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Wage Growth Is on Fire

mmi said:
It's true that, in seeking to properly interpret all the macroeconomic data collected over recent years, we need to account for the wild volatility we've experienced in many measures — employment, GDP, federal outlays and receipts, housing stats, etc. Even those that are fairly stable, such as inflation, have been significantly impacted by the wild ride we've been on.

So I'll agree that efforts to draw lines between 43 and the Negro and to compare their relative performance to that of other presidents is gonna be complex. But I also think an honest and informed discussion is possible.

The US economy is anything but a controlled environment that allows for precise scientific analysis, but I'm confident that I can go over this stuff a lot more effectively with someone like you, jaeger, than I can with … people … like the ConMan or AE or many others on the Right here.
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Unfortunately I can't say the same of you because of your continued inappropriate behavior.
 
jaeger19 said:
Yes. you aren't.
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Here let's start over....

I said:

If by spending problem you mean the government is spending too little. I agree.

Or if by spending problem you mean the private sector is going too far into debt, again we agree.

If you mean the government is spending too much, I'd disagree and I'd politely ask where you think I went wrong in my post.

-Cheers.
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And your reply is?
 
csbrown28 said:
Here let's start over....

I said:



And your reply is?
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Already stated. I replied to your original post.

You replied with the above.

I then pointed out where you made mistakes.

you came up with a BS answer that "I didn't include that because of the content restraints".

You spouted an ideology. You got caught at it.. and that's that.
 
jaeger19 said:
Already stated. I replied to your original post.

You replied with the above.

I then pointed out where you made mistakes.

you came up with a BS answer that "I didn't include that because of the content restraints".

You spouted an ideology. You got caught at it.. and that's that.
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Whenever you wish to stop obfuscating and want to discuss, let me know.

-Cheers
 
jaeger19 said:
Simple.. your statistic does not include where wages started.

Wages fell because of the recession. Wages coming back from that does not mean that there has been superior growth or that things are much better for people than previous times.
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e2fa184ff5bd4f4ce92f7ea91b8ac806.png


Seems real wages started to fall before the recession. Perhaps you have another explanation?
 
csbrown28 said:
e2fa184ff5bd4f4ce92f7ea91b8ac806.png


Seems real wages started to fall before the recession. Perhaps you have another explanation?
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Yep. notice the dip in wages from 2008 to 2010. thanks for illustrating my point.
 
jaeger19 said:
Yep. notice the dip in wages from 2008 to 2010. thanks for illustrating my point.
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Sure no problem. You seem to think I'm out here defending the economy under Obama. I'm not. What we should be discussing is why the economy is like it is, a conversation you seem reluctant to have.

Now for the record, I can't find anything to corroborate Incisor's claim. All I can find is the claim:

U.S. economy is nearly 15 percent bigger than when the president took office in 2008, adjusted for inflation.

Taken out of any context, that claim is rather meaningless. I mean if 10% of the economy grew by 100% and the other 90% of the economy declined by 50% in order to make the claim that the economy grew by 15% overall, is that a god thing? I think only people who don't want to think might see something like that and conclude anything from a statistic so bereft of real information.

Here is a pretty good page for statistics measuring and comparing the economy during the tenure of the last 5 Presidents. The following categories are included:

Economic Growth
Jobs Growth
Lost Workers
Wage Growth
Income Inequality
Home Sales
Home Ownership
Federal Spending
Budget Balance
Public Debt
Corporate Profits
Stock Prices


The source is CNBC, which I'm sure you'll scoff at, but the sources statistics are legit and pretty straight forward. Ignoring any commentary, what is your take?
 
csbrown28 said:
Sure no problem. You seem to think I'm out here defending the economy under Obama. I'm not. What we should be discussing is why the economy is like it is, a conversation you seem reluctant to have.

Now for the record, I can't find anything to corroborate Incisor's claim. All I can find is the claim:

U.S. economy is nearly 15 percent bigger than when the president took office in 2008, adjusted for inflation.

Taken out of any context, that claim is rather meaningless. I mean if 10% of the economy grew by 100% and the other 90% of the economy declined by 50% in order to make the claim that the economy grew by 15% overall, is that a god thing? I think only people who don't want to think might see something like that and conclude anything from a statistic so bereft of real information.

Here is a pretty good page for statistics measuring and comparing the economy during the tenure of the last 5 Presidents. The following categories are included:

Economic Growth
Jobs Growth
Lost Workers
Wage Growth
Income Inequality
Home Sales
Home Ownership
Federal Spending
Budget Balance
Public Debt
Corporate Profits
Stock Prices


The source is CNBC, which I'm sure you'll scoff at, but the sources statistics are legit and pretty straight forward. Ignoring any commentary, what is your take?
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Well. I think the economy is certainly better than it was when Obama took office. But as you can see.. the economy being better is really just a correction from where it was prior to the crash.

the bigger picture of the economy is that its growing, since the 1970's. But you can see that for the last three decades.. real wages for the lower and middle classes have remained relatively stagnant or decreased. Which begs the question.. whats causing the growth?

If we were a huge export country.. it would be money from other countries. But we are not a big exporter.. we are a more consumer society. So whats fueling the consumption? Wages...so basically its borrowing. Government and private.

Which in the long run is unsustainable. Its not a healthy economy. and the answers of more government spending... whether tax or spend or borrow in spend have proven not to work. We have been spending. Heck the government has been spending more than before. And yet the trend continues. Some say "well its because taxes are too low"... but taxes as a percentage of GDP have been at or higher than levels in the 1970's when we had growth and wage growth. (only for a few years after the bush tax cuts and the ARRA did revenue drop below historical norms).

So the issue is not spending.. its not revenue.

We have systemic issues that have reduced social mobility, that have reduced wage pressure, and that have funneled growth away from the middle class and poor and strictly into the hands of the rich.
 
jaeger19 said:
Well. I think the economy is certainly better than it was when Obama took office. But as you can see.. the economy being better is really just a correction from where it was prior to the crash.
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I agree though I don't think that it had to be as bad as it was. The government led by Republicans and Neo-Liberals sat by and watched things spin down to the point that real damage was irreversible waiting for the market to sort itself out. I'd credit huge deficit spending for putting back some of the value that was lost and preventing an all out global collapse.

It's kinda like watching the leak in your roof turn into a hole and doing damage in your house before you decide to fix it.

jaeger19 said:
the bigger picture of the economy is that its growing, since the 1970's. But you can see that for the last three decades.. real wages for the lower and middle classes have remained relatively stagnant or decreased. Which begs the question. whats causing the growth?

If we were a huge export country.. it would be money from other countries. But we are not a big exporter.. we are a more consumer society. So whats fueling the consumption? Wages...so basically its borrowing. Government and private.
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Again, we agree, where we're going to perhaps disagree is the effect of government vs private sector borrowing.

jaeger19 said:
Which in the long run is unsustainable.
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The private sector, yes, unsustainable, public sector, on the other hand, is indefinitely sustainable.

jaeger19 said:
Its not a healthy economy.
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Agreed

jaeger19 said:
and the answers of more government spending...
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That looks like a typo...?

jaeger19 said:
whether tax or spend or borrow in spend have proven not to work. We have been spending. Heck the government has been spending more than before. And yet the trend continues.
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Is the government really borrowing?

It the government creates IOU's that are redeemable in tax payments, but of what value is the IOU the government creates to the government? They have the same value your IOU's have to you. Nothing. Does collecting an IOU make it any more or less possible to make more IOU's? No, of course not. That's not to say that there aren't other real constrains on IOU creation, I'm just pointing out that collecting IOU's in circulation are not a constraint on making more.

When the government "borrows" it really just selling savings accounts. That is, the government creates money and acquires the things it needs to provision itself and uses it's IOU's to meet whatever policy goals it wants to achieve. However, all that currency creation and spending are earned by someone else as an income. Since people don't all spend 100% of what they make, some desire to save. t-bonds represent the safest opportunity for savers to protect the value of their US dollars. In turn, the government attracts dollars and sells bond assets that are less liquid than the cash they traded them for. This makes room for spending.

jaeger19 said:
Some say "well it's because taxes are too low"... but taxes as a percentage of GDP have been at or higher than levels in the 1970's when we had growth and wage growth. (only for a few years after the bush tax cuts and the ARRA did revenue drop below historical norms).
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That's because people think taxes are required to fund spending. That's not the purpose of taxes, and the irony is, the worse things get the more people believe that we need to raise taxes to collect revenue.

Taxes should operate counter-cyclically. Sort of like pushing a child on a bike. When the child slows you push, when they are going fast enough you let go, if they go to fast you act as a brake and grab them. When the economy slows, taxes are decreased leaving more money in the hands of spenders. Conversely, government spending is the push. As the economy speeds up you stop spending/ pushing....If the economy goes to "fast" (fear of long-term inflation sets in) then you slow the economy via taxing providing the "brake".

jaeger19 said:
So the issue is not spending.. it's not revenue.

We have systemic issues that have reduced social mobility, that have reduced wage pressure, and that have funneled growth away from the middle class and poor and strictly into the hands of the rich.
Click to expand...

Agreed, what I'm suggesting is a decrease in deficit spending has lead to an increase in private sector spending. We've moved much of the debt off the books of the government and onto the books of the average worker.

fredgraph.png
 
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The government led by Republicans and Neo-Liberals sat by and watched things spin down to the point that real damage was irreversible waiting for the market to sort itself out. I'd credit huge deficit spending for putting back some of the value that was lost and preventing an all out global collapse.
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Well deficit spending didn't "put back value".. and the market had to sort itself out. You weren't going to stop that with an infusion of deficit spending. In fact you would only make it worse and prolong and deepen the pain.

Again, we agree, where we're going to perhaps disagree is the effect of government vs private sector borrowing.
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Yep.

The private sector, yes, unsustainable, public sector, on the other hand, is indefinitely sustainable.
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Nope not at all. Because its not sustainable is why Obama reduced the deficit.

Is the government really borrowing?
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Yes.

Does collecting an IOU make it any more or less possible to make more IOU's? No, of course not. That's not to say that there aren't other real constrains on IOU creation, I'm just pointing out that collecting IOU's in circulation are not a constraint on making more.
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Actually yes it does. Paying out IOU's certainly helps you make more IOU's. Try not paying back your credit bills and see how easy it is to borrow in the future. Even the US has a credit rating. and that rating effects the willingness of investors to pick up our debt.

That's because people think taxes are required to fund spending. That's not the purpose of taxes, and the irony is, the worse things get the more people believe that we need to raise taxes to collect revenue.
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the fact that people believe that taxes are required to fund spending is important effects the economy and the decisions both in the private sector and in the public sector.

When the economy slows, taxes are decreased leaving more money in the hands of spenders. Conversely, government spending is the push. As the economy speeds up you stop spending/ pushing....If the economy goes to "fast" (fear of long-term inflation sets in) then you slow the economy via taxing providing the "brake".
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The problem is that decreasing taxes too much leaves you little revenue for things like defense and infrastructure spending.. which can decrease the overall economy if infrastructure breaks down or their are worries over security. If revenue is too low.. then investors worry about the countries ability to pay its bills with currency that's worth a darn. Thus reducing your ability to borrow.

Agreed, what I'm suggesting is a decrease in deficit spending has lead to an increase in private sector spending.
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Which would be good. But I think you meant to say an increase in private sector BORROWING.. instead of spending.

We've moved much of the debt off the books of the government and onto the books of the average worker.
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Actually as deficit spending decreased under Obama ... So did household debt decrease.

. U.S. families' debt loads decline to pre-recession levels - latimes

So while Obama decreased the deficit in those years.. consumer debt also decreased. Which according to you. it should have exploded.

But now the economy has perked up.. household debt has been on the increase.

Your premise doesn't seem to have much support.
 
Moderate Right said:
Oh please. It is the left who blames everything on Bush and Reagan, and recently Cheney. Even when their own policies fail they throw their darts at the Bush and Reagan dartboards, even after eight years.
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Actually "Moderate Right" is correct. The wide income disparity started under Reagan. However it hasn't ended. It has gotten worse under every president since. I thought Obama might make a difference in this regard, when he took on the GM executives, after they rode their corporate jet to the bailout hearings. But not much has changed. Ralph Nader once said that until the money-mongers stop this madness, progress will be stalled. Corporate board members sit on each other's boards, and pay themselves hundreds of thousands of dollars a year to go to 1 or 2 meetings.
 
jaeger19 said:
Your premise doesn't seem to have much support.
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You mean: "So far I can't see your premise has much support". "Can you explain it?"

My response, "Yes". :)

Just give me a little time. I'm really busy at the moment, but I will be back to make my case.

-Cheers
 
Moderate Right said:
Oh please. It is the left who blames everything on Bush and Reagan, and recently Cheney. Even when their own policies fail they throw their darts at the Bush and Reagan dartboards, even after eight years.
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I don't like to place myself on the ideologic spectrum as I consider myself a pragmatist, but I think it's obvious that the "left" has embraced ideas and policies that differ very little from the right with respect to government spending. I mean sure socially they call for differences when it comes right down to it, neo-liberals aren't that much different than Republicans with respect to financing, the irony is that Republicans spend as much if not more than Dems, but they pay lip service to the idea they want to spend less. I'm not being critical, it's brilliant actually. Tell the people what they want to hear and do whatever you want. This is why Democrats, IMO, have lost so much of the House and Senate. They've embraced many of the same ideas, only the "light" version of it. Who the hell wants "light" when you can have the real thing?

Repub's talk about freedom while Dems talk about equality. Overall, Repubs simply have a better message.

People don't remember facts, they remember how you make them feel. Repubs make people feel better about the things they say irrespective of what anything beliefs about the reality)
 
csbrown28 said:
You mean: "So far I can't see your premise has much support". "Can you explain it?"

My response, "Yes". :)

Just give me a little time. I'm really busy at the moment, but I will be back to make my case.

-Cheers
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Actually no.. your own evidence disputes your premise. Obama decreased deficit spending and during some of that time.. household debt decreased. You arrived at your premise by picking a time frame in which deficit spending decreased and household debt increased.. but ignore that there were times were deficit reduction happened and household debt decreased as well.
 
csbrown28 said:
I don't like to place myself on the ideologic spectrum as I consider myself a pragmatist, but I think it's obvious that the "left" has embraced ideas and policies that differ very little from the right with respect to government spending. I mean sure socially they call for differences when it comes right down to it, neo-liberals aren't that much different than Republicans with respect to financing, the irony is that Republicans spend as much if not more than Dems, but they pay lip service to the idea they want to spend less. I'm not being critical, it's brilliant actually. Tell the people what they want to hear and do whatever you want. This is why Democrats, IMO, have lost so much of the House and Senate. They've embraced many of the same ideas, only the "light" version of it. Who the hell wants "light" when you can have the real thing?

Repub's talk about freedom while Dems talk about equality. Overall, Repubs simply have a better message.

People don't remember facts, they remember how you make them feel. Repubs make people feel better about the things they say irrespective of what anything beliefs about the reality)
Click to expand...

Interesting insight but I will add this: For many years the Democrats were extremely successful at labeling the Republicans as the party of no and having a war on women, a war on minorities, a war on the poor, a war on seniors, and that they are racists and bigots. Now the public has realized that much of that is blown way out of proportion, exaggerated, and in many cases simply not true and that has really started hurting them at the polls but I don't think that as a whole they realize that all of that negative rhetoric has been actually backfiring on them in the last several elections, not only at the federal level but at the state levels as well.
 
jaeger19 said:
Actually no.. your own evidence disputes your premise. Obama decreased deficit spending and during some of that time.. household debt decreased. You arrived at your premise by picking a time frame in which deficit spending decreased and household debt increased.. but ignore that there were times were deficit reduction happened and household debt decreased as well.
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What a bazaar response. You must not think I'm very bright...lol

The debt (the accumulation of 250 years of deficits) in 2008 was ~$10 trillion. Today, 10 years later it's almost $20 trillion or $10 trillion more than it was in 2008. Government deficits are net assets from the private sector's point of view, the fact that debt declined is exactly what I would have predicted with $10 trillion more dollars in deficits spent into the economy in just 10 years. However, there are some significant nuances, not the least of which is that most of those assets were captured by those at the top and most of the debt retired was also at the top. Those at the bottom end of the scale continue to be marred in personal debt, but the overall numbers mask this fact.

Now you said:

Obama decreased deficit spending and during some of that time
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First, let's be fair, Congress controls the purse strings...

The fact is, as much if not more has been spent into the private sector over the last 8 years than the 250 years prior. Even if you account for inflation the difference is staggering. You'd have to go back to the last world war to find similar deficits. So yes, The deficit did decrease under Obama every year he was in office (except the last), but when you consider that the first years deficit was over $1 trillion dollars, decreasing the deficit isn't all that hard to do.

But again, when I have time I'll post a longer response...
 
Moderate Right said:
Interesting insight but I will add this: For many years the Democrats were extremely successful at labeling the Republicans as the party of no and having a war on women, a war on minorities, a war on the poor, a war on seniors, and that they are racists and bigots. Now the public has realized that much of that is blown way out of proportion, exaggerated, and in many cases simply not true and that has really started hurting them at the polls but I don't think that as a whole they realize that all of that negative rhetoric has been actually backfiring on them in the last several elections, not only at the federal level but at the state levels as well.
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I can agree with that to some extent...

Now I'm not judging the right or wrong policy wise in this post, just trying to be objective.

I think the social message of fairness plays really well when the country as a whole is doing well as whole. The Dems, as you said, rode that for a long time, esp under Clinton. When things went to hell in the Rust Belt, people there felt the level of effort spent on fairness may be at their expense and the Dems failed to identify that and they paid for it.
 
mbig said:
You need Links for the logical/Obvious?
You ignore the rest of my post?
Just looking for some burden-shifting/logically fallacious debate tonight?
Bored?
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I think the first thing they teach you in Economics is to never make assumptions, especially if something seems obvious. There are a lot of variables to wages. For example, elimination of cheap immigrant labor may simply lead to more development and implementation of automation and that could lead to a decrease in wage growth.
 
CriticalThought said:
I think the first thing they teach you in Economics is to never make assumptions, especially if something seems obvious.
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Yes Occam's Razor never works
Nice self-destruction.

CriticalThought said:
There are a lot of variables to wages. For example, elimination of cheap immigrant labor may simply lead to more development and implementation of automation and that could lead to a decrease in wage growth.
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I don't know about you, but I AM a financial professional.
I don't know what they didn't teach you in economics.
 
mbig said:
Yes Occam's Razor never works
Nice self-destruction.
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Um...apparently you have no idea what that is.

"Among competing hypotheses, the one with the fewest assumptions should be selected."

I don't know about you, but I AM a financial professional.
I don't know what they didn't teach you in economics.
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Apparently not one with a very basic working knowledge of economics.
 
csbrown28 said:
What a bazaar response. You must not think I'm very bright...lol

The debt (the accumulation of 250 years of deficits) in 2008 was ~$10 trillion. Today, 10 years later it's almost $20 trillion or $10 trillion more than it was in 2008. Government deficits are net assets from the private sector's point of view, the fact that debt declined is exactly what I would have predicted with $10 trillion more dollars in deficits spent into the economy in just 10 years. However, there are some significant nuances, not the least of which is that most of those assets were captured by those at the top and most of the debt retired was also at the top. Those at the bottom end of the scale continue to be marred in personal debt, but the overall numbers mask this fact.

Now you said:



First, let's be fair, Congress controls the purse strings...

The fact is, as much if not more has been spent into the private sector over the last 8 years than the 250 years prior. Even if you account for inflation the difference is staggering. You'd have to go back to the last world war to find similar deficits. So yes, The deficit did decrease under Obama every year he was in office (except the last), but when you consider that the first years deficit was over $1 trillion dollars, decreasing the deficit isn't all that hard to do.

But again, when I have time I'll post a longer response...
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Well... If you think my response was "bazaar"..... it does not speak well of your "brightness"..

Your post is largely a bunch of invalid statements that have little or nothing to do with the discussion at hand.
 
jaeger19 said:
Well... If you think my response was "bazaar"..... it does not speak well of your "brightness"..

Your post is largely a bunch of invalid statements that have little or nothing to do with the discussion at hand.
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Touché my friend. Perhaps the fact that you are unaware of the validity of the statements I made speaks to the fact there are things that you are unaware of.

Now honestly, I'm not interested in a pissing match with you (oops too late). No one has ever learned anything when they are simply trying to prove themselves right. Looking back out our exchange, that's all this is.

Now I'd be happy to discuss this like an adult, where you ask questions and challenge my assertions, but if you simply wish to declare yourself the winner by declaring my statements "invalid" and questioning my intellegence, that's cool too, I have other conversations I can dedicate myself to if this is what I can expect in the way of responses from you.
 
It's funny...or sad.

Obama supporters were talking with pride about every good data point released over the last 7,8 years.

And as the months now pass...they will be singing a complete opposite tune on the same stats.

And, of course, so will cons.

Man...I despise partisan politics.
 
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