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Good conditions didn't diminish. People now buy vastly bigger and more things. Want to live on one salary like a 1950 person, with 1950 level goods, you can. A

Good conditions didn't diminish. People now buy vastly bigger and more things. Want to live on one salary like a 1950 person, with 1950 level goods, you can. Also more classes of people now have much better things: women, minorities. Labor is not the only input to productivity, so there is zero reason labor rewards should match productivity. As capital expenses increased to obtain modern productivity gains, the reward should go towards capital, which enabled purchase of upgrading tooling. Also as people demanded more rights and benefits, some is taken from wages. When you track total cost to employ, which is what an employer pays to have an employee, you can see all the gains. BLS tracks this and many other related variables (like wages, total remuneration, and a host of other costs and benefits employees have gained over the decades.) And corporate margins are pretty much the same as ever, net profit ~10% of revenue, since time immemorial. That 10% is what provides cushion so businesses don't implode every hiccup, leaving lots unemployed. [1] has some 1950-now data. There's plenty more places to find more. Fairly constant profit is why stock returns have averaged what they did over 100+ years. If now had vastly more profitable companies, it would have vastly increased returns. [1] https://cdn.pficdn.com/cms/pgim-fixed-income/sites/default/files/2021-04/The%20Evolution%20of%20U.S.%20Corporate%20Profits_2.pdf https://cdn.pficdn.com/cms/pgim-fixed-income/sites/default/f...

deleted 3y ago
[deleted]
Turskarama 3y ago
>Want to live on one salary like a 1950 person, with 1950 level goods, you can. No, you can't. People lived in smaller houses, but the vast majority of the increase of property values is _land_. If you want a house that's anywhere near as cheap as the average was 50 years ago, you get to live somewhere with no jobs. That is not equivalent. As for everything else, the majority of the modern day luxuries we enjoy amounts to a rounding error next to the actual necessities that people also had back then. Consumer electronics are _cheap_, not having them will not meaningfully increase anyones wealth.
- SideQuark 3y ago
  The vast majority is not land. Here's [1] inflation adjusted land cost per acre over the last 50 years. Pick a piece of land at median 1950 sizes and the increase is around $500 in today's dollars. Now please cite why you claim the vast majority of the increase is land. Want to read what did increase? Houses got bigger as I stated [2]. [1] https://www.ers.usda.gov/webdocs/charts/55910/farmrealestatevalue2020_d.html?v=6230 https://www.ers.usda.gov/webdocs/charts/55910/farmrealestate... [2] https://www.supermoney.com/inflation-adjusted-home-prices/ https://www.supermoney.com/inflation-adjusted-home-prices/
  - Turskarama 3y ago
    And where can you buy a small house? EDIT: worth noting as well that the source you cited was specifically for farm real estate, not residential. Here is a source for land price: https://www.aei.org/housing/land-price-indicators/ https://www.aei.org/housing/land-price-indicators/ On the last chart, change the indicator to Change in Land price (standardised). Note that this is only for 2012 to 2021, not even 10 years, and the _smallest_ increase is 44%, while the highest is 807%!
    - SideQuark 3y ago
      First, you conveniently ignore my second link which points out that housing prices, across all houses, not the cherry picked most expensive subset you picked, when adjusted correctly, have been pretty flat. Care to address that? It's been well known that housing prices, per sq ft, inflation adjusted, has not risen according to the pop belief that you share. Here's another easy way to see it - median home prices since 1950, inflation adjusted, have not even doubled since 1950 [1]. Median home sizes each decade since 1920 [2] show that house size have far more than doubled. 1950 was 980 sq ft. 1970 was 1500. 2014 was 2657 (latest on their chart). It sure look like if you picked a 1950 house you'd be paying, well, 1950 rates, doesn't it? Some numbers from each: Feb 1954 house price $206,717 inflation adjusted. April 2023, $392,780 (the largest value). House sizes: 1950 was 983 ft^2. 2014 was 2657 ft^2 (feel free to chase down sizes for now if you like). 1950 was ~$210/ft^2. 2023 likely ~$147/ft^2. Care to check the math? Sure seems like housing has not increased (well, it actually decreased significantly by this check) when correctly measured. Houses cost more now because people want more, and also because they make more than in 1950, inflation adjusted. Next, new houses in most of the country are built on new residential land as cities expand. Where do you think that land comes from? Farmland. Farmland provides a price floor on new housing, as developers buy it up and add subdivisions. As to your oddly chosen subset of land: your list is not inflation adjusted. It's also the top 100 metro areas, not the median of house prices in the US. Of course you can pick smaller and smaller subsets to get the answer you want. The median house in 1950 was under 1/4 acre. From the table below on price per acre, it sure would seem land is not the major factor in house costs. So, can you provide the correct stat or not? Don't pick the highest cost subset of land. Don't pick non inflation adjusted values. And make it the median of all housing. Here, I'll help. Here is median price per acre of land with housing on it in the US, by state [3]. It also has the median price per acre, including farmland. Use Excel, check the correlation. If you are to do it, you can also population weight these, add median house cost per state (easy to find), etc. It's pretty clear the cost of a house is not majority the land, except perhaps in a few really dense, extreme outliers like NYC and SF. No wonder you believe the highest component of house cost is land. You have not presented actual numbers, only picked the subsets that you like. Try again. Also, please address the now 3 links I presented about housing costs when size adjusted. [1] https://dqydj.com/historical-home-prices/ https://dqydj.com/historical-home-prices/ [2] https://www.newser.com/story/225645/average-size-of-us-homes-decade-by-decade.html https://www.newser.com/story/225645/average-size-of-us-homes... [3] https://www.inmyarea.com/moving/buying-land-analysis https://www.inmyarea.com/moving/buying-land-analysis
jeffreyq 3y ago
Can you elaborate on what "labor rewards" means in the context of ``` Labor is not the only input to productivity, so there is zero reason labor rewards should match productivity. ```
- ang_cire 3y ago
  That sounds like they're saying, "if you get a tool that makes you twice as productive, you didn't double the production, the tool did, so the tool owner should get the additional proceeds". Total braindead understanding of how productivity and labor works, but it sounds great if you own the tools.

deleted 3y ago

[deleted]

Turskarama 3y ago

>Want to live on one salary like a 1950 person, with 1950 level goods, you can. No, you can't. People lived in smaller houses, but the vast majority of the increase of property values is _land_. If you want a house that's anywhere near as cheap as the average was 50 years ago, you get to live somewhere with no jobs. That is not equivalent. As for everything else, the majority of the modern day luxuries we enjoy amounts to a rounding error next to the actual necessities that people also had back then. Consumer electronics are _cheap_, not having them will not meaningfully increase anyones wealth.

SideQuark 3y ago
The vast majority is not land. Here's [1] inflation adjusted land cost per acre over the last 50 years. Pick a piece of land at median 1950 sizes and the increase is around $500 in today's dollars. Now please cite why you claim the vast majority of the increase is land. Want to read what did increase? Houses got bigger as I stated [2]. [1] https://www.ers.usda.gov/webdocs/charts/55910/farmrealestatevalue2020_d.html?v=6230 https://www.ers.usda.gov/webdocs/charts/55910/farmrealestate... [2] https://www.supermoney.com/inflation-adjusted-home-prices/ https://www.supermoney.com/inflation-adjusted-home-prices/
- Turskarama 3y ago
  And where can you buy a small house? EDIT: worth noting as well that the source you cited was specifically for farm real estate, not residential. Here is a source for land price: https://www.aei.org/housing/land-price-indicators/ https://www.aei.org/housing/land-price-indicators/ On the last chart, change the indicator to Change in Land price (standardised). Note that this is only for 2012 to 2021, not even 10 years, and the _smallest_ increase is 44%, while the highest is 807%!
  - SideQuark 3y ago
    First, you conveniently ignore my second link which points out that housing prices, across all houses, not the cherry picked most expensive subset you picked, when adjusted correctly, have been pretty flat. Care to address that? It's been well known that housing prices, per sq ft, inflation adjusted, has not risen according to the pop belief that you share. Here's another easy way to see it - median home prices since 1950, inflation adjusted, have not even doubled since 1950 [1]. Median home sizes each decade since 1920 [2] show that house size have far more than doubled. 1950 was 980 sq ft. 1970 was 1500. 2014 was 2657 (latest on their chart). It sure look like if you picked a 1950 house you'd be paying, well, 1950 rates, doesn't it? Some numbers from each: Feb 1954 house price $206,717 inflation adjusted. April 2023, $392,780 (the largest value). House sizes: 1950 was 983 ft^2. 2014 was 2657 ft^2 (feel free to chase down sizes for now if you like). 1950 was ~$210/ft^2. 2023 likely ~$147/ft^2. Care to check the math? Sure seems like housing has not increased (well, it actually decreased significantly by this check) when correctly measured. Houses cost more now because people want more, and also because they make more than in 1950, inflation adjusted. Next, new houses in most of the country are built on new residential land as cities expand. Where do you think that land comes from? Farmland. Farmland provides a price floor on new housing, as developers buy it up and add subdivisions. As to your oddly chosen subset of land: your list is not inflation adjusted. It's also the top 100 metro areas, not the median of house prices in the US. Of course you can pick smaller and smaller subsets to get the answer you want. The median house in 1950 was under 1/4 acre. From the table below on price per acre, it sure would seem land is not the major factor in house costs. So, can you provide the correct stat or not? Don't pick the highest cost subset of land. Don't pick non inflation adjusted values. And make it the median of all housing. Here, I'll help. Here is median price per acre of land with housing on it in the US, by state [3]. It also has the median price per acre, including farmland. Use Excel, check the correlation. If you are to do it, you can also population weight these, add median house cost per state (easy to find), etc. It's pretty clear the cost of a house is not majority the land, except perhaps in a few really dense, extreme outliers like NYC and SF. No wonder you believe the highest component of house cost is land. You have not presented actual numbers, only picked the subsets that you like. Try again. Also, please address the now 3 links I presented about housing costs when size adjusted. [1] https://dqydj.com/historical-home-prices/ https://dqydj.com/historical-home-prices/ [2] https://www.newser.com/story/225645/average-size-of-us-homes-decade-by-decade.html https://www.newser.com/story/225645/average-size-of-us-homes... [3] https://www.inmyarea.com/moving/buying-land-analysis https://www.inmyarea.com/moving/buying-land-analysis

jeffreyq 3y ago

Can you elaborate on what "labor rewards" means in the context of ``` Labor is not the only input to productivity, so there is zero reason labor rewards should match productivity. ```

ang_cire 3y ago
That sounds like they're saying, "if you get a tool that makes you twice as productive, you didn't double the production, the tool did, so the tool owner should get the additional proceeds". Total braindead understanding of how productivity and labor works, but it sounds great if you own the tools.