The economy is working perfectly fine for the people that own it.
this post was submitted on 09 May 2024
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Real wages are up for three straight years; they were unmoved or negative for nearly four decades before that. Your feelings about the economy don't matter when the data all goes in the other direction
People are (sometimes willfully) confusing "the current status quo is fucked" with "there is no improvement resulting from the measures taken by the administration". The former is true - the latter is not.
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Your feelings about the economy don’t matter when the data all goes in the other direction
Except its not "all the data". Its "the data we've always used to measure this up to now".
The disconnect is that classic measurements of national economic health used to reflect the earning and spending power of average Americans. So using the same basket of measures and things that can affect those was a valid approach. In recent years those measurements don't reflect average Americans anymore. Inflation has eaten away at the value of savings impacting older Americans. High interest rates are now acting as a double whammy for young Americans that need borrow for higher education as well as first time home buyers, but the costs of both have risen sharply in the last 20 years. So while the high cost has been a problem, the now high interest rates are a force multiplier stepping on the necks of young Americans.
I don't disagree that Biden's actions have improved classic measurements. Those are still valid and useful for where they apply. I disagree that those measurements still reflect the experience of regular Americans. Thats a problem that extra economic measures should be included when looking at the experience of regular Americans.
This. Buying power of the average American has decreased drastically. If you worked for the last five years and your pay has changed you've technically made less money every year as the power of the dollar has diminished. If you're on a fixed income it feels even worse.
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Peasants, We have increased your daily crumb rations by 1.2%. Be grateful for that.
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Are they? I got a 3% ‘raise’ again this year and that doesn’t seem like it’s keeping up with inflation. And yes yes get a different job, blah blah.
Two things:
- Judging by the increase in prices reported by many as well as shrinkflation, Official Inflation Figures in the US might be very understated, which would make that "real" part of real wage rise be complete total bollocks, since a wage adjusted to a smaller inflation index value than reality is not in fact "real". Considering that understating Official Inflation not only helps in political propaganda like the "real wages" one but also mathematically feeds to a higher GDP Growth figure (in simple terms: the unaccounted for inflation appear as "growth") which is also heavilly featured in political propaganda, it's pretty naive to think that there isn't political pressure to "adjust" that figure down, especially in an election year.
- Independently of that, it's perfectly possible for the average real wage (which is what's reported) to be going up whilst the median real wage (which is more representative of most people's experience and is not what's reported) to be stagnant or even falling: all it takes is for the top earners to be getting significant raises to pull the average up enough that it disguises everybody else not getting such raises.
PS: To add to my second point, here's an interesting chart. Even though it's an overall unweighted nominal (so, not real) value and it's a 3 month moving average (so the effects are shown delayed) you can see a spike and subsequent fall towards the trend in 2023. Now look at this inflation chart and you can see that the median salary growth is delayed from inflation and never actually managed to be as high as the actual inflation. This actually brings up a 3rd point I hadn't considered:
- The salary growth is delayed from inflation, so what we saw in 2023 (and which is now slowing down as per the first chart) is salaries trying to catch up with the high inflation of 2021/22 (and failing) but the inflation by then was already much lower. Obviously if one completelly ignores the last 5 years (which is a common technique in political propaganda) and just calculates "real" wage growth from present day wages and present day inflation, the result will be positive, simply because salaries are still trying to catch up to the inflation of 2-3 years before. However if one adds up the median real wage growth of the last 4 years, the picture is significantly worse.
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This is all about the disconnect between feelings and actual data. The question is how to get them back in sync. Some of that is time, but people will feel negatively as long as their media keeps telling them they are worse off.
For me it’s time. I know that be all objective measures I’m better off. It’s not just the overall stats but I got decent raises two years in a row. I still get hit with how bad inflation is. But a big part is that I stopped buying stuff for a couple of years. I cut back to really only make necessary purchases. Now that I have a little more available resources, and can make a few discretionary purchases, I’m hit by the last 4-5 years of inflation since I even looked. My comparison point is pre-COVID
Your statements about it matter as much as his opinion without sources. Not disagreeing or agreeing, just seeing two opinions and no facts.
But I think you can understand why three years of improvement after four decades of stagnation might not dramatically move peoples' perception of the economy. Plus, are real wages up for everyone? Is it average real wages? Median? There's a big difference. It's entirely possible some people are experiencing much more real wage growth than others.
Edit: apparently a lot of you are confused. You seem to think that if wages are up for some, they must be up for all. That's not how it works. Not everyone got a raise over the last three years. Some people did, others didn't. Some people saw their income increase dramatically, some saw their income stay about the same, and some saw their income go down. And that's true whether the incomes in question are measured in "real" (inflation adjusted) terms or are nominal figures.
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Serious question: are they up higher than inflation if you adjust for the last three years?
Yes, that's what real wages mean, adjusted for inflation
Wage growth now is outpacing inflation, meaning we're going in the right direction. But if you compare over a few years, many people have fallen behind and have a lot of catching up to do.
Lol
Look, peasants, wages have gone up by slightly less than 1% for reasons having nothing to do with the government, be grateful!
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My wage has not budged in four fucking years and no wages in Oklahoma have gone up if anything they going down.
My company will not give raises and I get paid more than any other person in my field and it isn't enough.
They literally offering jobs here at 12 an hour you be lucky to see 15 with bunch bullshit stipulations.
I'm sorry that some states are shitholes, with shitty people trying to make them shittier. I live in one too.
Low taxes, but low benefits to its citizens, so people don't really want to live there. Poor healthcare, poor education, fewer opportunities for the arts and the things that make life worth livin'. It's a cycle of poverty and despair, and it's awful.
When I get money, I'm moving out. But I may never have enough money.
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TBF even if you don't agree that the economy is getting better under Biden, that still doesn't say anything about his fiscal policy. His policies might not have a tangible effect for a decade. He's not a king, he doesn't decide who sells what and for how much.
Capitalism is strangling us. Any candidate who doesn't admit that is unacceptable.
That's literally their goal. Wealthy elites and corporations want to bury the middle and lower classes.
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the economy is not great but he has changed the trajectory. it took obama two terms to normalize after bush jr and unfortunately it was not so great that trump did not make it way worse. ironically mostly by not continuing gradual interest rate increases which forced the severe ones now.
Public demand and competition drove prices down. Since Covid reset prices, and stockholders demand growth, companies will continue to price gouge until customers say it's enough.
This is just what capitalism looks like.
The problem is where things are getting the most expensive, that being food and housing, the markets are captured. You can't just say no to having food and housing.
This is where regulation is supposed to step in.
Corporate ownership of housing is a major problem that no legislator seems to be handling. The Feds should start building and selling houses to individuals themselves. I believe that is one way to lower housing costs and increasing private ownership.
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The way that we measure the economy is disconnected from the quality of life of most residents.
The economy is "good" when the rich are getting richer.
So the system isn't broken and needs fixed, it's working as designed and needs destroyed. Got it.
Rent is outrageous and getting worse every year. The dream of owning a home is dead for my generation (xennials) and newer. Utilities and other basic costs of living have skyrocketed and continue to get worse. The environment is starting to fall apart and insurance companies are starting to drop people, refuse coverage, and skyrocket rates when it IS available. Fascists continue to dismantle any and all social safety nets while pushing tax burdens onto lower income households, cutting their own tax responsibilities, and also creating inventive ways to loot public coffers.
Cancelling a little bit of student debt (without ever solving the core problem, btw) isn't "turning around" - it's barely a wiggle on the steering wheel. We're all screwed and nobody is doing anything about it.
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