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Why haven't salaries and demand for jobs increased? Because non-wage compensation is tax advantaged so it's cheaper for companies to increase compensation ther

Why haven't salaries and demand for jobs increased? Because non-wage compensation is tax advantaged so it's cheaper for companies to increase compensation there. If they spent $1 more on health care, you get $1 more worth of health care. If they spend $1 more on wages, you get $0.80 in your take home pay. Real compensation per hour has increased, both across the economy and in manufacturing. https://research.stlouisfed.org/fred2/series/COMPRNFB https://research.stlouisfed.org/fred2/series/COMPRNFB https://research.stlouisfed.org/fred2/series/COMPRMS https://research.stlouisfed.org/fred2/series/COMPRMS That increase just comes in the form of health benefits/retirement/etc. If you want to fix this, eliminate the Obamacare employer mandate and push everyone to the exchanges and increase taxes on non-wage benefits. (You can make it revenue neutral by reducing taxes on wages commensurately.) There were and are much better ways to achieve the same goal. What are some of these "much better ways" to reliably and effectively achieve the same goal?

astazangasta 11y ago
The problem is increased payments to a bloated health care sector with costs growing faster than inflation does not actually amount to a real increase in compensation.
ap22213 11y ago
For one, we should not allow trade with countries that do not have some base level of rule of law, human rights, anti-corruption, safety nets, military control, and democratic rule. Capitalism is a game, and games still work even when there are rules in place. The rules just have to be consistent and enforced. I'm not against people getting rich. Some people like that. But, allowing those people to make us throw out important rules of the game just because it makes the game harder for them is really short-sighted.
- fidget 11y ago
  Why is it better to be repressed and out of work than be repressed and in work?
ap22213 11y ago
Also, I've seen your posts before. Often, you post links to data. I like data, and each time you post a link, I check it out. But, in the past I've been convinced that you had cherry picked your data or misrepresented it. But, when I've queried you about it in the past, I'd gotten no response.
- refurb 11y ago
  He's linking to data from the Federal Reserve. What makes you think it's cherry picked? The fact that total compensation has increased over the past 20-30 years is not a secret. It's well known.
  - ap22213 11y ago
    Cherry picking means presenting one set of data that supports an argument while ignoring others that don't. The data isn't from the fed but from BLS. And, a reading of the descriptions of what that data contains shows that it includes all non-farm works, including managers and executives, and even private business owners. http://www.bls.gov/opub/mlr/2005/05/art1full.pdf http://www.bls.gov/opub/mlr/2005/05/art1full.pdf
- lkrubner 11y ago
  yummyfajitas prefers to offer an alternate history of the USA, full of "what might have been"s. There was an era from the 1930s to the 1950s when the top income tax bracket was taxed at 91%. In the early 1960s, the top tax was lowered to 70%, and it remained at that level till the big tax cuts of President Regan, who lowered the top tax to 28%, back in 1982. When the top tax rates were extremely high, most workers sought un-taxed benefits, rather than money. For instance, in the 1950s, any income in excess of $100,000 was taxed at a rate of 91%, but benefits such as health care and life insurance and company sponsored travel were not taxed. Therefore, during that era, it became common for top workers to demand non-monetary, un-taxed perks. The same forces also drove the middle class, who were also facing high taxes -- they sought those benefits that were un-taxed, since asking for more money ran into the penalty of very high taxes. Everything changed once President Reagan lowered taxes in 1982. Then it became much more common for workers to seek income. Seeking un-taxed benefits became less crucial, once taxes were lowered. For reasons that I don't understand, yummyfajitas prefers to flip this narrative, and suggests that workers sought non-monetary compensation after President Reagan had lowered taxes. That is both ahistorical and it doesn't even make rational sense. The median male wage has been in decline since 1973: http://krugman.blogs.nytimes.com/2014/03/16/the-wages-of-men/ http://krugman.blogs.nytimes.com/2014/03/16/the-wages-of-men... Some people like to disguise this fact with rhetoric about the increasing quality of products. The debate over the standard of living can get very complex. There are thousands of variables that can be considered. To my mind, the strongest fact that effects this debate is that Bureau of Labor Statistics compiles the Consumer Price Index to keep track of the cost of an average basket of goods for an average American family, but rent is left out of the CPI. The ratio of the average wage to the average rent actually hit its happiest peak in 1958. For obvious reasons, this was also the peak year of the Baby Boom (if people have a more difficult time affording a place to live, then they will have fewer babies). Therefore, it is likely that men have seen a decline in wages since before 1973. That is, a full accounting of the median male wage, reduced by the full effects of inflation, including the impact on rent, suggests that men have seen an erosion of their standard of living since some point between 1958 and 1973.
poof131 11y ago
That’s one of the problems with data. It seems so exact but can really be so misleading. You break out charts, I break out charts. [1] My gut feeling is that much of middle class america has seen significant wage and livelihood stagnation. I’m all for free trade and a competitive economy, but something feels off about the past couple decades and the distribution of economic gains. And I don’t really trust the Federal Reserve and their CPI metrics—the institution is far too political and the members have too much skin in the game, rotating in and out of banking jobs. [1] http://www.epi.org/publication/charting-wage-stagnation/ http://www.epi.org/publication/charting-wage-stagnation/
- Avshalom 11y ago
  Important to note there is that employer provided health care (that non-wage compensation thats supposed to be making up for stagnate wages) has been falling for the last 20 years.
- yummyfajitas 11y ago
  Your charts don't contradict mine. They say yearly wages for certain households have gone down, I've shown wages+benefits/hour for workers has gone up. It's true that CPI has it's flaws - inflation is wildly overstated. Medicine - one of the big drivers of increases in CPI (the other is education) is not even hedonically adjusted. If we properly measured inflation compensation would almost certainly be a lot higher. Of course if you want to ignore all data which doesn't support your preconceived notions, I can't stop you. (Incidentally the data is from the BLS, not the fed. The fed just brings all the data to one convenient site.)
  - Apocryphon 11y ago
    Sounds like we're at an impasse. Both sides have their own respective stats and figures that they draw their conclusions from. The only way forward is for each side to debate the merits' of each dataset.
    - ap22213 11y ago

astazangasta 11y ago

The problem is increased payments to a bloated health care sector with costs growing faster than inflation does not actually amount to a real increase in compensation.

ap22213 11y ago

For one, we should not allow trade with countries that do not have some base level of rule of law, human rights, anti-corruption, safety nets, military control, and democratic rule. Capitalism is a game, and games still work even when there are rules in place. The rules just have to be consistent and enforced. I'm not against people getting rich. Some people like that. But, allowing those people to make us throw out important rules of the game just because it makes the game harder for them is really short-sighted.

fidget 11y ago
Why is it better to be repressed and out of work than be repressed and in work?

ap22213 11y ago

Also, I've seen your posts before. Often, you post links to data. I like data, and each time you post a link, I check it out. But, in the past I've been convinced that you had cherry picked your data or misrepresented it. But, when I've queried you about it in the past, I'd gotten no response.

refurb 11y ago
He's linking to data from the Federal Reserve. What makes you think it's cherry picked? The fact that total compensation has increased over the past 20-30 years is not a secret. It's well known.
- ap22213 11y ago
  Cherry picking means presenting one set of data that supports an argument while ignoring others that don't. The data isn't from the fed but from BLS. And, a reading of the descriptions of what that data contains shows that it includes all non-farm works, including managers and executives, and even private business owners. http://www.bls.gov/opub/mlr/2005/05/art1full.pdf http://www.bls.gov/opub/mlr/2005/05/art1full.pdf
lkrubner 11y ago
yummyfajitas prefers to offer an alternate history of the USA, full of "what might have been"s. There was an era from the 1930s to the 1950s when the top income tax bracket was taxed at 91%. In the early 1960s, the top tax was lowered to 70%, and it remained at that level till the big tax cuts of President Regan, who lowered the top tax to 28%, back in 1982. When the top tax rates were extremely high, most workers sought un-taxed benefits, rather than money. For instance, in the 1950s, any income in excess of $100,000 was taxed at a rate of 91%, but benefits such as health care and life insurance and company sponsored travel were not taxed. Therefore, during that era, it became common for top workers to demand non-monetary, un-taxed perks. The same forces also drove the middle class, who were also facing high taxes -- they sought those benefits that were un-taxed, since asking for more money ran into the penalty of very high taxes. Everything changed once President Reagan lowered taxes in 1982. Then it became much more common for workers to seek income. Seeking un-taxed benefits became less crucial, once taxes were lowered. For reasons that I don't understand, yummyfajitas prefers to flip this narrative, and suggests that workers sought non-monetary compensation after President Reagan had lowered taxes. That is both ahistorical and it doesn't even make rational sense. The median male wage has been in decline since 1973: http://krugman.blogs.nytimes.com/2014/03/16/the-wages-of-men/ http://krugman.blogs.nytimes.com/2014/03/16/the-wages-of-men... Some people like to disguise this fact with rhetoric about the increasing quality of products. The debate over the standard of living can get very complex. There are thousands of variables that can be considered. To my mind, the strongest fact that effects this debate is that Bureau of Labor Statistics compiles the Consumer Price Index to keep track of the cost of an average basket of goods for an average American family, but rent is left out of the CPI. The ratio of the average wage to the average rent actually hit its happiest peak in 1958. For obvious reasons, this was also the peak year of the Baby Boom (if people have a more difficult time affording a place to live, then they will have fewer babies). Therefore, it is likely that men have seen a decline in wages since before 1973. That is, a full accounting of the median male wage, reduced by the full effects of inflation, including the impact on rent, suggests that men have seen an erosion of their standard of living since some point between 1958 and 1973.

poof131 11y ago

That’s one of the problems with data. It seems so exact but can really be so misleading. You break out charts, I break out charts. [1] My gut feeling is that much of middle class america has seen significant wage and livelihood stagnation. I’m all for free trade and a competitive economy, but something feels off about the past couple decades and the distribution of economic gains. And I don’t really trust the Federal Reserve and their CPI metrics—the institution is far too political and the members have too much skin in the game, rotating in and out of banking jobs. [1] http://www.epi.org/publication/charting-wage-stagnation/ http://www.epi.org/publication/charting-wage-stagnation/

Avshalom 11y ago
Important to note there is that employer provided health care (that non-wage compensation thats supposed to be making up for stagnate wages) has been falling for the last 20 years.
yummyfajitas 11y ago
Your charts don't contradict mine. They say yearly wages for certain households have gone down, I've shown wages+benefits/hour for workers has gone up. It's true that CPI has it's flaws - inflation is wildly overstated. Medicine - one of the big drivers of increases in CPI (the other is education) is not even hedonically adjusted. If we properly measured inflation compensation would almost certainly be a lot higher. Of course if you want to ignore all data which doesn't support your preconceived notions, I can't stop you. (Incidentally the data is from the BLS, not the fed. The fed just brings all the data to one convenient site.)
- Apocryphon 11y ago
  Sounds like we're at an impasse. Both sides have their own respective stats and figures that they draw their conclusions from. The only way forward is for each side to debate the merits' of each dataset.
  - ap22213 11y ago