Do the Rich Capture All the Gains from Economic Growth? • Hacker News Board

Re: Do the Rich Capture All the Gains from Economic Growth?

#241

Post by gruez » Fri, Oct 26, 2018, 1:30 AM UTC

skybrian wrote: post #209

onlyrealcuzzo wrote: post #132

Earlier quoted context omitted.

Wait. Aren't rent, healthcare, AND education all included in the eight components of CPI? Isn't that how the government measures inflation? I think one of the big things left off is housing prices. But I'm pretty sure rent, healthcare, and education are part of it: https://www.bls.gov/cpi/factsheets/medical-care.htm http://webapps.dol.gov/dolfaq/go-dol-faq.asp?faqid=94

The inflation rate does include rent, or "imputed rent" for home owners. However, it's an average of what people actually pay, including people who somehow got a sweet deal on housing costs, through rent control or buying their house a long time ago or whatever. It's not going to match the prices you see advertised when you're looking to move.

>However, it's an average of what people actually pay, including people who somehow got a sweet deal on housing costs

which is arguably the more accurate way of measuring consumer prices.

Re: Do the Rich Capture All the Gains from Economic Growth?

#242

Post by GhostVII » Fri, Oct 26, 2018, 1:30 AM UTC

skybrian wrote: post #209

onlyrealcuzzo wrote: post #132

Earlier quoted context omitted.

Wait. Aren't rent, healthcare, AND education all included in the eight components of CPI? Isn't that how the government measures inflation? I think one of the big things left off is housing prices. But I'm pretty sure rent, healthcare, and education are part of it: https://www.bls.gov/cpi/factsheets/medical-care.htm http://webapps.dol.gov/dolfaq/go-dol-faq.asp?faqid=94

The inflation rate does include rent, or "imputed rent" for home owners. However, it's an average of what people actually pay, including people who somehow got a sweet deal on housing costs, through rent control or buying their house a long time ago or whatever. It's not going to match the prices you see advertised when you're looking to move.

Wasn't that also the case historically though? Rent control has been around for a while.

Re: Do the Rich Capture All the Gains from Economic Growth?

#243

Post by yuhong » Fri, Oct 26, 2018, 1:30 AM UTC

This is one of the reason I dislike the current debt-based economy that relies on extracting more dollars from "consumers".

Re: Do the Rich Capture All the Gains from Economic Growth?

#244

Post by thrmsforbfast » Fri, Oct 26, 2018, 1:33 AM UTC

alehul wrote: post #240

rwcarlsen wrote: post #51

While attempting to refute the idea that the poor haven't improved their station since the 70s, they cite a lot of stats that show most households make more income than their parents did (inflation adjusted), but they completely neglect to account for the huge factor that is the number of people working (or cumulative hours worked) per household in order to achieve that improvement. In the 1970s, there were a lot mor…

Wouldn't this be addressed by the fact that, as you said, we now have a new standard of multi-income households? If everyone in America was in a single-income household, and then we all became, for instance, two-income households, wouldn't it make sense for individual incomes to drop by half?

Only if GDP remained constant. Inflation-adjusted GDP increase from ~5 trillion in the 70's to ~18 trillion today. Much larger than 2x, and not every household is dual-income.

Re: Do the Rich Capture All the Gains from Economic Growth?

#245

Post by jorblumesea » Fri, Oct 26, 2018, 1:34 AM UTC

old-gregg wrote: post #47

The gains have been looted by the healthcare providers. It is not uncommon for health coverage to exceed $2k/mo for a typical family of 4, that's $24k/year. The median US household income is $59k, so the total comp is $83k/year. See the gains now? This absurd amount is not reflected in a paycheck and one may think "my job pays for it" but that is still your money.

That is just one example, the truth is that American society has many such "middleman looters" which exploit the system for gain at the expense of the middle and working classes.

A few examples:

* Student loan industry / higher education debt

* Unaffordable housing and exploitative renting due to NIMBY building practices

* Police ticketing as a revenue stream for municipal tax authorities

All of this either didn't exist for their parents, or were not as severe. All of this adds up to a middle class which has significantly less than their parents.

Re: Do the Rich Capture All the Gains from Economic Growth?

#246

Post by thrmsforbfast » Fri, Oct 26, 2018, 1:40 AM UTC

russroberts613 wrote: post #141

The whole point of much of this analysis (and the videos shown) is that household income can be very misleading. But most if not all of the analyses I report on are for individuals over time. So changes in the number of earners are actually more of a problem for most of the gloomy studies that look at households by quintile. Incredibly, the proportion of households with two earners is LOWER in 2014 than in 1980 becau…

> Incredibly, the proportion of households with two earners is LOWER in 2014 than in 1980 because of the large increase in households with one or no earners. Marriage is not nearly as common as it used to be. The data are here in Table H-12

That's interesting data.

However, one income supporting one person is very different from one income supporting 4+ people. Is there any reason why we shouldn't just use division (# earners/household size) here?

Re: Do the Rich Capture All the Gains from Economic Growth?

#247

Post by xupybd » Fri, Oct 26, 2018, 1:40 AM UTC

TheBeardKing wrote: post #31

This bullshit article tries to paint a rosy picture of the economy by dismissing proportional median income gains between quintiles and instead argues that absolute income gains of individuals over time is enough evidence to suggest everything is actually great. This chart [1] seems to be the crux of their argument, as in - Surprise! Over 30 years poor people gained an average of almost $30k in income! I sure fucking…

>Bottom line - if the economy can't support a living wage for the working class, it's not doing all that great.

Hasn't the standard of living risen for the working class over the 30 years?

This is an absolute position, has it ever been better the case in the past?

Re: Do the Rich Capture All the Gains from Economic Growth?

#248

Post by beiller » Fri, Oct 26, 2018, 2:02 AM UTC

snikeris wrote: post #136

JustSomeNobody wrote: post #124

Earlier quoted context omitted.

Not horrifying: When your refrigerator dies and you can go buy another without blinking. Horrifying: When you misplace a $20 bill and now you can't pay your rent. It's really simple to understand.

Okay, being poor can be horrifying. But I don't see what's horrifying about the fact that some people have more wealth than others.

Inequality is great really. It incentivizes people to give extra effort for a reward. But gone too far, the efficiency of humanity will drop. There needs to be (and there probably is) shifts in wealth to keep things moving. Let's get those moon bases going.

Re: Do the Rich Capture All the Gains from Economic Growth?

#249

Post by gowld » Fri, Oct 26, 2018, 2:17 AM UTC

beat wrote: post #190

T2_t2 wrote: post #178

Earlier quoted context omitted.

That needs a citation. If you cut out everything we have they didn't - cable TV, Netflix, computers, internet, cafes, restaurants, Kindle, better choices in grocery food and alcohol - and ate the sort of cheap food people lived on, things like meatloaf and crappy ingredient dishes, I reckon it would be entirely possible. The only thing that is prohibitively expensive today vs 1980 is housing. The reasons for that are…

A quick look at education numbers finds that, since 1988, the cost of private four year college has doubled (in inflation-adjusted dollars), and the cost of state four year college has tripled. Again in constant dollars, health care has seen a more than fivefold increase since 1970, from under $2000 to over $10,000 per capita. Constant dollars, mind you. Health care and education costs are more or less fixed and unav…

Health care is amazingly better now than it was for our parents.

Re: Do the Rich Capture All the Gains from Economic Growth?

#250

Post by gowld » Fri, Oct 26, 2018, 2:18 AM UTC

alehul wrote: post #240

rwcarlsen wrote: post #51

While attempting to refute the idea that the poor haven't improved their station since the 70s, they cite a lot of stats that show most households make more income than their parents did (inflation adjusted), but they completely neglect to account for the huge factor that is the number of people working (or cumulative hours worked) per household in order to achieve that improvement. In the 1970s, there were a lot mor…

Wouldn't this be addressed by the fact that, as you said, we now have a new standard of multi-income households? If everyone in America was in a single-income household, and then we all became, for instance, two-income households, wouldn't it make sense for individual incomes to drop by half?

Two-income households caused wages to drop due to labor oversupply.