Blog Entries: 3

Comparing Today to the 1960

I wish to compare today's income to the 1960s. I wan't to do this both because we currently have a thread going on with regards the effects of income inequality:

and because of an article I read a while back that I found particularly offensive.
Why Economics Can't Explain Our Cultural Divide
Even during upturns, blue-collar Americans are marrying and working less, writes Charles Murray

I also found a quote from the above offensive article in the income inequality thread.

I wish to begin by consider an article I posted in the above thread. Ironically, I got a response saying that income inequality is something we don't need to prove. This is roughly true but aside for the top 1%, top .1% etc. the picture isn't as clear. More importantly there are some question about how the general living standards compare and it is argued in the above thread by "Rus" that absolute well-being is more important then relative. If we need more evidence about that doubt exists as to the general well-being of america have a look at:

http://www.opednews.com/articles/Whi...120505-36.html

So let us begin.

Well, the government gathers inflation statistics, if we doubt these these statistics we can look for historical evidences of prices and judge for our self if the results our reasonable. Here is a table comparing the budget for an average houshold between now and the 1960s

Code:
   Yearly Expenses per Average Household
Category              1960     1960Today     2008
Food                 $1,681$11,681     $11,058 General Household$2,491     $17,314$24,305
Transportation       $759$  5,277    $9,601 Health Insurance$  107     $741$13,968
Federal Taxes        $1,884$13,096     $21,138 State & Local Taxes$  767     $5,331$12,637
Total Expenses       $7,689$53,440     \$92,707
http://www.clearpictureonline.com/1960-Summary.html

The CPI was used to compare 1960 prices to today but I believe the actually prices may have been independently gathered. We should compare these numbers to the average weights used by the CPI for each type of good:
http://www.bls.gov/cpi/cpit01test1111.htm

The CPI does not include tax. Perhaps this is the first thing we should look at. Does the above table accurately reflect the relative tax burden differences between today and the 1960s?

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 Blog Entries: 3 As a side note, I am using 1960 because that is what I have numbers for and that is the year mentioned in the article but 1965 might be a better comparison because according to the first graph from: http://www.stanford.edu/class/polisc...d%20Income.pdf real median household incomes were rising up until 1965.

Recognitions:
Gold Member

Comparing Today to the 1960

In the 60's, a young man (like me) growing up in Seattle could expect:
- to get a job at Boeing or Fisher Mills
- buy a home on a street with sidewalks
- marry a stay-at-home wife
- raise two kids
- own a muscle car
- afford a cabin in the mountains or beach

Now that is no longer true - not even remotely.

Respectfully submitted,
Steve

 Recognitions: Gold Member From my position I view today's income inequality and wealth inequality both as real; there's no need to prove the inequalities exist, and the USA has the highest of all the democratic countries. Now, the causes of these can be debated and are being argued in that "other thread". But there is a more basic dilemma: Do these inequalities need fixing? Some say no, the massive unequal distribution of income and wealth are a natural result of our capitalist system and nothing needs be done. Furthermore, we should "stop whining like those OWS folks and lazy males mooching off their parents." Others, like myself, claim that this lopsided distribution of income and wealth, along with other results are abberations and dangerous to our very survival as a nation. So, let digest some statistics regarding this dilemma from Wikipedia: "However, as of 2012 several surveys of voters attitudes toward growing income inequality found the issue ranked less important than other economic issues such as growth and equality of opportunity, and relatively low in affecting voters "personally". [205][206] In 1998 a Gallup poll found 52% of Americans agreeing that the gap between rich and the poor was a problem that needed to be fixed, while 45% regarded it as "an acceptable part of the economic system". In 2011, those numbers are reversed: Only 45% see the gap as in need of fixing, while 52% do not. However, there was a large difference between Democrats and Republicans, with 71% of Democrats calling for a fix.[204] In contrast, a national survey by the Pew Research Center for the People & the Press,[207] found that respondents' sense of unfairness about taxes centered on the perception that wealthy Americans were not paying their fair share of taxes; 57% say this is what bothers them most about the tax system, an increase of 6% over a poll taken in March 2003.[208] A more recent poll found about two-thirds of Americans now believe there are "strong conflicts" between rich and poor in the United States.[209][210] http://en.wikipedia.org/wiki/Income_..._United_States Note: I also found the article by Charles Murray offensive. Many folks there at The American Enterprise Institute, where he hails from, often called "neoconservative", but the institute itself always waves the "We are not neocons" flag.
 Mentor I wish pollsters put more effort into measuring people's understanding of reality against their perceptions.

 Quote by Pkruse WWII put the United States in a very excellent economic position because we had 85% of the worlds surviving production infrastructure. Everyone else was bombed out.
Thats a very good point I've never thought of that before.

 Quote by Bobbywhy From my position I view today's income inequality and wealth inequality both as real; there's no need to prove the inequalities exist, and the USA has the highest of all the democratic countries. Now, the causes of these can be debated and are being argued in that "other thread".
Actually there are democratic countries with higher level of inequality than the US:
http://en.wikipedia.org/wiki/List_of...ncome_equality

(that's not an ideological statement from my side in any direction and merely data check)

 Quote by John Creighto and because of an article I read a while back that I found particularly offensive.
By occasion - what did you find offensive in that article? The only thing I think could be easily challenged from that article that I can find is the idea of trying to blame traces of welfare state as responsible for all undesirable social changes.

 "Actually there are democratic countries with higher level of inequality than the US" Well, after transfer payments, not so much, so long as we're talking about being developed as well as democratic. They all tend to fall down on one or the other. Argentina, maybe. Many are nominal democracies but are really oligarchies. But does the US itself even count as a democratic country anymore? After two stolen presidential elections, hackable blackbox voting machines everywhere, a duopoly of parties that puts pro-wrestling style fake conflict out front but whose policies agree on nearly everything, (whatever popular opinion might actually be), and an electorate more pliant to the corporate oligarchy-controlled mass media than any Goebbels could have dreamed of - I'd have to say for practical purposes, no, the US is no longer a democratic country. It isn't even a nation of laws anymore - we have secret laws, secret interpretations, secret prisons, unlimited executive power. In large part this is because money has become the ultimate power that can buy public opinion, buy Congress, buy the President and the other powers in the government, and even buy more money from the government. And that money and power is in fewer and fewer hands every year.

 Quote by EWH "Actually there are democratic countries with higher level of inequality than the US" Well, after transfer payments, not so much, so long as we're talking about being developed as well as democratic. They all tend to fall down on one or the other. Argentina, maybe.
Bigger ones: South Africa, Brazil, Philippines, Argentina. However, I was very surprised when I learned recently that the US has higher gini coefficient than the whole EU. (odd because there were also new rather poor post-communism members)

 Many are nominal democracies but are really oligarchies. But does the US itself even count as a democratic country anymore? After two stolen presidential elections, hackable blackbox voting machines everywhere, a duopoly of parties that puts pro-wrestling style fake conflict out front but whose policies agree on nearly everything, (whatever popular opinion might actually be), and an electorate more pliant to the corporate oligarchy-controlled mass media than any Goebbels could have dreamed of - I'd have to say for practical purposes, no, the US is no longer a democratic country.
If you claim so, then you made a mistake by wanting to compare it with democratic countries? ;)

I read a few years ago that in Sweden tried to cure depression by sending people to Saint Petersburg for a while. They were coming back in a much better mood and were happier because started using as reference point not their country, but Russia.
You know, maybe you would benefit from a trip (maybe as volunteer in a charity organization, you seem somewhat idealistic) to a less develop country to learn how outher countries work? I'm almost sure that you would place your opinion about your country in more optimistic way.

 I have traveled quite a bit. I have been all over the US, Mexico, and most of western Europe. I have lived a few months in Costa Rica and Greece. My fourth passport is halfway to expiration. I have lived in eight or ten distinct regions of the US, depending how you count West / Central / East Texas. I have lived in travel trailers in Texas and Georgia, but also mansions in Georgia and Maryland and an elite boarding school in New England. A few months ago I went on a trip through Birmingham, Alabama and on into small towns in northern Alabama, then back to south-west Georgia. The economic devastation there is beyond anything I have seen abroad. I'd have to go to Fallujah or the West Bank to find something much worse, and I don't think it would cheer me up. Edit: This is relevant, and it cheered me up: Pearls Before Swine: Moving Abroad