Wages

The Krugman Equation and Ending Political Theater To Save A Nation's Economy

Paul Krugman's OpEd in The New York Times yesterday, titled "Willie Sutton Wept," makes a few very important points for anyone who's truly interested in learning about the factors affecting our current budget 'crunch' and the ongoing debates on what to cut. (Read it here.) He makes three points about the current "budget debate" right off the bat, summarized in my bullet list below:

  1. It's essentially fraudulent
  2. Self-proclaimed deficit "hawks" ~aren't~
  3. President Obama deserves a lot more credit for fiscal responsibility than he's been getting

Most of this boils down to the reality that the current budget "crisis" is ignoring the realities of what is impacting the economy the most, while the kabuki theater that the GOP is performing (and not performing alone) in the Potemkin village of our nation's capital isn't just for show -- it's also damaging our meager recovery. Krugman reiterates what we've already seen from looking at the CBO's numbers and from additional sources -- that the core costs which will rise sharply over the next few years will be from health insurance programs, not Social Security. And the lack of revenues from the additional taxes that we lost due to the tax cuts are making the whole situation much worse.

 

Crimes of the Times

In the Business section of the New York Times on Nov. 10, Edward Hadas, Martin Hutchinson and Anthony Currie analysed the structure of US manufacturing wages and found them to be too low, American Wages Out of Balance, A more accurate title might have been Creative Ideas on How to Screw the American Middle Class

The piece speaks for itself, but first a hat tip to Massaccio on Firedog Lake for the find.

It's the Inequality, Stupid!

Crossposted at DKos. Graphs there are in wider format.


Updated numbers and commentary from Emmanuel Saez (h/t Krugman) reminds us just how bad things are and have been for a while.  One might hope that the current economic crisis does not divert our attention from the longer term issues.  


I would argue that pretty much all of our problems and issues, be it health care, education, environment, collapsing public infrastructure, jobs, trade, taxes, and yes right-wing populism can be directly linked to income and wealth inequality.  And the fact that inequality has gotten MUCH MUCH worse ever since 1979-1980 (I suggest looking up who became president in the United States at that time):



 


On the one hand, it is not just a U.S. story. Income inequality has risen throughout the developed world, according the OECD.

Are you better off than you were 8 years ago?

Have you been working harder and harder, becoming more productive all the time, only to see your wages, fail to keep up with that ever increasing cost of living?

It's not your imagination ...

It's just the way our Economic System tilts ...

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For example, check out these disturbing trends:

Real Median Household Income [Notice the Flat-line trend over the last 8 years.]