10 ms·

An interesting analysis at http://charleshughsmith.blogspot.com/2015/05/us-households-under-pressure-stagnant.html http://charleshughsmith.blogspot.com/2015/05/

An interesting analysis at http://charleshughsmith.blogspot.com/2015/05/us-households-under-pressure-stagnant.html http://charleshughsmith.blogspot.com/2015/05/us-households-u... echoes these observations, concluding "How do you support a consumer economy with stagnant incomes for the bottom 90%, rising basic expenses and crashing employment for males ages 25-54? Answer: you don't."

humanrebar 11y ago
Why can't hiring people be cheaper? 1. Get rid of the minimum wage. It makes as much sense as rent control... none. 2. Help out the needy by introducing a minimum income and/or an aggressive earned income tax credit. 3. Everyone knows kids are expensive. They shouldn't be. Scale 2 according to household size. 4. Set the levels of 2 high enough that citizens can pay their own taxes (both halves of the pension tax) and buy their own benefits (disability, health, life, 401k 'matching', etc.). ...watch the number of entry-level jobs explode and the demand for robotic work tank (like McD's filling sodas with robotics). Side benefits: A. Small companies will be better able to compete with big companies with employment lawyers and HR departments. B. Bootstrapping and entrepreneurship becomes more viable. C. Corporations lose some of their relative power due to A and B.
- ryanobjc 11y ago
  "You must not be from around here, are you?" The problems with the suggestions here is #1 and #2 are both vigorously defended by different parties. So your proposal is a no-go politically. The Dems won't lower or get rid of minimum wage, and the earned income tax credit is already hated by the GOP (even though they proposed it). There is the additional problem of all the missing details as well. Now before anyone trots out the whole "well if politics werent so stupid..." I have to stop you there. You reform with the politics you have, not the politics you want.
  - humanrebar 11y ago
    > and the earned income tax credit is already hated by the GOP They hate writing checks just to write checks. You can get it passed if you sell it as a progressive subsistence voucher that will replace the minimum wage, medicaid (we still have an insurance mandate), food stamps, etc. In fact, use the word voucher. The GOP loves those. ...and the GOP is more complex than people understand. I voted for Romney and McCain and I'd go for an EITC if it came with the right reform package. All this "if it weren't for those guys..." is really counterproductive.
    - deleted 11y ago
      [deleted]
    - Retric 11y ago
      Overall I thing the GOP has a great message, but they don't follow through. Over the last 30 years the GOP has raised government spending far more than the Dems. Consider the Medicare prescription drug plan without any negotiation for lower rates. It's just redicusly over the top levels of corruption.
      - Intermernet 11y ago
        >Overall I thing the GOP has a great message, but they don't follow through. Can you name a political party, in any part of the world, in the last century that did follow through with their "great message"? Politicians are PR / sales people. The product work is rarely actually done by them. If mortgage interest rates on average went up, the politicians will blame the greed of banks, the international exchanges market, the gravity was higher than normal etc. If mortgage interest rates on average went down, then that's a great reason to vote that politician in for another term!
        arethuza 11y ago
        UK Labour Party elected in 1945 removing Churchill from office - they founded the NHS. People who had suffered through WW2 wanted to feel that there would be some benefit to the common people - 70 years later and the NHS is still one of the most loved institutions in the UK despite being avowedly a socialist endeavour. NB I am not a supporter of the current Labour Party (AKA "New Labour") but they do deserve a lot of credit for what they did back then.
- deleted 11y ago
  [deleted]
- eli_gottlieb 11y ago
  Excuse me, but I think much of what you've written fails to actually address the question you asked. The reason hiring people is expensive is largely because of the regressive (ie: not scaling with the wage) taxes and insurance premiums. Those are why any given employee costs something like 40% on top of their actual pay to their employer. And by and large, much of what's "bought" with those fees and taxes just doesn't fucking work. Pension taxes can either go up for low-wage workers (precisely where they impact low-wage employers more) xor they can stop topping out for well-off professionals (and instead scale linearly or progressively with income). Health, life, and disability insurance should be consolidated into a more efficient public system. Company-provided 401k's are often basically just a handout to mutual-fund companies (that is, the fees take away from contributions but the investments don't perform better than a random walk). We can switch people over to firm-independent IRAs or some other supplementary pension system to increase efficiency, and give the gains back to workers as pay rises. Also, getting rid of the minimum wage - or any other measure designed to decrease mechanization and increase the usage of low-wage, low-skill labor - is exactly the opposite of what should happen. Public policy should never be written to deliberately hamper productivity growth in the name of increasing human toil!
  - humanrebar 11y ago
    > Public policy should never be written to deliberately hamper productivity growth in the name of increasing human toil! Depends on what you mean by productivity. Taken as a whole, people are working less and less. > And by and large, much of what's "bought" with those fees and taxes just doesn't fucking work. I disagree, but regardless, tying benefits to employment is silly and counterproductive. How many people make major employment decisions based on availability of benefits. I think there's common ground in thinking that employer-provided benefits is a broken idea. I also think there's way to provide for the needy while letting individuals make their own decisions. Health insurance is already regulated and individually mandated.
    - eli_gottlieb 11y ago
      >Depends on what you mean by productivity. Taken as a whole, people are working less and less. Productivity is well-defined: output per unit of input. Labor is only one input, but since it's the most common, productivity-per-hour is one of the most measured forms of productivity. If we assume that wages and productivity are correlated, then while reducing wage floors sounds like a good idea, what actually happens is that we're encouraging employers to use low-skill, low-output-per-hour labor in place of machines that have a higher output-per-hour but a higher up-front cost and no ability to externalize maintenance expenses (ie: between the cost of keeping a machine repaired or a worker fed and housed, we currently allow employers to externalize the latter but not the former). This is why low wages are a bad idea: they reduce the total output of the economy, but make up the loss by externalizing it onto workers (who then have to take Food Stamps to stay alive because their job isn't productive enough to provide them a living). It means we end up using losses to the total economy to subsidize exploitative and unpleasant working conditions, throwing good money after bad.
- ahallock 11y ago
  > watch the number of entry-level jobs explode and the demand for robotic work tank (like McD's filling sodas with robotics). People have better things to do than repetitive, unfulfilling tasks (unless they enjoy it, of course). We need to get to the Star Trek utopia... what you're talking about sounds like halting progress.
  - humanrebar 11y ago
    > what you're talking about sounds like halting progress Depends on what you mean by progress. Giving someone work experience is progress for her. I'm not talking about halting progress. I'm talking dividing the employment and subsistence problems. There will still be demand for automation. It just won't be artificially inflated by making employment more expensive than it has to be.
    - ahallock 11y ago
      So artificially increasing the demand for automation is bad, but incentivizing people to have more children and artificially increasing the population is good? > Giving someone work experience is progress for her. Progress is getting to the point where people can have technology provide the essentials, so that these repetitive jobs are just for fun, rather than a means for survival. It's like in DS9 where Sisko's father runs a restaurant--for pleasure. If he'd been sick or no longer interested in working, he wouldn't have to worry about starving or finding a place to live.
      - waterlesscloud 11y ago
        Do you want employment and consumer spending or do you want automation and progress? They're mostly mutually exclusive, and we'll have to face up to that fact.
        toomuchtodo 11y ago
        I want automation and technology to fuel progress, and provide for people so they can "spend" without the need for employment. "Our infrastructure provides you with X to spend every time period. Spend on what you'd like. Earn more if you'd like with a job/tasks/work of your choosing."
- xacaxulu 11y ago
  The last thing any government should do is subsidize procreation. You get more of what you incentivize and if you want an even larger percentage of the population on welfare, go ahead and pay more minimum income for bad planning and failure to use birth control.
  - xyzzyz 11y ago
    > The last thing any government should do is subsidize procreation. It's pretty funny how sentiment is completely opposite in Europe, and how heavily invested most European governments are in promoting procreation.
- deleted 11y ago
  [deleted]
- clavalle 11y ago
  > 1. Get rid of the minimum wage. It makes as much sense as rent control... none. This would only work if we got rid of welfare. Otherwise we are just going to create more government subsidized jobs. > 4. Set the levels of 2 high enough that citizens can pay their own taxes (both halves of the pension tax) and buy their own benefits (disability, health, life, 401k 'matching', etc.). ...watch the number of entry-level jobs explode and the demand for robotic work tank (like McD's filling sodas with robotics). I wouldn't call those entry level jobs. There is very little opportunity to grow beyond the entranceway. Why would we want to waste human minds on things robots can do. Robots are our friends. If we had enough in your #2 and taxes covered taking care of people's basic needs, selling of people's precious life wouldn't make the robotics takeover of the menial (and beyond) all that scary.
  - commandar 11y ago
    >This would only work if we got rid of welfare. Otherwise we are just going to create more government subsidized jobs. Basic income is usually suggested as a replacement for most current welfare programs.
    - ams6110 11y ago
      Bottom line, if you pay people to not work, you will get what you pay for.
  - humanrebar 11y ago
    I'm not anti-robot. I am pro entry-level job. > There is very little opportunity to grow beyond the entranceway. That was just an example. Nobody would show up to flip burgers for $0.25 an hour unless they saw a longer-term payoff down the road. They might take a job doing menial work for little-to-nothing while they learn the ins and outs of a business and eventually apply for a more substantive role. We could call them 'apprentices'.
    - SapphireSun 11y ago
      eh... I never flipped burgers and I got a good job. There are more ways to demonstrate worth than simply being present and wasting your time. It's more important to open useful doors to people than it is to make them do robotic work for no reason. I feel like your view is the sort of a "paying your dues" view, but the people I know that take off quick find something substantive to do, learn a lot very quickly, and are off doing something better in rapid iterative succession. The strategy you're advocating sounds like a very long runway before takeoff.
- nickbauman 11y ago
  5. Make sure you also deregulate construction and allow people to build shanty towns so they can work for $1 an hour and actually manage to somewhat survive in your dystopian nightmare.
- bsder 11y ago
  > Why can't hiring people be cheaper? Because it doesn't matter? All of the data from minimum wage increases indicates that employers are not employee constrained, they are demand constrained. So, minimum wages increases bump demand significantly while hurting employment weakly (if it all).
  - aburan28 11y ago
    Hiring is cheaper, ever hear of H1B's?
    - bsder 11y ago
      Uh, yeah, lots of companies spend money on lawyers to pay minimum wage to H1Bs. Suuuuuuuuure. And H1B's don't represent more people hired. The data shows that companies use H1B's to replace existing employees. So, you don't improve employment but you do reduce the demand. Congratulations, welcome to a downward spiral.
yummyfajitas 11y ago
With stagnant incomes? Very easy - non-wage compensation. Instead of giving people money, you give them non-wage compensation (e.g., health care benefits rather than wages, and similar things). That's exactly what happened, in fact - wages are "stagnant", but compensation per hour is not. http://research.stlouisfed.org/fred2/series/COMPRNFB http://research.stlouisfed.org/fred2/series/COMPRNFB http://research.stlouisfed.org/fred2/series/LES1252881600Q http://research.stlouisfed.org/fred2/series/LES1252881600Q
- cryoshon 11y ago
  Health care benefits don't help with rising food and housing costs...
  - nickff 11y ago
    Could you please provide a citation for the claims that food and housing prices are going up? I looked, but could only find information to the contrary on food (especially as a proportion of household spending), and very short term, noisy, and confusing information on housing (not house prices, but housing).[1] [1] https://www.aei.org/wp-content/uploads/2013/03/food.jpg https://www.aei.org/wp-content/uploads/2013/03/food.jpg
    - toomuchtodo 11y ago
      The cost of food continues to drop, but wages have also been stagnant since the 70's. Housing vs wages: https://makewealthhistory.files.wordpress.com/2011/05/wages-vs-house-prices.jpg https://makewealthhistory.files.wordpress.com/2011/05/wages-...
      - nickff 11y ago
        That data is on house prices, not on cost of housing; do you have any long-term data on cost of housing?
        11y ago
drawkbox 11y ago
We need a debt stimulus for the lower class, by lower I mean the bottom 90%. Back when they gave the stimulus to the banks, it almost would have been better to get money/stimulus to the people to use strictly to pay down debt (credit card, home, student loans). Even if it was only a chunk, not only would this have helped free up debt load, it would also go directly back to the banks that had been lending to the lower 90% all along. Instead they gave money to banks to help with loans/lending, overlooking the fact that it does nothing to help consumers. They gave it to groups that weren't really lending to the 90% of consumers. Trickle up is not just trickle up, it is trickle up and down. When you give money to the lower 90%, most of them give it right back. When you give it only to banks and upper 10%, it typically stays locked up in that 10%. Anybody surprised by this consumer economy sputtering hasn't been looking at it and doesn't get that you need to get money to the lower classes to prop up the upper classes and banks. Wages have stagnated this entire century so far, when people were surprised in 2008 when it came crashing down, it wasn't housing alone, it was that people had no money, less raises, while costs rose immensely. I won't go into the trillions on war spent on credit by the country as well that further harmed the downturn. We financed the wars with China's credit, it is almost as if China wants to break us with debt and ongoing, un-winnable wars. We aren't playing the game very smart and the greed is thick. In the future, stimulus should mean lowering debt loads of personal and state debt from the bottom up. Again, rich people mad by this aren't thinking it through, it is a two step hop and it is right back to them. But you'd have the lower classes now with more debt room and or room to spend. This is the only fix. If you were playing a simulation to create a good economy in a game, you'd probably do something like this instead of enrich modern day kings to hold onto, hoard and lock up more money in the upper 10% backdrift that does not make it's way to the lower 90% with enough force.
- themartorana 11y ago
  It's surprisingly short sighted of businesses (banks) to not have pushed for consumer bailouts with say... vouchers for paying down mortgages or other bad debts. The banks collect, and people are left with a lighter load, and are more likely to re-spend. Do banks assume that bailout + people making payments on underwater mortgages is, in the end, more profitable than bailout + lower debt loads and increased spending? An awful lot of people just walked away from their homes and mortgages.
NoPiece 11y ago
If you look at inflation adjusted after tax income, it looks more like income is stagnant for the bottom 50%, not 90%. There are some great graphs in this New York Times article about the stagnation of the US middle class. http://www.nytimes.com/2014/04/23/upshot/the-american-middle-class-is-no-longer-the-worlds-richest.html?&abt=0002&abg=1 http://www.nytimes.com/2014/04/23/upshot/the-american-middle...

humanrebar 11y ago

Why can't hiring people be cheaper? 1. Get rid of the minimum wage. It makes as much sense as rent control... none. 2. Help out the needy by introducing a minimum income and/or an aggressive earned income tax credit. 3. Everyone knows kids are expensive. They shouldn't be. Scale 2 according to household size. 4. Set the levels of 2 high enough that citizens can pay their own taxes (both halves of the pension tax) and buy their own benefits (disability, health, life, 401k 'matching', etc.). ...watch the number of entry-level jobs explode and the demand for robotic work tank (like McD's filling sodas with robotics). Side benefits: A. Small companies will be better able to compete with big companies with employment lawyers and HR departments. B. Bootstrapping and entrepreneurship becomes more viable. C. Corporations lose some of their relative power due to A and B.

ryanobjc 11y ago
"You must not be from around here, are you?" The problems with the suggestions here is #1 and #2 are both vigorously defended by different parties. So your proposal is a no-go politically. The Dems won't lower or get rid of minimum wage, and the earned income tax credit is already hated by the GOP (even though they proposed it). There is the additional problem of all the missing details as well. Now before anyone trots out the whole "well if politics werent so stupid..." I have to stop you there. You reform with the politics you have, not the politics you want.
- humanrebar 11y ago
  > and the earned income tax credit is already hated by the GOP They hate writing checks just to write checks. You can get it passed if you sell it as a progressive subsistence voucher that will replace the minimum wage, medicaid (we still have an insurance mandate), food stamps, etc. In fact, use the word voucher. The GOP loves those. ...and the GOP is more complex than people understand. I voted for Romney and McCain and I'd go for an EITC if it came with the right reform package. All this "if it weren't for those guys..." is really counterproductive.
  - deleted 11y ago
    [deleted]
  - Retric 11y ago
    Overall I thing the GOP has a great message, but they don't follow through. Over the last 30 years the GOP has raised government spending far more than the Dems. Consider the Medicare prescription drug plan without any negotiation for lower rates. It's just redicusly over the top levels of corruption.
    - Intermernet 11y ago
      >Overall I thing the GOP has a great message, but they don't follow through. Can you name a political party, in any part of the world, in the last century that did follow through with their "great message"? Politicians are PR / sales people. The product work is rarely actually done by them. If mortgage interest rates on average went up, the politicians will blame the greed of banks, the international exchanges market, the gravity was higher than normal etc. If mortgage interest rates on average went down, then that's a great reason to vote that politician in for another term!
      - arethuza 11y ago
        UK Labour Party elected in 1945 removing Churchill from office - they founded the NHS. People who had suffered through WW2 wanted to feel that there would be some benefit to the common people - 70 years later and the NHS is still one of the most loved institutions in the UK despite being avowedly a socialist endeavour. NB I am not a supporter of the current Labour Party (AKA "New Labour") but they do deserve a lot of credit for what they did back then.
deleted 11y ago
[deleted]
eli_gottlieb 11y ago
Excuse me, but I think much of what you've written fails to actually address the question you asked. The reason hiring people is expensive is largely because of the regressive (ie: not scaling with the wage) taxes and insurance premiums. Those are why any given employee costs something like 40% on top of their actual pay to their employer. And by and large, much of what's "bought" with those fees and taxes just doesn't fucking work. Pension taxes can either go up for low-wage workers (precisely where they impact low-wage employers more) xor they can stop topping out for well-off professionals (and instead scale linearly or progressively with income). Health, life, and disability insurance should be consolidated into a more efficient public system. Company-provided 401k's are often basically just a handout to mutual-fund companies (that is, the fees take away from contributions but the investments don't perform better than a random walk). We can switch people over to firm-independent IRAs or some other supplementary pension system to increase efficiency, and give the gains back to workers as pay rises. Also, getting rid of the minimum wage - or any other measure designed to decrease mechanization and increase the usage of low-wage, low-skill labor - is exactly the opposite of what should happen. Public policy should never be written to deliberately hamper productivity growth in the name of increasing human toil!
- humanrebar 11y ago
  > Public policy should never be written to deliberately hamper productivity growth in the name of increasing human toil! Depends on what you mean by productivity. Taken as a whole, people are working less and less. > And by and large, much of what's "bought" with those fees and taxes just doesn't fucking work. I disagree, but regardless, tying benefits to employment is silly and counterproductive. How many people make major employment decisions based on availability of benefits. I think there's common ground in thinking that employer-provided benefits is a broken idea. I also think there's way to provide for the needy while letting individuals make their own decisions. Health insurance is already regulated and individually mandated.
  - eli_gottlieb 11y ago
    >Depends on what you mean by productivity. Taken as a whole, people are working less and less. Productivity is well-defined: output per unit of input. Labor is only one input, but since it's the most common, productivity-per-hour is one of the most measured forms of productivity. If we assume that wages and productivity are correlated, then while reducing wage floors sounds like a good idea, what actually happens is that we're encouraging employers to use low-skill, low-output-per-hour labor in place of machines that have a higher output-per-hour but a higher up-front cost and no ability to externalize maintenance expenses (ie: between the cost of keeping a machine repaired or a worker fed and housed, we currently allow employers to externalize the latter but not the former). This is why low wages are a bad idea: they reduce the total output of the economy, but make up the loss by externalizing it onto workers (who then have to take Food Stamps to stay alive because their job isn't productive enough to provide them a living). It means we end up using losses to the total economy to subsidize exploitative and unpleasant working conditions, throwing good money after bad.
ahallock 11y ago
> watch the number of entry-level jobs explode and the demand for robotic work tank (like McD's filling sodas with robotics). People have better things to do than repetitive, unfulfilling tasks (unless they enjoy it, of course). We need to get to the Star Trek utopia... what you're talking about sounds like halting progress.
- humanrebar 11y ago
  > what you're talking about sounds like halting progress Depends on what you mean by progress. Giving someone work experience is progress for her. I'm not talking about halting progress. I'm talking dividing the employment and subsistence problems. There will still be demand for automation. It just won't be artificially inflated by making employment more expensive than it has to be.
  - ahallock 11y ago
    So artificially increasing the demand for automation is bad, but incentivizing people to have more children and artificially increasing the population is good? > Giving someone work experience is progress for her. Progress is getting to the point where people can have technology provide the essentials, so that these repetitive jobs are just for fun, rather than a means for survival. It's like in DS9 where Sisko's father runs a restaurant--for pleasure. If he'd been sick or no longer interested in working, he wouldn't have to worry about starving or finding a place to live.
    - waterlesscloud 11y ago
      Do you want employment and consumer spending or do you want automation and progress? They're mostly mutually exclusive, and we'll have to face up to that fact.
      - toomuchtodo 11y ago
        I want automation and technology to fuel progress, and provide for people so they can "spend" without the need for employment. "Our infrastructure provides you with X to spend every time period. Spend on what you'd like. Earn more if you'd like with a job/tasks/work of your choosing."
xacaxulu 11y ago
The last thing any government should do is subsidize procreation. You get more of what you incentivize and if you want an even larger percentage of the population on welfare, go ahead and pay more minimum income for bad planning and failure to use birth control.
- xyzzyz 11y ago
  > The last thing any government should do is subsidize procreation. It's pretty funny how sentiment is completely opposite in Europe, and how heavily invested most European governments are in promoting procreation.
deleted 11y ago
[deleted]
clavalle 11y ago
> 1. Get rid of the minimum wage. It makes as much sense as rent control... none. This would only work if we got rid of welfare. Otherwise we are just going to create more government subsidized jobs. > 4. Set the levels of 2 high enough that citizens can pay their own taxes (both halves of the pension tax) and buy their own benefits (disability, health, life, 401k 'matching', etc.). ...watch the number of entry-level jobs explode and the demand for robotic work tank (like McD's filling sodas with robotics). I wouldn't call those entry level jobs. There is very little opportunity to grow beyond the entranceway. Why would we want to waste human minds on things robots can do. Robots are our friends. If we had enough in your #2 and taxes covered taking care of people's basic needs, selling of people's precious life wouldn't make the robotics takeover of the menial (and beyond) all that scary.
- commandar 11y ago
  >This would only work if we got rid of welfare. Otherwise we are just going to create more government subsidized jobs. Basic income is usually suggested as a replacement for most current welfare programs.
  - ams6110 11y ago
    Bottom line, if you pay people to not work, you will get what you pay for.
- humanrebar 11y ago
  I'm not anti-robot. I am pro entry-level job. > There is very little opportunity to grow beyond the entranceway. That was just an example. Nobody would show up to flip burgers for $0.25 an hour unless they saw a longer-term payoff down the road. They might take a job doing menial work for little-to-nothing while they learn the ins and outs of a business and eventually apply for a more substantive role. We could call them 'apprentices'.
  - SapphireSun 11y ago
    eh... I never flipped burgers and I got a good job. There are more ways to demonstrate worth than simply being present and wasting your time. It's more important to open useful doors to people than it is to make them do robotic work for no reason. I feel like your view is the sort of a "paying your dues" view, but the people I know that take off quick find something substantive to do, learn a lot very quickly, and are off doing something better in rapid iterative succession. The strategy you're advocating sounds like a very long runway before takeoff.
nickbauman 11y ago
5. Make sure you also deregulate construction and allow people to build shanty towns so they can work for $1 an hour and actually manage to somewhat survive in your dystopian nightmare.
bsder 11y ago
> Why can't hiring people be cheaper? Because it doesn't matter? All of the data from minimum wage increases indicates that employers are not employee constrained, they are demand constrained. So, minimum wages increases bump demand significantly while hurting employment weakly (if it all).
- aburan28 11y ago
  Hiring is cheaper, ever hear of H1B's?
  - bsder 11y ago
    Uh, yeah, lots of companies spend money on lawyers to pay minimum wage to H1Bs. Suuuuuuuuure. And H1B's don't represent more people hired. The data shows that companies use H1B's to replace existing employees. So, you don't improve employment but you do reduce the demand. Congratulations, welcome to a downward spiral.

yummyfajitas 11y ago

With stagnant incomes? Very easy - non-wage compensation. Instead of giving people money, you give them non-wage compensation (e.g., health care benefits rather than wages, and similar things). That's exactly what happened, in fact - wages are "stagnant", but compensation per hour is not. http://research.stlouisfed.org/fred2/series/COMPRNFB http://research.stlouisfed.org/fred2/series/COMPRNFB http://research.stlouisfed.org/fred2/series/LES1252881600Q http://research.stlouisfed.org/fred2/series/LES1252881600Q

cryoshon 11y ago
Health care benefits don't help with rising food and housing costs...
- nickff 11y ago
  Could you please provide a citation for the claims that food and housing prices are going up? I looked, but could only find information to the contrary on food (especially as a proportion of household spending), and very short term, noisy, and confusing information on housing (not house prices, but housing).[1] [1] https://www.aei.org/wp-content/uploads/2013/03/food.jpg https://www.aei.org/wp-content/uploads/2013/03/food.jpg
  - toomuchtodo 11y ago
    The cost of food continues to drop, but wages have also been stagnant since the 70's. Housing vs wages: https://makewealthhistory.files.wordpress.com/2011/05/wages-vs-house-prices.jpg https://makewealthhistory.files.wordpress.com/2011/05/wages-...
    - nickff 11y ago
      That data is on house prices, not on cost of housing; do you have any long-term data on cost of housing?
      - 11y ago

drawkbox 11y ago

We need a debt stimulus for the lower class, by lower I mean the bottom 90%. Back when they gave the stimulus to the banks, it almost would have been better to get money/stimulus to the people to use strictly to pay down debt (credit card, home, student loans). Even if it was only a chunk, not only would this have helped free up debt load, it would also go directly back to the banks that had been lending to the lower 90% all along. Instead they gave money to banks to help with loans/lending, overlooking the fact that it does nothing to help consumers. They gave it to groups that weren't really lending to the 90% of consumers. Trickle up is not just trickle up, it is trickle up and down. When you give money to the lower 90%, most of them give it right back. When you give it only to banks and upper 10%, it typically stays locked up in that 10%. Anybody surprised by this consumer economy sputtering hasn't been looking at it and doesn't get that you need to get money to the lower classes to prop up the upper classes and banks. Wages have stagnated this entire century so far, when people were surprised in 2008 when it came crashing down, it wasn't housing alone, it was that people had no money, less raises, while costs rose immensely. I won't go into the trillions on war spent on credit by the country as well that further harmed the downturn. We financed the wars with China's credit, it is almost as if China wants to break us with debt and ongoing, un-winnable wars. We aren't playing the game very smart and the greed is thick. In the future, stimulus should mean lowering debt loads of personal and state debt from the bottom up. Again, rich people mad by this aren't thinking it through, it is a two step hop and it is right back to them. But you'd have the lower classes now with more debt room and or room to spend. This is the only fix. If you were playing a simulation to create a good economy in a game, you'd probably do something like this instead of enrich modern day kings to hold onto, hoard and lock up more money in the upper 10% backdrift that does not make it's way to the lower 90% with enough force.

themartorana 11y ago
It's surprisingly short sighted of businesses (banks) to not have pushed for consumer bailouts with say... vouchers for paying down mortgages or other bad debts. The banks collect, and people are left with a lighter load, and are more likely to re-spend. Do banks assume that bailout + people making payments on underwater mortgages is, in the end, more profitable than bailout + lower debt loads and increased spending? An awful lot of people just walked away from their homes and mortgages.

NoPiece 11y ago

If you look at inflation adjusted after tax income, it looks more like income is stagnant for the bottom 50%, not 90%. There are some great graphs in this New York Times article about the stagnation of the US middle class. http://www.nytimes.com/2014/04/23/upshot/the-american-middle-class-is-no-longer-the-worlds-richest.html?&abt=0002&abg=1 http://www.nytimes.com/2014/04/23/upshot/the-american-middle...