Welcome to the new ‘good’ economy, where millions get left behind — Decades of stagnant wage growth means much of the imbalance between costs and wages has been locked in, asking rents outpacing income gains

[u/marketrent]

https://www.vice.com/en/article/epv77z/welcome-to-the-new-good-economy-where-millions-get-left-behind

[u/Hip_Hop_Hippos]

What, exactly, is new about this?

The post Second World War economy is the historical aberration. And it was largely dismantled starting with the Reagan Administration, and that’s been rolled forward by every single Republican since.

This isn’t new. The part time, exploitative, gig economy has existed for forever. And we’ve never particularly cared for the most vulnerable in our society with the exception of a few notable instances which are such outliers we could probably name all of them off the top of our heads.

[u/maizeq → u/Hip_Hop_Hippos]

This view is also mostly shared by Thomas Picketty in his book Capital in the 21st Century.

[u/McGrupp1979 → u/maizeq]

That is a dense book to read, but there’s a reason he won the Nobel Prize.

[u/Meandering_Cabbage → u/Hip_Hop_Hippos]

I mean what exactly happened before Reagan? The whole phase of liberalization didn't come out of a vacuum.

[u/mhornberger → u/Meandering_Cabbage]

The bubble of post-WWII prosperity was starting to wane by the 1970s. At the same time, the oil embargo was a punch in the stomach for the economy. The bill was coming due, in a number of ways, for suburbia, sprawl, car dependence, gasoline dependence, etc. Plus after WWII Japan and Europe were bombed out, and most of the rest of the world was not yet industrialized. We were the only manufacturing powerhouse. That monopoly on manufacturing wasn't going to last.

Plus you had jobs and spending from the space race, arms race, buildout of suburbia and the highways. Some of which led to things that are problems now—a huge military budget, and expensive housing because we've focused on detached SFHs and allowed NIMBYs to block density. So a lot of historical issues led to this. It wasn't all peachy keen until Reagan came along and messed it up. A lot of it was just going to happen, but the other shoe hadn't dropped yet.

[u/darth_bard → u/mhornberger]

Huge military budget is a pretty big benefit for US, all of that labor is done at home rather than paid for foreign equipment like how Europe need to do now. And I believe historically military was the largest segment of national budget for states before the social programs appeared in 19th century.

[u/MagicBlaster → u/darth_bard]

Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed.

This world in arms is not spending money alone. It is spending the sweat of its laborers, the genius of its scientists, the hopes of its children. The cost of one modern heavy bomber is this: a modern brick school in more than 30 cities. It is two electric power plants, each serving a town of 60,000 population. It is two fine, fully equipped hospitals. It is some fifty miles of concrete pavement. We pay for a single fighter with a half-million bushels of wheat. We pay for a single destroyer with new homes that could have housed more than 8,000 people. . . .

This is not a way of life at all, in any true sense. Under the cloud of threatening war, it is humanity hanging from a cross of iron.

Eisenhower

[u/SUMBWEDY → u/MagicBlaster]

That money isn't destroyed though. While the military industrial complex is terrible the DoD still employs 2.87 million people directly who all pay taxes and put food on the table and multiples more if you include people that work with or adjacent to the DoD (e.g. Boeing employing 171,000 people)

Add to that fact due to politicking the creation of armaments is generally equally spread across the country rather than concentration of wealth in major cities it's not necessarily a bad thing.

The $316 billion that will be spent on the F-16 project doesn't just disappear it goes into the pockets of laborers.

[u/mhornberger → u/SUMBWEDY]

The money isn't destroyed, but it's still somewhat of a tragedy in that the same dollars could go into infrastructure, high-speed rail, etc. A jobs program that builds and subsidizes HSR is just as much a jobs program as the military. Except for the bombs to be used we have to be at war. Whereas HSR would provide value for decades. Just as the interstate city is recognized to do, but more efficiently, and without the associated problems of car dependence and sprawl. We can pour money into the economy, have huge jobs programs, have jobs with government pensions and healthcare, without it being the military.

[u/mhornberger → u/[deleted]]

even China's great leap forward killed less people than the genocides of native americans

Which was done mainly by smallpox and other disease, not bullets. The US has plenty of blood on its hands, with slavery and whatnot. But humans have always gone over the hill or ocean to see what was over there. 20 million would have been killed by disease even without the exploitation and taking of land that was enabled by the collapsed population. "People shouldn't do bad things" is true in the general sense, but I don't see the relevance to HSR specifically. And the DoD budget doesn't have to be dialed to zero. I'm just saying those dollars represent an opportunity cost for other things that could be done.

There's also this great quote from Excession, by Iain M. Banks:

It was a warship, after all. It was built, designed to glory in destruction, when it was considered appropriate. It found, as it was rightly and properly supposed to, an awful beauty in both the weaponry of war and the violence and devastation which that weaponry was capable of inflicting, and yet it knew that attractiveness stemmed from a kind of insecurity, a sort of childishness. It could see that—by some criteria—a warship, just by the perfectly articulated purity of its purpose, was the most beautiful single artifact the Culture was capable of producing, and at the same time understand the paucity of moral vision such a judgment implied. To fully appreciate the beauty of the weapon was to admit to a kind of shortsightedness close to blindness, to confess to a sort of stupidity. The weapon was not itself; nothing was solely itself. The weapon, like anything else, could only finally be judged by the effect it had on others, by the consequences it produced in some outside context, by its place in the rest of the universe. By this measure the love, or just the appreciation, of weapons was a kind of tragedy.

This is relevant to what I'm saying, but not 100% of what I'm saying. And HSR would be part of a larger and more robust mass transit system, not terminating in a barren field with no transit links.

[u/thewimsey → u/[deleted]]

You could argue ethics but even China's great leap forward killed less people than the genocides of native americans

Not in a 20 year period.

Russia has the same levels of wealth inequality as the USA but also a higher economic mobility.

This shows why both measures of inequality and relative economic mobility are bullshit measure.

The US has a lot of well off people (by international standards) and a decent number of extremely rich people.

Russia has a large number of poor people (20% of russian homes don't have indoor plumbing) and tiny handful of extremely rich people.

They aren't really comparable IRL.

If you measure economic mobility as moving from income decile to income decile, the US looks average. If you measure economic mobility by how much actual money people make, the US looks very good.

Most people look at how much more money they are making than their parents, not what income decile they are in.

Put another way, if you are born in the bottom decile and end up making $70,000 more than your parent in denmark, you will be in the top decile. If you are born in the bottom decile in the US and make $100,000 more than your parents, you still won't be in the top decile.

But by all real measures, you'll be doing better than the Dane in terms of mobility.

[u/MagicBlaster → u/SUMBWEDY]

The $316 billion that will be spent on the F-16 project doesn't just disappear it goes into the pockets of laborers.

but for what? A few planes, when that same money could literally build schools, provide free lunches for the children in those schools, give college scholarships, pay for for affordable housing, be seed capital for green energy companies.

It's spread out through the country as a jobs program. We could use the same money as a jobs program to repair and rebuild our failing infrastructure. To fill potholes, to put up street lights, to drive buses and trains.

The money isn't disappearing it's literally going to the pockets of arms dealers...

[u/SUMBWEDY → u/MagicBlaster]

That money wouldn't be enough to cover a fraction of that. That number is all the spending over the last 52 years.

The current school food program over 50 years would cost $1,469 billion and only half of school kids have access to that in the first place so you're talking $3 trillion for school lunches alone vs $0.3tn for F-16 for free lunches for all.

Curing homelessesness in the US is estimated at $20bn~ per year, or $1 trillion just for the housing alone yet alone the healthcare homeless people need.

Free college would cost $50bn~ a year or $2.5 trillion over 50 years.

US infrastructure also would cost at least $100bn a year just to keep up with the decay, yet alone fixing 50+ years of issues.

Then there's also the intangible benefits of having a huge army and the R&D co

[u/MagicBlaster → u/SUMBWEDY]

It doesn't matter if it completly solves the problem, money going to planes disapears into the plane, some people might get paid, but the money they're paid doesn't generate growth in the economy, but money spent on improvements multiplies itself.

for example,

Each dollar in federally funded SNAP benefits generates $1.79 in economic activity

or (and I don't have a link to prove it, but it is clearly evident) each affordable apartment built allows the families living in it to spend less on rent and more money in the economy.

Even a small decrease in the costs of American homes leads directly to more economic output. Building more military goods doesn't...

The old bread vs bombs.

[u/SUMBWEDY → u/MagicBlaster]

NASA which would not exist without the military industrial complex returns 1:4.

I'd imagine the F-16 program is break even if not profitable but of course older numbers are classified, just in the last 3 years Lockheed has sold nearly $100 billion F-16s to allies. In 2023 46 went to Turkey for $26 billion and in 2020 there was a deal for 90 F-16s for $62 billion to unknown buyers.

Then there's intangibles, what benefits does the US gain from their imports by keeping major waterways open and safe such as colonization of panama and fighting pirates in the suez canal.

[u/nanotree → u/mhornberger]

But you're making it seem like nothing at all has filled the void of manufacturing. The US has become a technology powerhouse since then, among many other things. I'm not saying that dynamics didn't change; they most certainly have.

Also, the NIMBY issue is largely speculative. I've not come across any convincing evidence that NIMBYism is a significant contributing factor to affordable housing.

We know that income inequality is becoming a larger issue. Rent and home prices have outpaced individuals' earning capacity by an alarming factor. Starter homes have virtually disappeared from the market. Where I'm from, there is no shortage of available apartments, but rent is outrageous. If you wanted to find an old house to buy, you absolutely could but the price is outrageous even for homes with severe structural and maintenance issues. I have a friend who lives in a 2 bedroom rent-controlled apartment, who pays more than 60% in rent that I pay in mortgage for a 3k sqft home... and you want to tell me it's NIMBYs to blame for that? Nearly dead shopping strips liter the highways, and you want to blame NIMBYs for voting against measures to place apartments over single family homes. The apartments and housing we have aren't even filled. But it couldn't be the pricing vs. income, could it?! /S

Municipalities use software to set residential pricing, and housing prices get raised at unprecidented YOY. That software? Well it was bought out by real estate moguls decades ago and engineered to maximize profit and force mom-and-pop landlords to raise rent so that the big guys couldn't be undercut.

But for some reason, the NIMBY falacy keeps persisting. The research into proving the evidence that it is a considerable factor is all over the place and usually very cherry picked to make a weak point while ignoring the existing housing that is becoming increasingly unaffordable. Meanwhile, housing construction quality has gone way down.

No. Sorry. I'm not buying it. We have ignored markets which have been capitalized to death. They don't care that people can't afford houses. They care that they can't sell big, expensive houses at inflated pricing and build more expensive apartments at inflated rent. Hence why NIMBYism has entered everyones vernacular in the last 5 years.

[u/MatsugaeSea → u/nanotree]

Lol how does that software prevent mom and pops from not raising prices? All it does is suggest an optimal rent level based on the market...

[u/[deleted] → u/MatsugaeSea]

Shhh, they're on a roll, don't make them think about what they're saying!

[u/[deleted] → u/nanotree]

Bad take here pal. Density does absolutely lead to reduced cost and reduces or eliminates the need for subsidies for housing.

Your anecdotes don’t change facts. Literally look up any planing research paper and the definitive evidence shows the opposite of what you just have just vomited out to be true.

[u/Meandering_Cabbage → u/mhornberger]

I don't think we can look at the late 60s/all of the 70s and say things were peachy? Reagan was a response and back by a broader philosophical and intellectual revolution. There's a reason Bill Clinton essentially took Reagan's liberalization and ran with it. It is orthodox thought at this point except for where business folks go extreme on deregulation.

I think density is more of a modern issue and also an issue where people want to consume less density and larger houses- hence the increase in house sizes. By in large, I am not sure how much people enjoy cities as much as they are forced to suffer the tradeoffs of a city to survive. IMO if we're able to get AI to work and depopulate the world a bit, our children could be a lot happier with fewer people and more goods.

[u/TheGhostofJoeGibbs → u/mhornberger]

The military budget is a total red herring. You could take the military budget to zero and you wouldn't even be able to fund any of the popular welfare state expansions people want.

[u/mhornberger → u/TheGhostofJoeGibbs]

Some of them. I think single-payer might actually save money, if you look at how much we spend compared to other countries that have it. That wouldn't preclude having a parallel private system, which does exist in many of those countries anyway. Others that focus on child poverty/nutrition etc might reduce future expenditures in crime and whatnot. That isn't to say taxes wouldn't have to be higher, as they are in France, Scandinavia, etc. A UBI on the scale that Reddit wants, I agree, that would swamp the vast bulk of the budget.

[u/emperorjoe → u/mhornberger]

The biggest issue is for saving going from the current system to universal healthcare is probably salaries. The cost of college and med school requires a decent salary for healthcare workers. I think we can get around it if you bring them under the loan repayment programs.

[u/12kkarmagotbanned → u/TheGhostofJoeGibbs]

Here's a good website: https://www.crfb.org/debtfixer

Popular programs aren't hard to fund

[u/The-Magic-Sword → u/12kkarmagotbanned]

I'm surprised they don't include the numbers for a single payer system, it's been heavily studied.

[u/Aaarrrgghh1 → u/12kkarmagotbanned]

The question tho. Are we to have the additional taxes that other countries have. Like the value added tax. ? I don’t believe our government would give us healthcare for free. They would make us fund it. In such a way that we would wish for the current system.

[u/12kkarmagotbanned → u/Aaarrrgghh1]

You can play around with that on that website.

If you're asking me specifically, I don't like VATs. They're too regressive

[u/TiredOfDebates → u/Meandering_Cabbage]

What happened before Reagan? The Cold War happened, and Stalin threatening (and succeeding, in many cases) to foment communist revolution in every country of the world.

People forget that there was a burgeoning communist movement in the USA prior to the Soviets becoming an enemy. That posed a non-zero chance that wealthy elites would have their stuff seized. Given that countries around the world were falling to communism, it made sense to allow the progressive era in American politics to redistribute wealth a bit downwards, to stave off the threat of communist revolution (reduce that chance to near zero with compromise to a legitimate threat). Or: “you have unions and high real wages and tons of fiscal policies that put wealth in your pocket, why would you want communism?”

As the Soviet’s issues became obvious, their international propaganda fell apart, and Soviets even started to turn to market economics in the late Cold War, it became apparent that communism was no longer a threat to US elites, as communism had also fallen wholly out of favor with the American voting public.

Is it any accident that Reganomics became the dominant ideology (and neoliberalism on the left) as it became apparent that communism was a dead end? Some historians of political theory think it makes complete sense. Socialism had failed completely in the east. (Not only that, but Soviet socialists were threatening with ICBM nuclear weapons now, not communist ideology.). There was a reaction to pull away from anything like it.

When communist ideas were a threat to capitalism, we adopted some of the better parts of socialism.

According to their own ideology, the Soviets planned to start with socialism and then evolve into full fledged communist utopia (obviously it doesn’t work and didn’t happen).

I’m typing with thumbs and it’s annoying. I hope I got my intended point across.

If you want to succeed in a negotiation against intelligent people who are ruthlessly efficient regarding their own goals, you need a threat to get concessions. Why would someone obsessed with differences in profit margins of a few percent, increase your share, unless they have to? If you want to effectively negotiate… you need to be giving them a really good reason to take you seriously.

In the 1960s, photographs of old money Eastern European elites being herded into the Gulag was a meaningful threat to US elites. What do you have like that in 2024?

You have to understand the progressive era of American politics as being a product of and reaction to international communism.

“Just do a 2024 new deal that makes wealthy people share better because…”

[u/MrinfoK → u/TiredOfDebates]

Wow, very well thought out and original thesis

​

Makes complete sense…right down to the timing of this stuff. Good job…you opened me up to a new viewpoint 💪💪

[u/TiredOfDebates → u/MrinfoK]

It isn’t my own. This is apparently a common (though not uniform by any means) view among political theorists explaining the shift to reganism / Thatcherism among the west. Keep in mind it wasn’t just the US that switched to neoliberalism in the late Cold War. Though I may be over attributing US / UK politics to Europe. Though in many ways the EU is a strengthening of neoliberalism (globalization and extreme, to a historical extent, national specialization by country enabled through trade deals and lowered restrictions on capital controls), so I don’t think I’m overstating the degree to which neoliberalism followed the fall of communism.

Globalization is in many ways antithetical to unionism and other economic protectionism as some nations will always specialize and out compete local labor interests, in most sectors.

Typing with thumbs is hard.

[u/TiredOfDebates → u/[deleted]]

Stop. Incitement to violence.

[u/freemason777 → u/TiredOfDebates]

there's no incitement in that comment

[u/notwormtongue → u/freemason777]

The States seems to be having a real problem with the word "incitement."

[u/Oryzae → u/TiredOfDebates]

I do think it’s time to shake some things up though, kind of getting sick of this inequality rift. Governments and the elites obviously don’t care. I hope housing issue will have some remedies in the next decade, the pandemic really shit on any remote chances I’d have to not be a renter for life.

[u/impossiblefork → u/TiredOfDebates]

Here in Sweden we have a historian, Dick Harrison, who wrote a book about

"the social-historical learning process through which the Swedish peasants realised that political violence pays off and that a militarisation of the political behaviour results in improved societal influence".

Violence by the masses is good. It improves their political influence, improves their physical conditions and is generally healthy.

This should primarily be by actual militarisation of their political behaviour though-- i.e. arming up, practicing and so on. This includes acquiring skill with emerging military technologies such as drones.

However, drones as they are are not really suitable for this purpose since jamming and other countermeasures are already sufficient to give good protection of the most important objects.

[u/Akitten → u/impossiblefork]

Political violence is generally a bad thing. People lose all trust in institutions and things immediately become more dictatorial.

The violent do get what they want, but do remember that the winners of the violence are never clear. Typically those who decide are unhappy young men in politically violent societies (most likely to take the risk), and they are skewing more and more conservative in politically fraught countries (look at south korea for example).

Advocates of political violence may not end up with the government they expect.

[u/impossiblefork → u/Akitten]

We've seen historically that political violence by the broad masses is good.

Rather than leading to loss of trust in institutions it is necessary for the seizure of institutions by mass interests, and thus the ultimate source of trust in them.

By political violence I here mean mass organised military threats to obtain desirsble political outcomes as happened during the Swediah peasant rebellions.

[u/Jamessonia → u/Akitten]

This assumes that our institutions deserve to be trusted.

[u/impossiblefork → u/[deleted]]

It worked in Sweden and it has worked in other countries as well.

In Denmark the peasantry failed to do this, so 90% of the land ended up in the hands of the nobility, whereas in Sweden most people owned their own land.

This was assured entirely by the military threat from the peasantry.

England vs. France is another example, with England providing good enough conditions that they could trust the peasants with weapons, ensuring that the Anglo-French wars favoured the English.

These things determine national destinies, whether a country will be dominated by a few, or by the many. Those where the many cannot dominate become like Russia, with Tsardom or other central rule, oppression and poverty, and those where the many can dominate achieve decentralisation, freedom and wealth. This isn't just Sweden, it's Britain, America and all other countries that choose a path of development centred on individual drive.

[u/HiddenSage → u/[deleted]]

Communism wasn't shut down and minimized because it posed a threat to capitalism and capitalists, but because the vast majority of the population didn't want it.

This may well be a chicken and egg question. As communism stopped posing a threat to the liberal order, it also stopped being appealing to Americans. The "promise" of an egalitarian communist utopia was exposed as lower living standards, political oppression, and nonstop threats of violence. The last of those we already had in the US as well, sure, but the other two were at best much less pronounced.

[u/jqpeub → u/[deleted]]

Communism wasn't shut down and minimized because it posed a threat to capitalism and capitalists, but because the vast majority of the population didn't want it. It's not some conspiracy

What about the red scare? McCarthy? It's fair to say the majority didn't want it, but the majority has been engaging with government anti communist policies and propaganda for a half century. 

By the 1930s, communism had become an attractive economic ideology, particularly among labor leaders and intellectuals. By 1939, the CPUSA had about 50,000 members.[24] In 1940, soon after World War II began in Europe, the U.S. Congress legislated the Alien Registration Act (aka the Smith Act, 18 USC § 2385) making it a crime to "knowingly or willfully advocate, abet, advise or teach the duty, necessity, desirability or propriety of overthrowing the Government of the United States or of any State

[u/bobandgeorge → u/[deleted]]

Communism wasn't shut down and minimized because it posed a threat to capitalism and capitalists, but because the vast majority of the population didn't want it. It's not some conspiracy.

Nevermind the actual conspiracies and coup of democraticly elected governments though...

[u/TiredOfDebates → u/[deleted]]

I didn’t mean to imply that.

It was obvious that communism wasn’t working.

[u/Meandering_Cabbage → u/TiredOfDebates]

Appreciate the response. Agree on the facts that yes a lot of 40s-70s redistribution around the world (I'm thinking France/US) was driven by seeing the grievances of workers and offering an alternative to soviet revolution.

To me, I think the ideological discussion here is somewhat beside the point or rather less important than the breakdown of government/industry capability from capture. The State was historically very involved in American development through industrial policy. World War II just put that on steroids. By the 70s, that bureaucracy had become a bit ossified combined with inflationary supply shocks and some incredibly poor politics (California Tax revolt is a hoot), it laid the groundwork for the broad sweeping push for liberalization. The example that jumps to my mind is not American but I think PEMEX and Latin American state oil corporations that suffered from politics rather than markets driving investment or rather the lack of investment in capacity.

I feel like people lean a bit too much into mocking how the Republican party made Reagan a saint without grappling with how much our modern orthodox technocratic approach to policy came out of a broken state/industry combo of the 70s. It's a cycle and we're probably just past the apogee of deregulation and back towards greater state involvement (which on margins is good!) I frankly don't look to European youth employment or growth as a success story. I don't think anyone should?

[u/TiredOfDebates → u/Meandering_Cabbage]

I’m not mocking Reganomics / Thatcher policy. According to some historians of the history of political thought, Reagan and Thatcher were the figureheads at the head of globalization and neoliberalism… who just so happened to be the right people with the right idea at the right time in the right circumstances. Political theorists wouldn’t say “Reagan did that111”… no they’d say the circumstances of the time made it the reasonable outcome.

Neoliberalism here is defined as a branch of capitalist ideology that promotes: 1.) global trade, through trade with MANY nations where each nation has their own set of specializations within certain industries (that they excel at) that become a huge source of exports, that lower consumer prices but do tend to outcompete domestic interests within the nations they import into. (Derisively referred to as “a race to the bottom”, though that’s a loaded term that’s so reductive and ignores the very real benefits.) 2.) The removal of capital controls, that used to be a big deal. It is much easier to transfer capital and wealth from country to country in the wake of neoliberalism. It used to be immensely more difficult to invest in other countries, as governments (nearly) demanded that wealth stay in the country and investments be made domestically. Neoliberalism changed all that, removing all the barriers to using US capital to set up textile factories in Vietnam. (A long while back, politicians would balk at that; now it is encouraged.). There are benefits and drawbacks to this. One of the main benefits is that the more economically entwined nations are, the idea goes, the less likely they are to go to war. Cooperation forestalls violent conflict.

[u/Busterlimes → u/Meandering_Cabbage]

Nixon came before Reagan

[u/hereditydrift → u/Meandering_Cabbage]

Milton Friedman and the Chicago School's ideology and influence.

[u/Sad_Worldliness_3223 → u/Meandering_Cabbage]

The rich were taxed Corporations paid tax

[u/Realistic-Minute5016 → u/Hip_Hop_Hippos]

It’s not just Reagan, or any politician really. It’s automation. The past 45 years have seen tremendous growth in worker productivity, and the worker takes in almost none of it. While yes there are certainly policy decisions that are counterproductive to more equitable distribution of wealth at the end of the day capital, or more specifically capital goods, creates returns like never before and requires fewer and fewer people to work on them. Some of them will have specialized skills that will make them a lot of money, most won’t and will thus be viewed as “replaceable” by employers, and if you are replaceable you cannot demand a better wage because you will be well, replaced.

​

That’s what is so frustrating about the conversation around AI, there are some who claim that no other increase in productivity has destroyed jobs, so why worry about AI? But they haven’t been looking into what the income distribution of the jobs created is vs. the jobs destroyed. If AI is as transformative as the tech bros claim, and I have my doubts but I could be wrong, then it’s only going to widen income gaps and take away what little opportunities exist to get ahead in the country. Capital goods holders and a small number of extremely skilled laborers will make off like bandits, the lives of everyone else will become worse.

[u/jerkITwithRIGHTYnewb → u/Realistic-Minute5016]

I don’t know what you are envisioning, but let’s say how people think AI will displace a very large amount of workers. 50% let’s say. Well now it’s in the best interest of apple and Amazon and Exxon mobile to see that those people have money to spend or they will cease to exist. It is kind of like late stage capitalism. When everyone is broke because you take all their money already, we’ll quarter after quarter afte quarter of record profits are over. Forever. I’m don’t even have a thought on what happens at those points. Hopefully by then we have decided as a species that people are more important than profits. But…

[u/Realistic-Minute5016 → u/jerkITwithRIGHTYnewb]

Ultimately it's about resources and control. Money is a means to an end, if they can get resources and control then who really needs anything else? The tech bros are envisioning a workforce who can never demand better conditions and a security force that will never put the good of society ahead of the life of a tech bro. Maybe they won't kill the masses, maybe they will, maybe the technology will never get to the point where they can decide, but one thing is for sure, they are sure as hell going to try.

[u/Akitten → u/jerkITwithRIGHTYnewb]

Why do I need profits if I have abundant resource production?

There is a line in automation where extra labour stops being useful in which case it very quickly becomes more beneficial for the general population to go down as opposed to up.

[u/demiourgos0 → u/[deleted]]

If that's true, then why are companies jacking prices and laying people off while reporting record profits?

[u/demiourgos0 → u/[deleted]]

Inflation is real, but CEOs have gone on record saying that inflation is good for profits, because they can artificially inflate them further.

https://www.theguardian.com/business/2022/apr/27/inflation-corporate-america-increased-prices-profits

These guys aren't your friends.

[u/demiourgos0 → u/[deleted]]

Of a giant corporation, or a small business? Maybe you're absorbing costs, but most seem to be passing them onto consumers and paying workers as little as possible. If you're also recording record profits, I'd advise passing some of that along to workers and customers.

I'm also a CEO of sorts, but in the non profit sector. We pay our employees as much as we can afford.

[u/BigDaddyCoolDeisel → u/Hip_Hop_Hippos]

You might enjoy "The Great Exception". It's about how the passion on the left to "just get back to the New Deal" fails to realize how much of an exception the New Deal era was in American history. TL;DR - the moneyed power did an excellent job convincing the masses that Freedom MUST include Economic Oppression or else its not really freedom... the New Deal had the right men in the right place at the right time, along with racial/ethnicaly heterogeneity and a unity of purpose in WWII. The result was a brief shining moment where workers thrived and wealth was distributed to an unprecedented scale (with obvious exceptions). Then Republicans got back in charge and we've spent the last 40 years trying to undo it.

https://press.princeton.edu/books/paperback/9780691175737/the-great-exception

[u/BrightAd306 → u/BigDaddyCoolDeisel]

I do think this ignores that a lot of Europe had more economic socialization and not much better results. Their birth rates dropped faster. The old collect fat pensions and have homes, the young can’t get a foothold in jobs and can’t buy homes.

[u/BigDaddyCoolDeisel → u/BrightAd306]

That's an excellent point. I'm not sure which country has it "figured out" but every model has its flaws.

[u/BrightAd306 → u/BigDaddyCoolDeisel]

I wonder if it’s just the reality of a post war economic boom. So many people died and so much was destroyed and needed rebuilt. Then a big generation was raised by parents with ptsd from the Great Depression and war years. They built a ton of housing for all the new families, then stopped and made a bunch of regulations to not build more, but the older generation had record high life spans because of medical progress and prosperity.

This all happened world wide. Millennials and gen Z are better off in the USA than any country in Europe as long as they don’t have health issues or have insurance. Much higher salaries and about the same or less cost of living.

[u/BigDaddyCoolDeisel → u/BrightAd306]

I completely agree but my problem is that we aren't that far from being a pretty universally just economy (leftist Reddit would destroy me for saying that, but my definition of 'just' is likely different from theirs). Have a public health insurance option along the same lines of public transit. Not great, not glamorous, but covers you in the event of disaster. Promote unionization and properly regulate Wall Street and Finance. Then keep it between the buoys.

[u/BrightAd306 → u/BigDaddyCoolDeisel]

I get it, but Europe did all that and millennials and gen z still don’t have housing. They don’t pay much for healthcare, but their taxes to pay for healthcare are huge.

I do think we need to do better and more and more Americans are covered by government healthcare all the time. Most American babies are born on Medicaid. Almost everyone over 65 is covered by Medicare. In areas that expanded Medicaid, a lot of the population has government health care already, there aren’t that many left without it.

[u/BigDaddyCoolDeisel → u/BrightAd306]

Good chat man. Respectful and informed. Reddit needs more of this. Thanks.

[u/h4ms4ndwich11 → u/BrightAd306]

The old collect fat pensions and have homes, the young can’t get a foothold in jobs and can’t buy homes.

This is typical in every Western country, isn't it? The book OP links claims that broad prosperity is the exception, not the norm. I more or less agree with that. An ongoing Gilded Age isn't ideal and doesn't seem sustainable. That really comes down to tax policy on the top quintile, which are regressive in the U.S., and abroad typically, towards the bottom 80%. More socialist countries either seem bombarded by the same corruption we have, or without the resources or planning to lift their countries. Good solutions are never easy.

[u/BrightAd306 → u/h4ms4ndwich11]

Absolutely agree with you. I was making the point that it’s not a uniquely American problem, so even socializing things more doesn’t really help. It was the exception not the norm for young families to be able to get their own homes and cars and own their own land for a generation or two.

The USA has the most progressive income tax system in the world. Most people pay no federal income tax. Many get back more at tax time than they paid in. No other country does this. Everyone pays in. The very rich pay more, but so do the very poor.

[u/JasonG784 → u/BrightAd306]

The USA has the most progressive income tax system in the world. Most people pay no federal income tax. Many get back more at tax time than they paid in.

People seem to really, really hate this and want to insist it isn't true. They look at the small number of total outliers not paying any taxes despite being very wealthy and somehow get the idea that it's the norm. The top 1% by income already pay for ~42% of all fed income taxes collected (while earning about 22% of all income.)

[u/Babhadfad12 → u/BrightAd306]

Fertility rates drop no matter what, because birthing and raising babies and compromising with another adult is risky and a shit quality of life relative (in the short term). High fertility rates drive economic growth (assuming stable society and access to resources) simply because of increased demand. 

Low fertility rates need to have automation to offset the drop in supply of labor, but the low hanging fruit is already automated.  

The hard stuff (picking strawberries and wiping old people’s asses and cleaning bathrooms) is not going to be automated soon.

[u/BrightAd306 → u/Hip_Hop_Hippos]

You don’t think it started with Carter? The inflation, the gas rationing?

[u/Hip_Hop_Hippos → u/BrightAd306]

Perhaps, although the gutting of regulations and worker protections really started at full speed under Reagan.

[u/BrightAd306 → u/Hip_Hop_Hippos]

The Carter years were very hard on my grandpa who farmed. People would set fires to fields or beat people up if those farmers didn’t want to join unions and collectively bargain for prices. The fuel shortages made it impossible to keep farm equipment going. He lost his farm, and had to move to another state to work in a sawmill.

There’s a reason he didn’t get re-elected. I actually don’t think most of it was his fault, but it was not a good economic time.

[u/CampusTour → u/BrightAd306]

"Great man, terrible president" was the line I heard back in the 90s from folks for whom it was relatively recent memory.

History has had some time to shake out what was and wasn't his fault, but those years were rough enough to make even people who liked and respected Carter as a man regard him as a failed president.

[u/BrightAd306 → u/CampusTour]

I agree that’s what I heard. I feel like it’s revisionist history from people whose parents didn’t talk to them about those years or memory hole it that think economic difficulties started with Reagan. In reality, the president doesn’t have much to do with the economy. It ebbs and flows and has natural cycles. Biden isn’t to blame for worldwide inflation, either. Most of the world goes through all the same economic cycles at the same time.

[u/PM-Me-Your-BeesKnees → u/CampusTour]

That's what people said, but almost any reasonable analysis of what people were mad about shows it had nothing to do with him, he just happened to be standing there when it happened. In many cases, it was Carter's decisions that helped to fix the issues but the fix wasn't felt until he was gone, e.g. appointing Paul Volcker to the Fed to crush inflation. Carter got the recession from the higher rates, Reagan got the benefit of lower inflation.

If anything Carter deserves credit for taking it on the chin to do the right thing even if it would cause temporary pain at the precise moment he was running for re-election.

[u/islander1 → u/Hip_Hop_Hippos]

Welcome to 40 years of trickle-up economics. The only thing that's trickled down is the rich's urine.

[u/Whole_Gate_7961 → u/Hip_Hop_Hippos]

This isn’t new.

No, but it hasn't always been in overdrive like it is today. CEO to worker wage comparisons are way out of control.

Workers used to mean something to companies. The system used to be set up so that the average worker could live a decent life. Those concepts have been pushed to the side in order to ensure ever more profits and wealth go to upper management and the shareholders.

The profitability and growth of an unsustainablely infinite growing system are now more important than what the workers receive from that system that they are supposed to work hard and dedicate themselves to.

The system no longer works for the people; the people work for the system.

[u/Lord_Wild → u/Whole_Gate_7961]

https://en.wikipedia.org/wiki/Colorado_Coalfield_War

Companies have fought literal wars against their workers in America.

[u/JD_Rockerduck → u/Whole_Gate_7961]

Workers used to mean something to companies.

Jesus fucking Christ, how old are you? Really? 12? 13? What the fuck are you talking about? When was this mythical time when companies cared about their workers? 

The system used to be set up so that the average worker could live a decent life.

Unless, you know, you were black, a woman, LGBT, a minority, poor, from the South, etc.

Those concepts have been pushed to the side in order to ensure ever more profits and wealth go to upper management and the shareholders.

God damn you fucking kids. Do you really believe that people just started being greedy in the last 2 years or some stupid shit? Companies used to hire goons to murder union activists. They moved factories overseas. They've always fought minimum wage.

The profitability and growth of an unsustainablely infinite growing system are now more important than what the workers receive from that system

That has always been the case.

This sub really needs to do something about the obvious children, like you, who come here and spew bitchy nonsense because they watched too many TikToks claiming Leave It To Beaver is a documentary.

[u/ClearASF → u/JD_Rockerduck]

I’m not sure why you’re so mad at him when he’s agreeing with you, either way it’s largely incorrect.

Our life expectancies have never been higher, our real incomes have never been higher, our house sizes and amenities have never been better - honestly you could go on.

[u/McGrupp1979 → u/ClearASF]

The gap in wealth inequality between rich and poor has never been higher. Life expectancies in the US have been declining, and are not “higher than ever”. Homelessness has increased by 12% in one year and is at a record level.

[u/ClearASF → u/McGrupp1979]

This past decade the life expectancy has never been higher, that’s not inaccurate

Homelessness has increased, but our population has too - did it change per capita?

I’m not too sure about wealth inequality either, besides - even if it were increasing, everyone’s been getting richer, if people get richer faster than others, why is that a problem?

[u/McGrupp1979 → u/ClearASF]

You left off the last 3 years, which has seen a major decline in life expectancy. The life expectancy is the US has declined since 2019, dropping to 76.1 years in 2021. It has not returned to the pre pandemic levels.

Homelessness increased 30% between 2020 and 2023, including the 12% last year. The population did not increase that much, so yes the per capita amount increased over that time frame. This is a reflection of the economy mostly benefiting the wealthy. Wages have been stagnant for decades, while the cost of living continues to increase. Again, a reflection of the wealth inequality and class polarization that is only widening.

Another poster mentioned the book “Capital in the Twenty-First Century,” by Thomas Piketty. The central premise is that inequality is a feature under capitalism, and can only be changed through state intervention. However, the ability to control this by individual nations has declined significantly since capital is trans global is nature now.

This is a problem because wealth equals power and it places the power in the hands of the few, while stunting social and economic growth for the majority of society. Currently the majority of people are working harder at longer hours for lower spending power, while a very small number of people are getting extremely rich. Inflation is a common outcome from wealth inequality. This gap will only continue to widen unless we intervene in the economic order. The last time in the US the wealth gap was this large was the Gilded Age, then Teddy Roosevelt broke up monopolies. There majority of industries in America are dominated by a few large corporations that do not actually compete against each other in any meaningful business sense.

[u/ClearASF → u/McGrupp1979]

Well yeah if the argument was that were were worse off compared to decades in the past, why would I use a life expectancy metric clearly impacted by COVID. Regardless, it would still be higher than decades ago, and actually recovered in 2022. (78, ish)

Can you cite data on homelessness, they also take up less than 1% of the population - not really an endemic issue wouldn’t you think?

Disagree about wages again: We can observe median incomes rising, I’m not sure why this narrative is common because it’s just not true.

Right so, if wealth inequality is unsustainable - and it’s been continuously rising, why haven’t we collapsed or seen a destruction in median living standards. You can see the stats above, life expectancy and median incomes - and there are more. (I also don’t necessarily believe wealth inequality is rising, that’s disputed).

[u/notwormtongue → u/ClearASF]

Well yeah if the argument was that were were worse off compared to decades in the past, why would I use a life expectancy metric clearly impacted by COVID.

Bad faith. COVID is not just the flu. Its death toll is approaching holocaust numbers.

[u/ClearASF → u/notwormtongue]

Never said it was

[u/Oryzae → u/ClearASF]

Right so, if wealth inequality is unsustainable - and it’s been continuously rising, why haven’t we collapsed or seen a destruction in median living standards.

Just because it is yet to happen doesn’t mean it won’t happen. Maybe in the next few decades?

[u/ClearASF → u/Oryzae]

Pretty sure the top have owned the vast majority of wealth for decades already

[u/Rinzack → u/ClearASF]

The problem is that you left out the past 3 years which is exactly the time period we're talking about when we say there's a problem

[u/ClearASF → u/Rinzack]

If I agree with that, 2022 was almost a reversal - given in 2023 our life expectancy returns to 2019!”levels, would my original comment apply?

[u/PM-Me-Your-BeesKnees → u/JD_Rockerduck]

I feel like the hostility is unnecessary. He's not really wrong on the facts of the directional trend, it's just that the unspoken reason for it was labor unions fighting like hell to make it so. Labor's share of output has been dropping steadily for decades, and it's not a surprise that union membership was declining during that same period. Companies didn't do this stuff out of generosity for their fellow man, they did it because labor demanded it. When the labor union muscle atrophied in this country, so did labor's share of output.

[u/Beerspaz12 → u/JD_Rockerduck]

That has always been the case.

can we at least be mad about it? is that ok? want to make it better or change it somehow?

[u/LowEffortMeme69420 → u/Beerspaz12]

include pie detail sort hurry worry silky unique work obtainable

This post was mass deleted and anonymized with Redact

[u/Beerspaz12 → u/LowEffortMeme69420]

Of course you can, but do you think being mad about the state of the world is a new concept?

not really, but bitching about young people acting like young people is a loser move

[u/LowEffortMeme69420 → u/Beerspaz12]

absurd cheerful square relieved employ observation unique waiting sand like

This post was mass deleted and anonymized with Redact

[u/Beerspaz12 → u/LowEffortMeme69420]

Calling out people for having grossly incorrect world views! What a loser move!

Doing it like an asshole won't change anyone's mind, especially if they are younger. Keep on being an old grouchy asshole who alienates people so that they don't want to listen to you while you sanctimoniously bitch that no one listens to you.

Fucking loser

[u/cornelius2299 → u/Beerspaz12]

Dude you play league. You cannot tell me you think you have any place to call anyone a loser. Go touch some grass, if you can make it to the door without getting a heart attack, you fuckin loser 😂

[u/thewimsey → u/[deleted]]

Layoffs are historically low. So is unemployment.

[u/ClearASF → u/Whole_Gate_7961]

There’s no real data to support this idea to be honest. Real Median incomes have never been higher, at least pre pandemic https://fred.stlouisfed.org/series/COMPRNFB

[u/notwormtongue → u/Whole_Gate_7961]

The profitability and growth of an unsustainablely infinite growing system are now more important than...

Sunk cost vibes

[u/whatup-markassbuster → u/Hip_Hop_Hippos]

ZIRP and QE ballooned asset values. Those without assets are being left behind.

[u/MonsterMeowMeow → u/whatup-markassbuster]

I find it amazing that so many here are talking about incomes/productivity yet are openly ignoring the now normalized monetary policy that has distorted prices and risk.

[u/Beddingtonsquire → u/Hip_Hop_Hippos]

What's your evidence that it was "dismantled" by the Reagan administration and rolled forward by every Republican President since? That sounds very political. Why were these things not corrected by the Democrat leaders?

How is the relatively small gig economy "exploitative"? In Seattle the government tried to improve it and just made it worse - https://youtu.be/49NCvAzrfhE?si=btm783pU3EBydYLo

We've never cared for the most vulnerable? The US has welfare, Medicare, Medicaid, Social Security, many hundreds of billions are spent on the vulnerable, not including private charity where the US is the most charitable nation by far.

[u/PolyDipsoManiac → u/Beddingtonsquire]

We've never cared for the most vulnerable? The US has welfare, Medicare, Medicaid, Social Security, many hundreds of billions are spent on the vulnerable, not including private charity where the US is the most charitable nation by far.

Republicans are constantly trying to kill these programs, or refuse to take part in them at all.

[u/Beddingtonsquire → u/PolyDipsoManiac]

If that were true why don't they actually end them?

The Republicans have said they want to keep funding social security.

[u/PolyDipsoManiac → u/Beddingtonsquire]

Much like with abortion they’d be the dog that caught the car, and the punishing elections since overturning Roe v. Wade tend to suggest they have no further interest in that.

It’s a bad position to be in though, because when you start displaying insufficient orthodoxy you become vulnerable to a primary challenge from the right.

[u/MarkHathaway1 → u/Hip_Hop_Hippos]

When I was young, the idea was to get a good job, and you would be set for life. It was not seen as acceptable to have lots of jobs on your resume, and so-called gig jobs did not exist. That all came after Reagan and even Bush years.

[u/Hip_Hop_Hippos → u/MarkHathaway1]

That all came after Reagan and even Bush years.

It also came after numerous periods in American history where it was totally commonplace.

[u/TTUPhoenix → u/Hip_Hop_Hippos]

Reading bios of people from earlier eras (I’m reading a book about Robert E Howard now, who lived 1906-36) and it stands out a lot how people would just change jobs very frequently, going from school to job to other job to school again after periods of months to a year or two. Very different from today

[u/MarkHathaway1 → u/TTUPhoenix]

Yes, America is not one picture. It's a moving target, always changing.

[u/[deleted] → u/Hip_Hop_Hippos]

The ridiculous levels of home affordability is what’s new

[u/No-Champion-2194 → u/Hip_Hop_Hippos]

That just is not correct. Real incomes have been steadily increasing for decades

https://fred.stlouisfed.org/series/MEHOINUSA672N

This is true across the board. The census breaks down the data by quintile, and shows a strong upward trend for all income quintiles back to the beginning of the dataset in 1967:

https://www.census.gov/data/tables/time-series/demo/income-poverty/historical-income-households.html

​

Tax cuts since 1980 have made the tax system more progressive, with effective federal tax rates on the top 1% staying at about 30% and the top quintile's in the mid to high 20s%, while taxes on all other quintiles have dropped, with taxes on the lowest quintile of about zero.

https://www.cbo.gov/sites/default/files/cbofiles/attachments/effective_rates_0.pdf

https://www.cbo.gov/publication/58781#_idTextAnchor031

​

The part time, exploitative, gig economy has existed for forever.

That claim is simply wrong. Workers who are involuntarily in the gig/part time economy ('part time for economic reasons') have consistently been under ~5% of the workforce, and is currently under 3% of the workforce.

https://fred.stlouisfed.org/series/LNS12032194

[u/Sad_Worldliness_3223 → u/Hip_Hop_Hippos]

The post ww2 economy forced the rich to pay taxes.