Real wages have not stagnated. The poor are not poorer.

I completely disagree household income has no bearing on the standard of living.

 

Perhaps then you can provide data that shows a meaningful correlation between real income per capita and real income per household over time and I will be inclined to agree with you if the data supports your claim.

 

You would have to compare the number of people in households over time.

 

That's my point. Why not just avoid that altogether and use real income per capita instead?

 

Be my guest.

 

Well that just goes to show you that if you choke a statistic long enough you can make it admit to anything.
　
　
In the mean time;
　
Reality;
The average home in the 1970's was about $30,000.00 and if you worked as a helper/carpenter in training on the job site you made about $6-8 an hour, well above the minimum wage for that time. And now the average home is what $150-300 thousand depending on what part of the country you live in, and now the helper/carpenter in training on the job site makes minimum wage or $6-8 an hour. Oh sure it might be a little bigger but compared to what you were getting built in the 1970’s it is basically a junk cardboard home, that probably will not be here long, while the home that was built in 1970, with minimum care will still be here many decades after the average home of today falls over and is rotting away in a land fill someplace.
　
　
More reality;
A loaf of bread (top name brand) in the 1970's was about $.12-.13 a loaf or 8 for a dollar, and today that same loaf of bread costs $3-4 a loaf.
　
　
Even more reality;
In the 1970's an office visit to get a prescription for your child's cold, would set you back about $15-20, but today that same office visit might require mandatory insurance, doctor acceptance (they have become awfully choosy about who they see these days), and a co-pay of about $50 would be required, up front, while your insurance company will also be billed additionally, any where from $75-120 or more, depending on what ever the doctor can cheat them out of.
　
　
Still more reality;
A broken arm, and an emergency room visit might set you back $150-300 in the 1970’s for x-ray, setting the cast and a second visit to remove the cast with a final x-ray to make sure that it was healing properly, but today, the emergency room visit will set you back a minimum $750-up, just for filling out the paperwork, and an additional $10-30 thousand for the exact same care, with a lot more flashing lights and bells than you got for a week or two's pay then.
　
　
But the working class are much richer today because they have a typewriter that talks to them, mails letters with the push of a button, and that can download movie or an album from for a nominal fee (basically what it cost to go to the movies or buy an album in the 1970‘s), and an X-box is right there in their home with more games than they ever had in a pool hall or bowling alley in the 1970's.
　
The average American household have less wealth and more debt than ever before, but hey they are much better off because a government statistic says so…

 

Some of those numbers seem suspect to me, but if you were an average family in the 1970s, your income was about $10,000 a year. Today it is $60,000.

Of course, if your in the 1%, you are doing fabulous much better than the 1% in the 70s.

The last 30 years have been great for the richest in this country.

 

The figures are based on the 70's 1970-1979. Average income for the household (remember back then one was enough)

1965, $28599- 1975, $33148- 1985, $42847- 1995, $39186- 2005, $41386.

Guess it just depends on what government figures you want to go by. Anyway according to these figures (average household figures), the average family income was about $34000 and today it is only about $54000 (not sure where you got the $60000, but it doesn't matter because I do not believe either or any of the numbers the government has to offer), but lets go with the $60000 just for the sake of argument. Inflation has increased 300% since the 70's, but the average income for household hasn't even doubled (increased by 100%) since 1975. So households are making more money than they did in the 70's as the OP is trying to imply, but he is failing miserably since the cost of living is still over 200% more than it was in the decade of the 1970's on average.


Number people, you got to love them, NOT! I prefer reality. Everybody else should try it too. The government has blown enough smoke up the average Americans arse in the last 4 decades than they have the rest of the time this place has been a country combined.

 

When discussing income, median household data is better than the average (i.e. gdp per capita), since the median does not suffer from outliers. Real gdp per capita suffers from outliers of the uber rich.

 

Median Household income in 1970 was $9,867. Mean (average) was $11,106.

http://www.census.gov/hhes/www/income/data/historical/families/2010/F06AR_2010.xls

 

That was the topic early in the thread.

In the last decade average (mean) incomes increased, but median incomes decreased.

Any math wizzes out there want to explain how that could be?

 

You have five people in the economy who make $10,000, $20,000, $30,000, $40,000, and $50,000. In this scenario, the median equals the average of $30,000.

In the next time period, these five people earn $5,000, $15,000, $25,000, $35,000, and $75,000. Now, the median is $25,000 while gdp per capita is $31,000.

 

Very good. Rep points for you. (I'll have to give it after the board lets me.) NIce to see we have some informed folks out there.

As you noted above, an increase in the extremity (in your example, the top income increasing by 50%) can bring an average up (or down). The median is the midpoint in the data.

And that is pretty close to what has happened to incomes in our economy. The lower incomes stagnated or declined (bringing down the median), while the top incomes increased dramatically (bringing up the average).

This would be an example where, to anti-paraphrase Churchill, a rising tide does not float all boats.

 

Still playing with numbers not reality of how much better off people are today, comparable wealth that actually matters, debt, ability to obtain wealth and maintain it, etc...


It's a whole different ballgame these days, and the rules are fixed in somebody else's favor. The average Joe doesn't even have the chance of surviving and/or improving their situation the way they did 40 years ago.

 

Now that we have shown your numbers are wrong, my deduction is that your conclusions are also probably flawed. Others can decide for themselves.

Somebody else is the 1%. 30 years dominated by conservative politics will get you that.

Eye opening charts showing the growing income disparity between the super rich and everyone else:









Source: http://news.yahoo.com/s/yblog_thelo...but-unequal-charts-show-growing-rich-poor-gap

 

Must have missed that part? You showed government numbers, I showed government numbers, you showed more government numbers that even sai your first numbers were wrong and then you declare victory??? Yes people need to stop listening to the best government corporate money can buy, the corporate owned media, and actually start paying attention to what is "really" going on around them.



Then you show charts that say I was right things are not better than they were for well over 80% of the country, but I was wrong??? Are you arguing with me or agreeing with me?

 

Those were Govt numbers you showed? Where's the link to the source for your numbers?

Except for the 1%, things for most folks are worse over the past 10 years and barely better over the past 30, but that is not true since the early 70s and particularly if you add in the 50s and 60s.

 

So you've heard the right-wing corporatist version of the "information".

And now for the truth...



You do understand the concept of "inflation", right?

Do you also understand that since increases in food and energy are removed from the official inflation, that the above chart which is adjusting for inflation by expressing the terms in 2010 dollars is probably understating the true declination in median household income if it is using the official inflation statistic, right? Good... just wanted to make sure.

It's probably 'cause American workers are lazy and spoiled...amiright?



Those (*)(*)(*)(*)ed unions...always looking out for executive compensation...



They are obviously just plain bad for the US...

 

Do you wish to make the claim that real median per capita incomes have decreased since 2000?

 

What truth? You are posting the same information on median income yet claiming it means something completely different by isolating data points at the top of a bubble and bottom of a recession in a desperate attempt to support your idiotic world view. And as you go up it gets even better. Considering that today a large portion of the population is entitled and lazy, it's easier than ever to be in the top 20% where upon you are sitting far better than ever before.

Why don't you just post the last 3 years and claim that we are all headed to ruin? If you are trying to be intellectually dishonest, why not go all out?

The reality is that over the last thirty years, all income brackets have gotten richer in real wages, even as income disparity has increased because income disparity has nothing to do with our standard of living.

The middle class isn't disappearing, in fact we are doing much better today than our parent's generation even in spite of the recession.

You can thank capitalism for that.

Oh, and I especially like this graph. Note how at the top it states 'middle class income shrinks' (which anyone following this thread should realize is a lie), yet at the side the line claims to represent 'share of income'.

Let me post it along side this one. I wonder why they charted union membership alongside 'share of income' instead of 'real manufacturing wages'. I suppose that wouldn't have supported their argument huh.



Haha, thanks for the 'truth' from think progress. I needed the laugh.

 

Nope.

...........

 

Then I have no dispute with your comments.

 

What you claim does not seem be consistent with wealth distribution in our political-economy.

S&P CEO wage ratios are one example.

 

To you, because you have a flawed understanding of the economy. You are making a fundamentally incorrect assumption.

You are assuming that if income disparity is increasing than real income for the lower and middle class is decreasing. That is not true. The total share of wealth controlled by the middle class is decreasing and the middle class is getting richer in terms of real wages at the same time.

 

Pre-edit: it's hard to source everything and stay inline with the conversation just sayin'...

Ya know every time I see this argument that pay has not increased I get the feeling the figures are being skewed. I decided to look this one up:

Median average pay for an assistant carpenter: $35,151/y = $16.90/h -- http://www.salarylist.com/jobs/Carpenters-Assistant-Salary.htm

Less "skilled" construction laborer median average pay: $14/h = $29,120/y -- http://www.ehow.com/info_7735993_salary-construction-laborer.html

This field in particular has increased substantially since the 70s (assuming $6-8/h was the pay back then) I am not faulting you in particular, it is very possible that in "your" particular area the going pay is similar to the 70s. After all, pay rate is often driven by employer's demand for said profession type on a local basis - for quick consideration, the pay rate of a trolley car servicer in San Francisco vs in any other city.


As far as housing costs goes; I often feel it should be pointed out that the cost of housing is driven hugely by demand and that demand fluctuates a lot across the country. For example, right now the "median" home cost in the northeast is $231,300 where as in the midwest the median home cost is only $129,100, in the west it's $205,200 and in the south it's $146,900 ( http://www.realestateabc.com/outlook/overall.htm ) That's a pretty big difference imo.

I realize that economists like using "median" house prices, but I am not too keen on the idea in this particular argument because I feel the "median cost" fails to accurately reflect the reality of the country overall to the huge variances that go into that "median" calculation, however, the same could be said for average pay rates so perhaps my "gut feeling" point on it is moot.

In any event - the national median home cost is $212k right now. On the surface I rather see this number reflecting only half the country, but on the other hand, it is likely that the south and midwest do not have the population of the northeast and west, therefore it skews the national "median" toward their regions prices. /shrug


I think the most over-looked consideration in this home cost argument is the mortgages themselves. Back in the 70s the interest rates on mortgages went as high as 19% due to inflation ( High interest rates continued into the 90's - http://www.ehow.com/about_5576484_history-mortgage-interest-rates.html )


The reason I feel this is important when considering "cost of living" vs "quality of life" discussion is because your $30k 1970 home with a 30yr mortgage at 19% interest would cost the buyer $171,600 in total vs today a $212k home with a 30yr mortgage at 3.25% interest will cost the buyer $332,150 in total.


So "in practice" the cost of a home is actually increasing in parallel with the pay of your construction laborer there (roughly doubled since the 70s), and in fact, one could actually argue that said house provides the worker a higher quality of life on many levels considering both the increased living space and the higher construction quality (aka lower heating/air conditioning bills, etc.)



I do not feel it is "proper" to cherry pick out particular "aspects" (the doctor's office visit or a prescription for example) when the argument is meant to consider an overall increased cost of life vs wage theory. That said, while the cost of your visit to your doctor's office / prescription may indeed have increased since the 70s, the overall cost of medical care is roughly the same as it has been almost throughout history - aka medical care costs are increasing at the same rate as wages are.

http://www.westandfirm.org/docs/Gorman-01.pdf On page 4 you'll find medical expenses charted and discussed (citing only my used stats here) percent of a family's income going to medical expenses, 1972-73 at 4.7%, and 2002 at 4%.

http://www.ehow.com/info_7811523_typical-family-expenses-annualized-expenditures.html notes that typical income of $62k with health care being $3.1k aka 5% going to medical expenses (sorry the other link stopped at 02)

In some ways I want to get into the issue of health care more deeply but I think it would detract from the over all discussion here so I'm just going to say that health care costs are not really "consumer" driven and have been allowed to balloon essentially out of control for nearly 100 years with almost no checks or balances in place that would have kept costs "affordable" to the average Joe, and perhaps worse, average Joe has almost never had a "realistic" handle on the "actual" cost of his medical care due to health insurance, pre-paid medical care, and government "twiddling."