6 ms·

> everyone is lifted up and made richer over time Really? In the 1970's in the US it was possible to own a house and support a family of 4 on a single income

by skohan 6y ago

> everyone is lifted up and made richer over time Really? In the 1970's in the US it was possible to own a house and support a family of 4 on a single income in the manufacturing sector. It was also possible to work your way through college and exit with a degree and no debt, in a job market which made that worth it. Yes global poverty has decreased, but the material standard of living has decreased for most people in the working class in the developed world, while wealth has skyrocketed for a select lucky few. It's more complex than saying "everyone is made richer" - it seems what has happened is that a few people have been made much richer, and everyone else is somehow equalizing somewhere closer to the bottom.

ksec 6y ago
I think both what you said and parents are true. The problem isn't with the "Single Income" part. It is with the "cost" of hosting and medical care. The world in general has a huge incentive in driving up asset prices. And Housing is one of the biggest asset.( Correct me if it is not the biggest ) And rent is the biggest expenses in living cost. What needs to be done is fixing housing prices / supply.
- skohan 6y ago
  I agree - I think housing functioning as an asset and also as a functional human need are conflicting interests. Like if food were also subject to speculation, this would cause a lot of suffering.
thunderbird120 6y ago
>the material standard of living has decreased for most people in the working class in the developed world Who told you that? Both inflation adjusted median personal and household income have increased by double digit percentages over the past 50 years. In the case of household incomes that still happened even with the shrinking average household size (i.e. number of people in a household). [1]https://fred.stlouisfed.org/series/MEPAINUSA672N#0 https://fred.stlouisfed.org/series/MEPAINUSA672N#0 [2]https://fred.stlouisfed.org/series/MEHOINUSA672N/ https://fred.stlouisfed.org/series/MEHOINUSA672N/
- novok 6y ago
  You're not focusing on the other side of his statement, where costs for housing, healthcare and education have also skyrocketed, along with the development of the two income trap. What he said isn't controversial for most academics studying this. https://en.wikipedia.org/wiki/The_Two-Income_Trap https://en.wikipedia.org/wiki/The_Two-Income_Trap https://medium.com/@6pranavk/insight-of-the-day-cost-disease-c14f50c1cd2e https://medium.com/@6pranavk/insight-of-the-day-cost-disease...
  - wernercd 6y ago
    And neither of you are focusing on the "extra" stuff you don't "need" - high speed phones, large TVs, cars with air bags, etc. Want to compare to 1970? Then live with those restrictions and you'll probably have enough money to pay for insurance, college, etc.
    - skohan 6y ago
      The numbers don't add up. This is essentially the math which blames avocado toast for why millennials aren't buying homes. If the price of university has doubled relative to median wages in the past 50 years, you're going to have to buy an awful lot of smartphones every year to account for that difference.
      - s1artibartfast 6y ago
        The numbers add up when you add in healthcare, which has captured an increasing portion of workers compensation.
        deleted 6y ago
        [deleted]
    - sagarm 6y ago
      This is simply not true. Education, healthcare, and housing costs have far outpaced inflation.
xster 6y ago
> Really? In the 1970's in the US it was possible to own a house and support a family of 4 on a single income in the manufacturing sector. It was also possible to work your way through college and exit with a degree and no debt, in a job market which made that worth it.m This is more of a feature of the transition from a Bretton Woods/Treasury/politics-based monetary policy to neoliberal/central bank/finance-based one no? At 10% inflation, the creditors just ate most of your mortgage debt regardless of whether you worked in manufacturing or not.
- skohan 6y ago
  Probably it was a combination of factors, but I imagine the transition to a service-based economy and the outsourcing of entire sectors of jobs relying on large pools of organized labor didn't help the situation
pkulak 6y ago
I always figured that was because WW2 destroyed Europe, Russia and Japan, forcing the entire world to buy from us for 30 years. I don't think it's anything that can be replicated.
- virtue3 6y ago
  And China, and large parts of Africa. The Philippines. Probably a lot more than I can remember. Your point stands tho. Basically everywhere that wasn't the US and Canada (excluding Pearl Harbor).
  - oblio 6y ago
    Even Pearl Harbor caused minor damage, all things considered. I think many of the facilities were repaired and rebuilt within 1 year while many of the ships were actually recovered. The carriers weren't even there during the attack. For the US it was a huge shock, for a country like Poland it was Tuesday.
    - ethbro 6y ago
      Because I was curious, Friday might have been a better analogy. https://en.wikipedia.org/wiki/September_1939#September_1,_1939_(Friday) https://en.wikipedia.org/wiki/September_1939#September_1,_19...
      - virtue3 6y ago
        I think he was referring to the highly famous quite (/s) from Street Fighter the movie delivered by Raúl Juliá
        oblio 6y ago
        Hey, a little respect for the quote! It's even up on TV Tropes: https://tvtropes.org/pmwiki/pmwiki.php/Main/ButForMeItWasTuesday https://tvtropes.org/pmwiki/pmwiki.php/Main/ButForMeItWasTue... I'll be honest and say I didn't even know the origin of the quote :-))
scythe 6y ago
> In the 1970's in the US it was possible to own a house and support a family of 4 on a single income in the manufacturing sector. Modern expectations mean that this isn't what people think it is. You also owned one car per family in the '70s; new houses often have to build two parking spaces. Housing prices were held down because public housing was still being built; today it's unmaintained and often torn down. Old houses were built on small lots; suburbs today require a quarter-acre. Colleges received way more public funding as a proportion of their income than they do today, and enrollment was lower. Housing has gone from subsidized to restricted and college has gone from subsidized to free-market while demand keeps rising. It's not surprising that the price increased. (And the protectionism lobby is now also the anti-housing lobby!)
hajile 6y ago
> Really? In the 1970's in the US it was possible to own a house and support a family of 4 on a single income in the manufacturing sector. It was also possible to work your way through college and exit with a degree and no debt, in a job market which made that worth it. Since the 1970s, physical house size has increased from around 1600 sq.ft to around 2600 sq.ft. At the same time, house occupants has dropped from about 3 to about 2.5 [0]. In addition to that, the building requirements and safety features have increased costs significantly per square foot. Average house price in 1975 was around 42k [1]. That is a little over 200k in 2020 dollars [2]. Doing some math with 200k/1600 vs 380k/2600 gives $125/sq.ft and $146/sq.ft or roughly a 14% increase in relative cost. In 1975, median income was around 12k [3] while median income in 2018 was around 63k [4]. (EDIT: I'd note that I'm being generous as home prices dropped significantly this year and I went with the higher numbers) SHOCK!!!! An average house in 1975 is 16.5x the yearly income while an average house in 2020 is only 6x yearly income despite being 40% bigger and 15% less occupied while being safer to live in as well. I'll give you college debt, but for all the wrong reasons. The government artificially incentivizes bad loans. They insist that kids CAN'T get that 380k house loan (even though the house is collateral), but also insist that kids CAN get that same 380k for a piece of (often useless) paper without any collateral backing. Get rid of the stupid laws and you'll watch that problem go away all by itself. Get rid of the pressure to have a degree to sweep floors and you'll watch college prices fall even faster. [0] https://www.aei.org/carpe-diem/new-us-homes-today-are-1000-square-feet-larger-than-in-1973-and-living-space-per-person-has-nearly-doubled/ https://www.aei.org/carpe-diem/new-us-homes-today-are-1000-s... [1] https://fred.stlouisfed.org/series/ASPUS https://fred.stlouisfed.org/series/ASPUS [2] https://www.usinflationcalculator.com/ https://www.usinflationcalculator.com/ [3] https://www2.census.gov/prod2/popscan/p60-104.pdf https://www2.census.gov/prod2/popscan/p60-104.pdf] [4] https://www.census.gov/library/stories/2019/09/us-median-household-income-not-significantly-different-from-2017.html https://www.census.gov/library/stories/2019/09/us-median-hou...
- skohan 6y ago
  The government not only incentivizes bad loans, they also exempt college debt from the bankruptcy process. And these are loans people are supposed to agree to when they are 17-18 years old. It's an insane system if you ask me. As a side-note, lately I've been curious about what's actually been driving the cost of higher education. I know it's often cited as "administrative costs", but what does that actually mean? Where does the money actually go?
AkshatM 6y ago
You're arguing income inequality has worsened in spite of free trade, which is fine, but I think the original comment's point was that free trade carries some benefits, which is a separate argument altogether (that is, they are not asserting free trade is a panacea). It could be the case that some other cause has led to increased income inequality, which then would not affect the free-trade-has-benefits argument. Here is a Brookings report that explores whether global trade has directly contributed to worsening income inequality: https://www.brookings.edu/articles/worsening-american-income-inequality-is-world-trade-to-blame/ https://www.brookings.edu/articles/worsening-american-income...
Petrova 6y ago
There was also less competition in the job market because women only worked a subset of lower paying jobs if they worked at all.

by skohan 6y ago

ksec 6y ago

I think both what you said and parents are true. The problem isn't with the "Single Income" part. It is with the "cost" of hosting and medical care. The world in general has a huge incentive in driving up asset prices. And Housing is one of the biggest asset.( Correct me if it is not the biggest ) And rent is the biggest expenses in living cost. What needs to be done is fixing housing prices / supply.

skohan 6y ago
I agree - I think housing functioning as an asset and also as a functional human need are conflicting interests. Like if food were also subject to speculation, this would cause a lot of suffering.

thunderbird120 6y ago

>the material standard of living has decreased for most people in the working class in the developed world Who told you that? Both inflation adjusted median personal and household income have increased by double digit percentages over the past 50 years. In the case of household incomes that still happened even with the shrinking average household size (i.e. number of people in a household). [1]https://fred.stlouisfed.org/series/MEPAINUSA672N#0 https://fred.stlouisfed.org/series/MEPAINUSA672N#0 [2]https://fred.stlouisfed.org/series/MEHOINUSA672N/ https://fred.stlouisfed.org/series/MEHOINUSA672N/

novok 6y ago
You're not focusing on the other side of his statement, where costs for housing, healthcare and education have also skyrocketed, along with the development of the two income trap. What he said isn't controversial for most academics studying this. https://en.wikipedia.org/wiki/The_Two-Income_Trap https://en.wikipedia.org/wiki/The_Two-Income_Trap https://medium.com/@6pranavk/insight-of-the-day-cost-disease-c14f50c1cd2e https://medium.com/@6pranavk/insight-of-the-day-cost-disease...
- wernercd 6y ago
  And neither of you are focusing on the "extra" stuff you don't "need" - high speed phones, large TVs, cars with air bags, etc. Want to compare to 1970? Then live with those restrictions and you'll probably have enough money to pay for insurance, college, etc.
  - skohan 6y ago
    The numbers don't add up. This is essentially the math which blames avocado toast for why millennials aren't buying homes. If the price of university has doubled relative to median wages in the past 50 years, you're going to have to buy an awful lot of smartphones every year to account for that difference.
    - s1artibartfast 6y ago
      The numbers add up when you add in healthcare, which has captured an increasing portion of workers compensation.
      - deleted 6y ago
        [deleted]
  - sagarm 6y ago
    This is simply not true. Education, healthcare, and housing costs have far outpaced inflation.

xster 6y ago

skohan 6y ago
Probably it was a combination of factors, but I imagine the transition to a service-based economy and the outsourcing of entire sectors of jobs relying on large pools of organized labor didn't help the situation

pkulak 6y ago

I always figured that was because WW2 destroyed Europe, Russia and Japan, forcing the entire world to buy from us for 30 years. I don't think it's anything that can be replicated.

virtue3 6y ago
And China, and large parts of Africa. The Philippines. Probably a lot more than I can remember. Your point stands tho. Basically everywhere that wasn't the US and Canada (excluding Pearl Harbor).
- oblio 6y ago
  Even Pearl Harbor caused minor damage, all things considered. I think many of the facilities were repaired and rebuilt within 1 year while many of the ships were actually recovered. The carriers weren't even there during the attack. For the US it was a huge shock, for a country like Poland it was Tuesday.
  - ethbro 6y ago
    Because I was curious, Friday might have been a better analogy. https://en.wikipedia.org/wiki/September_1939#September_1,_1939_(Friday) https://en.wikipedia.org/wiki/September_1939#September_1,_19...
    - virtue3 6y ago
      I think he was referring to the highly famous quite (/s) from Street Fighter the movie delivered by Raúl Juliá
      - oblio 6y ago
        Hey, a little respect for the quote! It's even up on TV Tropes: https://tvtropes.org/pmwiki/pmwiki.php/Main/ButForMeItWasTuesday https://tvtropes.org/pmwiki/pmwiki.php/Main/ButForMeItWasTue... I'll be honest and say I didn't even know the origin of the quote :-))

scythe 6y ago

> In the 1970's in the US it was possible to own a house and support a family of 4 on a single income in the manufacturing sector. Modern expectations mean that this isn't what people think it is. You also owned one car per family in the '70s; new houses often have to build two parking spaces. Housing prices were held down because public housing was still being built; today it's unmaintained and often torn down. Old houses were built on small lots; suburbs today require a quarter-acre. Colleges received way more public funding as a proportion of their income than they do today, and enrollment was lower. Housing has gone from subsidized to restricted and college has gone from subsidized to free-market while demand keeps rising. It's not surprising that the price increased. (And the protectionism lobby is now also the anti-housing lobby!)

hajile 6y ago

> Really? In the 1970's in the US it was possible to own a house and support a family of 4 on a single income in the manufacturing sector. It was also possible to work your way through college and exit with a degree and no debt, in a job market which made that worth it. Since the 1970s, physical house size has increased from around 1600 sq.ft to around 2600 sq.ft. At the same time, house occupants has dropped from about 3 to about 2.5 [0]. In addition to that, the building requirements and safety features have increased costs significantly per square foot. Average house price in 1975 was around 42k [1]. That is a little over 200k in 2020 dollars [2]. Doing some math with 200k/1600 vs 380k/2600 gives $125/sq.ft and $146/sq.ft or roughly a 14% increase in relative cost. In 1975, median income was around 12k [3] while median income in 2018 was around 63k [4]. (EDIT: I'd note that I'm being generous as home prices dropped significantly this year and I went with the higher numbers) SHOCK!!!! An average house in 1975 is 16.5x the yearly income while an average house in 2020 is only 6x yearly income despite being 40% bigger and 15% less occupied while being safer to live in as well. I'll give you college debt, but for all the wrong reasons. The government artificially incentivizes bad loans. They insist that kids CAN'T get that 380k house loan (even though the house is collateral), but also insist that kids CAN get that same 380k for a piece of (often useless) paper without any collateral backing. Get rid of the stupid laws and you'll watch that problem go away all by itself. Get rid of the pressure to have a degree to sweep floors and you'll watch college prices fall even faster. [0] https://www.aei.org/carpe-diem/new-us-homes-today-are-1000-square-feet-larger-than-in-1973-and-living-space-per-person-has-nearly-doubled/ https://www.aei.org/carpe-diem/new-us-homes-today-are-1000-s... [1] https://fred.stlouisfed.org/series/ASPUS https://fred.stlouisfed.org/series/ASPUS [2] https://www.usinflationcalculator.com/ https://www.usinflationcalculator.com/ [3] https://www2.census.gov/prod2/popscan/p60-104.pdf https://www2.census.gov/prod2/popscan/p60-104.pdf] [4] https://www.census.gov/library/stories/2019/09/us-median-household-income-not-significantly-different-from-2017.html https://www.census.gov/library/stories/2019/09/us-median-hou...

skohan 6y ago
The government not only incentivizes bad loans, they also exempt college debt from the bankruptcy process. And these are loans people are supposed to agree to when they are 17-18 years old. It's an insane system if you ask me. As a side-note, lately I've been curious about what's actually been driving the cost of higher education. I know it's often cited as "administrative costs", but what does that actually mean? Where does the money actually go?

AkshatM 6y ago

You're arguing income inequality has worsened in spite of free trade, which is fine, but I think the original comment's point was that free trade carries some benefits, which is a separate argument altogether (that is, they are not asserting free trade is a panacea). It could be the case that some other cause has led to increased income inequality, which then would not affect the free-trade-has-benefits argument. Here is a Brookings report that explores whether global trade has directly contributed to worsening income inequality: https://www.brookings.edu/articles/worsening-american-income-inequality-is-world-trade-to-blame/ https://www.brookings.edu/articles/worsening-american-income...

Petrova 6y ago

There was also less competition in the job market because women only worked a subset of lower paying jobs if they worked at all.