2 ms·
I like the spirit and target of the article but some of this is pretty off. For one it's insanely US-centric. Granted I'm sure the original website was, too, b
by cmrdporcupine 3y ago
I like the spirit and target of the article but some of this is pretty off.
For one it's insanely US-centric. Granted I'm sure the original website was, too, but some of the explanations don't hold when you pan out a bit.
Example:
The “relentless 50 year decline in wages” should be labelled the “relentless 50 year increase in healthcare costs”.
Doesn't explain why the same incomes decline happened in the rest of the G7. Our insurance rates didn't go up as % of compensation or of corporate profitability. They did go up as a % of government spending, but that's in a different ledger.
- friend_and_foe 3y agoSince just after world war 2, most world's currencies were backed by USD which was backed by gold, due to the fact that any country could redeem their dollar reserves for gold at a pegged rate. In 1971 the US broke that agreement, known as the Bretton Woods agreement, and stopped redeeming USD for gold to other countries. So the currencies devalued at least as fast as USD from that point, which explains the same income declines. I wouldn't be so quick to call government spending a different ledger. Governments borrow to spend, they tax to rein in devaluation of their currency, as per modern monetary theory. When they borrow they print money, and a significant chunk of international debt is denominated in USD, so such debt would see a real term devaluation as the federal reserve expands the money supply. This would show up as price inflation for goods and services purchased by the government, inelastic goods and services would plausably show an increase as a percentage of total spending.