5 ms·

I've heard multiple explanations, some of them include. 1. The moving off the gold standard 2. A large number of women started entering the workforce essentia

I've heard multiple explanations, some of them include. 1. The moving off the gold standard 2. A large number of women started entering the workforce essentially doubling the supply of labor. 3. The rise of MBAs and downsizing really became big. 4. Outsourcing and off shoring started to be introduced during this time 5. The 70's stagflation where we say inflation and high interest rates. These all seem to be plausible factors to me.

mortureb 3y ago
[flagged]
- dingosity 3y ago
  be nice.
  - timeon 3y ago
    Probably just missing '/s'.
  - mortureb 3y ago
    Well I can’t delete it anymore. I was honestly being serious, maybe a little terse.
  - omginternets 3y ago
    He's not being mean; he's just failing to present an argument.
  - next_xibalba 3y ago
    I believe the hypothesis behind this is that women entering the workforce in large numbers disrupted the labor demand/supply equilibrium while also portending major changes to family structure and aggregate social dynamics. I don't think its a very interesting hypothesis though. The increase was fairly gradual post-WWII [1]. It also seems like it probably points the causal arrow in the wrong direction. Women probably would not have entered the workforce in such broad numbers had economic conditions supported a single income earner per household. [1] https://fred.stlouisfed.org/series/LNS11300002 https://fred.stlouisfed.org/series/LNS11300002
- deleted 3y ago
  [deleted]
- legitster 3y ago
  Before this dude gets downvoted to oblivion, there has been a lot of thought about how the introduction of women into the workforce has (theoretically) caused wage stagnation. Basically, there are twice as many eligible workers in the economy now, and so labor groups lost lots of bargaining power. I don't necessarily buy this explanation - but there have been some somewhat serious efforts to quantify this effect when looking at wage stagnation.
- jjoonathan 3y ago
  I'd love to work 2.5 days a week and raise my own kids. Might help with that whole fertility crisis thing. The mistake wasn't bringing women into the workforce, it was doing so on terms that nakedly favored capital and screwed labor, men and women alike. We should probably revisit those at some point.
hyperfuturism 3y ago
Yeah. I would also agree that there are multiple explanations floating out there, and it's not entierly clear what exactly is happening in the economy that have lead it to where it is today. Could be a combination of all of them, could be that a few root causes. Not entierly clear imo.
trgn 3y ago
6. All congressional votes in meetings are public since 1971. This has forced congressmen to prove fealty to their corporate sponsors. https://www.congressionalresearch.org/TransparencyProblem.html https://www.congressionalresearch.org/TransparencyProblem.ht...
rc_mob 3y ago
lets be honest whatever happened probably did not actually happen in 1971. it probably happened a few years before and then became noticeable in 1971
dnissley 3y ago
My personal favorite is that we failed to make the transition to nuclear power
slg 3y ago
>1. The moving off the gold standard As someone with an econ degree, people advocating for a return to the gold standard are so weird to me. I totally understand people having objections to how central banks manage the money supply and the impacts that has on the economy, but that doesn't mean we should give up control of it completely. It reminds me of the 2008 housing crisis when people saw a regulation failure and their proposed response was to remove even more regulation. It would be like your home being broken into and deciding the solution is to stop locking your doors instead of trying to find a better lock. It is both defeatist and it does nothing to actually improve the situation. Advocate for better policy. Don't advocate for no policy. The gold standard is effectively no policy because it gives control of the money supply over to control of the gold supply and gold can be both lost and found which won't happen in ways that actually support the economy.
- jovial_cavalier 3y ago
  [flagged]
- legitster 3y ago
  > As someone with an econ degree, people advocating for a return to the gold standard are so weird to me I mean, I understand. People really like simple things they can understand. And people hate inflation. It's clearly a bad idea, but I understand the appeal if you were raised in a blue-collar household and think debt is evil.
- tivert 3y ago
  > As someone with an econ degree, people advocating for a return to the gold standard are so weird to me. I totally understand people having objections to how central banks manage the money supply and the impacts that has on the economy, but that doesn't mean we should give up control of it completely. I think you're probably thinking about it wrong. It's not a conventional policy proposal. I think the main factor is just naked mistrust of people like you (people with an econ degree, etc), leading people to seek out simple solutions you have no control over. Another factor is people just getting high on pure ideology, and losing interest in solving actual problems in the pursuit of that ideology.
- 3y ago
BoiledCabbage 3y ago
The reason is due to the oil shocks. As stated in a comment below: > The post-war growth in America was largely driven by cheap and abundant domestic oil... The oil crises of 1973 and beyond were the proximate result. But our economy as a whole never really recovered; While lots of things contributed, this is almost certainly the case. Energy is an input into everything. Our current standard of living exists mainly due to energy and figuring out productive/efficient ways to consume energy. For example if we retained all of our knowledge, all of our productive know how, but were banned from using fossil fuels and electricity we'd be essentially back to pre-industrial standards of living. When you think about it, it's self-evident, but we can't do anything modern without consuming enormous amounts of energy. Transportation, shipping, computing, agriculture, communication, heating manufacturing all of these are essentially energy consumption endeavors. More expensive energy means all of these factors because significantly more expensive. The cost of your food goes up if every input is now paying more for energy. If maintaining a standard of living is now more expensive then cost of labor goes up without any improvement in standard of living. This drives inflation. Increasing the price of energy probably is likely a more broad economic driver of inflation than lowering interest rates. Lowering interest rates drives asset price increases heavily, but much less so on commodity and day to day price increases. Eventually those asset price increases work their way back to housing and then drive labor, but it's not very direct. Increasing the cost of energy drives up the price of everything. The only thing that tops it is direct giving of money to people. The 1970s oil shocks cost us an enormous amount in our standard of living and drove pure inflation. Just like the oil price increases of the past few years (along with supply/labor shortages) drove our recent bout of inflation. Oil dropped in early 2020 and so did inflation. Oil peaked in mid 2022 and so did inflation. Energy prices drive your economy - anything that notably increases the cost of energy will have ripple effects on the rest your economy.
- anthonypz 3y ago
  I'm fascinated by this idea. Do you have any books or resources you'd recommend that dives into the topic of energy? I've found two interesting books so far: - Oil: A Beginner's Guide by Vaclav Smil - Energy and Civilization: A History by Vaclav Smil
mikhailfranco 3y ago
All of the above, and the oil price, plus ... ... Rent-seeking administrative bureaucracies, which seriously dilute the effectiveness of education, healthcare, government, town planning, infrasfucture investment ... everything. The trends for admin in universities and hospitals is literally off-the-charts exponential. Nothing exponential lasts forever. Baby-Boomers will all die, eventually, but I hope their parasitic hippie socialism dies with them.
pjfin123 3y ago
I think the primary cause of the stagnation in the 1970s was a failure to continue to increase energy production. Other factors probably contributed, or contributed to us not making the transition to nuclear.
voisin 3y ago
6. Entry of the boomers into adulthood
hwc 3y ago
I suspect that all of those things happened at once. The trigger might have been the end of the gold standard on August 15, 1971. I suspect that we had been going too long without an increase in the gold backing our money supply, and after decades of temporary fixes to the Breton Woods system, things fell apart then. Afterwards, although we moved to a superior fiat currency, most people didn't really believe in the new system for at least a decade. (And the popularity of bitcoin seems to prove that some people still believe that fixed monetary supply is a good thing!) This allowed the other factors, plus the shock of having to rely on foreign oil, plus the rise of reactionary tax policy, to really mess up the economy in ways that we haven't really fixed yet. Yes, we stabilized the dollar by the early 80s, and yes we have started to ween ourselves off of foreign oil, but the low income taxes on the highest earners remain in place, along with lots of loopholes that make it easy for billionaires to pay almost no taxes. I don't know the long-term consequences of carrying so much public debt (relative to GDP), but it seems that the only possible way to reduce it (without making things worse) is to tax the rich, which is now going to be incredibly difficult since they have so much power at the moment.

mortureb 3y ago

[flagged]

dingosity 3y ago
be nice.
- timeon 3y ago
  Probably just missing '/s'.
- mortureb 3y ago
  Well I can’t delete it anymore. I was honestly being serious, maybe a little terse.
- omginternets 3y ago
  He's not being mean; he's just failing to present an argument.
- next_xibalba 3y ago
  I believe the hypothesis behind this is that women entering the workforce in large numbers disrupted the labor demand/supply equilibrium while also portending major changes to family structure and aggregate social dynamics. I don't think its a very interesting hypothesis though. The increase was fairly gradual post-WWII [1]. It also seems like it probably points the causal arrow in the wrong direction. Women probably would not have entered the workforce in such broad numbers had economic conditions supported a single income earner per household. [1] https://fred.stlouisfed.org/series/LNS11300002 https://fred.stlouisfed.org/series/LNS11300002
deleted 3y ago
[deleted]
legitster 3y ago
Before this dude gets downvoted to oblivion, there has been a lot of thought about how the introduction of women into the workforce has (theoretically) caused wage stagnation. Basically, there are twice as many eligible workers in the economy now, and so labor groups lost lots of bargaining power. I don't necessarily buy this explanation - but there have been some somewhat serious efforts to quantify this effect when looking at wage stagnation.
jjoonathan 3y ago
I'd love to work 2.5 days a week and raise my own kids. Might help with that whole fertility crisis thing. The mistake wasn't bringing women into the workforce, it was doing so on terms that nakedly favored capital and screwed labor, men and women alike. We should probably revisit those at some point.

hyperfuturism 3y ago

Yeah. I would also agree that there are multiple explanations floating out there, and it's not entierly clear what exactly is happening in the economy that have lead it to where it is today. Could be a combination of all of them, could be that a few root causes. Not entierly clear imo.

trgn 3y ago

6. All congressional votes in meetings are public since 1971. This has forced congressmen to prove fealty to their corporate sponsors. https://www.congressionalresearch.org/TransparencyProblem.html https://www.congressionalresearch.org/TransparencyProblem.ht...

rc_mob 3y ago

lets be honest whatever happened probably did not actually happen in 1971. it probably happened a few years before and then became noticeable in 1971

dnissley 3y ago

My personal favorite is that we failed to make the transition to nuclear power

slg 3y ago

>1. The moving off the gold standard As someone with an econ degree, people advocating for a return to the gold standard are so weird to me. I totally understand people having objections to how central banks manage the money supply and the impacts that has on the economy, but that doesn't mean we should give up control of it completely. It reminds me of the 2008 housing crisis when people saw a regulation failure and their proposed response was to remove even more regulation. It would be like your home being broken into and deciding the solution is to stop locking your doors instead of trying to find a better lock. It is both defeatist and it does nothing to actually improve the situation. Advocate for better policy. Don't advocate for no policy. The gold standard is effectively no policy because it gives control of the money supply over to control of the gold supply and gold can be both lost and found which won't happen in ways that actually support the economy.

jovial_cavalier 3y ago
[flagged]
legitster 3y ago
> As someone with an econ degree, people advocating for a return to the gold standard are so weird to me I mean, I understand. People really like simple things they can understand. And people hate inflation. It's clearly a bad idea, but I understand the appeal if you were raised in a blue-collar household and think debt is evil.
tivert 3y ago
> As someone with an econ degree, people advocating for a return to the gold standard are so weird to me. I totally understand people having objections to how central banks manage the money supply and the impacts that has on the economy, but that doesn't mean we should give up control of it completely. I think you're probably thinking about it wrong. It's not a conventional policy proposal. I think the main factor is just naked mistrust of people like you (people with an econ degree, etc), leading people to seek out simple solutions you have no control over. Another factor is people just getting high on pure ideology, and losing interest in solving actual problems in the pursuit of that ideology.
3y ago

BoiledCabbage 3y ago

The reason is due to the oil shocks. As stated in a comment below: > The post-war growth in America was largely driven by cheap and abundant domestic oil... The oil crises of 1973 and beyond were the proximate result. But our economy as a whole never really recovered; While lots of things contributed, this is almost certainly the case. Energy is an input into everything. Our current standard of living exists mainly due to energy and figuring out productive/efficient ways to consume energy. For example if we retained all of our knowledge, all of our productive know how, but were banned from using fossil fuels and electricity we'd be essentially back to pre-industrial standards of living. When you think about it, it's self-evident, but we can't do anything modern without consuming enormous amounts of energy. Transportation, shipping, computing, agriculture, communication, heating manufacturing all of these are essentially energy consumption endeavors. More expensive energy means all of these factors because significantly more expensive. The cost of your food goes up if every input is now paying more for energy. If maintaining a standard of living is now more expensive then cost of labor goes up without any improvement in standard of living. This drives inflation. Increasing the price of energy probably is likely a more broad economic driver of inflation than lowering interest rates. Lowering interest rates drives asset price increases heavily, but much less so on commodity and day to day price increases. Eventually those asset price increases work their way back to housing and then drive labor, but it's not very direct. Increasing the cost of energy drives up the price of everything. The only thing that tops it is direct giving of money to people. The 1970s oil shocks cost us an enormous amount in our standard of living and drove pure inflation. Just like the oil price increases of the past few years (along with supply/labor shortages) drove our recent bout of inflation. Oil dropped in early 2020 and so did inflation. Oil peaked in mid 2022 and so did inflation. Energy prices drive your economy - anything that notably increases the cost of energy will have ripple effects on the rest your economy.

anthonypz 3y ago
I'm fascinated by this idea. Do you have any books or resources you'd recommend that dives into the topic of energy? I've found two interesting books so far: - Oil: A Beginner's Guide by Vaclav Smil - Energy and Civilization: A History by Vaclav Smil

mikhailfranco 3y ago

All of the above, and the oil price, plus ... ... Rent-seeking administrative bureaucracies, which seriously dilute the effectiveness of education, healthcare, government, town planning, infrasfucture investment ... everything. The trends for admin in universities and hospitals is literally off-the-charts exponential. Nothing exponential lasts forever. Baby-Boomers will all die, eventually, but I hope their parasitic hippie socialism dies with them.

pjfin123 3y ago

I think the primary cause of the stagnation in the 1970s was a failure to continue to increase energy production. Other factors probably contributed, or contributed to us not making the transition to nuclear.

voisin 3y ago

6. Entry of the boomers into adulthood

hwc 3y ago

I suspect that all of those things happened at once. The trigger might have been the end of the gold standard on August 15, 1971. I suspect that we had been going too long without an increase in the gold backing our money supply, and after decades of temporary fixes to the Breton Woods system, things fell apart then. Afterwards, although we moved to a superior fiat currency, most people didn't really believe in the new system for at least a decade. (And the popularity of bitcoin seems to prove that some people still believe that fixed monetary supply is a good thing!) This allowed the other factors, plus the shock of having to rely on foreign oil, plus the rise of reactionary tax policy, to really mess up the economy in ways that we haven't really fixed yet. Yes, we stabilized the dollar by the early 80s, and yes we have started to ween ourselves off of foreign oil, but the low income taxes on the highest earners remain in place, along with lots of loopholes that make it easy for billionaires to pay almost no taxes. I don't know the long-term consequences of carrying so much public debt (relative to GDP), but it seems that the only possible way to reduce it (without making things worse) is to tax the rich, which is now going to be incredibly difficult since they have so much power at the moment.