There’s another huge factor you’re forgetting in the housing cost comparison - square footage. I would think it’s a very significant change when you’re talking about the median single family home. Probably not nearly as much of a change for apartments, but still some sort of change in the upward direction.
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The entire point of discussion of this thread has changed nearly 20 times. I’m sorry, but you don’t get to dictate the entire point of discussion of income inequality. This is another reason I addressed my post to Full Disclosure and not you. You have your narrow discussion points and I get tired to rehashing them because the topic of income inequality is an extremely nuanced topic with lots of subtopics. There has been a lot of ink spilled on the topic in the past few years. Forgive me if I don’t care if you want to talk about only one aspect.
You’re drawing a completely arbitrary line when it comes to country comparisons, which is just as meaningless and nonsensical as my comparisons.
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yeah I was actually just about to comment on that. Yes housing has gotten bigger over the decades.
There are though other ways that housing has gotten more expensive.
Property taxes go up along with the home costs. Assuming flat 1% property tax across the decades wed be spending ~1% more of our income on property tax as homeowners now vs in the 70’s.
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Not in regards to extreme income inequality in developed countries (except when I posted wealth inequality but meant income inequality on Dec 31st, but fixed it the next day. I plead extenuating party circumstances.). You’re the only one who went off the reservation with meaningless irrelevant nonsense.
Good grief. The idea that “developed” versus “non-developed” countries is “a completely arbitrary line” is laughable.
Nice failed try, but no cigar.
You don’t get what I’m trying to say, so I will say it a different way
Since you don’t think developed and non-developed should ever be talked about together, how about two non-developed countries compared?
I’m going to give you the Gini % for two countries at a similar stage of newly advanced economic development and you tell me which one has a higher percentage of people living in extreme poverty (on less than $1.90 cents a day).
Country A, 51.3% income inequality
Country B, 42.2% income inequality
Country A should be poorer than country B, right?
Spoiler alert, Country A is Brazil and has .5% of its population living in extreme poverty. Country B is China and has 1.9% of its population living in extreme poverty. So the country with the significantly smaller amount of income inequality has an extreme poverty rate 3.8 times higher than that of the country with the higher amount of income inequality.
Now do you see my point that talking about income inequality in an oversimplified manner can be pretty worthless?
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A terrible idea. The developed countries with no legal minimum wage have minimums set by collective bargaining agreements. Unfortunately, unions have been losing power in this country, which i think contributed to wage stagnation for blue collar jobs. No minimum wage here would mean slave labor and lots more people relying on federal and state benefits for income, food, healthcare, etc, which means higher taxes for everyone else.
I think another cause of most wealth going to the top is that only those with money can invest, and investments have performed very well. Partly because corporations only care about investors now instead of employees, and have shifted long-term pension obligations to basically private retirement funds (401k).
Maybe if we brought back unions and stopped corporations from treating employees like disposable cattle and only caring about investor profits, we’d get closer to solving both income inequality and wage stagnation.
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It has nothing whatsoever to do with what I “think”, rather that you’re attempting to make incompatible and irrelevant comparisons.
Which is meaningless. As jerosen already pointed out to you upthread, you’re conflating Poverty and Income Inequality. Again!
You still have no comprehension of the issue.
(Not to mention, if you believe any of the economic stats coming out of China, man have I got a lovely bridge you’ll want to purchase.)
Only if you have no comprehension of the issue.
Utilizing your form of thinking, you would contend that Rolls Royce must manufacture lousy cars because they only sold a little more than 4,000 in 2017, whereas Volkswagen must make fantastic cars because they sold more than 10 million in 2017.
The point is that you can’t compare a handmade hand-crafted automobile that takes more than six months to build, to just one VW plant that spits out 35 cars an hour.
Your attempt at comparisons are meaningless, irrational, and irrelevant.
Short term, it could have a negative effect on some people currently making minimum wage (MW) that would see their wage drop. But most MW jobs would likely remain at the same wage and employers would just add more jobs below the MW. Why is that important? Because we extremely underestimate the importance of a first job, at ANY wage. Very few (almost no one) stays at the MW, especially if they are able to work full time. 66% of people making MW are making more than MW a year later.
The people that I am concerned about are the millions that would be helped by adding another rung to the bottom of the ladder, specifically 16-24 year olds. The unemployment rate for that group was 9.6% in July 2017 (employment for that group peaks in July). The labor force participation rate was only 61%. In 1989, that number was 77%. The numbers are much more grim for minorities.
Abolishing the MW would allow employers to create more unskilled jobs - jobs that young people need because of their lack of qualifications. If you’re really concerned about people relying on benefits, you would want to make it easier for young people to get that first job. Without consistently being in the workforce, it’s extremely difficult to get yourself off the welfare rolls.
Brought back unions? Are you not going to admit why union membership has dropped so much over the past 50 years? It’s not like we actively abolished them. They did themselves in. Their ridiculous contracts that they were unwilling to renegotiate forced manufacturers to move more jobs overseas in order to compete.
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Interesting point. Maybe unions are the reason for income inequality in developed country’s?
You in post 842: Having one of the worst cases of income inequality in the developed world… increases Poverty.
Me in 846: I think other factors contribute more to… poverty numbers than income inequality does.
You in 849: According to what metric?
Me in 850: If you finish high school, get a job, and wait until at least 21 to get married THEN have kids, you are very unlikely to be poor. So in that sense, life choices are the biggest determining factor of poverty.
You in 852: In other words, you have no metric, you just wish your unsubstantiated belief is true. It’s not.
You in 928: Extreme income inequality stunts GDP, increases Poverty, and severely stifles economic mobility.
You in 930: Nambia, Botswana, and many many more of the nations you have offered-up are not developed countries.
Me in 932: I think it’s important to look at worldwide income inequality to get a proper picture of this issue.
You in 937: No, that is a completely meaningless and nonsensical comparison.
Me in 942: You’re drawing a completely arbitrary line when it comes to country comparisons.
You in 944: The idea that “developed” versus “non-developed” countries is “a completely arbitrary line” is laughable.
Me in 945: How about two non-developed countries compared? The country with the significantly smaller amount of income inequality has an extreme poverty rate 3.8 times higher than that of the country with the higher amount of income inequality.
You in 947: You’re conflating Poverty and Income Inequality. Again! The point is that you can’t compare a handmade hand-crafted automobile that takes more than six months to build, to just one VW plant that spits out 35 cars an hour.
You are the one that said extreme income inequalty increases poverty. I specifically said that there was more to poverty numbers than that. Then you REPEATED that extreme income inequality increases poverty with no mention of any of the other factors. If I am responding DIRECTLY to YOUR statement with data that doesn’t support YOUR statement, how am I the one conflating Poverty and Income Inequality?
I compared two counties, Brazil and China, that are at a similar stage of development to go along with YOUR statement that I shouldn’t compare developed to non-developed, so how am I now comparing Volkswagen to Rolls Royce?
And you say I can’t use economic stats coming out of China presumably because they overestimate their economic prosperity. If so, then my point is even stronger because that would mean that there are even more people in extreme poverty in China, the country with lower Income Inequality.
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If a decrease of blue collar union type manufacturing jobs helped increase income inequality, then unions absolutely had a hand in that. But things were trending in that direction anyway, so I wouldn’t put too much of it on the unions’ back. They just didn’t handle it well for their membership.
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Ask any economist without a political agenda (still got any of those?), and they’ll tell you it’s clear the minimum wage is a bad thing for both theoretical and practical reasons. The only reason it hasn’t messed up our economy much so far is that it has been so low.
More people with jobs is better than fewer, even if the jobs pay less. If the businesses pay out the same money, but to more people each getting less, your welfare or whatever should still give out the same only now it’s paying half to two sub-MW workers rather than nothing to the one lucky guy who’s overpaid at MW and got the job and 100% benefits to the unlucky guy who’s unemployed.
Having people sitting around with nothing to do on the dole creates bad social and cultural problems, both for themselves and others.
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Your assumption is that those sub-MW workers would still choose to work at those levels. If the government is just going to fill the gap with welfare most or all of the way anyway, it may no longer be worth it to them.
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There are a variety of reasons why union membership has declined over the decades.
Loss of manufacturing jobs is a big part of it. Manufacturing was a large base of union employment and our manufacturing jobs have dwindled over the years. $1/hr wages in China are impossible for US to compete with regardless of unionization. Many unions didn’t help themselves there either.
Unions have lost many legal battles at the federal and state level. We haven’t abolished them but a lot of people have tried hard to do so. 28 states are now right to work and 3 of those are newly minted in just the past 3 years. In the 40’s only 11 states were right to work. and it continues NH just killed a bill and OH is working on one.
Work has changed. Unions have mostly failed to adapt to a modern workforce. And the union model doesn’t fit the modern work environment.
Unions have just simply lost the battle to unionize on some fronts. Frankly I can’t see why a union couldn’t organize the employees of a Walmart or Home depot in someplace like here in Oregon.
Many of the rights, benefits and protections that unions fought for are now common. Things like 8 hour work days, sick leave, etc were stuff we didn’t used to have and fighting for that kind of stuff is a lot of what made unions popular in the first place. But now everyone has those rights and we don’t need unions to get them. [edit ok everyone doesn’t have sick leave]
A survivorship bias effect. When a unionized business goes under its not as if new businesses pop up all ready unionized.
Unions can make business less competitive. Obviously if a union wage is too large of a differential to non-union wages then a unionized business is going to be at a competitive disadvantage versus nonunion businesses.
Keep in mind that unions aren’t all the same just as businesses aren’t all the same. Some unions have done a lot better job than others just as some businesses operate better.
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in 1983 27% of manuf jobs were union and we had 16.7M jobs so thats 4.5M union manuf jobs
Today there are 12M jobs and only 9% are union for a total of 1M union manuf jobs.
Thats a net loss of 3.5M union manuf jobs.
In 83 there were 12M private secotr union members and now its 7.5M A total decline of 4.5M jobs
78% of the total decline in private sector union jobs were in the manufacturing industry.
ref:
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100% correct. This is a great point and one that many people miss when they argue that Walmart is able to stay in business because their employees can afford to work there only because they get welfare. It’s actually the opposite. Walmart (and low wage/low skill employers in general) are worse off because of welfare. Welfare shrinks the low skill employee market. There are millions of people unwilling to work a low wage job because it only marginally improves their overall standard of living. If they can have a very similar standard of living without working, why work? Since those millions aren’t looking for jobs, Walmart’s potential employee pool is shrunk. The less people that apply for that low wage/low skill job, the higher the wage the employer has to offer in order to fill it. That’s why we see so many low skill jobs right now actually starting at wages above the minimum.
So yeah, abolishing the minimum wage would be quite worthless without reforming low income benefits so that people are legitimately incentivized to work.
Do any of you remember the first hand story of that guy that posted on FWF about how he received certain benefits because of his disability? He came to FW because he wanted advice on how to get out from under that system and work and make a life for himself, but before making enough to support himself, he would lose his benefits and have no fallback if his disability acted up again. His life experience was the perfect example of the brokeness of our current welfare/disability assistance system.
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I’ve sometimes thought minimum wage and parts of welfare would be better if they were combined into a directly subsidized wage support system. This could be accomplished through a progressively negative tax and withholding rate on very low incomes.
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Was that the guy that had random medical attacks of some sort and couldn’t work steady reliably? Like he might be fine for a while but then have a random onset of his condition and not be able to work for a random period? IIRC he was on disability and other aid and felt trapped in it because if he got a job he’d have an attack then lose the job then be broke. Medical conditions like that are a lot harder to work around. I don’t think the lack of a safety net would have helped him.
Yes, $10.25/hr is more than $10/hr. It doesn’t mean that if you abandon MW, then the new worker hired at $5/hr would make $10.25/hr a year later. Plenty of service industry workers are at or near MW regardless of experience.
I’m actually not against a separate, lower-paying rung for younger workers. I would expect more younger workers to qualify for healthcare under their parents, consume less healthcare in general, possibly even file taxes as dependents, and therefore be less dependent on .the rest of us. But this does not require abolishing the minimum wage.
This is also not entirely true. I don’t know the history of unions well enough to argue, but I do know that they were “done in” at least in part by corporations and by labor laws that made them less relevant. Yes, there were cases of greed and corruption. Yes, globalization plays a significant role. But they’re doing just fine in Western Europe. I don’t know the solution, but I do know that employees are powerless as individuals. And what jerosen said above.
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Yes, that’s the guy.
If you read what I proposed as getting rid of the safety net, then you missed what I was trying to say.