Real Wages Haven't Grown for a Decade

[busenbust]

Real Wages Haven't Grown for a Decade

http://bigthink.com/ideas/38720

^short but excellent article i thought

It has been a bad 10 years for the economy. As I’ve written before, the last decade was, economically, a lost decade. As this graph from Ezra Klein shows, there has been essentially no job growth for ten years, net household worth actually fell, and the economy as a whole grew less than 18%—compared to 35% or more for every other decade since the Great Depression. In fact, in many ways, the last 10 years has been as bad as the Great Depression. That's why Paul Krugman called the decade "the Big Zero.”

do take a look at the graph ! :eek:

 

[D-rock]

If you count only the poorer half of the country and in a lot of way even lower 90% of the country real wages haven't grown in about 40 YEARS! For many of those people when you count hours worked and number of people working per household they actually earn a lot less comparatively than before.

So it's even a lot worse than that that claims.

 

[Jagger69]

This is a trend that is gouging a deeper divide between the haves and have-nots. The so-called "middle class" is shrinking. By recent statistics, 1 in 6 American workers are "underemployed". Check out this article for more:

http://www.businessweek.com/ap/financialnews/D9NKG4AO0.htm

When the unemployed are combined with part-time workers who would rather be working full time and people who have given up looking for jobs, roughly 25 million Americans are "underemployed. That's equal to 15.8 percent of the work force.

 

[Rey C.]

Not good, is it?

If you really want to get depressed, overlay that graph with graphs of the national deficit and the trade deficit starting with the decade of the 1980's.

But these are the things that happen when you have no national manufacturing policy, among other things. The U.S. is one of the only developed Western nations without such. But we will break our necks to sign a trade agreement with some other country, even though we won't enforce it if they cheat. And we'll even work to get a country like China into the WTO... and go for years without pressing a case when they cheat.

 

[D-rock]

Not good, is it?

If you really want to get depressed, overlay that graph with graphs of the national deficit and the trade deficit starting with the decade of the 1980's.

But these are the things that happen when you have no national manufacturing policy, among other things. The U.S. is one of the only developed Western nations without such. But we will break our necks to sign a trade agreement with some other country, even though we won't enforce it if they cheat. And we'll even work to get a country like China into the WTO... and go for years without pressing a case when they cheat.

For that manner I don't know any great thing the US exports other they maybe a few entertainment related things. Even if somehow we enforced all trade agreements it's not like anybody buys stuff from us anyhow besides a handful of things (and raw materials which they then make stuff out of and sell it back to us). People can get what we make cheaper or better made somewhere else. It's not just enforcing trade agreements it's the fact we have those trade agreements in the first place that's more the problem. There is no way we and soon any reasonable first world industrialized nation will be able to compete with virtual slave labor that also has virtually no regulations in any other aspect either.

All the while the huge numbers of jobs we used to have that a lot of people could work for decent money are gone.

 

[Rey C.]

We actually set a monthly record for exports this past March: $172.7 billion. The previous monthly record was set in January of 2011: $167.5. Where we still stand out is in higher tech industries: machine tools, complex equipment, medical devices, aerospace goods, etc. Very true that we can't compete with Third World nations when it comes to sewing shirts and making socks. But if we allow the Chinese (or whomever) to steal our technology and then sell those goods here, we're just cutting our own throats.

And like I said, it's not just the Chinese, Indians or Vietnamese - I don't really mean to single them out. And to be honest, it's kind of a dual edged sword. If not for the cheap consumer goods we get from them, our middle class might be in an even harder spot, because prices would be higher. But on the other hand, wages here (and employment) would probably be higher if certain jobs hadn't gotten NAFTA'ed. The blame is really on us. We're the ones who bought into the "Free Trade" arguments of the U.S. Chamber of Commerce, et al, back in the early 90's. They said that these trade agreements would be good for American workers. But what we actually got was free trade on a one way street. Other countries were able to sell their goods more easily here, but they subsidized their own industries or maintained trade barriers against our goods. A classic case of "heads I win, tails you lose". Plus you have countries like China that won't allow American/European companies to sell their Chinese produced goods there - they force them to export them (which helps their balance of trade). And the U.S. trade deficit has swelled ever since.

IMO, we're just the biggest chumps on the planet.

 

[D-rock]

We actually set a monthly record for exports this past March: $172.7 billion. The previous monthly record was set in January of 2011: $167.5.

Compared to what we import that's small and isn't that significant. It would have to go up very significantly to somehow have a significant effect on our economy. That’s not going to happen by just going by and honoring the deals we have with other people now. Ironically enough the export rate or the deficit gap might actually been helped by our economy tanking as sad as that is. (I could also point out since we import a lot of cheap things while exporting a lot fewer expensive things that per unit it's even a lot worse. That hurts a lot when it comes to number of jobs lost and the number we can gain.)

...and as places like China and India get more technologically advanced it will get even worse because then they will just produce the higher end stuff cheaper as well, and they will be at the point where they are close to us in that very soon. It's not just us that is going to be screwed either, I image pretty much all of Europe and any other place that has a reasonable standard of living will go next, even if they aren't as stupid with the economic policies as us.

Basing our economy off of service jobs or high tech stuff (Services is another sector where it takes less people to do more and cover as many people.) is just never going to happen successfully for a whole host of reasons, and it won't happen for any other sizable country either. To put it brutally it was a very stupid thing to do. I'm just surprised there are so many people blind to that. Finally, there is a small handful of people that are coming around and realizing that we always and probably will always need into the far future that strong well paying huge manufacturing base and that whole thing about everybody in the country magically being able get great educations and having very well paying jobs for them and everybody living happily ever after was nothing more than some peoples' vision of a fantasy world that was never going to happen. Unfortunately, it's way too little too late. Not only didn't it happen but we put in place social conditions, lack of infrastructure, and the lack of help for most people to make sure it was even extra impossible to achieve. I also think it's sad that even a lot of those high paying well educated jobs are being moved off for elsewhere.

Even with equal trade there is no way we can win. Those free trade agreements are some of the dumbest things this country has ever done. We should not only have gotten into less free trade agreements we should have made trade more restrictive. Other worse places in the world have way too many advantages and soon will have every advantage. (Not to mention a lot of those places are totalitarian and tyrannical and we basically fund them for a perceived monetary benefit to ourselves.) The leaders of this country have literally sold our country and the people in it out for mountains of cheap crap so we could have short term gain in greed and have the wealth remaining in this country go into fewer and fewer hands.

 

[Rey C.]

I can't disagree with those points, D-rock. We really need (and should have always had) a solid manufacturing policy in this country. The sad thing is that far too many of the people who would make that policy will lie and claim that free (unfair) trade is actually good for this country. They're the same ones who helped China get into the WTO, but then sat on their asses and didn't want to bring the first case against China, when it was obvious to even a blind man that they were breaking the rules. If you happen to see anyone who is a member of the Club for Growth, call him a traitor and punch him square in the face for me.

Don't quote me on the exact numbers, but I believe I read that Obama had pressed more WTO cases against China in six months than W. Bush did in six years. If I got the numbers wrong, pardon me. But the point remains. And I wouldn't even say that the Obama Administration has done a good job with respect to trade or developing any sort of manufacturing policy. It's just that Bush did nothing and Obama has done a little something. We're still in a right fine mess though.