The United States of Inequality

[Paratus]

A fairly fascinating piece from Slate on how the income distribution has changed over the last 100 years.

http://www.slate.com/id/2266025/entry/2266026/

We have now reviewed all possible causes of the Great Divergence—all, at least, that have thus far attracted most experts' attention. What are their relative contributions? Here is a back-of-the-envelope calculation, an admittedly crude composite of my discussions with and reading of the various economists and political scientists cited thus far:

Race and gender are responsible for none of it, and single parenthood is responsible for virtually none of it.

Immigration is responsible for 5 percent.

The imagined uniqueness of computers as a transformative technology is responsible for none of it.

Tax policy is responsible for 5 percent.

The decline of labor is responsible for 20 percent.

Trade is responsible for 10 percent.

Wall Street and corporate boards' pampering of the Stinking Rich is responsible for 30 percent.

Various failures in our education system are responsible for 30 percent.

I'm sure some will say the guy is flaming commie liberal or possibly a raging teabagger but he does assess many of the talking points of both sides of the issue.

 

[dmcowen674]

A fairly fascinating piece from Slate on how the income distribution has changed over the last 100 years.

http://www.slate.com/id/2266025/entry/2266026/



I'm sure some will say the guy is flaming commie liberal or possibly a raging teabagger but he does assess many of the talking points of both sides of the issue.

Negative

It's simply the rich fault.

 

[Moonbeam]

Of course is somebody is at fault there will never be a cure. Folk will only spend time in denial and covering their asses. Unless we can take the blame out of this and see we are in deep and serious danger, nothing productive will be done about it in my opinion.

Once that toilet gets up enough swirl, you kind of know where you're going.

 

[EagleKeeper]

Negative

It's simply the rich fault.

Define rich

 

[Anarchist420]

It's the government's fault for intervening in the economy too much. Mostly corporate welfare.

 

[Paratus]

He's wrapping the series up today or Monday so I'm interested to see what his final opinion is.

 

[BoberFett]

Define rich

Anybody who can afford $5/gal gasoline.

 

[irishScott]

Anybody who can afford $5/gal gasoline.

lol this. Anyone who buys the "supreme" option at the gas station. If you're doing it because the owners manual says it's best for the engine, chances are you just proved my point anyway.

Seriously, outside of the people who own high performance sports cars, who buys the non-regular grade gas anyway? Seems like a waste of money IMO.

 

[BoberFett]

lol this. Anyone who buys the "supreme" option at the gas station. If you're doing it because the owners manual says it's best for the engine, chances are you just proved my point anyway.

Seriously, outside of the people who own high performance sports cars, who buys the non-regular grade gas anyway? Seems like a waste of money IMO.

Whoosh? I was making a joke at Dave's expense.

I put premium in my car, the Ford Modular just runs better on premium.

 

[soulcougher73]

Define rich

If you need it defined you aint it

Or:
Rich (r

ch), Adrienne Born 1929. American poet and essayist whose works, notably Diving Into the Wreck (1973), concern radical feminism, lesbianism, and political activism.


rich (r

ch) adj. rich·er, rich·est 1. Possessing great material wealth: "Now that he was rich he was not thought ignorant any more, but simply eccentric" (Mavis Gallant).
2. Having great worth or value: a rich harvest of grain.
3. Magnificent; sumptuous: a rich brocade.
4. a. Having an abundant supply: rich in ideas.
b. Abounding, especially in natural resources: rich land.

5. Meaningful and significant: "a rich sense of the transaction between writer and reader" (William Zinsser).
6. Very productive and therefore financially profitable: rich seams of coal.
7. a. Containing a large amount of choice ingredients, such as butter, sugar, or eggs, and therefore unusually heavy or sweet: a rich dessert.
b. Having or exuding a strong or pungent aroma: "Texas air is so rich you can nourish off it like it was food" (Edna Ferber).

8. a. Pleasantly full and mellow: a rich tenor voice.
b. Warm and strong in color: a rich brown velvet.

9. Containing a large proportion of fuel to air: a rich gas mixture.
10. Informal Highly amusing.

n. (used with a pl. verb) Wealthy people considered as a group. Often used with the: "Were there, indeed, a sure appeal to the mercies of the rich, the calamities of the poor might be less intolerable" (Charlotte Smith).

 

[irishScott]

Whoosh? I was making a joke at Dave's expense.

I put premium in my car, the Ford Modular just runs better on premium.

No doubt, but from a monetary standpoint is it really necessary? Unless the engine is specifically designed to take the higher grade stuff (read: regular would damage it) I fail to see the point.

Point is I see buying that stuff as a sign of wealth, doubly so if you have a car that requires it. Definitely something you can afford to live without, but then again there are people on welfare with cable TV.

 

[bfdd]

lol this. Anyone who buys the "supreme" option at the gas station. If you're doing it because the owners manual says it's best for the engine, chances are you just proved my point anyway.

Seriously, outside of the people who own high performance sports cars, who buys the non-regular grade gas anyway? Seems like a waste of money IMO.

Most people don't know what an octane rating indicates or even what the fuck octane means. I simply ask my friends if they have a high compression motor and if they say 'what's a high compression motor' I tell them to put in regular.

 

[woolfe9999]

The octane of gas and definition of "rich" aside, the linked article is very worth reading.

- wolf

 

[AreaCode707]

In 1915, King wrote, "It is easy to find a man in almost any line of employment who is twice as efficient as another employee,"
but it is very rare to find one who is ten times as efficient. It is common, however, to see one man possessing not ten times but a thousand times the wealth of his neighbor."

It's absolutely easy to find someone who's ten times as efficient as a coworker, even in the same job. Half the people I've worked with in the past should by all rights be fired if proper ways of measuring efficiency are ever put into place.

As far as someone possessing a thousand times the wealth of another, it seems to hint at the argument, "how can one person's time be worth a million dollars a day and another person's only $70?" The fact is though, it is both possible and true. Sorry, but Bill Gates has done more for this country's economy in a day than most of us will in a lifetime. It is absolutely possible for certain people to be financially worth a thousand times more than another.

The problem is identifying those people properly. When we don't, we get Enron, the car companies, the securities industry... When we do, we get Buffet, Gates, Ellison and others. Some may be arseholes but they employ a measurable portion of Anandtech and the rest of the country. Their creative and organizational force has reaped them the rewards they received.

 

[Zebo]

The war of who profits off your labors will never end. Someone always feels like they are getting the shaft. You think I like paying people $12-$18 an hour add about $8-$12 on top of that for administration, taxes, insurances, etc. You think they like making $12 an hour? Basically I feel workers are stupid and accept less is why they make what they do. You truly are paid what you are worth.

 

[bfdd]

The war of who profits off your labors will never end. Someone always feels like they are getting the shaft. You think I like paying people $12-$18 an hour add about $8-$12 on top of that for administration, taxes, insurances, etc. You think they like making $12 an hour? Basically I feel workers are stupid and accept less is why they make what they do. You truly are paid what you are worth.

I remember a contractor I worked for basically had to pay my 22 an hour wage, plus another 12 or 15 on top for my TWO retirement plans, health insurance, etc(I was union so we got a lot of perks). So it came out to like the high 30's for me, but they would charge around 55-60 an hour for my services. They really should of only been charging 45-50 and tbh that's the main reason I quit. They billed me out as a higher grade than I was because I was sellable in those positions and pocketed the difference. When I asked to be bumped up in pay equal to my responsibilities they shot me down. After the 3rd time being shot down I quit.

 

[ShawnD1]

I remember a contractor I worked for basically had to pay my 22 an hour wage, plus another 12 or 15 on top for my TWO retirement plans, health insurance, etc(I was union so we got a lot of perks). So it came out to like the high 30's for me, but they would charge around 55-60 an hour for my services. They really should of only been charging 45-50 and tbh that's the main reason I quit. They billed me out as a higher grade than I was because I was sellable in those positions and pocketed the difference. When I asked to be bumped up in pay equal to my responsibilities they shot me down. After the 3rd time being shot down I quit.

Yes that sucks, but the reason they do this is because companies do a lot of leg work that you don't think about. I just got a job at a consulting engineering firm and my pay is far less than what they will charge the client, but the company I'm working for is taking a cut for finding the work. I don't need to apply or bid on work; they did all of that and they give me a constant supply of work to do. They also supply the building I work in and the computer and the licensed software and the super expensive CAD plotter as well as a system to communicate with other engineers. They also keep people during recession rather than having mass layoffs just so they always have a strong team of experienced engineers, so there's added stability in working for someone else.

The basic rule of life that is you trade money for stability. Welders who own their own truck and bid on contracts make ridiculous money.... when they are working. One of my brother's friends does welding with his own truck and he makes something crazy like $80/hour for that plus overtime, but there are weeks and sometimes months where he has no work. It's a very unstable yet very profitable job. Even more extreme are the people who start larger businesses. Guys who do good look like Bill Gates. Guys who fail at it file for bankruptcy.

In 1915, King wrote, "It is easy to find a man in almost any line of employment who is twice as efficient as another employee,"
but it is very rare to find one who is ten times as efficient. It is common, however, to see one man possessing not ten times but a thousand times the wealth of his neighbor."

When looking at people doing the same work, this is true. 2 people working at McDonalds are about the same ballpark for abilities, so they get roughly the same pay. What happens if you look at a trained job though? I'm trained to use AutoCAD and Microstation for engineering jobs. What about some random asshole on the street who can't use a computer? I'm absolutely certain that I really am 10x more efficient than them in this field because I'm specifically trained to do this. Doctors get paid a lot because they're a lot better at being doctors. A guy who went to med school for 10 years really is 10x or even 1000x better at diagnosing medical problems than some random guy at McDonalds.

 

[Paratus]

So did anyone besides Woolfe read the article?

 

[ShawnD1]

The article comments are hilarious.

American education used to work because the morons and deadbeats dropped out before high school. Now they stick around and skrew up the whole educational culture.

There's some truth to that. Instead of No Child Left Behind, it was Leave All Retards Behind while the rest learn stuff.

America has an anti-intellectual streak that makes certain segments of our culture shun education. That's part of the problem.

Damn blacks :awe:

Noah connects some interesting dots here but there's an 800-lb gorilla in the room he glosses over when he first says --

"but clearly it represents a failure by elementary and secondary schools to provide education relevant to the economy's growing demands..."

and then follows with --

"... the United States is a global leader in higher education ..."

No. We're a global leader in putting a certain class of students through a certain kind of university, we are NOT a global leader in higher education. If we were a global leader in higher education, we'd have more and more students coming out of our schools with knowledge and skills in :

* Engineering
* Math
* Sciences

Has Noah ever heard of the H-1B Visa? You know what American companies are looking for when they hire somebody with an H-1B Visa? Here's what they're looking for --

"requiring theoretical and practical application of a body of highly specialized knowledge in a field of human endeavor including, but not limited to, architecture, engineering, mathematics, physical sciences, social sciences, biotechnology, medicine and health, education, law, accounting, business specialties, theology, and the arts, and requiring the attainment of a bachelor’s degree or its equivalent as a minimum."

Seems simple enough, the USA needs more people with these skills, enough so that employers need to hire people from all over the world because we don't have enough college graduates with these skills.

I agree with this guy 100%. I can't say what Americans are thinking, but I can tell you what the message is on American TV. Anyone who attends "community college" to learn is trade is obviously a retard, so the nobody does. Everyone wants to attend a 4 year university even if that's not what the market is looking for. There's a strange shame associated with having a skilled blue collar job like welding or fixing large industrial machines even though it's a difficult job most people cannot do.

Upper level high school and post secondary education should have more up to date vocational choices for students to really prepare them for a job. Too many courses have no connection to the real world of work.

I think we just had a thread about this.

 

[Jhhnn]

Another piece by the same author-

http://www.slate.com/id/2118237/

the title explains everything...

 

[manimal]

Another piece by the same author-

http://www.slate.com/id/2118237/

the title explains everything...

Love slate!!!!

Yes I read the article...

 

[Craig234]

So did anyone besides Woolfe read the article?

Yes. It was good.

 

[Jhhnn]

So did anyone besides Woolfe read the article?

Yeh, I read it. The attribution of only 5% divergence being caused by tax policy is absurd. The fact that top 1% effective tax rates have fallen by a third over the last 30 years is glossed over.

The author puts it off onto macro economic policy, not tax policy, when the two are deeply entwined.

I'll read the whole series rather shortly.

 

[Jhhnn]

There's a strange shame associated with having a skilled blue collar job like welding or fixing large industrial machines even though it's a difficult job most people cannot do.

The sad truth is that the world would end sooner if nobody hauled off the trash than if the heads of the Fortune 500 died in their sleep on the same night....

 

[Zebo]

I remember a contractor I worked for basically had to pay my 22 an hour wage, plus another 12 or 15 on top for my TWO retirement plans, health insurance, etc(I was union so we got a lot of perks). So it came out to like the high 30's for me, but they would charge around 55-60 an hour for my services. They really should of only been charging 45-50 and tbh that's the main reason I quit. They billed me out as a higher grade than I was because I was sellable in those positions and pocketed the difference. When I asked to be bumped up in pay equal to my responsibilities they shot me down. After the 3rd time being shot down I quit.

So you don' expect the contractor to reap any secondary income from employing you? What's the point then? All I was saying is the distribution of your labor has to be looked at. Labor can increase it's share by organizing. Capital can increase it's share by shunning organization or offering capital intensive goods and services or other barriers to entry. Mircosoft is a good example where each employee nets MS over 2 million. China's even better where facotry owners get 99% labor 1%. The are many other things creating divide as well. From who gets loans, who gets grants of descression from govt like no bid contracts and almost zero interest loans to complexity or tax code and regs. All are factors in complex equation which dictates pay. Lots of people don't pay attention which this article does a good job of highlighting.