wsj is own by Murdoc and anything that dude own seems to be fills with lies and bias. They got flak for it over in England, I believe.
The Myth of a Stagnant Middle Class
41–50 of 75 posts
Re: The Myth of a Stagnant Middle Class
#42I am tired of this: "the CPI overestimates inflation by underestimating the value of improvements in product quality and variety" The extreme right-wing has been making this argument since the early 1980s. I used to believe this argument, as it once sounded believable. But Newt Gingrich used this issue (among others) to engineer a Republican resurgence in 1994, and one of the first things they did was force the Burea…
It wasn't the extreme right wing making that argument, it was the broad consensus of the economics profession and the 90's reform reflected that. Williams himself (the guy behind Shadowstats) claims that our inflation figures are the result of a conspiracy among the political class in both parties to deceive voters rather than being the fault of just right wingers. Personally I think he's a crank, so here's the BLS's rebuttal of his charges:
Re: The Myth of a Stagnant Middle Class
#43This article is pretty much geared for people who can't do math (ironically, considering the ostensible target demographic of the WSJ). 1) Pointing out that things have gotten cheaper is specious. Things have gotten cheaper for rich people too. One would expect technological progress to make things cheaper over time--what does that have to do with income distribution within the country? 2) Average worker productivity…
Things have gotten cheaper for rich people too. One would expect technological progress to make things cheaper over time--what does that have to do with income distribution within the country?
Nothing. But the article makes no attempt to address income inequality.
These are two different questions:
1. Has the middle class stagnated over the last n decades?
2. Has the middle class improved its share of national income over the last n decades?
In fact, it's possible to believe that income inequality is ultimately a good thing that improves the standard of living across all income brackets.
Edit: The short version of this argument: It's good to let some people get very rich creating the iPhone if the end result is that we all end up with iPhones.
Re: The Myth of a Stagnant Middle Class
#44This article is pretty much geared for people who can't do math (ironically, considering the ostensible target demographic of the WSJ). 1) Pointing out that things have gotten cheaper is specious. Things have gotten cheaper for rich people too. One would expect technological progress to make things cheaper over time--what does that have to do with income distribution within the country? 2) Average worker productivity…
He's not writing about 'income distribution' or 'share of national income', he's writing about wages and consumption. (Adopting the same dismissive tone as your first sentence, can we thus conclude your refutation is pretty much geared for people "who can't do reading"?)
You're right, he's talking about wages re: consumption, but as an attempt to address "progressive" concerns about wages re: income distribution. He's setting up a straw man and knocking it down.
Re: The Myth of a Stagnant Middle Class
#45This article is pretty much geared for people who can't do math (ironically, considering the ostensible target demographic of the WSJ). 1) Pointing out that things have gotten cheaper is specious. Things have gotten cheaper for rich people too. One would expect technological progress to make things cheaper over time--what does that have to do with income distribution within the country? 2) Average worker productivity…
Things have gotten cheaper for rich people too. One would expect technological progress to make things cheaper over time--what does that have to do with income distribution within the country? Nothing. But the article makes no attempt to address income inequality. These are two different questions: 1. Has the middle class stagnated over the last n decades? 2. Has the middle class improved its share of national income…
> Nothing. But the article makes no attempt to address income inequality.
Right, because that's a losing argument for him. But that's the concern of "progressives." He's using the classic tactic of pretending that the other side is arguing something different than they are, then attacking that argument.
> 1. Has the middle class stagnated over the last n decades?
What does "stagnated" mean? Humans think relatively, not in terms of absolutes. Has the middle class stagnated relative to the upper class? Yes, it has.
Re: The Myth of a Stagnant Middle Class
#46All I see is a bunch of handwaving and distractions from what is admitted to be a real issue at the start. Imagine we still had slavery in the US in 2013. Who would argue that slavery is perfectly ok because, by golly, slaves live longer and have access to nicer clothes and improved healthcare? And look, we had to deal with an influx of new slaves, so it's actually their fault! Really, those are your arguments? After…
You're missing the point. The gross numbers haven't increased, but the things that actually matter (what you can buy for your money) have decreased. The key point being: "spending by households on many of modern life's "basics"—food at home, automobiles, clothing and footwear, household furnishings and equipment, and housing and utilities—fell from 53% of disposable income in 1950 to 44% in 1970 to 32% today." There'…
This can be considered independent of the fact that the income increases due to the gains in productivity (inflation-adjusted GDP/capita) largely accrued to the top earners, and not across the entire income spectrum.
Re: The Myth of a Stagnant Middle Class
#47All I see is a bunch of handwaving and distractions from what is admitted to be a real issue at the start. Imagine we still had slavery in the US in 2013. Who would argue that slavery is perfectly ok because, by golly, slaves live longer and have access to nicer clothes and improved healthcare? And look, we had to deal with an influx of new slaves, so it's actually their fault! Really, those are your arguments? After…
You're missing the point. The gross numbers haven't increased, but the things that actually matter (what you can buy for your money) have decreased. The key point being: "spending by households on many of modern life's "basics"—food at home, automobiles, clothing and footwear, household furnishings and equipment, and housing and utilities—fell from 53% of disposable income in 1950 to 44% in 1970 to 32% today." There'…
"The gross numbers haven't increased"
Not only have inflation-adjusted hourly wages not increased with rising GDP, they've actually fallen.
"spending by households on many of modern life's 'basics'" The article factors in auto payments as a basic, but not gas prices - which have risen for people since the 1950s. It does not factor in the increased amount of money going to their HMO (some of which is then sent as a dividend to GMO stockholders, there's a racket...) It also does not factor in that people have to spend more on their own training and college education just to make the same wages as someone without these things could make at a factory in 1950. You would be correct in saying food prices have fallen in the past 60 years, but their claims that the middle class now has more disposable income is false.
The fact which they can not deny is that inflation-adjusted hourly wages have fallen since the early 1970s. Many of the points they make are sophistic. They do make the point that commercial airplane travel has improved since the 1970s, but how often does the average middle class person use that? Most of the people I know who fly regularly are made to do so by their jobs and are usually unhappy having to spend so much time away from home in order to make a living.
Re: The Myth of a Stagnant Middle Class
#48I am tired of this: "the CPI overestimates inflation by underestimating the value of improvements in product quality and variety" The extreme right-wing has been making this argument since the early 1980s. I used to believe this argument, as it once sounded believable. But Newt Gingrich used this issue (among others) to engineer a Republican resurgence in 1994, and one of the first things they did was force the Burea…
The WSJ has lost all credibility with me. This and the picture of sad faces of people that will pay more in taxes, but all of them had ridiculously high incomes, were the last straws. They have moved from somewhat impartial to full-on a promoting the GOP agenda.
Did you expect anything less from Rupert Murdoch? As soon as I saw the news of him buying the WSJ, I knew it was just a matter of time until it was filled with propaganda.
Re: The Myth of a Stagnant Middle Class
#49Earlier quoted context omitted.
Things have gotten cheaper for rich people too. One would expect technological progress to make things cheaper over time--what does that have to do with income distribution within the country? Nothing. But the article makes no attempt to address income inequality. These are two different questions: 1. Has the middle class stagnated over the last n decades? 2. Has the middle class improved its share of national income…
> Nothing. But the article makes no attempt to address income inequality. Right, because that's a losing argument for him. But that's the concern of "progressives." He's using the classic tactic of pretending that the other side is arguing something different than they are, then attacking that argument. > 1. Has the middle class stagnated over the last n decades? What does "stagnated" mean? Humans think relatively, n…
This is disingenuous. Progressives routinely frame the argument in zero-sum terms, as though 1) there is a pie; 2) the rich have taken a larger share of that pie; and 3) this means that the poor are getting less than they got before.
The argument this article makes is that the pie is getting bigger, so everyone's share is bigger. You might still think this is a bad thing, but you should at least understand the argument.
Re: The Myth of a Stagnant Middle Class
#50Another factor that isn't often acknowledged when making comparisons of 'household income' over time: households are shrinking. To contrive a stark example, say 30 years prior the median household size was 4 people, and the household income was $100K (in real dollars). Fast-forward to a later period, median household size 3 people (due to later marrying, fewer children, more people living alone), and median household…
Conversely, mean number of earners per household has also gone up, but household income does not reflect this.
Also an excellent point, and possibly a concern... but some of this has been a conscious rebalancing of roles (for example, men doing more nonmarket work and women doing more market work) to optimize leisure time. Altogether, the story is complicated and top-level headlines from people with political agendas almost always mislead.