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U.S. Suffers Sharpest Rise in Poverty Rate in More Than 50 Years

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Re: U.S. Suffers Sharpest Rise in Poverty Rate in More Than 50 Years

#91

Post by mjevans »

anotherman554 wrote: post #76
willcipriano wrote: post #29

Earlier quoted context omitted.

If you made a minimum wage that was significantly above the prevailing wage I'd expect to see inflation in a economy like the US. My wager would be that dollars that are currently chasing returns in the stock market may shift to wages resulting in those same dollars now trying to buy consumer goods rather than stock. We might not call that inflation in the economy generally as after all stocks would "deflate" during…

This is an empirical question (if raising minimum wage effects inflation) so what you expect in terms of inflation doesn't really matter. This isn't a philosophy question where you can imagine the answer and get a best in class result. Since 2009 people on the Internet have been prophesizing about massive inflation and inflation has been extremely low. Maybe they will one day be right, but like the boy who cried wolf…

Offhand, just from my own crummy bio memory of prices of things...

I'd estimate about a 50% increase in food prices in about the last decade.

I'd also estimate that the asking price of a house was completely out of whack even post the recession in 2008; it _never_ corrected in any of the west coast areas I live in. Still even that price has continued to go up due to inelastic supply and ever growing demand.

Re: U.S. Suffers Sharpest Rise in Poverty Rate in More Than 50 Years

#92

Post by tharne »

bmitc wrote: post #48
throwaway0a5e wrote: post #2

Alternative title: "events of 2020 case poverty rate to regress to 2017/2018 levels" Frankly I'm surprised the effect was so small considering that the industries hit hardest by covid employ a heck of a lot of people who are near the poverty line to begin with. I would expect all those people to be pushed to the other side of the line resulting in a much more dramatic increase in the poverty rate.

I think using the word regress seems to imply that it was improving. Wealth inequality in the U.S. has been getting worse at faster rates, even before 2020.

I don't know why we always go back to income inequality, it's not a useful metric. What matters is how many people are living good, prosperous lives. You can have have income equality simply by keeping everyone equally poor, or you can have prosperous societies where some people have a lot more than others, but everyone is doing well. Income inequality is only meaningful if the amount if wealth and prosperity in a society is fixed, which it's not.

Re: U.S. Suffers Sharpest Rise in Poverty Rate in More Than 50 Years

#93

Post by vagrantJin »

Eridrus wrote: post #52
bmitc wrote: post #48

Earlier quoted context omitted.

I think using the word regress seems to imply that it was improving. Wealth inequality in the U.S. has been getting worse at faster rates, even before 2020.

Poverty metrics were improving.

I like the bureaucratic way you put this like it means anything. Especially since poverty is arbitrarily defined.

Re: U.S. Suffers Sharpest Rise in Poverty Rate in More Than 50 Years

#94

Post by macspoofing »

JumpCrisscross wrote: post #83
macspoofing wrote: post #11

Earlier quoted context omitted.

I think that's what OP is saying and if that's the case, they are wrong. Minimum wage is not inflationary. It has other problems like the fact it never ever decreases poverty, and has a good chance of increasing unemployment, and is a one-size-fits all ($15/hr in NY, is different than $15/hr in Alabama) ... but it isn't inflationary. You're not creating new money.

> it isn't inflationary. You're not creating new money Nitpick. We have no evidence minimum wage increases are inflationary. (We have evidence it is not [1][2].) But something doesn't have to create new money to be inflationary. Increasing money velocity causes inflation as much as printing bills. The poor spend their dollars in the real economy (as opposed to the wealthy, who buy GameStock calls). That increases dem…

OK .. so when price of flowers goes up prior to Valentine's day, that's inflation?

Re: U.S. Suffers Sharpest Rise in Poverty Rate in More Than 50 Years

#95

Post by slumdev »

lumost wrote: post #63
Eridrus wrote: post #52

Earlier quoted context omitted.

Poverty metrics were improving.

These two seem at odds, are we defining poverty in such a way that it's decoupled from the expected living standard of the age?

They're not at odds.

It is possible for the people at the bottom to have better housing, better food, better education, and better health, while the people at the top still enjoy a vastly disproportionately greater increase in income and wealth.

With disproportionate gains and different spending priorities, you won't see consistent inflation across all kinds of goods. Because the inflation is concentrated at the top, the people at the bottom won't get priced out of the things they need. They're not getting priced out of anything they couldn't have afforded 20 years ago.

A nice house that cost $100k in 1999 costs $200k today.

A fabulous house that cost $500k in 1999 costs $5,000k today.

Re: U.S. Suffers Sharpest Rise in Poverty Rate in More Than 50 Years

#96

Post by anotherman554 »

mjevans wrote: post #91
anotherman554 wrote: post #76

Earlier quoted context omitted.

This is an empirical question (if raising minimum wage effects inflation) so what you expect in terms of inflation doesn't really matter. This isn't a philosophy question where you can imagine the answer and get a best in class result. Since 2009 people on the Internet have been prophesizing about massive inflation and inflation has been extremely low. Maybe they will one day be right, but like the boy who cried wolf…

Offhand, just from my own crummy bio memory of prices of things... I'd estimate about a 50% increase in food prices in about the last decade. I'd also estimate that the asking price of a house was completely out of whack even post the recession in 2008; it _never_ corrected in any of the west coast areas I live in. Still even that price has continued to go up due to inelastic supply and ever growing demand.

The government CPI statistics show 18.7% price increase between 2010 and 2020.

It's certainly possible that your expenses went up 50% in your presumably super-affluent area of the U.S. It wouldn't surprise me if booming tech companies in certain regions have caused this- but it is not the effect of monetary policy or government minimum wage policy- and my expenses have not gone up much in the last 10 years in my wealthy-but-not super-affluent east coast suburb.

Re: U.S. Suffers Sharpest Rise in Poverty Rate in More Than 50 Years

#97

Post by JumpCrisscross »

macspoofing wrote: post #94
JumpCrisscross wrote: post #83

Earlier quoted context omitted.

> it isn't inflationary. You're not creating new money Nitpick. We have no evidence minimum wage increases are inflationary. (We have evidence it is not [1][2].) But something doesn't have to create new money to be inflationary. Increasing money velocity causes inflation as much as printing bills. The poor spend their dollars in the real economy (as opposed to the wealthy, who buy GameStock calls). That increases dem…

OK .. so when price of flowers goes up prior to Valentine's day, that's inflation?

> when price of flowers goes up prior to Valentine's day, that's inflation?

No. Inflation is a "a general rise in the price level in an economy over a period of time" [1]. A single product pricing up is not a "general rise," and a temporary spike before Valentine's Day isn't "over a period of time."

[1] https://en.wikipedia.org/wiki/Inflation

Re: U.S. Suffers Sharpest Rise in Poverty Rate in More Than 50 Years

#98

Post by elliekelly »

vagrantJin wrote: post #93
Eridrus wrote: post #52

Earlier quoted context omitted.

Poverty metrics were improving.

I like the bureaucratic way you put this like it means anything. Especially since poverty is arbitrarily defined.

If we define the federal poverty threshold as having an annual income of less than $1 poverty metrics will improve drastically. Heck, we might even be able to solve it!

Re: U.S. Suffers Sharpest Rise in Poverty Rate in More Than 50 Years

#99

Post by machiaweliczny »

runamok wrote: post #57
machiaweliczny wrote: post #18

Earlier quoted context omitted.

I just started reading Pikkety and at 2010 already private owned capital was at 600% of GDP (almost reaching pre WW1 lvl). I wonder how it's now when stock rised 4x in the last 4 years (probably will rise more with next relief). They have some DB online with such info. I'm of opinion that work is no longer profitable (and I have top non-exec salary). I'm not from US but IMO federal wage is stupid but on state lvl I w…

That seems more sane and seems to ensure less inequality. E.g. a rising tide lifts all boats. I think that would be something like 24000 a year based on 2019: https://www.thestreet.com/personal-finance/average-income-in... Current federal minimum is about $15,000 a year for 40 hours a week. However, I doubt the politicians will do it as it's harder to explain.

Fedeal min wage might cause demage to underdeveloped parts of country if it's too high.

Re: U.S. Suffers Sharpest Rise in Poverty Rate in More Than 50 Years

#100

Post by kyuudou »

whateveracct wrote: post #54
__blockcipher__ wrote: post #15

Earlier quoted context omitted.

Agreed, the reason minimum wage is bad policy and unethical is that you're making it illegal to pay someone below a certain threshold, which stated differently is making it illegal for a sufficiently unskilled worker to get any job. But I don't see how minimum wage could be inflationary, but if it were it certainly wouldn't be enough to "wipe out savings" - that requires hyperinflation.

> But I don't see how minimum wage could be inflationary, but if it were it certainly wouldn't be enough to "wipe out savings" - that requires hyperinflation. Inflation is a boogeyman. I heard a friend of mine not wanting any sort of covid stimulus checks because it would make his and his family's savings depreciate.

Huh? Inflation is very real. The dollars I saved from 20 years ago buy a lot less across the consumer spectrum. Prices don't go up, the money's purchasing power goes down. That is not a "boogeyman", it's theft by the inflation tax.
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