4 ms·

All fair criticisms to the points brought up in the post. I was nodding all the way to your last sentence, where I think you missed the mark. It isn't true tha

by lyudmil 16y ago

All fair criticisms to the points brought up in the post. I was nodding all the way to your last sentence, where I think you missed the mark. It isn't true that this generation of twenty-somethings has it better than most. In the US specifically real wages have been declining since the early 80's, even as productivity has boomed. The economic benefits of automation and computerization have gone disproportionately to the top of the income ladder. The recession has little to do with the sentiments the OP expressed. In fact, the decline in housing prices, as crass as that may sound, is a form of wealth transfer to the current generation of twenty-somethings as they will be able to get a house cheaper than what their parents would have paid for it a decade ago. I think the point the OP was getting at was that this is a generation more aware of an economic reality that is worse than it was twenty years ago. This perception is correct, however misguided some of the other points may be.

yummyfajitas 16y ago
I'd like to see evidence that real wages have been declining. (Note: I'm not asking about CPI-adjusted wages, since I think CPI doesn't reflect real prices very well. ) People of my generation, in terms of goods and services, are considerably richer than in my parent's generation. This is true for both the rich and poor - the poor today tend to have more material goods and services than the middle class of the 70's. If real wages (i.e., wages measured in terms of the stuff they could purchase) were going down, that would be impossible. Can you name a single good or service [1] which fewer people today have than in my parent's generation? [1] Note: I'm asking about specific goods or services, not categories of goods or services, since the composition of a category may change over time. E.g., compare land line 1970/1980 to land line 2010, not "telecom 1970" to "telecom 2010", since "telecom 2010" is much broader than "telecom 1970".
- yardie 16y ago
  CPI has changed over time to fit the needs of policy makers. They removed things such as food because the populace wouldn't be pleased if they were told the truth.
- jtbigwoo 16y ago
  > Can you name a single good or service [1] which fewer people today have than in my parent's generation? Fresh food. Fresh hamburger was less than $1 per pound when I was a kid in the late 70's/early 80's. It's $5 per pound now. A five pound bag of onions used to be $1, now it's $6. Home ownership is also increasingly out of reach for younger people. In my suburb, the number of homes affordable on 80% of the median income fell from 70% to 40% in the last ten years. In some neighboring suburbs, it's below 25%.
  - yummyfajitas 16y ago
    Home ownership is currently 67.8%. In 1975 it was 64.6%, which means that home ownership is (slightly) more accessible to people today than in the past. http://en.wikipedia.org/wiki/Homeownership_in_the_United_States http://en.wikipedia.org/wiki/Homeownership_in_the_United_Sta... The average home is also 60% bigger. http://www.realtor.org/RMODaily.nsf/pages/News2007032701?OpenDocument http://www.realtor.org/RMODaily.nsf/pages/News2007032701?Ope... Obviously, these statistics are averaged over the entire country. Some specific regions will behave differently, of course (like your suburb and my hometown). As for the cost of hamburger, your dollar figure comparisons are irrelevant. I never disputed that green pieces of paper are worth less now than in 1970. However, on average wages in 1975, people spent 13.8% of their income on food. Today they only spend 9.6% and they eat out more. http://www.ers.usda.gov/Briefing/CPIFoodAndExpenditures/Data/table7.htm http://www.ers.usda.gov/Briefing/CPIFoodAndExpenditures/Data...
    - dwiel 16y ago
      > However, on average wages in 1975, people spent 13.8% of their income on food. Today they only spend 9.6% and they eat out more. People's diets and 'food' in general are different now too though: see high fructose corn syrup and a huge increase in dietary related disease such as obesity and diabetes for example. You aren't comparing apples to apples.
      - yummyfajitas 16y ago
        Very true. Nowadays we have both access to crappy food as well as a larger variety of both fresh and ethnic foods which were not available in the US back then (e.g., avocados were uncommon when I was a kid). I don't know where to find really good data on this, unfortunately...
- lyudmil 16y ago
  I stand corrected. They have not declined nationally, they've stagnated. If you search for it you'll get the data, but here's a supporting quote: ...from 1973 to 2005... real hourly wages of those in the 90th percentile—where most people have college or advanced degrees—rose by 30 percent or more... among this top 10 percent, the growth was heavily concentrated at the very tip of the top, that is, the top 1 percent. This includes the people who earn the very highest salaries in the U.S. economy, like sports and entertainment stars, investment bankers and venture capitalists, corporate attorneys, and CEOs. In contrast, at the 50th percentile and below—where many people have at most a high school diploma—real wages rose by only 5 to 10 percent Janet L. Yellen, President and CEO, Federal Reserve Bank of San Francisco, November 6, 2006 As for CPI-adjusted wages - even though CPI isn't perfect, it's still useful. Certainly better than the anecdotal evidence you're asking for. Also, if anything CPI is under-reported, so CPI-adjusted wages should be considered a conservative estimate, which is all we're after here.

by lyudmil 16y ago

yummyfajitas 16y ago

I'd like to see evidence that real wages have been declining. (Note: I'm not asking about CPI-adjusted wages, since I think CPI doesn't reflect real prices very well. ) People of my generation, in terms of goods and services, are considerably richer than in my parent's generation. This is true for both the rich and poor - the poor today tend to have more material goods and services than the middle class of the 70's. If real wages (i.e., wages measured in terms of the stuff they could purchase) were going down, that would be impossible. Can you name a single good or service [1] which fewer people today have than in my parent's generation? [1] Note: I'm asking about specific goods or services, not categories of goods or services, since the composition of a category may change over time. E.g., compare land line 1970/1980 to land line 2010, not "telecom 1970" to "telecom 2010", since "telecom 2010" is much broader than "telecom 1970".

yardie 16y ago
CPI has changed over time to fit the needs of policy makers. They removed things such as food because the populace wouldn't be pleased if they were told the truth.
jtbigwoo 16y ago
> Can you name a single good or service [1] which fewer people today have than in my parent's generation? Fresh food. Fresh hamburger was less than $1 per pound when I was a kid in the late 70's/early 80's. It's $5 per pound now. A five pound bag of onions used to be $1, now it's $6. Home ownership is also increasingly out of reach for younger people. In my suburb, the number of homes affordable on 80% of the median income fell from 70% to 40% in the last ten years. In some neighboring suburbs, it's below 25%.
- yummyfajitas 16y ago
  Home ownership is currently 67.8%. In 1975 it was 64.6%, which means that home ownership is (slightly) more accessible to people today than in the past. http://en.wikipedia.org/wiki/Homeownership_in_the_United_States http://en.wikipedia.org/wiki/Homeownership_in_the_United_Sta... The average home is also 60% bigger. http://www.realtor.org/RMODaily.nsf/pages/News2007032701?OpenDocument http://www.realtor.org/RMODaily.nsf/pages/News2007032701?Ope... Obviously, these statistics are averaged over the entire country. Some specific regions will behave differently, of course (like your suburb and my hometown). As for the cost of hamburger, your dollar figure comparisons are irrelevant. I never disputed that green pieces of paper are worth less now than in 1970. However, on average wages in 1975, people spent 13.8% of their income on food. Today they only spend 9.6% and they eat out more. http://www.ers.usda.gov/Briefing/CPIFoodAndExpenditures/Data/table7.htm http://www.ers.usda.gov/Briefing/CPIFoodAndExpenditures/Data...
  - dwiel 16y ago
    > However, on average wages in 1975, people spent 13.8% of their income on food. Today they only spend 9.6% and they eat out more. People's diets and 'food' in general are different now too though: see high fructose corn syrup and a huge increase in dietary related disease such as obesity and diabetes for example. You aren't comparing apples to apples.
    - yummyfajitas 16y ago
      Very true. Nowadays we have both access to crappy food as well as a larger variety of both fresh and ethnic foods which were not available in the US back then (e.g., avocados were uncommon when I was a kid). I don't know where to find really good data on this, unfortunately...
lyudmil 16y ago
I stand corrected. They have not declined nationally, they've stagnated. If you search for it you'll get the data, but here's a supporting quote: ...from 1973 to 2005... real hourly wages of those in the 90th percentile—where most people have college or advanced degrees—rose by 30 percent or more... among this top 10 percent, the growth was heavily concentrated at the very tip of the top, that is, the top 1 percent. This includes the people who earn the very highest salaries in the U.S. economy, like sports and entertainment stars, investment bankers and venture capitalists, corporate attorneys, and CEOs. In contrast, at the 50th percentile and below—where many people have at most a high school diploma—real wages rose by only 5 to 10 percent Janet L. Yellen, President and CEO, Federal Reserve Bank of San Francisco, November 6, 2006 As for CPI-adjusted wages - even though CPI isn't perfect, it's still useful. Certainly better than the anecdotal evidence you're asking for. Also, if anything CPI is under-reported, so CPI-adjusted wages should be considered a conservative estimate, which is all we're after here.