Curiously, while high percentages of people of people are negative about the economy right now, and feel we are going in the wrong direction, the vast majority are positive about their own prospects. There is also a recent poll, asking people if they were "living the American Dream, or had good prospects to in the near future." Public perception is strange
Using GDP is tricky, and I am not sure they were appropriately used. Part of GDP growth simply reflects a growing population through kids growing up, and immigration, another part is productivity improvement from newer less expensive ways to do things. When looking at an economic activity measure, that might be compared to worker wages, the productivity measure is the one to use., because the income is a per worker measure.
From after WW II, when the playing field had been leveled by federal legislation, and the National Guard was no longer used on strikers, productivity gains, long buses with one driver, automated toll stations, huge coal mining machines, CAD systems for architects and computer logic, were split equally between worker wages and owners. Part of the Reagan Administration agenda was breaking labor unions, done partly by conning non union people, that labor unions were ripping them off. The fact was that union contracts set the standard for similar companies in the same industry, and/or the same type of worker. The recent decades since, have a dramatic shift with worker wages getting a very small share.
Finally, I like to say that the top 0.01% gives the whole top 1% a bad name. Most of the top 1% more like the 9% below it, being just families of two professionals, with bachelors or masters degrees, being teachers, professors, IT Professionals, lawyers (most make less than you think), family practice doctors, Nurse practitioners, Physicians Assistants etc.
- Worker power has declined a lot since the Reagan revolution, as you've described. I wrote about this in terms of how the benefits of productivity increases have been shared in a previous post. See https://www.winwindemocracy.org/i/54189361/declining-worker-power. There's a compelling graph that shows how productivity and compensation growth tracked each other closely for decades and then started to diverge starting in the early 1980's, widening more and more over time, with productivity increasing almost 61.8% from 1979 to 2020, but compensation increasing only 17.5%.
- Yes, population growth can be one factor driving GDP growth. But that same population growth can also mean that the benefits of the GDP growth are distributed among a larger population. In this particular case, all of the numbers are pointing at the same thing: something big happened in our economy as a result of the Reagan revolution.
- In Matthew Stewart's Atlantic article that I mentioned, he argues that the 9.9% (i.e., the top 10% less the .1% at the very top) are the one's causing many of society's ills.
I'm not aware of any societies that don't eventually have some degree of "have and have not". Even societies that have professed to behave that way -- for example, communist countries -- are not that way in fact. There may be some small, isolated societies that aren't "have and have not" to some degree, but, if so, I don't know of them.
That said, there are many modern economies where wealth/income is distributed much more equally than in the United States. There is a number, called the Gini index, that purports to measure how much unequal distribution there is, with 0 being that everyone has the same and 100 being that one person has everything and the rest have nothing. Of course, one number can't capture the full situation and there are many methodological issues around the Gini index, but it gives a rough idea of where the US stands.
There's a graph of the Gini index for various countries over time at https://en.wikipedia.org/wiki/File:Gini_since_WWII.svg. You'll see that the Gini index for the US has been increasing since the early 1980's and is now higher than all the countries on the graph except China, Brazil and Mexico. Changes initiated by the Reagan revolution have changed the socioeconomic situation in the United States dramatically.
Curiously, while high percentages of people of people are negative about the economy right now, and feel we are going in the wrong direction, the vast majority are positive about their own prospects. There is also a recent poll, asking people if they were "living the American Dream, or had good prospects to in the near future." Public perception is strange
Using GDP is tricky, and I am not sure they were appropriately used. Part of GDP growth simply reflects a growing population through kids growing up, and immigration, another part is productivity improvement from newer less expensive ways to do things. When looking at an economic activity measure, that might be compared to worker wages, the productivity measure is the one to use., because the income is a per worker measure.
From after WW II, when the playing field had been leveled by federal legislation, and the National Guard was no longer used on strikers, productivity gains, long buses with one driver, automated toll stations, huge coal mining machines, CAD systems for architects and computer logic, were split equally between worker wages and owners. Part of the Reagan Administration agenda was breaking labor unions, done partly by conning non union people, that labor unions were ripping them off. The fact was that union contracts set the standard for similar companies in the same industry, and/or the same type of worker. The recent decades since, have a dramatic shift with worker wages getting a very small share.
Finally, I like to say that the top 0.01% gives the whole top 1% a bad name. Most of the top 1% more like the 9% below it, being just families of two professionals, with bachelors or masters degrees, being teachers, professors, IT Professionals, lawyers (most make less than you think), family practice doctors, Nurse practitioners, Physicians Assistants etc.
Thanks for your comments. A few thoughts:
- Worker power has declined a lot since the Reagan revolution, as you've described. I wrote about this in terms of how the benefits of productivity increases have been shared in a previous post. See https://www.winwindemocracy.org/i/54189361/declining-worker-power. There's a compelling graph that shows how productivity and compensation growth tracked each other closely for decades and then started to diverge starting in the early 1980's, widening more and more over time, with productivity increasing almost 61.8% from 1979 to 2020, but compensation increasing only 17.5%.
- Yes, population growth can be one factor driving GDP growth. But that same population growth can also mean that the benefits of the GDP growth are distributed among a larger population. In this particular case, all of the numbers are pointing at the same thing: something big happened in our economy as a result of the Reagan revolution.
- In Matthew Stewart's Atlantic article that I mentioned, he argues that the 9.9% (i.e., the top 10% less the .1% at the very top) are the one's causing many of society's ills.
So interesting….
Are there any societies in the history of the world that do not perpetuate the ‘have and have not’ socioeconomic mode?
Maybe in small pockets like a Kibbutz?
I'm not aware of any societies that don't eventually have some degree of "have and have not". Even societies that have professed to behave that way -- for example, communist countries -- are not that way in fact. There may be some small, isolated societies that aren't "have and have not" to some degree, but, if so, I don't know of them.
That said, there are many modern economies where wealth/income is distributed much more equally than in the United States. There is a number, called the Gini index, that purports to measure how much unequal distribution there is, with 0 being that everyone has the same and 100 being that one person has everything and the rest have nothing. Of course, one number can't capture the full situation and there are many methodological issues around the Gini index, but it gives a rough idea of where the US stands.
There's a graph of the Gini index for various countries over time at https://en.wikipedia.org/wiki/File:Gini_since_WWII.svg. You'll see that the Gini index for the US has been increasing since the early 1980's and is now higher than all the countries on the graph except China, Brazil and Mexico. Changes initiated by the Reagan revolution have changed the socioeconomic situation in the United States dramatically.