I say there should be no future medical costs crisis — if what is happening is properly understood. If the houses we live in were expected to expand faster than our incomes will expand, then, we would have no trouble figuring out we have to cut someplace else.
Medical care will increase, thank God, because it will provide more treatments for more diseases all the time (which I appreciate more at 68 years old).
Trick that keeps us from intuitively understanding this is that — as AVERAGE income continues to expand — the median wage can expect to continue to stagnate — for 40 years now (since 1973).
Ditto for other future crises: social security retirement should be easily covered by average income doubling twice as fast as overall population — but the incomes of those who pay into the tax keep up with average income growth only at the 90 percentile level which is where the tax cuts off.
Can anybody here tell me another way to straighten these messes and most other messes — crime, under performing ghetto schools (on the street research shows the schools don’t work because work wont pay enough to make effort worth while after poor students graduate), nobody, no lobbyists, are minding the store for the average person in the legislatures (David Broder recalls that when he came to D.C. most of the lobbyists were labor unionists) …
… any other way than instituting in America the over half century and around the world proved, successful labor market balancer (and political muscle balancer): legally mandated, sector-wide collective bargaining?
Airline and supermarket employees would kill for sector-wide contracts. Just a matter of opening our mouths and telling them about it — hottest political pancakes ever to fly out the door.
but i think the big problem labor organizers have is that they ship the jobs to china when they can and fire the labor organizers when they can’t.
meanwhile those at the top are either sold out or sincerely believe that the way of the future is to privatize everything.
i’d feel better about this if at least the “defenders of Social Security” understood how (and why) the program works.
they want universal welfare, but they have no idea how to get it (you can’t get there from here) and meanwhile they fail utterly to defend Social Security (which works, and will work as long as workers are making at least enough to live and to save at least enough to live when they can’t work).
“Trick that keeps us from intuitively understanding this is that — as AVERAGE income continues to expand — the median wage can expect to continue to stagnate — for 40 years now (since 1973).”
Hmmm???? Denis, would you care to expand upon that thought? It seems a bit of an oxymoron of a phrase.
Maybe we should all start to recognize that the crux of the economic issue for all of those below the income levels of the top quintile is that income is grossly skewed to that upper sector. More for less, a good gig if one can get it. And the distortion only increases as the size of the top percentile group is reduced. When the median family income is in the $30,000 annually range what else can be expected to work our well for the majority of Americans. For those who are statistically unknowing the median is the middle score. Fifty percent of working families are earning $30,000 or less. Try living on that and raising a kid or two in the process.
Drew, I like your thinking but it I suspect you first need to figure out how to turn a bunch of those red (i.e., non-urban) congressional districts into blue ones that will support more liberal politicians and policies, including your ideas. Not so easy, but not impossible–after all, we had a Speaker Pelosi not so long ago. For 2014, should the Dem infrastructure investment sales pitch feature many small-town renewal programs? Should Dems promote favoritism for local banks and businesses, versus big-city corporations? What might attract these districts’ voters, rather than ever-larger majorities in urban districts?
coberly, I have a sort of smoke and mirrors thing in mind. Oakland’s female mayor is heavy into a crime crisis — what to do: policing, education, what? I am thinking of sending her an open letter describing how doubling the federal minimum wage would only add 4% direct inflation and pretty much close up gangs. (See http://ontodayspagelinks.blogspot.com/2008/08/3-cost-of-gdp-output-and-inflation.html ).
I don’t expect her to take a washed up cab driver’s word. I will ask her to ask the Berkeley (progressive!) economic faculty up the road. My California driver’s license says I live about half way up the road from City Hall to the campus — so I figure I’m a townee.
I will ask her to ask them about sector-wide labor agreements also. I will try to explain to her that they have all the answers but they wont tell anybody (unless maybe asked). I will try to explain my take that being mostly male they are trapped by their primitive PACK hunter instinct and cannot be expected to say the words “sector-wide contracts” out loud unless the PACK is already discussing it — feeling childishly helpless to raise anything new in a PACK or 300,000,000 when their primitive instincts are for a pack only large enough to trap and kill small animals (or something like that :-]). As a female her primitive instinct as a SINGLE gatherer allows her to THINK FOR HERSELF — so I don’t expect her to dismiss these two themes out of hand just because nobody else ever talks about it.
Half the gang age, minority males in Chicago (100,000!) are in gangs. What do we expect when the minimum wage is $3.25 below what it was in 1968; $1.25 below 1956 (thank you LBJ for both and for including retail workers by 1968).
If we ever get these guys talking out loud about the most obvious and easiest roads back to a normal America, everybody will jump for it. From my family doctor to the cab driver next door, everybody is shocked to find out about the minimum wage sink hole and interested in sector-wide collective bargaining (WalMart closed 88 big boxes in Germany I tell them because they couldn’t make it paying as much as everybody else). Just got to get it before the people some way.
Jack, Below this post is a five year old blog post of mine that I sent to an NYT writer this morning. It describes a realistic poverty line for a family of three: $49,500! As I described to coberly above, I think the biggest problem getting simple sense across to our progressive “leaders” is that they wont move until everybody else moves first. For a long time I was frustrated looking at the ever more foolish federal poverty line as it fell further and further behind reality but nobody would stop quoting the foolish 12.5%, based on 3X the price of an emergency diet (dried beans only, no expensive canned), nothing else at all. When I emailed “everybody in the world” a more realistic 30% (not counting the food stamp kind of thing — just like the federal measure) the 12.5% seemed to disappear; too big a difference to ignore I guess.
Approaching 37% of American families are below a more up-to-date poverty line? ***********
The 50 percentile American family income in 2005 was $56,277 (mean third-quintile in the Census tables).
“Minimum needs” (table 3-2) on p.44 of the 2001 book Raise the Floor maps out a very plausible poverty line for a family of three at $31,111 in 2005 dollars — assuming that health care is otherwise paid for . Add $11,000 to purchase a family health plan and this plausible poverty line rises to $42,111 for a family of three (three years ago — $49,505 in 2012 **). The “Raise” minimum needs line is computed by totaling up a comprehensive list of actual needs — does not parrot the half-century old federal formula that simply multiplies three times the cost of an emergency food budget (dried beans only; no expensive canned).
(“Raise” provides extensive explanations for its minimum needs parameters in Appendix B — its tables cite Solutions for Progress. Average family size is 3.13 persons.)
The difference between second and third quintile average family incomes ($35,000 and $56,000) runs roughly $1,000/percentile. So, adding $7,000 to $35,000 (the 30 percentile mark) gets us to $42,000: and demarks 37%* of American families as below minimum needs, at least without food stamps and other helps. Assuming that all families were covered by comprehensive health insurance would still leave 26% of families on the south side of “Raise’s” minimum needs line without helps. I do not know how many of those families between 26% and 37% are covered or by how much.
However perfectly accurate “Raise’s” tables may or may not be, our media continue to report the decades old, mis-measured official federal poverty line of 12.5% without qualification; which is like the press of Columbus’ era repeating without comment that the world is flat: it makes no waves; but informed folks know better. 🙂
PJR, Like I said to coberly, one and all seem shocked and amazed to find out the federal minimum wage has dropped more than three dollars since 1968 while average income has about doubled. Everyone seems intrigued by the common sense of legally mandated, sector-wide labor contracts where everybody doing the same job in the same geographic locale (where applicable) work under on contract with all firms.
A couple of years back Northwest Airlines squeezed a billion dollars in givebacks out of flight crews; the next year it gave a billion in bonuses to a thousand managers. That kind of gouging can only be prevented by sector-wide contracts; no other way.
Sector-wide started out, after WWII, in Germany and other war torn European countries to hold off unions from a race to the top (each wanting more because the other guy got more) so more money could go into rebuilding. Europe’s fabled welfare state was actually a compensation for accepting sector-wide contracts.
Sector-wide contracts are done in continental Europe (not England which is why it fell behind according to Berkeley’s Barry Eichengreen’s “The European Economy since 1945.” They are in use from Argentina to Indonesia to French Canada right next door — shouldn’t be too hard to check out Canada’s version.
Jack, I think 90-97 percentile incomes have just kept pace with average income growth since 1973 (the year growth began to go all to the top) — so that segment have nothing to lose by everybody else getting their share. I think the next couple of points up haven’t gotten anything that much out of proportion. It’s all the top one percent that’s been getting all the excess income, so politically there shouldn’t be too much opposition, in vote numbers anyway, to straightening things out.
I think $30,000 is the median wage (if that much — it may have fallen — up from $25,000 in 1968). Which means that the median wage is what the minimum wage could easily be — pretty shocking, BUT NOBODY EVEN KNOWS.
Another example of nobody knows (which is what drives me crazier than anything — if Americans only knew what was happening to them): New York’s police and firefighters would have, you would think, a super strong union. From 1973 until a recent year average income grew two-thirds. During that time their unions got inflation raises only. And they like most Americans don’t even know it happened to them. Pathetic.
I say there should be no future medical costs crisis — if what is happening is properly understood. If the houses we live in were expected to expand faster than our incomes will expand, then, we would have no trouble figuring out we have to cut someplace else.
Medical care will increase, thank God, because it will provide more treatments for more diseases all the time (which I appreciate more at 68 years old).
Trick that keeps us from intuitively understanding this is that — as AVERAGE income continues to expand — the median wage can expect to continue to stagnate — for 40 years now (since 1973).
Ditto for other future crises: social security retirement should be easily covered by average income doubling twice as fast as overall population — but the incomes of those who pay into the tax keep up with average income growth only at the 90 percentile level which is where the tax cuts off.
Can anybody here tell me another way to straighten these messes and most other messes — crime, under performing ghetto schools (on the street research shows the schools don’t work because work wont pay enough to make effort worth while after poor students graduate), nobody, no lobbyists, are minding the store for the average person in the legislatures (David Broder recalls that when he came to D.C. most of the lobbyists were labor unionists) …
… any other way than instituting in America the over half century and around the world proved, successful labor market balancer (and political muscle balancer): legally mandated, sector-wide collective bargaining?
Airline and supermarket employees would kill for sector-wide contracts. Just a matter of opening our mouths and telling them about it — hottest political pancakes ever to fly out the door.
denis
it’s up to you then.
but i think the big problem labor organizers have is that they ship the jobs to china when they can and fire the labor organizers when they can’t.
meanwhile those at the top are either sold out or sincerely believe that the way of the future is to privatize everything.
i’d feel better about this if at least the “defenders of
Social Security” understood how (and why) the program works.
they want universal welfare, but they have no idea how to get it (you can’t get there from here) and meanwhile they fail utterly to defend Social Security (which works, and will work as long as workers are making at least enough to live and to save at least enough to live when they can’t work).
“Trick that keeps us from intuitively understanding this is that — as AVERAGE income continues to expand — the median wage can expect to continue to stagnate — for 40 years now (since 1973).”
Hmmm???? Denis, would you care to expand upon that thought? It seems a bit of an oxymoron of a phrase.
Maybe we should all start to recognize that the crux of the economic issue for all of those below the income levels of the top quintile is that income is grossly skewed to that upper sector. More for less, a good gig if one can get it. And the distortion only increases as the size of the top percentile group is reduced. When the median family income is in the $30,000 annually range what else can be expected to work our well for the majority of Americans. For those who are statistically unknowing the median is the middle score. Fifty percent of working families are earning $30,000 or less. Try living on that and raising a kid or two in the process.
Drew, I like your thinking but it I suspect you first need to figure out how to turn a bunch of those red (i.e., non-urban) congressional districts into blue ones that will support more liberal politicians and policies, including your ideas. Not so easy, but not impossible–after all, we had a Speaker Pelosi not so long ago. For 2014, should the Dem infrastructure investment sales pitch feature many small-town renewal programs? Should Dems promote favoritism for local banks and businesses, versus big-city corporations? What might attract these districts’ voters, rather than ever-larger majorities in urban districts?
coberly,
I have a sort of smoke and mirrors thing in mind. Oakland’s female mayor is heavy into a crime crisis — what to do: policing, education, what? I am thinking of sending her an open letter describing how doubling the federal minimum wage would only add 4% direct inflation and pretty much close up gangs. (See http://ontodayspagelinks.blogspot.com/2008/08/3-cost-of-gdp-output-and-inflation.html ).
I don’t expect her to take a washed up cab driver’s word. I will ask her to ask the Berkeley (progressive!) economic faculty up the road. My California driver’s license says I live about half way up the road from City Hall to the campus — so I figure I’m a townee.
I will ask her to ask them about sector-wide labor agreements also. I will try to explain to her that they have all the answers but they wont tell anybody (unless maybe asked). I will try to explain my take that being mostly male they are trapped by their primitive PACK hunter instinct and cannot be expected to say the words “sector-wide contracts” out loud unless the PACK is already discussing it — feeling childishly helpless to raise anything new in a PACK or 300,000,000 when their primitive instincts are for a pack only large enough to trap and kill small animals (or something like that :-]). As a female her primitive instinct as a SINGLE gatherer allows her to THINK FOR HERSELF — so I don’t expect her to dismiss these two themes out of hand just because nobody else ever talks about it.
Half the gang age, minority males in Chicago (100,000!) are in gangs. What do we expect when the minimum wage is $3.25 below what it was in 1968; $1.25 below 1956 (thank you LBJ for both and for including retail workers by 1968).
If we ever get these guys talking out loud about the most obvious and easiest roads back to a normal America, everybody will jump for it. From my family doctor to the cab driver next door, everybody is shocked to find out about the minimum wage sink hole and interested in sector-wide collective bargaining (WalMart closed 88 big boxes in Germany I tell them because they couldn’t make it paying as much as everybody else). Just got to get it before the people some way.
Jack,
Below this post is a five year old blog post of mine that I sent to an NYT writer this morning. It describes a realistic poverty line for a family of three: $49,500! As I described to coberly above, I think the biggest problem getting simple sense across to our progressive “leaders” is that they wont move until everybody else moves first. For a long time I was frustrated looking at the ever more foolish federal poverty line as it fell further and further behind reality but nobody would stop quoting the foolish 12.5%, based on 3X the price of an emergency diet (dried beans only, no expensive canned), nothing else at all. When I emailed “everybody in the world” a more realistic 30% (not counting the food stamp kind of thing — just like the federal measure) the 12.5% seemed to disappear; too big a difference to ignore I guess.
Approaching 37% of American families are below a more up-to-date poverty line?
***********
The 50 percentile American family income in 2005 was $56,277 (mean third-quintile in the Census tables).
“Minimum needs” (table 3-2) on p.44 of the 2001 book Raise the Floor maps out a very plausible poverty line for a family of three at $31,111 in 2005 dollars — assuming that health care is otherwise paid for . Add $11,000 to purchase a family health plan and this plausible poverty line rises to $42,111 for a family of three (three years ago — $49,505 in 2012 **). The “Raise” minimum needs line is computed by totaling up a comprehensive list of actual needs — does not parrot the half-century old federal formula that simply multiplies three times the cost of an emergency food budget (dried beans only; no expensive canned).
(“Raise” provides extensive explanations for its minimum needs parameters in Appendix B — its tables cite Solutions for Progress. Average family size is 3.13 persons.)
The difference between second and third quintile average family incomes ($35,000 and $56,000) runs roughly $1,000/percentile. So, adding $7,000 to $35,000 (the 30 percentile mark) gets us to $42,000: and demarks 37%* of American families as below minimum needs, at least without food stamps and other helps. Assuming that all families were covered by comprehensive health insurance would still leave 26% of families on the south side of “Raise’s” minimum needs line without helps. I do not know how many of those families between 26% and 37% are covered or by how much.
However perfectly accurate “Raise’s” tables may or may not be, our media continue to report the decades old, mis-measured official federal poverty line of 12.5% without qualification; which is like the press of Columbus’ era repeating without comment that the world is flat: it makes no waves; but informed folks know better. 🙂
[* “Raise’s” tables allot $3,000 to yearly medical expenses for a family of three even if insured.]
[** http://data.bls.gov/cgi-bin/cpicalc.pl?cost1=42%2C111.00&year1=2005&year2=2012 ]
PJR,
Like I said to coberly, one and all seem shocked and amazed to find out the federal minimum wage has dropped more than three dollars since 1968 while average income has about doubled. Everyone seems intrigued by the common sense of legally mandated, sector-wide labor contracts where everybody doing the same job in the same geographic locale (where applicable) work under on contract with all firms.
A couple of years back Northwest Airlines squeezed a billion dollars in givebacks out of flight crews; the next year it gave a billion in bonuses to a thousand managers. That kind of gouging can only be prevented by sector-wide contracts; no other way.
Sector-wide started out, after WWII, in Germany and other war torn European countries to hold off unions from a race to the top (each wanting more because the other guy got more) so more money could go into rebuilding. Europe’s fabled welfare state was actually a compensation for accepting sector-wide contracts.
Sector-wide contracts are done in continental Europe (not England which is why it fell behind according to Berkeley’s Barry Eichengreen’s “The European Economy since 1945.” They are in use from Argentina to Indonesia to French Canada right next door — shouldn’t be too hard to check out Canada’s version.
Jack,
I think 90-97 percentile incomes have just kept pace with average income growth since 1973 (the year growth began to go all to the top) — so that segment have nothing to lose by everybody else getting their share. I think the next couple of points up haven’t gotten anything that much out of proportion. It’s all the top one percent that’s been getting all the excess income, so politically there shouldn’t be too much opposition, in vote numbers anyway, to straightening things out.
I think $30,000 is the median wage (if that much — it may have fallen — up from $25,000 in 1968). Which means that the median wage is what the minimum wage could easily be — pretty shocking, BUT NOBODY EVEN KNOWS.
Another example of nobody knows (which is what drives me crazier than anything — if Americans only knew what was happening to them): New York’s police and firefighters would have, you would think, a super strong union. From 1973 until a recent year average income grew two-thirds. During that time their unions got inflation raises only. And they like most Americans don’t even know it happened to them. Pathetic.
Denis
i am on your side. but you still have to tell the people.