collected, and earn less than 70 of the wages. I’ll link the IRS tables if you want documentation.
Personally, I have no issues with it.
[quote]thunderbolt23 wrote:
2. I don’t think absolute wealth - as opposed to relative - is the best measure
People like to know that their work pays off in the system we have, and that they are sharing in the pie they help create. As such, absolute wealth - recognizing that the baseline of material security has improved - would be ok for assessing the non-working poor, perhaps. But for the working crowd, lower- and middle- class, whose working hours are going up, but the cost of important things keeps going up, all the while their wages stagnate while the income of the 1% goes up - well, the “absolute wealth has gone up” isn’t a satisfactory answer to these folks. Republicans attempt this at their peril.
[/quote]
So what’s the solution then? What is an appropriate platform to address these issues?
I’m not trying to say “let’s cut taxes” is a winning formula politically, and I’m not even clamoring to cut them in general. The ACA and other obamanomics have assraped us enough in that department, and I want people to feel it before we do anything about it.
However, I’m really curious how anyone is going to outline that government “fix” income inequality without totally trampling personal freedom, let alone the risks this idea poses to economic activity in general.
So couple those concerns with the Democrat’s idea of “let’s tax the rich” which solves nothing, because they already pay all the taxes, and you couldn’t tax our way out of this problem, the math just doesn’t work… What is the GOP platform you’re all suggesting? Democrat lite? “Let’s tax the rich, just less than those guys want to”?
[quote]countingbeans wrote:
[quote]BlueCollarTr8n wrote:
In a globalized economy the approach doesn’t appear to hold up well.
[/quote]
Based on what measure?
Assuming I agree that it doesn’t magically cut deficits, because it doesn’t. Other than that, in what way does it not hold up?[/quote]
Fair enough Beans; upon reflection that was an open-ended comment. For the median wage worker in a developing country I concede the situation has improved. For the same here in the United States; not so much.
Housing Cost:
Year Median Family Income Median Home Price Factor
1970 $7,559 $22,300 2.950
1990 $28,149 $127,000 4.512
2010 $47,793 $241,000 5.047
Just look back 30 years or so.
Median income to house price
Tuition
US GDP
1.076 trillion USD (1970)
$17.701 trillion USD (2014)
Things are more expensive relatively, and people aren’t making as much relatively.
The economy has increased greatly, but this isn’t reflected in peoples take home.
[quote]countingbeans wrote:
I’m not trying to say “let’s cut taxes” is a winning formula politically, and I’m not even clamoring to cut them in general. The ACA and other obamanomics have assraped us enough in that department, and I want people to feel it before we do anything about it.
However, I’m really curious how anyone is going to outline that government “fix” income inequality without totally trampling personal freedom, let alone the risks this idea poses to economic activity in general.
So couple those concerns with the Democrat’s idea of “let’s tax the rich” which solves nothing, because they already pay all the taxes, and you couldn’t tax our way out of this problem, the math just doesn’t work… What is the GOP platform you’re all suggesting? Democrat lite? “Let’s tax the rich, just less than those guys want to”?[/quote]
Well, taxing the rich for the sake of doing it doesn’t really fix inequality, and inequality per se isn’t a problem. But when workers continually enjoy fewer rewards in a system they work harder than ever to contribute to is a problem.
Possible solutions? Any I can think involve some level of government action in the marketplace. Raise the overtime threshold? Provide paid family leave? These policies are conservative in their aims, in terms of the things they purport to protect, but would be seen as “intrusive government” by libertarian types.
Modifying free trade agreements would be a way to deal with some of these issues as well.
[quote]BlueCollarTr8n wrote:
[quote]countingbeans wrote:
[quote]BlueCollarTr8n wrote:
In a globalized economy the approach doesn’t appear to hold up well.
[/quote]
Based on what measure?
Assuming I agree that it doesn’t magically cut deficits, because it doesn’t. Other than that, in what way does it not hold up?[/quote]
Fair enough Beans; upon reflection that was an open-ended comment. For the median wage worker in a developing country I concede the situation has improved. For the same here in the United States; not so much.
Housing Cost:
Year Median Family Income Median Home Price Factor
1970 $7,559 $22,300 2.950
1990 $28,149 $127,000 4.512
2010 $47,793 $241,000 5.047
[/quote]
So, on it’s face, the value of people’s homes is outpacing their wage inflation by about 450%. (530% compared to 980%). This is after the Real Estate crashes of the 80’s and 2008.
According to this calculator, the wages outpace inflation by short money, $2,605 or 27% of the 1970 median income compared to 2015 and $2,686 from 1970 to 1990.
The mortgage interest rate in April 1971 was 7.31%, which on a 30 year note on the 22,300 house results in $32,790 in interest payments. Which is $198,364 in 2015 dollars.
Gotta trust me on the interest, I’m using in-house software.
Interest rates in April 2010 were 5.10% for interest payments of $230,000, so you’re paying about 32k more in interest in a dollar for dollar comparison for a house that is worth 980% more than it was 40 years ago.
But let’s go back to the inflation calculator. $1 in 1970 has the same buying power as $6.05 in 2015… 500% inflation in 40 years… Between 1970 and 1986 it is 282%. So 282% in sixteen years, and 214% between 1986 and 2015. Inflation can largely be blamed on the Fed.
YOu can blame the bubbleious house prices on Wall Street I guess. I could argue otherwise, but wouldn’t likely.
Now… Do we have any charts on the fringe benefit changes between 1970 and 2010/2015?
[quote]MattyG35 wrote:
The economy has increased greatly, but this isn’t reflected in peoples take home.[/quote]
Fringe?
[quote]pushharder wrote:
[quote]BlueCollarTr8n wrote:
Housing Cost:
Year Median Family Income Median Home Price Factor
1970 $7,559 $22,300 2.950
1990 $28,149 $127,000 4.512
2010 $47,793 $241,000 5.047
[/quote]
Interesting stat. I wonder if there’s more to it than meets the eye. Seriously, I wonder.
For instance, I’d bet a $22k house in 1970 would be significantly inferior (back then) to a $241k house in 2010. I’d bet a fair sum even.[/quote]
Yes…I think that’s a fair assumption H vs H depending on how one defines inferior. That’s why I selected median vs median. Consider also when markets were restricted there were more total players globally. If you manufactured paper towels in the US, your factory was in the US. The same for China, the Soviet Union, etc, etc. Many more CEOs, CFOs, Managers, etc. Perhaps the revenue per towel globally was the same, but that revenue was spread across a greater number of people in total.
Another metric, price of vehicles
Inflation + increasing scarcity + more burdensome construction demands…I mean, more effective safety measures(I.e., home/real estate costs) =/= inflation + decreasing scarcity + dealing with more burdensome regulations(I.e., employment rewards).
It’s stunning, I tell you.
If people are too ignorant to understand things, then this system will be disastrous. People are too ignorant to understand things.
[quote]countingbeans wrote:
[quote]MattyG35 wrote:
The economy has increased greatly, but this isn’t reflected in peoples take home.[/quote]
Fringe?[/quote]
So, this is the quickest chart I could find, and I bet it would be more significant if I could find one since 1970.
Let’s assume this person makes $2,500 a pay period in 2000, pay’s 50% of their HI (employer covers the other 50%) at $500 a pay period. With a take home of $2000.
So…
Total HI goes from $1000 to $2140, and the employees contribution from $500 to $1235. That means the employer’s portion goes up to $905 (2140-1235=905).
So even though the wages only go up from $2500 by 36% to $3400, the actual pay the employee receives goes from $3000 (original $2500+500 in insurance) to $4305 for a 43.5% increase in actual wages, while take home stays relatively flat.
This doesn’t include increased vacation time, flex time, PTO, gas cards, company outings, training, etc etc etc. This is solely HI costs.
The world isn’t black and white, and business typically has more shades of gray than that chick pron, with less whips and chains.