Monday, August 28, 2006

A rising tide (Ninth Ward edition)

Real Wages Fail to Match a Rise in Productivity - New York Times
The median hourly wage for American workers has declined 2 percent since 2003, after factoring in inflation. The drop has been especially notable, economists say, because productivity — the amount that an average worker produces in an hour and the basic wellspring of a nation’s living standards — has risen steadily over the same period.

As a result, wages and salaries now make up the lowest share of the nation’s gross domestic product since the government began recording the data in 1947, while corporate profits have climbed to their highest share since the 1960’s. UBS, the investment bank, recently described the current period as “the golden era of profitability.”

And there, in a nutshell, is the triumph of Reaganomics, compassionate conservatism, the Laffer Curve, and every other Ponzi scheme used to make sure them that's got shall get.

In case you don't immediately grasp the import of that statistic, consider: wage and salary income are returns on labor -- the only income-earning asset most Amercians have. For lower and middle class and even well into the upper middle class, wage income is essentially identical to total income.

Returns on capital have been very, very good. That is the way corporate income gets distributed, and it goes overwhelmingly to the best off among us. But even the wage component has tilted increasingly toward the top:

In 2004, the top 1 percent of earners — a group that includes many chief executives — received 11.2 percent of all wage income, up from 8.7 percent a decade earlier and less than 6 percent three decades ago, according to Emmanuel Saez and Thomas Piketty, economists who analyzed the tax data.

I don't know if these kinds of statistics will ever awake the have-nots from their torpor. I've written before about some of the reasons for their oblivion. But these kinds of stories suggest that there must be a breaking point eventually.

I'm no Marxist -- I think he was an important philosopher but a lousy economist. But I do believe that the flavor of capitalism favored by most of the incumbents on both sides of the aisle is going to lead us to ever greater concentration of wealth until the whole thing collapses into chaos.

6 Comments:

Blogger <-<--esoder<---<----<----- said...

I remember an old Wizard of Id comic that went something like:

"Sire, the peasants are revolting!"

"Yes, and they smell bad, too."

Maybe we should start the meme that it's shameful to be rich?

Come on TA, Blue Meme is wearing his Jeff Gannon costume and lobbing you a softball here!!

9:06 PM  
Anonymous Anonymous said...

What? You want me to point out the obvious? If religious people are encouraged to give one-tenth of their income for charitable social purposes (that is what churches do with the offerings in the plate isn't it?), then shouldn't the rule for letting rich people continue to take breaths of OUR air be that they give NINE-tenths of their INCOME (not total wealth, just income) to similar causes? Just idle speculation here, but I can't come up with a good reason why that shouldn't be the case. Can you?

I think money should come with a warning printed on it, just like cigarettes: WARNING Too much of this stuff is hazardous to your health. Then we should enforce it.

TA

5:17 AM  
Blogger bluememe said...

esoder, I think you are referring to Mel Brooks' "History of the World, Part I."

And TA, tithing is nothing more than a protection racket; if you want to think of redistributive taxation that way, too, so be it.

Or was your 90% tax proposal serious?

6:38 AM  
Anonymous Anonymous said...

Well, I hadn't planned on adding to this thread but.....

Come on guys, I knew you were too young for serious matters. Wizard of Id? Mel Brooks? ...really!

Try Groucho, who probably stole it from Henny, who got it direct from God.

TA

10:59 AM  
Anonymous Anonymous said...

Well, I hadn't planned on adding to this thread but.....

Come on guys, I knew you were too young for serious matters. Wizard of Id? Mel Brooks? ...really!

Try Groucho, who probably stole it from Henny, who got it direct from God.

TA

Oh, yeah. A bank clerk once told me "You don't have to be able to spell 'thousand' correctly to have the money in your account (based on a poorly written check I had received). So, my question is, "Why the F*** don't you have to be smart enough to spell MONEY in order to keep it? Isn't there some kind of parallelism that is supposed to apply here? You know, like "What goes up must..."

11:08 AM  
Blogger bluememe said...

Don't try to out-old fart me....

I loved "Duck Soup," and consider it as good a primer to the Bush Administration as you will ever find.

1:13 PM  

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