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All “growth” in gdp seems to go to rich people. Normal people have seen stagnant wages and increased costs from the owners. Why should I care if gdp isn’t incr

All “growth” in gdp seems to go to rich people. Normal people have seen stagnant wages and increased costs from the owners. Why should I care if gdp isn’t increasing when I don’t see any gains whether it does or not?

talldatethrow 3y ago
Does all growth go to the same rich people, or do more people become rich?
- dralley 3y ago
  A little of column A, a little of column B. But the wealth distribution across percentiles continues getting worse.
- cumshitpiss 3y ago
  [dead]
- ceejayoz 3y ago
  See the chart at https://www.nytimes.com/interactive/2017/08/07/opinion/leonhardt-income-inequality.html https://www.nytimes.com/interactive/2017/08/07/opinion/leonh....
- TeMPOraL 3y ago
  Yes, but: in case of the latter, does the amount of people becoming rich outpace population growth? Is it even greater than the rate of growth in the sub-population of those already rich?
- carlosjobim 3y ago
  More people become poor. Haven't you noticed?
  - refurb 3y ago
    Percent of people in poverty is much lower now than in 1970. And that’s with the poverty level being a moving target.
- jmeister 3y ago
  >For example, if you’re looking at static inequality, Europe appears to be more egalitarian than the United States—their wealth is more evenly distributed across the population. But Taleb uses some statistics of dynamic inequality that propose America may be fairer than Europe. In Europe, more than a third of the five hundred wealthiest people inherited their wealth from family dynasties that have lasted for centuries. Compare this to the US, where 90% of the wealthiest five hundred people entered that list less than thirty years ago. >Here’s another statistic on dynamic equality in America: 10% of Americans will spend at least one year in the top 1% of income earners, and more than half of all Americans will spend at least a year in the top 10% of income earners. Since what we’re trying to do is allow the market to reward those who contribute to society, greater turnover among the rich in the United States is a sign of fairness. https://www.shortform.com/blog/types-of-inequality/ https://www.shortform.com/blog/types-of-inequality/ https://medium.com/incerto/inequality-and-skin-in-the-game-d8f00bc0cb46 https://medium.com/incerto/inequality-and-skin-in-the-game-d...
alfalfasprout 3y ago
The way real wages are tracked also undersell this trend. In theory since 2008 real wages have been increasing... in practice, housing and other costs like childcare have increased astronomically during that period negating any real gains.
- gruez 3y ago
  >In theory since 2008 real wages have been increasing... in practice, housing and other costs like childcare have increased astronomically during that period negating any real gains. That's categorically not true. Adjusting for inflation, wages today are up 6.8% compared to 2008. [1] https://fred.stlouisfed.org/series/LES1252881600Q https://fred.stlouisfed.org/series/LES1252881600Q
  - scaredginger 3y ago
    Do you understand that you've just linked the numbers that are being criticised without addressing the criticisms?
    - ilikehurdles 3y ago
      What piece of the CPI adjustment formula are you arguing is so flawed that is negates any "real" gains of wages? And why do you believe the markets haven't caught on and started following a better metric? To bring things back a bit, the argument was that > housing and other costs like childcare have increased astronomically during that period negating any real gains Yet, gruez is downvoted while citing CPI-adjusted wage growth showing the contrary. CPI, for everyone's information, includes rental and housing costs in its indexing, as well as child care and many other services. Of course, it's just one (financially significant) formula, but it was a good faith rebuttal and the only comment in this thread citing anything close to objective evidence.
      - jfim 3y ago
        The CPI only includes OER (owner equivalent rent), not housing prices. OER is also a lagging indicator due to it being calculated on current rental expenses, not market rate rents (eg. when people move and their rental expenses get adjusted for the market). A study by the San Francisco fed in 2022 [0] calculated that based on Zillow market data, the rent component of the CPI is to increase by about seven percent each year in 2022 and 2023: > Our model confirms that an increase in current asking rents or current house prices can push up the CPI rent index for a typical MSA for as long as 24 months into the future. Given the currently elevated levels of Zillow asking rent inflation and Zillow house price inflation averaged across all MSAs, the model predicts that CPI rent inflation will increase by about 3.4pp for both 2022 and 2023, relative to its historical average rate of 3.7%. [0] https://www.frbsf.org/economic-research/publications/economic-letter/2022/february/will-rising-rents-push-up-future-inflation/ https://www.frbsf.org/economic-research/publications/economi...
slibhb 3y ago
The economy doubling in size helps most people even if the resulting wealth is unevenly distributed. Goods, services, technologies, jobs, etc are good.
- Retric 3y ago
  Hardly, 99% of the population can be worse off with a sufficiently uneven distribution despite 2x GDP growth. Read up on countries hit by the “resource curse” where dictators suddenly don’t care about the productivity of most of their citizens. Also, extremely uneven economic distributions tend to be bad for large segments of the population due to inherently limited resources like desirable beach front property as well as artificially limited resources like city apartments.
- notfromhere 3y ago
  No it doesn't. Growth in the economy has to increase real wages, and real wages need to keep pace with housing, food, healthcare, etc increases in order to be meaningful. More jobs are only good if they actually provide a living wage.
  - Alupis 3y ago
    > More jobs are only good if they actually provide a living wage. This is false if you spend even a few seconds thinking about it. Not all jobs are intended to "live" off of. Most of your entry-level jobs were supposed to be for highschool and college kids working part time. The problem is we have more and more people never graduating out of entry level positions, and today we have folks demanding those entry level positions support a comfortable lifestyle. You're supposed to graduate out of entry level work after you acquire skills, training, and/or education. Why are people not "moving up" is the real problem...
    - deleted 3y ago
      [deleted]
    - Supermancho 3y ago
      > Most of your entry-level jobs were supposed to be for highschool and college kids working part time. This is some soft language hiding some bad assumptions. "supposed to be" - what does this mean? because it's a lot more interesting...low skilled jobs, are probably what we're going to be talking about. However, it's not the 1950s anymore. eg Staffing a movie theater is not a part-time job (which you would know if you have ever worked one), even post-covid. Targeting for graduates (or current students) is reserved for economies like college towns, historically. Those places have also experienced wages rising noticeably over, at least, the last 2 decades. Industrial and metropolitan areas don't have enough "school labor" to staff all the unskilled positions, regardless. > Not all jobs are intended to "live" off of If you have a fulltime job, the minimum wage is intended to allow you to survive^. The main issue is that places with fulltime positions open to unskilled labor, have living costs that outpace the minimum wage...all the way out to the most rural of US towns. The financial guidelines for employees from McDonalds, Wallmart, etc are telling. ^Claiming that jobs that pay minimum wage and only allow working 30 hours a week, aren't intended to "live" off of, is cherry picking exploitative employers. This is not compelling, nor the common case, so we can focus the discussion on the issues that the majority of the economy deal with.
eastbound 3y ago
[flagged]
seydor 3y ago
while it's true and it s very unequal the difference has become so big that even the poorest americans are richer than most europeans.
- gitfan86 3y ago
  Yes but so many Americans are on Instagram and Tiktok that they feel poor since they are inundated with stories about people doing better than them.
  - sonicshadow 3y ago
    It's just an extension of the American culture, everyone is a temporarily embarrassed millionaire, whereas in Europe it seems like people sit around waiting for entitlements to be handed to them and then riot in the street when they're not
  - fullshark 3y ago
    Comparing your life to tiktok celebrities is toxic but comparing it to the impoverished halfway around the world is healthy?
    - gitfan86 3y ago
      Right
      - fullshark 3y ago
        They are both distorted perspectives, one I guess makes you appreciate your lot in life, the other makes you realize working for the man until you die/retire in old age kind of sucks.
- Sharlin 3y ago
  And what do those "riches" buy them? Decent healthcare? A reasonable social safety net? Not having to work three slavery-like jobs without paid vacations or maternity leave or…? The ability to stay out of prison given the incredible incarceration rates in the US?
onlyrealcuzzo 3y ago
What about: - Your access to mRNA vaccines - Your access to cleaner air due to electric car adoption - Ditto for energy security and renewable sources of electricity - Your chance of dying in a car going down due to new safety features - Your access to crazy advanced cancer treatments that are making progress at almost miraculous paces - Your much improved ability to work from home, cutting out ~2 hours of commuting each day By every metric, the world is DRAMATICALLY better today for virtually everyone than it was in 1960, and the same from 1960 to 1900, and so on. The pace things are improving is exponential. If you think we're all worse off, maybe you're depressed. Or maybe you actually are worse off - but most people aren't...
- troupo 3y ago
  The world is dramatically better, but it already was dramatically better 10 years ago, and in the developed countries a lot of those improvements stagnated or are slowly rolling back due to stagnant wages, insane costs of living etc.
  - onlyrealcuzzo 3y ago
    The world is getting almost noticeably better by the day - due to all the progress people make every day, building on top of past progress. If you're staying "stagnant" and the world is getting better, you're better off. Even if you're declining, you can be better off. If you think poor people in the US and Europe have it rough today, you should read up about what it was like to be a normal person in the 1600s in Europe. If you think poor people have it rough today in California, you should read up on what it was like being poor in California in the 80s and 90s. Etc. The average lower middle class family today has it better off than nobility in the 1700s.
    - bamboozled 3y ago
      When people use the term progress, what is meant by it? What are we progressing towards exactly? Utopia?
    - troupo 3y ago
2OEH8eoCRo0 3y ago
I hear this or something similar all the time and I don't get it. Everyone with a 401k, IRA, etc. sees these gains.
stevenwoo 3y ago
Piketty breaks this down in historic terms for all countries for which data is available in Capital and Ideology, tldr, a very small percentage of people have gotten much richer than everyone else for the last 200+ years, it's just gotten extreme after progressive taxes and regulations were rolled back in countries circa the Reagan/Thatcher years. I dunno if it's still up but the web page for the book had all the data.

talldatethrow 3y ago

Does all growth go to the same rich people, or do more people become rich?

dralley 3y ago
A little of column A, a little of column B. But the wealth distribution across percentiles continues getting worse.
cumshitpiss 3y ago
[dead]
ceejayoz 3y ago
See the chart at https://www.nytimes.com/interactive/2017/08/07/opinion/leonhardt-income-inequality.html https://www.nytimes.com/interactive/2017/08/07/opinion/leonh....
TeMPOraL 3y ago
Yes, but: in case of the latter, does the amount of people becoming rich outpace population growth? Is it even greater than the rate of growth in the sub-population of those already rich?
carlosjobim 3y ago
More people become poor. Haven't you noticed?
- refurb 3y ago
  Percent of people in poverty is much lower now than in 1970. And that’s with the poverty level being a moving target.
jmeister 3y ago
>For example, if you’re looking at static inequality, Europe appears to be more egalitarian than the United States—their wealth is more evenly distributed across the population. But Taleb uses some statistics of dynamic inequality that propose America may be fairer than Europe. In Europe, more than a third of the five hundred wealthiest people inherited their wealth from family dynasties that have lasted for centuries. Compare this to the US, where 90% of the wealthiest five hundred people entered that list less than thirty years ago. >Here’s another statistic on dynamic equality in America: 10% of Americans will spend at least one year in the top 1% of income earners, and more than half of all Americans will spend at least a year in the top 10% of income earners. Since what we’re trying to do is allow the market to reward those who contribute to society, greater turnover among the rich in the United States is a sign of fairness. https://www.shortform.com/blog/types-of-inequality/ https://www.shortform.com/blog/types-of-inequality/ https://medium.com/incerto/inequality-and-skin-in-the-game-d8f00bc0cb46 https://medium.com/incerto/inequality-and-skin-in-the-game-d...

alfalfasprout 3y ago

The way real wages are tracked also undersell this trend. In theory since 2008 real wages have been increasing... in practice, housing and other costs like childcare have increased astronomically during that period negating any real gains.

gruez 3y ago
>In theory since 2008 real wages have been increasing... in practice, housing and other costs like childcare have increased astronomically during that period negating any real gains. That's categorically not true. Adjusting for inflation, wages today are up 6.8% compared to 2008. [1] https://fred.stlouisfed.org/series/LES1252881600Q https://fred.stlouisfed.org/series/LES1252881600Q
- scaredginger 3y ago
  Do you understand that you've just linked the numbers that are being criticised without addressing the criticisms?
  - ilikehurdles 3y ago
    What piece of the CPI adjustment formula are you arguing is so flawed that is negates any "real" gains of wages? And why do you believe the markets haven't caught on and started following a better metric? To bring things back a bit, the argument was that > housing and other costs like childcare have increased astronomically during that period negating any real gains Yet, gruez is downvoted while citing CPI-adjusted wage growth showing the contrary. CPI, for everyone's information, includes rental and housing costs in its indexing, as well as child care and many other services. Of course, it's just one (financially significant) formula, but it was a good faith rebuttal and the only comment in this thread citing anything close to objective evidence.
    - jfim 3y ago
      The CPI only includes OER (owner equivalent rent), not housing prices. OER is also a lagging indicator due to it being calculated on current rental expenses, not market rate rents (eg. when people move and their rental expenses get adjusted for the market). A study by the San Francisco fed in 2022 [0] calculated that based on Zillow market data, the rent component of the CPI is to increase by about seven percent each year in 2022 and 2023: > Our model confirms that an increase in current asking rents or current house prices can push up the CPI rent index for a typical MSA for as long as 24 months into the future. Given the currently elevated levels of Zillow asking rent inflation and Zillow house price inflation averaged across all MSAs, the model predicts that CPI rent inflation will increase by about 3.4pp for both 2022 and 2023, relative to its historical average rate of 3.7%. [0] https://www.frbsf.org/economic-research/publications/economic-letter/2022/february/will-rising-rents-push-up-future-inflation/ https://www.frbsf.org/economic-research/publications/economi...

slibhb 3y ago

The economy doubling in size helps most people even if the resulting wealth is unevenly distributed. Goods, services, technologies, jobs, etc are good.

Retric 3y ago
Hardly, 99% of the population can be worse off with a sufficiently uneven distribution despite 2x GDP growth. Read up on countries hit by the “resource curse” where dictators suddenly don’t care about the productivity of most of their citizens. Also, extremely uneven economic distributions tend to be bad for large segments of the population due to inherently limited resources like desirable beach front property as well as artificially limited resources like city apartments.
notfromhere 3y ago
No it doesn't. Growth in the economy has to increase real wages, and real wages need to keep pace with housing, food, healthcare, etc increases in order to be meaningful. More jobs are only good if they actually provide a living wage.
- Alupis 3y ago
  > More jobs are only good if they actually provide a living wage. This is false if you spend even a few seconds thinking about it. Not all jobs are intended to "live" off of. Most of your entry-level jobs were supposed to be for highschool and college kids working part time. The problem is we have more and more people never graduating out of entry level positions, and today we have folks demanding those entry level positions support a comfortable lifestyle. You're supposed to graduate out of entry level work after you acquire skills, training, and/or education. Why are people not "moving up" is the real problem...
  - deleted 3y ago
    [deleted]
  - Supermancho 3y ago
    > Most of your entry-level jobs were supposed to be for highschool and college kids working part time. This is some soft language hiding some bad assumptions. "supposed to be" - what does this mean? because it's a lot more interesting...low skilled jobs, are probably what we're going to be talking about. However, it's not the 1950s anymore. eg Staffing a movie theater is not a part-time job (which you would know if you have ever worked one), even post-covid. Targeting for graduates (or current students) is reserved for economies like college towns, historically. Those places have also experienced wages rising noticeably over, at least, the last 2 decades. Industrial and metropolitan areas don't have enough "school labor" to staff all the unskilled positions, regardless. > Not all jobs are intended to "live" off of If you have a fulltime job, the minimum wage is intended to allow you to survive^. The main issue is that places with fulltime positions open to unskilled labor, have living costs that outpace the minimum wage...all the way out to the most rural of US towns. The financial guidelines for employees from McDonalds, Wallmart, etc are telling. ^Claiming that jobs that pay minimum wage and only allow working 30 hours a week, aren't intended to "live" off of, is cherry picking exploitative employers. This is not compelling, nor the common case, so we can focus the discussion on the issues that the majority of the economy deal with.

eastbound 3y ago

[flagged]

seydor 3y ago

while it's true and it s very unequal the difference has become so big that even the poorest americans are richer than most europeans.

gitfan86 3y ago
Yes but so many Americans are on Instagram and Tiktok that they feel poor since they are inundated with stories about people doing better than them.
- sonicshadow 3y ago
  It's just an extension of the American culture, everyone is a temporarily embarrassed millionaire, whereas in Europe it seems like people sit around waiting for entitlements to be handed to them and then riot in the street when they're not
- fullshark 3y ago
  Comparing your life to tiktok celebrities is toxic but comparing it to the impoverished halfway around the world is healthy?
  - gitfan86 3y ago
    Right
    - fullshark 3y ago
      They are both distorted perspectives, one I guess makes you appreciate your lot in life, the other makes you realize working for the man until you die/retire in old age kind of sucks.
Sharlin 3y ago
And what do those "riches" buy them? Decent healthcare? A reasonable social safety net? Not having to work three slavery-like jobs without paid vacations or maternity leave or…? The ability to stay out of prison given the incredible incarceration rates in the US?

onlyrealcuzzo 3y ago

What about: - Your access to mRNA vaccines - Your access to cleaner air due to electric car adoption - Ditto for energy security and renewable sources of electricity - Your chance of dying in a car going down due to new safety features - Your access to crazy advanced cancer treatments that are making progress at almost miraculous paces - Your much improved ability to work from home, cutting out ~2 hours of commuting each day By every metric, the world is DRAMATICALLY better today for virtually everyone than it was in 1960, and the same from 1960 to 1900, and so on. The pace things are improving is exponential. If you think we're all worse off, maybe you're depressed. Or maybe you actually are worse off - but most people aren't...

troupo 3y ago
The world is dramatically better, but it already was dramatically better 10 years ago, and in the developed countries a lot of those improvements stagnated or are slowly rolling back due to stagnant wages, insane costs of living etc.
- onlyrealcuzzo 3y ago
  The world is getting almost noticeably better by the day - due to all the progress people make every day, building on top of past progress. If you're staying "stagnant" and the world is getting better, you're better off. Even if you're declining, you can be better off. If you think poor people in the US and Europe have it rough today, you should read up about what it was like to be a normal person in the 1600s in Europe. If you think poor people have it rough today in California, you should read up on what it was like being poor in California in the 80s and 90s. Etc. The average lower middle class family today has it better off than nobility in the 1700s.
  - bamboozled 3y ago
    When people use the term progress, what is meant by it? What are we progressing towards exactly? Utopia?
  - troupo 3y ago

2OEH8eoCRo0 3y ago

I hear this or something similar all the time and I don't get it. Everyone with a 401k, IRA, etc. sees these gains.

stevenwoo 3y ago

Piketty breaks this down in historic terms for all countries for which data is available in Capital and Ideology, tldr, a very small percentage of people have gotten much richer than everyone else for the last 200+ years, it's just gotten extreme after progressive taxes and regulations were rolled back in countries circa the Reagan/Thatcher years. I dunno if it's still up but the web page for the book had all the data.