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I think that's exactly what happened. For example, what I described earlier, medical costs increasing at twice the rate of inflation in the US while outcomes di

I think that's exactly what happened. For example, what I described earlier, medical costs increasing at twice the rate of inflation in the US while outcomes did not improve much at all, is the median worker being cheated out of their productivity gains: it means they are paying more and getting less, while health care providers and people who own patents on drugs or medical devices get more. This change has absolutely zilch to do with changes in how productive anyone is and much more to do with how income is distributed, how property rights are enforced, how high-tech industry is regulated, etc.

deleted 10y ago
[deleted]
harryh 10y ago
Increased costs for health care(1) are a measure of where workers are spending their money. That's an orthogonal issue to measures of worker productivity. 1. It's a side issue, but I'd also dispute your statement that people are getting less. Life expectancy has increased ~10 years in the US since 1970.
- astazangasta 10y ago
  People in the US are getting less than in other places, in terms of health care. Other countries also haven't seen the same gap in gdp/income. Arguing that workers are less productive because they earn less is a tautology; it also requires us to believe that workers magically stopped being more productive in 1973 after decades of improvement.
  - harryh 10y ago
    1) Our health care system is certainly unusual and it might very well have problems. But, again, that has nothing to do with measures of worker productivity outside of the health care sector. 2) Other countries have significantly larger transfers from the rich to the poor. That certainly puts more spending power in the hands of the bottom half of the bell curve (which might be a good idea!), but it doesn't mean they're more productive. 3) I don't magically believe that increases in median worker productivity slowed in the 1970s, I believe it because it matches what I see in the world. GM used to employ 100s of thousands of people when it was one of the most valuable companies in America. Now Facebook holds that status with something like 15,000. Technology has become this huge lever where fewer and fewer people are needed to make more and more stuff. So increasingly it's the people at the top end of the bell curve that are capturing these gains. A programmer can write software that gets used by more people than ever. A retail store employee is doing pretty much the same job now that they were doing 30 years ago.
    - astazangasta 10y ago
      > increases in median worker productivity slowed > fewer and fewer people are needed to make more and more stuff. You're arguing against yourself, here. The latter is productivity increase, the former is productivity decrease. Also, productivity growth is not new, it has been going on as long as the economy exists. Machine automation has been occurring since the industrial revolution started, it did not start in 1973. What started in 1973 was that the high end (basically, the owners of capital) stopped sharing productivity gains - meaning that where previously, workers were able to bargain for a share of the increase, now they cannot, because of various mechanisms of taking. CEO pay did not go up 10X because CEOs were suddenly drinking tiger blood and winning the Fields medal. My original contention was that one of these was the shift away from the Bretton Woods system, with fixed currency exchange rates based on the dollar; going from here to speculative international currency flows and floating exchange rates is one possible mechanism for making workers less able to bargain for those productivity increases.
      - harryh 10y ago
        What started in 1973 was that the high end (basically, the owners of capital) stopped sharing productivity gains - meaning that where previously, workers were able to bargain for a share of the increase, now they cannot, because of various mechanisms of taking. NO! This is EXACTLY what I (really Scott Summers) am saying has not happened. The share of national income going to labor (vs the owners of capital) has remained almost exactly constant since 1973 (and before then as well).
        astazangasta 10y ago
        I already commented on this; his assumption is that the PCE is "correct" and the CPI is "wrong". I made a criticism of PCE that you did not address; it is merely counting increased health care spending (a significant mechanism of wealth transfer) as "labor share" of national income.
        harryh 10y ago

deleted 10y ago

[deleted]

harryh 10y ago

Increased costs for health care(1) are a measure of where workers are spending their money. That's an orthogonal issue to measures of worker productivity. 1. It's a side issue, but I'd also dispute your statement that people are getting less. Life expectancy has increased ~10 years in the US since 1970.

astazangasta 10y ago
People in the US are getting less than in other places, in terms of health care. Other countries also haven't seen the same gap in gdp/income. Arguing that workers are less productive because they earn less is a tautology; it also requires us to believe that workers magically stopped being more productive in 1973 after decades of improvement.
- harryh 10y ago
  1) Our health care system is certainly unusual and it might very well have problems. But, again, that has nothing to do with measures of worker productivity outside of the health care sector. 2) Other countries have significantly larger transfers from the rich to the poor. That certainly puts more spending power in the hands of the bottom half of the bell curve (which might be a good idea!), but it doesn't mean they're more productive. 3) I don't magically believe that increases in median worker productivity slowed in the 1970s, I believe it because it matches what I see in the world. GM used to employ 100s of thousands of people when it was one of the most valuable companies in America. Now Facebook holds that status with something like 15,000. Technology has become this huge lever where fewer and fewer people are needed to make more and more stuff. So increasingly it's the people at the top end of the bell curve that are capturing these gains. A programmer can write software that gets used by more people than ever. A retail store employee is doing pretty much the same job now that they were doing 30 years ago.
  - astazangasta 10y ago
    > increases in median worker productivity slowed > fewer and fewer people are needed to make more and more stuff. You're arguing against yourself, here. The latter is productivity increase, the former is productivity decrease. Also, productivity growth is not new, it has been going on as long as the economy exists. Machine automation has been occurring since the industrial revolution started, it did not start in 1973. What started in 1973 was that the high end (basically, the owners of capital) stopped sharing productivity gains - meaning that where previously, workers were able to bargain for a share of the increase, now they cannot, because of various mechanisms of taking. CEO pay did not go up 10X because CEOs were suddenly drinking tiger blood and winning the Fields medal. My original contention was that one of these was the shift away from the Bretton Woods system, with fixed currency exchange rates based on the dollar; going from here to speculative international currency flows and floating exchange rates is one possible mechanism for making workers less able to bargain for those productivity increases.
    - harryh 10y ago
      What started in 1973 was that the high end (basically, the owners of capital) stopped sharing productivity gains - meaning that where previously, workers were able to bargain for a share of the increase, now they cannot, because of various mechanisms of taking. NO! This is EXACTLY what I (really Scott Summers) am saying has not happened. The share of national income going to labor (vs the owners of capital) has remained almost exactly constant since 1973 (and before then as well).
      - astazangasta 10y ago
        I already commented on this; his assumption is that the PCE is "correct" and the CPI is "wrong". I made a criticism of PCE that you did not address; it is merely counting increased health care spending (a significant mechanism of wealth transfer) as "labor share" of national income.
        harryh 10y ago