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This bullshit article tries to paint a rosy picture of the economy by dismissing proportional median income gains between quintiles and instead argues that abso

This bullshit article tries to paint a rosy picture of the economy by dismissing proportional median income gains between quintiles and instead argues that absolute income gains of individuals over time is enough evidence to suggest everything is actually great. This chart [1] seems to be the crux of their argument, as in - Surprise! Over 30 years poor people gained an average of almost $30k in income! I sure fucking hope someone who started at minimum wage in 1980 is making $30k more today. And even though the median income of the top 1% went from $189,000 to $843,000 in that sime timeframe, that's not important because in our sample, the average income of those in the top QUINTILE actually FELL $7k. Guess you couldn't find any 1%ers for your study? Bottom line - if the economy can't support a living wage for the working class, it's not doing all that great. [1] https://cdn-images-1.medium.com/max/2000/1*Z5rBoco1CtNVHYZdhWn4QQ.jpeg https://cdn-images-1.medium.com/max/2000/1*Z5rBoco1CtNVHYZdh...

JAlexoid 8y ago
Well... To be fair - people that use this inaccurate measure dig their own grave. It's not a good metric, by far.
rconti 8y ago
even worse; absolute household income gains over time, not accounting for the increase in person-hours worked outside of the home, nor the corresponding increases in yard work, housekeeping, child care, meal preparation costs....
pwaivers 8y ago
> Surprise! Over 30 years poor people gained an average of almost $30k in income! I sure fucking hope someone who started at minimum wage in 1980 is making $30k more today. Well this is an important part of his argument. The people's wages are not stagnant, but rather they went up an 30K (including inflation). That fact this their wages went up is not trivial.
- scarmig 8y ago
  Not to the overall structure of the economy. Imagine this: at one high school, there's a 80% literacy rate in the 2008 class. Then it drops to a 60% rate for the 2018 class. Even if the 2008 cohort may now have a 90% literacy rate, that doesn't change the fact that the school is declining in literacy, and trying to argue otherwise verges on duplicitous.
- munificent 8y ago
  But that's not a useful fact. People are going to get older regardless of what economic policy choices you make, so observing that people go through economic changes as they age isn't actionable. By analogy, if you're trying to choose effective dietary policy, a study that shows people got taller over the past twenty years isn't helpful if you measure the same people. All it shows you is that children grow larger as they become adults.
  - refurb 8y ago
    What is the connection between aging and wages? Sure, most people make more money when they get older, but this was looking at ~40 to retirement when people are already at their peak earnings. I wouldn't take it for granted that the older you are the more you make.
munificent 8y ago
Thank you for writing this comment so that I don't feel like a crazy person after reading this article. It came across to me as so obviously flawed that it's hard to even apply Hanlon's Razor to it. Not once does he mention of any correction for the obvious bias that people make different amounts at different points in their careers. Using his exact same process, you could also show that the average height of Americans has increased significantly in the past thirty years, possibly up to a foot! Because, duh, people are shorter when they're kids. If you're trying to measure how the economy is doing over time, you don't want panels, you want to compare equivalent people at different points in time. Comparing a 20 year old in 1980 to a 50 year old in 2010 confounds the differences between 1980 and 2010 with the differences between being 20 and being 50. There are reasonable criticisms that identifying representative "equal" people over time is hard, but the author's solution seems dramatically worse than all of them.
- tanderson92 8y ago
  One huge blind spot in using panel data over a 34 year period is that a lot of the people you are initially looking at are retired, and so do not typically pay as much tax or otherwise need to make the same amount of income to have the same standard of living. The article is very poorly framed and argued.
- lgats 8y ago
  Hanlon's razor is an aphorism expressed in various ways, including: Never attribute to malice that which is adequately explained by stupidity https://en.wikipedia.org/wiki/Hanlon%27s_razor https://en.wikipedia.org/wiki/Hanlon%27s_razor
- chrismanfrank 8y ago
  From the article: "The study looks at people who were 35–40 in 1987 and then looks at how they were doing 20 years later, when they are 55–60. The median income of the people in the top 20% in 1987 ended up 5% lower twenty years later. The people in the middle 20% ended up with median income that was 27% higher. And if you started in the bottom 20%, your income doubled. If you were in the top 1% in 1987, 20 years later, median income was 29% lower."
kevin_thibedeau 8y ago
I make less than I did as a junior engineer 18 years ago after accounting for inflation and COLA. Assuming my accumulated experience is worth nothing or I guess it apparently has negative value. Not all ships rise.
- SketchySeaBeast 8y ago
  Was that large junior wage due to the 2000's cyber boom and was later readjusted to the new reality? Or has your wage actually remained stagnant / rose slower than inflation since that time?
  - kevin_thibedeau 8y ago
    I started at $55K in 2000. That was in line with normal and not part of the dotcom boom.
    - oh_sigh 8y ago
      So you make $80k now or so? What has your career path been like? I can't imagine a senior engineer only making 80k/yr
      - kevin_thibedeau 8y ago
        I make more than that but living in a higher cost of living area nullifies that gain.
refurb 8y ago
I think you're missing the point of the article. When you actually follow the same people, the poor see the greater increase in income than the most wealthy. You may poo-poo a $30K inflation-adjusted increase in pay, but that moves someone from the lower class to the middle class. Isn't that the goal?
- JAlexoid 8y ago
  That's social mobility, not wage growth. Those are not the same thing. It's akin to arguing that wage growth is looking at income of a person that was flipping burgers while in school 10 years ago now leads an engineering team. It's not the same job, not the adequate comparison. I presume you work in IT related field, so imagine you decided to take a break and be a parking lot attendant... You cannot then quote your own example as an instance of falling wages for IT workers.
  - refurb 8y ago
    You can't have social mobility without wage growth, so I'm not sure what you're getting at. And it doesn't matter if it's not the same job. The argument has always been about opportunity and the key point of this article is for people who start out in the lowest income quintile, the average wages doubles over time. That's opportunity.
    - JAlexoid 8y ago
      But this isn't wage growth. When you switch between different socioeconomic profession groups, the wage of your previous socioeconomic group doesn't change because your wages have changed. Socioeconomic group isn't for life, you know. Once you become rich, you stop being poor. Except that wage growth debate isn't about opportunity. He's trying to argue about oranges, when the initial issue is about apples. Arguments about wage growth are about costs, productivity and compensation. As in - if you're 2x more productive at doing the same job, then the gains are deposited somewhere. The argument in the end is that productivity gains are not distributed at a fair level. Equal isn't ever a requirement for a stable society, fair is enough.
hopefulengineer 8y ago
It's supply and demand 101, illegal immigration combined with offshoring lowers wages and increases profit margin for the wealthy. Low wage jobs are taken by illegal immigrants, forcing US citizens to take on debt to go to college, where wages are also lowered because there are now thousands of college grads desperate to pay off their debt that can't be eliminated through bankruptcy due to congress being lobbied. A wonderful scam. Same thing with big tech companies pushing for more H1B to push down engineering wages and lower standard of living. This stuff shouldn't even be left vs right, it should be common sense. Here's bernie sanders talking about how open boarders is pushed by the koch brothers to give them cheap labor https://www.youtube.com/watch?v=vf-k6qOfXz0 https://www.youtube.com/watch?v=vf-k6qOfXz0 We're rapidly heading towards feudalism 2.0. You can already see it in the Bay Area(and essentially any major urban area) where only the wealthy can afford a home. The majority pay a large chunk of their income to their landlord
- conanbatt 8y ago
  Cant see the video now but is Bernie Sanders in favor of the wall then?
- bdamm 8y ago
  Eh.. it's not that obvious to me. H1B is a result of America having widespread problems producing well educated Americans.
  - hopefulengineer 8y ago
    My point is that we should be offering citizenship to these people instead of H1B, which is glorified indentured servitude that only benefits giant corporations. Not to mention the blatant fraud in hiring practices companies use to justify more, ie: nobody in the US has 15 years of experience with ReactJS, tensorflow, or another technology that hasn't even existed that long, so we need more visas. If it was actually about getting talent and not driving down wages we would be giving these people citizenship.
- fzeroracer 8y ago
  I'd like you to actually cite those claims you've made, because so far you've just repeated a lot of nonsense I hear from people that refuse to back up their arguments with empirical evidence. Immigration is hardly the issue. Low-wage jobs exist because of the lack of labor protections for workers resulting in companies looking for the cheapest and most efficient labor they can, even if it means tapping desperate people who have no other options. If you want to fix the problem, you start by increasing the minimum wage and having proper healthcare. Any other complaints about illegal immigration driving down wages is in my opinion deflection. Because if you remove illegal immigration, they'll just move to exploiting the next most vulnerable population (prison labor, people with disabilities etc)
mediaobs1 8y ago
On the source: I generally like EconTalk and Russ Roberts, but they come from a particular ideological perspective. Roberts is at the Hoover Inst (a rightwing think tank that gets major funding from rightwing billionaires). And EconTalk itself is funded by a libertarian (Koch-type libertarian, not Niskanen-type libertarian) foundation. https://en.m.wikipedia.org/wiki/Liberty_Fund https://en.m.wikipedia.org/wiki/Liberty_Fund I think Roberts has a lot of interesting podcasts but he’s flat wrong on this one. I think Piketty, Saez, Zucman, Krugman, DeLong, Stiglitz, etc. are the people to read on wealth inequality and concentration. Oh, and on that line- this recent series from TPM is great on wealth concentration and how it leads to uncertainty and unhappiness. https://talkingpointsmemo.com/feature/what-is-social-insurance-why-does-it-matter https://talkingpointsmemo.com/feature/what-is-social-insuran... And this older series from TPM on the same topic. (Brad DeLong) http://talkingpointsmemo.com/features/marchtoinequality/fourmeltingsocialdemocracy/ http://talkingpointsmemo.com/features/marchtoinequality/four...
xupybd 8y ago
>Bottom line - if the economy can't support a living wage for the working class, it's not doing all that great. Hasn't the standard of living risen for the working class over the 30 years? This is an absolute position, has it ever been better the case in the past?

JAlexoid 8y ago

Well... To be fair - people that use this inaccurate measure dig their own grave. It's not a good metric, by far.

rconti 8y ago

even worse; absolute household income gains over time, not accounting for the increase in person-hours worked outside of the home, nor the corresponding increases in yard work, housekeeping, child care, meal preparation costs....

pwaivers 8y ago

> Surprise! Over 30 years poor people gained an average of almost $30k in income! I sure fucking hope someone who started at minimum wage in 1980 is making $30k more today. Well this is an important part of his argument. The people's wages are not stagnant, but rather they went up an 30K (including inflation). That fact this their wages went up is not trivial.

scarmig 8y ago
Not to the overall structure of the economy. Imagine this: at one high school, there's a 80% literacy rate in the 2008 class. Then it drops to a 60% rate for the 2018 class. Even if the 2008 cohort may now have a 90% literacy rate, that doesn't change the fact that the school is declining in literacy, and trying to argue otherwise verges on duplicitous.
munificent 8y ago
But that's not a useful fact. People are going to get older regardless of what economic policy choices you make, so observing that people go through economic changes as they age isn't actionable. By analogy, if you're trying to choose effective dietary policy, a study that shows people got taller over the past twenty years isn't helpful if you measure the same people. All it shows you is that children grow larger as they become adults.
- refurb 8y ago
  What is the connection between aging and wages? Sure, most people make more money when they get older, but this was looking at ~40 to retirement when people are already at their peak earnings. I wouldn't take it for granted that the older you are the more you make.

munificent 8y ago

Thank you for writing this comment so that I don't feel like a crazy person after reading this article. It came across to me as so obviously flawed that it's hard to even apply Hanlon's Razor to it. Not once does he mention of any correction for the obvious bias that people make different amounts at different points in their careers. Using his exact same process, you could also show that the average height of Americans has increased significantly in the past thirty years, possibly up to a foot! Because, duh, people are shorter when they're kids. If you're trying to measure how the economy is doing over time, you don't want panels, you want to compare equivalent people at different points in time. Comparing a 20 year old in 1980 to a 50 year old in 2010 confounds the differences between 1980 and 2010 with the differences between being 20 and being 50. There are reasonable criticisms that identifying representative "equal" people over time is hard, but the author's solution seems dramatically worse than all of them.

tanderson92 8y ago
One huge blind spot in using panel data over a 34 year period is that a lot of the people you are initially looking at are retired, and so do not typically pay as much tax or otherwise need to make the same amount of income to have the same standard of living. The article is very poorly framed and argued.
lgats 8y ago
Hanlon's razor is an aphorism expressed in various ways, including: Never attribute to malice that which is adequately explained by stupidity https://en.wikipedia.org/wiki/Hanlon%27s_razor https://en.wikipedia.org/wiki/Hanlon%27s_razor
chrismanfrank 8y ago
From the article: "The study looks at people who were 35–40 in 1987 and then looks at how they were doing 20 years later, when they are 55–60. The median income of the people in the top 20% in 1987 ended up 5% lower twenty years later. The people in the middle 20% ended up with median income that was 27% higher. And if you started in the bottom 20%, your income doubled. If you were in the top 1% in 1987, 20 years later, median income was 29% lower."

kevin_thibedeau 8y ago

I make less than I did as a junior engineer 18 years ago after accounting for inflation and COLA. Assuming my accumulated experience is worth nothing or I guess it apparently has negative value. Not all ships rise.

SketchySeaBeast 8y ago
Was that large junior wage due to the 2000's cyber boom and was later readjusted to the new reality? Or has your wage actually remained stagnant / rose slower than inflation since that time?
- kevin_thibedeau 8y ago
  I started at $55K in 2000. That was in line with normal and not part of the dotcom boom.
  - oh_sigh 8y ago
    So you make $80k now or so? What has your career path been like? I can't imagine a senior engineer only making 80k/yr
    - kevin_thibedeau 8y ago
      I make more than that but living in a higher cost of living area nullifies that gain.

refurb 8y ago

I think you're missing the point of the article. When you actually follow the same people, the poor see the greater increase in income than the most wealthy. You may poo-poo a $30K inflation-adjusted increase in pay, but that moves someone from the lower class to the middle class. Isn't that the goal?

JAlexoid 8y ago
That's social mobility, not wage growth. Those are not the same thing. It's akin to arguing that wage growth is looking at income of a person that was flipping burgers while in school 10 years ago now leads an engineering team. It's not the same job, not the adequate comparison. I presume you work in IT related field, so imagine you decided to take a break and be a parking lot attendant... You cannot then quote your own example as an instance of falling wages for IT workers.
- refurb 8y ago
  You can't have social mobility without wage growth, so I'm not sure what you're getting at. And it doesn't matter if it's not the same job. The argument has always been about opportunity and the key point of this article is for people who start out in the lowest income quintile, the average wages doubles over time. That's opportunity.
  - JAlexoid 8y ago
    But this isn't wage growth. When you switch between different socioeconomic profession groups, the wage of your previous socioeconomic group doesn't change because your wages have changed. Socioeconomic group isn't for life, you know. Once you become rich, you stop being poor. Except that wage growth debate isn't about opportunity. He's trying to argue about oranges, when the initial issue is about apples. Arguments about wage growth are about costs, productivity and compensation. As in - if you're 2x more productive at doing the same job, then the gains are deposited somewhere. The argument in the end is that productivity gains are not distributed at a fair level. Equal isn't ever a requirement for a stable society, fair is enough.

hopefulengineer 8y ago

It's supply and demand 101, illegal immigration combined with offshoring lowers wages and increases profit margin for the wealthy. Low wage jobs are taken by illegal immigrants, forcing US citizens to take on debt to go to college, where wages are also lowered because there are now thousands of college grads desperate to pay off their debt that can't be eliminated through bankruptcy due to congress being lobbied. A wonderful scam. Same thing with big tech companies pushing for more H1B to push down engineering wages and lower standard of living. This stuff shouldn't even be left vs right, it should be common sense. Here's bernie sanders talking about how open boarders is pushed by the koch brothers to give them cheap labor https://www.youtube.com/watch?v=vf-k6qOfXz0 https://www.youtube.com/watch?v=vf-k6qOfXz0 We're rapidly heading towards feudalism 2.0. You can already see it in the Bay Area(and essentially any major urban area) where only the wealthy can afford a home. The majority pay a large chunk of their income to their landlord

conanbatt 8y ago
Cant see the video now but is Bernie Sanders in favor of the wall then?
bdamm 8y ago
Eh.. it's not that obvious to me. H1B is a result of America having widespread problems producing well educated Americans.
- hopefulengineer 8y ago
  My point is that we should be offering citizenship to these people instead of H1B, which is glorified indentured servitude that only benefits giant corporations. Not to mention the blatant fraud in hiring practices companies use to justify more, ie: nobody in the US has 15 years of experience with ReactJS, tensorflow, or another technology that hasn't even existed that long, so we need more visas. If it was actually about getting talent and not driving down wages we would be giving these people citizenship.
fzeroracer 8y ago
I'd like you to actually cite those claims you've made, because so far you've just repeated a lot of nonsense I hear from people that refuse to back up their arguments with empirical evidence. Immigration is hardly the issue. Low-wage jobs exist because of the lack of labor protections for workers resulting in companies looking for the cheapest and most efficient labor they can, even if it means tapping desperate people who have no other options. If you want to fix the problem, you start by increasing the minimum wage and having proper healthcare. Any other complaints about illegal immigration driving down wages is in my opinion deflection. Because if you remove illegal immigration, they'll just move to exploiting the next most vulnerable population (prison labor, people with disabilities etc)

mediaobs1 8y ago

On the source: I generally like EconTalk and Russ Roberts, but they come from a particular ideological perspective. Roberts is at the Hoover Inst (a rightwing think tank that gets major funding from rightwing billionaires). And EconTalk itself is funded by a libertarian (Koch-type libertarian, not Niskanen-type libertarian) foundation. https://en.m.wikipedia.org/wiki/Liberty_Fund https://en.m.wikipedia.org/wiki/Liberty_Fund I think Roberts has a lot of interesting podcasts but he’s flat wrong on this one. I think Piketty, Saez, Zucman, Krugman, DeLong, Stiglitz, etc. are the people to read on wealth inequality and concentration. Oh, and on that line- this recent series from TPM is great on wealth concentration and how it leads to uncertainty and unhappiness. https://talkingpointsmemo.com/feature/what-is-social-insurance-why-does-it-matter https://talkingpointsmemo.com/feature/what-is-social-insuran... And this older series from TPM on the same topic. (Brad DeLong) http://talkingpointsmemo.com/features/marchtoinequality/fourmeltingsocialdemocracy/ http://talkingpointsmemo.com/features/marchtoinequality/four...

xupybd 8y ago

>Bottom line - if the economy can't support a living wage for the working class, it's not doing all that great. Hasn't the standard of living risen for the working class over the 30 years? This is an absolute position, has it ever been better the case in the past?