Do you want fries with that?
By louisehartmann
The Commerce Department said yesterday, that personal incomes took a dive across the U.S. last year except in areas with high volumes of federal government and military jobs. This comes on the heels of an article in the Financial Times, where Edward Luce picked apart the American Dream, reporting, "The annual incomes of the bottom 90% of U.S. families have been essentially flat since 1973 -- having risen by only 10% in real terms over the past 37 years. That means most Americans have been treading water for more than a generation. Over the same period the incomes of the top 1% have tripled. In 1973, chief executives were on average paid 26 times the median income. Now the multiple is above 300." The simple reality is that while every industrialized country in the world has a solid safety social safety net, made up of robust programs like social security, medicare, unemployment benefits, and welfare for those unable to work, the historic social safety net for the United States - because these programs are quite minimal in the US - has been a well paying, unionized, manufacturing job. But 30 years of Reaganomics, Clintonomics, and Tom Freidman, Flat Earth insanity has moved those jobs to China, Vietnam and India, leaving American workers to say, "Welcome to Wal-Mart" and "Do you want Fries with that?" Until we bring our jobs home and re-empower our unions we are left with a frayed and largely ineffective social safety net - and even that safety net itself is under attack from conservatives and big business. This is why the average American working family is one paycheck away from living on the streets.
Comments
#2
Do not criticize someone until you have walked a mile in their shoes. Because then you will be a mile away, and you'll have their shoes.
#3
Good paying, unionized manufacturing jobs were great in the 50's and 60's when the US was the only manufacturing entity still operating after WWII. It is time to admit that that environment is no longer valid, and with global competition, it is a matter of living standards reaching an equilibrium.
#4
Hi Thom,
since you brought up India here, I wanted to bring to your attention that the anti-India narrative regarding jobs is unsupported by evidence, and it is highly unfair towards India and the Indian people.
The reason being that, unlike our China trade (also, see "China" link @BEA) which has been highly unbalanced for over 15 years and continues to get more and more unbalanced with each year, US' trade with India (in both good and services, see "India" entry at the BEA link above for good, services and combined trade numbers, or this excel file for services trade stats alone) is quite small and fairly balanced.
And US direct investment (USDI) in India is a tiny 0.5% of total USDI abroad, while a part of that investment is returned to the US by Indian FDI flow into the US (0.2% of total FDI.)
Further, a recent investigation by a U. of Maryland professor details many concrete and quantitative ways in which the economic relationship between India and the US is one in which the US benefits significantly as well. For example:
--- Between 2004 and 2009, US exports to India grew 269 per cent, while India's exports to that country grew 136 per cent. US exports to India have grown faster than exports to all other countries.
--- Indian immigrant entrepreneurs have founded more engineering and technology companies during 1995-2005 than immigrants from Britain, China, Japan, and Taiwan combined.
Another recent study by a Harvard professor (w/ a co-author) found that Indians contributed a far larger (about 5x-10x) share of US domestic technology patents than their population in the US (which, has been in the 0.5% to 1% range during the period studied) over the last 30 years.
You will find links to those studies as well as several charts and extensive data sources (US government sources used: census.gov and bea.gov) at this site: IAFN
Please go over it and feel free to give me some feedback in comments here or by email (at the address associated with this account at your site).
Thanks and keep up your good work. I am an Indian-American progressive Democrat. I've been following your writings on and off for a few years. Like you, I also wanted to see Al Gore run for President in 2008. Although Obama was my second choice after Gore, the last 19 months make it very clear that Al would have made a far better President (for example, since 2002, Gore supported single payer, and Obama took single payer off the table from the get go, and later cut a deal with HC lobbyists to gut even a weak version of the public option!), proving us right.
Best regards.
#5
THE COST OF LIVING SINCE 1973 HAS INCREASED QUITE A BIT, COMBINE THAT WITH LOWER INCOME AND WAGES AND THE PICTURE IS EVEN WORSE THAN JUST THE NUMBERS. MORE is LESS....and War is Peace!
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There is something wrong with the numbers here. We all know that Reagan rewrote the formula for 'percent unemployed' as an attempt to deceive people. We always hear discussion of the unemployment % like this -- "We are at X% unemployed, but the real number is more like...". If real income has risen and we are worse off, we need a different measurement or set of numbers set as standards for expressing how well off Americans are.
The motivation is not to limit discussion of a complex economy to a few very simple numbers, but to start reading them off repeatedly until they become commonplace so that at least we don't end up flipping channels 10 years from now just to hear "Well real income is up but in order to get the correct calculation for real income you need to...". Also, the number(s) should give a clearer picture.
What numbers do you think would paint a clearer picture of the real financial situation that most Americans find themselves in?