"This is without precedent in U.S. history"

Discussion in 'Economics' started by ByLoSellHi, Sep 22, 2009.

  1. http://business.theatlantic.com/2009/09/americas_lost_decade_cont_1.php

    Sep 22 2009, 10:30 am by Derek Thompson
    America's Lost Decade, Cont.


    For the last few months, Atlantic Business has been running an occasional series on the last decade, which has been, in far too many ways, a lost decade for Americans. Private sector job growth in the last ten years is now negative for the first time since the Great Depression. Income for the median American household fell for the first time in four decades according to the new Census report. And it's possible we haven't hit the bottom in either category.

    If you prefer your bad news in picture form, then try this.

    Here's a chart from the Center on Budget and Policy Priorities, via Matthew Yglesias, that shows how Americans in the middle have never recaptured the highs of the late 1990s.

    [​IMG]

    "This is basically without precedent in U.S. history," Yglesias says. It's certainly without precedent in the last half-century. But unfortunately, it's part of a broad trend that is rather recent. The last two recession recoveries in America -- after the early '90s recession and the early '00s recession -- were famously jobless recoveries. That is, GDP was growing, but the job market was not. Check out this graph, that measures job loss and job growth in the last six recessions.

    [​IMG]

    The recessions of '74, '80 and '81 are valleys that turn up quickly. The bottom of the job market is a trampoline. In '91 and '01, it looks more like a wide riverbed. That's what a jobless recovery looks like, with a long meandering floor during which time GDP has recovered but thousands still languish in un- and under-employment. The inability of the private sector to produce enough jobs coming out of recessions is becoming something much worse than "basically without precedent." It's becoming a trend.
     
  2. Shows the total failure of LBJ's "War on Poverty".
    How many billions have we spent on that?
     
  3. When actual inflation is considered, American incomes have been in decline for several decades.

    That explains why 2 spouses must work to support todays family. Whereas, pre-70's, one breadwinner earned enough for the entire family.

    Interesting?
     
  4. Shows the total failure of LBJ's "War on Poverty".
    --------------------------------------------
    I think you need more data to do that.:D

    Like what was the poverty rate in 1965??
     
  5. That explains why 2 spouses must work to support todays family. Whereas, pre-70's, one breadwinner earned enough for the entire family.
    -------------------------------------------------
    Yea. If the bread winner worked for General Motors. :D
     
  6. Not true. There were far more single-worker households back in the day.

    Real salaries were much higher.
     
  7. Most acute was off of the 2002 low. Government kept harping about "productivity, above average GDP", "inflation only 1-2%"

    TRUTH was that the GDP number was phony-balony... had a high component of inflation in that calculation... MUCH higher than the "don't worry, be happy 1-2%" the government was telling us. (My estimation of inflation during that time was something in the neighborhood of 8%.).

    High inflation rate coupled with job outsourcing = "average decline in real wages."
     
  8. You are on a impressive roll of incorrectness. Inflation-adjusted per capita incomes for the US, in 2006 dollars:

    1967 - $12,711

    2006 - $26,352
     
  9. Not true. There were far more single-worker households back in the day.

    Real salaries were much higher.
    ------------------------------------------------

    Stop watching Ozzie and Harriet reruns.:D
     
  10. Like I said, you're not very bright.

    The definition of inflation has been changed more than 4 times, since its inception.

    Your example does not count food or fuel. It assumes price substitution. People buy hamburger when steak gets too expensive = no inflation. Interesting, when the CPI is designed to track standard of living via prices. So when product quality goes down, but prices held constant, there's no inflation. Dumb.

    Thirdly, hedonics is bullshit. Even though people PAY MORE for items, like clothes, or electronics, if they get more "value" (as defined by the BLS) out of pushing electronic buttons on a cheap-ass washing machine built in china, the additional 20% paid for it over the old push-button model, is a wash. NO INFLATION.

    Now back-track 60 years, apply all the writedowns, and you get a nicely distorted number like the one you just gave.

    You still haven't explained how familys in the 60's got by with one breadwinner. And now, the average family needs two. Please explain.

    Also, please tell us what bank you work for? I'd like to know.
     
    #10     Sep 22, 2009