Wednesday, May 21, 2008

Taxes & Wages Under Republicans

Dims claim that Republicans have, in recent years, harmed the working person.

But, the objective, quantitative data tell another story (as usual):

1) The Truth About Tax Cuts.

2) The truth about inflation adjusted hourly compensation for working persons:

Inflation Adjusted Hourly Compensation (for the working person)
Click the image to enlarge & view the source data

Click the image to enlarge & view the source data

Continuously Compounded Annual Rate of Change
in Inflation Adjusted Hourly Compensation (for the working person)
Click the image to enlarge & view the source data

Click the image to enlarge & view the source data

Comparing pre-LBJ to post-LBJ, there was a slight slowdown in (continued positive) inflation adjusted wage growth from roughly 1975 to 1997. Blame the tidal wave of Federal Entitlements imposed by LBJ in the mid 1960’s, starting with Medicare and Medicaid.

But, trends have been improving since 1997 (after Republicans took control of Congress in 1996). Will the positive trends continue if Dims control both houses of Congress AND the White House. No, they won’t. But, the media will, as usual, lie and distort. And, the terminally gullible will, as usual, believe every word of it.


themancommon said...

The state of our country isn't about Dem/Rep (rich/rich); it's about rich/poor (them/us). The politicians, Dem/Rep, are waging a war on the middle class. They've put policies in place (NAFTA, CAFTA, etc.) that ship jobs to other countries and drive our quality of living down. The goal is to eliminate the middle class and produce an environment where there are only two classes: an investor class & a working class. Here's some info:

Cost of U.S. War and Occupation of Iraq: $519,842,244,056

Goldman Sachs Group Inc. predicts the US deficit will expand to a record $500 billion for the year ending Sept. 30, 2008; after a $163 billion gap last year.

The recession of 2001 never ended.

At least not for ordinary Americans.

Ordinary Americans found that their income was declining. From 2001 to 2007, median family income declined - depending on where you get your figures from - by somewhere between $500 and $1,000. Median individual income went down by at least $1,000.

The yearly average number of new private sector jobs created from 2001-2008 was just

369,000, not even keeping up with the growth in population. It should be compared to the average number of new private sector jobs created from '92 to 2,000: 1,760,000 per year.

The number of people in manufacturing jobs decreased by over 3 million.

The number who got health care at work went down, from 64.2 million to 59.7 million. The number of people without health care went up from 38.4 to 46.9 million.

The number of people in poverty increased from 31.6 million to 36.5 million.

The value of America's businesses, at least as measured by the stock market, did not go up. An astonishing thing in what was called a boom. Meantime, the cost of living went up.

Home heating oil went up about 150 percent. Gas at the pump at least doubled. The cost of health insurance went up about 50 percent. The cost of college went up about 30 percent. Now food is going up. How can the myth and the reality be so different?

Part of it is the standard theology and story telling about free markets and America always being number one and the envy of the world. Add to that the great grasp of media manipulation on the part of the administration, the herd mentality in politics, the media, even, and especially, among economists.

The key fact is this: during the Bush administration the US economy 'grew' by 37 percent. Give or take, plus or minus, but something around there

What has been ignored is what that growth consists of. And even more, what it cost.

The middle class has shrunk and is less well off. So the growth isn't there.

The stock market is flat, so it's not in business. Manufacturing jobs have been dramatically reduced, so it's not there.

The 'growth' in the US economy is a bubble. It consists entirely of debt. Can it be true that the growth in the US economy in the last seven years, such as it is, consists entirely of debt?

Here are the numbers:

The US economy grew by about $4 trillion.

-- The national debt in Jan. 2008: $9.2 trillion
-- The national debt in 2001: $5.7 trillion

An increase of $3.5 trillion

-- Total consumer credit debt in 2008: $12.8 trillion
-- Total consumer credit debt in 2001: $7.65 trillion

An increase of $5.25 trillion

SBVOR said...

TheManCommon (more like TheAverageSocialist),

You appear to be particularly well propagandized.

Allow me to shed some light onto your mythology/propaganda:

1) Your opening paragraph reveals your Marxist Class Warfare mindset. Whether you got it from Karl Marx, Lou Dobbs, Obama or elsewhere, it is still classic Marxism (and absolute balderdash).

2) Your questionable, unsubstantiated figures on median income are, at best, cherry picked (if they have any validity at all). Here is a different, longer term and far more relevant perspective. And here (figure D) is an even longer term perspective.

The second of these two charts further substantiates my original thesis that the real stagnation resulted from LBJ introducing massive new tax burdens to fund Medicare, Medicaid and his other Entitlement programs. It took a while for the effect to be seen. And the economic insanity of Jimmy Carter and his “windfall profits tax” on “Big Oil” certainly compounded the problem.

And, now, just like a typical Socialist, you appear to be longing for more of what produced the very issues you whine about.

3) The Iraq War is not the cause of the budget deficit (as the quantitative federal spending facts presented in the latter charts of this post demonstrate).

4) The number of baby boomers who are retiring probably outpaces the population growth.

Hence, your chosen (and unsubstantiated) employment stats qualify as one of those things worse than “damn lies”. Now, only a fool would suggest that all statistics are worse than “damn lies”. But, sometimes it is just intuitively obviously so. This is clearly one such case.

What matters is the unemployment rate. And, even today, that number remains historically low.

5) Yes, manufacturing jobs (all around the world) have been declining for a very long time.

But, even Robert Reich knows that the cause is rapid advances in automation (all around the world).

And, productivity advances such as these are “the single most important determinant of a country's standard of living” (all around the world).

6) Health Insurance through one’s employer was an enormously destructive market distortion introduced by FDR’s wage and price controls. Good freaking RIDDANCE!

More and more young people are choosing to work for smaller companies offering higher wages in lieu of “benefits” like employer provided health insurance. More and more healthy people with healthy life styles are opting to self insure rather than subsidize those with unhealthy lifestyles. More and more people are opting out of the health care system all together. I personally avoid it like the freaking plague that it has become. The simple truth is that most doctor visits are utterly unnecessary!

Unfortunately, FDR (who preferred a purely Socialist health care system) set us on the course towards collectivist health care and now we’re back on his road to purely Socialist health care system. You will regret it when it arrives. Nothing is so costly as that which is “free”!

7) Poverty rates were higher under Clinton than they are today. See page 23 (as Adobe Acrobat sees it) of this link.

8) Your unsubstantiated stock market propaganda (at best) relies upon the distortions introduced by the stock market bubble which burst in March of 2000. The S&P 500 is back on a sustainable track (following the bursting of the stock market bubble in March of 2000).

9) Every price increase you cite is a direct result of Socialist Stupidity imposed by Democrats.

10) There is absolutely NOTHING to substantiate your claim that “The middle class has shrunk and is less well off.”. It’s a bald faced LIE!

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