Much reason to be thankful: The 99 percent never had it so good.

Washington Times ^ | 11/25/2011 | Nita Ghei

[SeekAndFind]

Forget what you read on the signs at the local Occupy Whatever City rally. The so-called “99 percent” have never had it so good.

Living standards for poor and middle-class Americans have improved steadily since 1980. Much of this improvement can be credited to the economic growth and tax reforms that provide incentives to invest and work. In a study for the American Enterprise Institute last month, Bruce Meyer of the University of Chicago and James X. Sullivan of the University of Notre Dame examined survey-level data to determine changes in what they call the “material well-being” of the poor and middle class - that is, the Americans in the bottom 20 percent of the income distribution and those in the middle 20 percent.

Much of the literature looks at the income these groups receive - before tax and transfers - to conclude incorrectly that they are worse off today. Mr. Meyer and Mr. Sullivan argue, quite correctly, that pre-tax income doesn’t tell the whole story. For example, a retired couple with substantial assets could have almost no income. Even though they enjoy a very comfortable living, they would be tossed in the “poor” category because they lack income. That’s why Mr. Meyer and Mr. Sullivan concluded that consumption levels are a better measure of how well people are doing.

By this yardstick, even the bottom 10 percent of the population can boast a 54 percent improvement in material well-being between 1980 and 2009.

[kearnyirish2]

I’m glad I’m better off than 3 years ago; it must have been my imagination.

When they try to convince us we’re not being reduced to serfs, one can only conclude they’re doing that because we’re being reduced to serfs.

[algernonpj]

I’m glad I’m better off than 3 years ago; it must have been my imagination.

When they try to convince us we’re not being reduced to serfs, one can only conclude they’re doing that because we’re being reduced to serfs.

Yep. Despite the article's cheer leading, we're experiencing:

[SeekAndFind]

What this article is saying is this -— In spite of the fact that we have a great number of people behind on their mortgages, in foreclosure and unemployed, all of these people should be thankful that they have these problems in the America of today.

They are still VERY COMFORTABLE compared to Americans who lived in past generations ( and relative to most people in the world for that matter).

[mjp]

Living standards for poor and middle-class Americans have improved steadily since 1980. Much of this improvement can be credited to the economic growth and tax reforms that provide incentives to invest and work.

In a free society, with a rational culture, and a just government, the economic progress produced by capitalism, and not socialism, is the best cure for poverty.

[conservatism_IS_compassion]

I’m glad I’m better off than 3 years ago; it must have been my imagination.

When they try to convince us we’re not being reduced to serfs, one can only conclude they’re doing that because we’re being reduced to serfs.

The statistics being referenced deal with the long term progress over a generation rather than the effects of the depredations of the current administration.

What this article is saying is this -— In spite of the fact that we have a great number of people behind on their mortgages, in foreclosure and unemployed, all of these people should be thankful that they have these problems in the America of today.

They are still VERY COMFORTABLE compared to Americans who lived in past generations ( and relative to most people in the world for that matter).

. . . and even that underestimates the progress being discussed. Because, as Thomas Sowell points out, people tend to start out making low salaries and progress to higher salaries with maturity and experience - so the person who started out in the bottom quintile back in 1980 is almost certain to be in a higher quintile today. At any given time the bottom quintile is loaded with young people (and, perhaps, recent immigrants) just starting out. Two decades after an individual was in the bottom quintile, he's statistically more likely to be in the top quintile than he is to still be in the bottom one.

So, statistically and in the long run, people have been doing better and better. It's just the short run since the Fannie/Freddie collapse that has been a problem. And will I fear continue to be such for the duration of the current administration, and at least somewhat beyond.

[algernonpj]

01. you all forgot to cc kearnyirish2

02. I'm cc'ing Carbonsteel as a courtesy

... They are still VERY COMFORTABLE compared to Americans who lived in past generations ( and relative to most people in the world for that matter).

Gee I'm so thrilled that the political elite of both parties have not yet succeeded in reducing the middle class to complete third world living conditions /sarc

The statistics being referenced deal with the long term progress over a generation rather than the effects of the depredations of the current administration.

Since the 1980's the only groups whose living standards have consistantly improved are illegal aliens, brand new immigrants on the dole, guest workers who pay no or very partial taxes, the permanent under class, those off shore who have been the recipients of American jobs, and TBTF corporations and finance.

The statistics being referenced deal with the long term progress over a generation rather than the effects of the depredations of the current administration.

The depredation has been going on for a long time prior to the current administration. To quote FReeper carbonsteel: "Obama didn’t start the fire, it was ablaze when he took office.....then he poured gasoline on it."

Regarding statistics, please look at the blue line on the three charts I posted. In particular note that the CPI has morphed from reflecting the cost of a set standard of living to reflecting the cost of a declining standard of living. This in turn has falsely inflated the GDP.

The middle class of the US has slowly and surely been paying the price for the political elite's love affair with globalism and 'free trade' based upon Ricardo's theory of comparative advantage since the 1970's.

For Ricardo's theory of comparative advantage to work, a country's labor, capital, and technology must not move offshore. Ricardo himself admits this. International immobility is necessary to prevent a business from seeking an absolute advantage by going abroad. His theory only works for such factors as geography and climates. Ricardo assumes that patriotism will check investment abroad even under absolute advantage.

[kearnyirish2]

Thanks; you omitted the public school teachers from those who’ve seen a large imrpovement in standard of living.

Here in NJ they are our upper middle class.

[conservatism_IS_compassion]

For Ricardo's theory of comparative advantage to work, a country's labor, capital, and technology must not move offshore. Ricardo himself admits this. International immobility is necessary to prevent a business from seeking an absolute advantage by going abroad. His theory only works for such factors as geography and climates. Ricardo assumes that patriotism will check investment abroad even under absolute advantage.

Technology will migrate. America stole Britain's textile making secrets, and one way or another that sort of thing will always happen if the incentive is powerful enough. The issue is whether the country with the technology stagnates or whether it develops additional technology and so keep its lead.

America's biggest "technology" is actually its Constitution and equality before the law, and it is an open secret. Others have different traditions, and the result has been an inability to assure "the progress of science and the useful arts" as well as America has.

That difference between the US and Mexico in particular is why Texas, California, and much of the rest of the US which used to be part of Mexico became part of the US in the first place. Mexico was dysfunctional 200 years ago, and isn't so much better now.

As to the export of capital, that is what produces a positive balance of payments surplus - people who worry about the "balance of payments deficit" are actually demanding the export of capital.

[Revolting cat!]

I doubt that the 19% of workers and their families who are permanently unemployed or underemployed are better off than they were 3 or 10 years ago.