so apperantly 40% of americans make less than the 1968 minimum wage

[cash money 1999]

http://thecontributor.com/40-americans-now-make-less-1968-minimum-wage

You may have seen charts like the one to the right from the Economic Policy Institute, showing how working people’s wages stopped going up along with productivity gains.

This means the gains went…somewhere else. See if you can guess who got them? (Hint: it’s the 1 percent; this is one driver of the terrible income and wealth inequality.) This breakoff of wages from productivity growth is partly the result of trade agreements that pit Americans against exploited workers in non-democracies. This weakened the bargaining power of unions, moved factories and industries out of the country, devastated entire regions of our country — and gave the giant multinational corporations, Wall Street and the billionaires the leverage they needed.

Economist Dean Baker describes one effect of this in Minimum Wage: Who Decided Workers Should Fall Behind?

“If the minimum wage had risen in step with productivity growth [since 1968], it would be over $16.50 an hour today. That is higher than the hourly wages earned by 40 percent of men and half of women.”

The minimum wage would be $16.50 an hour — $33,000 a year — if it had kept up with the growth of productivity since 1968. To put the effect of this a different way, 40 percent of Americans now make less than the 1968 minimum wage, had the minimum wage kept pace with productivity gains.

To put this even another way, the average American’s living standard would be much, much higher today if wages had not decoupled from productivity gains – with the gains all going to the 1 percent instead of being shared by workers. If wages had kept pace we wouldn’t feel the terrible squeeze that everyone in the middle class is feeling.

This is one more way to understand the effect of income and wealth inequality on each of us. The 1 percent versus 99 percent thing is real. When you hear that the 6 Walmart heirs have more wealth than a third of all Americans combined, it is real. When you hear that the people on the Forbes list of the 400 wealthiest Americans have more wealth than half of all Americans combined, it is real.

And the effects on the rest of us are real.

This seems like a good time to drag out the old post, Nine Pictures Of The Extreme Income/Wealth Gap, which puts pictures on what this kind of wealth means. (This post, by the way, first explained that 400 people have as much wealth as half of all Americans combined. Michael Moore picked that up and talked about it in Madison, Wisconsin, and it rippled out from there.)

Here is another relevant post: Tax Cuts Are Theft, explaining how cutting taxes on the rich siphons off public wealth.

And of course this one: Reagan Revolution Home To Roost — In Charts.

Here are some posts on the trade deficit:

Fix The Trade Deficit, Fix The Economy.,

Yet another report is out showing how the trade deficit is costing us millions of jobs and hurting our economy. This report has specific numbers: between 2.2 million and 4.7 million U.S. jobs, between 1 percent and 2.1 percent of the unemployment rate and a gross domestic product increase of between 1.4 percent and 3.1 percent.

These are real numbers that were carefully calculated. This is a real problem that is hurting people, hurting small and mid-sized companies, hurting communities, hurting our tax base and hurting our ability to make a living in the future. And there are real solutions available to fix the problem.

Does Trade Deficit Drive Inequality?:

null

Job Fear From Trade Deficit Is What Happened To Jobs And The Middle Class,

The middle class is disappearing. Our economy is “hollowing out” because the money goes to the top and the people fall to the bottom. This is because we allow American companies to close factories here and open them there, shipping the same goods back here to sell in the same stores, costing jobs, companies, industries and our economy. This makes us afraid for our own jobs and afraid to make waves. By helping a few at the top get fabulously rich, China has essentially recruited our own businesses leaders to fight against our own government – and us.

Trade Deficit – One Root Of Many Problems,

You buy things till your wallet is empty. So you raid the savings account to buy more stuff. Then you get a loan, and buy more stuff. Another loan, another, you keep buying stuff… Finally you’re selling off the tools you had used to make a living. That’s where the country is now because of the huge imbalance in our trade relationships. We buy more from them than they buy from us and we have let this go on and on and on. This is the deficit we should be worried about.

The Root

Pick a national problem, and the odds are that our trade imbalance is aggravating it. Our trade deficits literally suck money out of the country. When looking up the numbers I had to double check, our annual trade deficits are so huge. In the chart below that first line under the dates represents $100 billion. Look at what happened in the late 90s, when we opened the China floodgates. (Click to enlarge):

Dave Johnson is a fellow at at the Campaign for America's future, and has more than 20 years of technology industry experience including positions as CEO and VP of marketing. His earlier career included technical positions, including video game design at Atari and Imagic. And he was a pioneer in design and development of productivity and educational applications of personal computers. More recently he helped co-found a company developing desktop systems to validate carbon trading in the U.S.

 

[andycrazn]

what happened in 1971? we dropped out of the gold standard. thats what causes the disconnects we see today. dont believe me? look at the debt accumulated over a 50 year span and everything else

 

[cash money 1999]

what happened in 1971? we dropped out of the gold standard. thats what causes the disconnects we see today. dont believe me? look at the debt accumulated over a 50 year span and everything else

this

 

[dipsetgeneral]

Interesting read...

 

[water]

Interesting read...

Interdasting indeed

 

[teamjordan79]

well, at least atlas didnt shrug

 

[stealth 23]

$16.50 and JB prices would be $350 for every retro and $500 for foambz.

 

[nixonjames]

what happened in 1971? we dropped out of the gold standard. thats what causes the disconnects we see today. dont believe me? look at the debt accumulated over a 50 year span and everything else

C'mon now.  This is such a weak and misguided argument.  This suggests that if we hadn't switched to a fiat currency then the decisions made by the wealthy business owners that lined their pockets and took from those less fortunate then them wouldn't have happened under the gold standard.   There's a ton of very valid economic reasons why a fiat economy makes 1000X more sense than any sort of hard metal/concrete material backed currency.

1st off.  We tried that in Mercantilism and when wealth is defined by possession of gold then those in power can have an even more obscene effect on those less fortunate.  Not to mention a tangible thing that could be stolen/destroyed/etc which would compromise the economy completely.   

The decisions of the few negatively affected the many and until those many decide to stand up for themselves this isn't going to stop.  And whether we have a silver/gold/platinum/uranium/etc.

Hey I know, why don't we provide an even greater target for those who hate us to attack to attempt to cripple our economy.  9/11 was aimed at insulting/embarassing/crippling the US economy, through symbolism, because America had won the symbolism war (how could they not after getting to be the good guys despite dropping 2 atomic bombs on a country mere weeks away from total surrender...)  Anyways i went on a small tangent.

 

[6 Rings G.O.A.T.]

Going to read this later..

 

[crcballer55]

So let's say that we do start taxing the wealthy are a significantly higher rate than we already do. What happens then? Money tends to flow to the place of least resistance. Hence why we buy things when they're on sale and why Swiss banks and tax havens exist.

We had this artificially high standard of living for most of the 20th century because Europe had virtually destroyed themselves and we were the only country with the capability to manufacture what they needed. It was Nixon why opened the doors to trade with Asia. Sure, wages may be lower, but so is the relative price of most everything else we buy. Phones used to be $900 in the 80's and a desktop computer that served the same function as a typewriter was $5000. Now both items are 1/10th of that.

 

[airthompson]

In '68 a Camaro would've been around 3K... Gimme a time machine.

Edit: nvm I'm black. 60's ...no bueno

 

[teamjordan79]

So let's say that we do start taxing the wealthy are a significantly higher rate than we already do. What happens then? Money tends to flow to the place of least resistance. Hence why we buy things when they're on sale and why Swiss banks and tax havens exist.

We had this artificially high standard of living for most of the 20th century because Europe had virtually destroyed themselves and we were the only country with the capability to manufacture what they needed. It was Nixon why opened the doors to trade with Asia. Sure, wages may be lower, but so is the relative price of most everything else we buy. Phones used to be $900 in the 80's and a desktop computer that served the same function as a typewriter was $5000. Now both items are 1/10th of that.

inflation is a built-in mechanism of upward wealth redistribution and a hidden tax on the population. So it's not a question of taxation but more of a money supply issue as well as interest rate fixing. "Taxing the rich" is a red herring imo.

 

[ninjahood]

free trade and da fiat currency makes us broke.

 

[isiahil]

Cmon Son. That whole article is useless. Why should wages keep up with productivity gains? Technology has sent productivity through the roof over last few decades. Why would wages keep up? If you really understand the economy that article means nothing. It is like me saying wages has not kept pace with the number of albums sold over the years. Wages and productivity over the whole economy are not linked in the way the article suggests. And most importantly wages are not supposed to keep up with productivity gains just like wages are not supposed to keep up with albums sales.

 

[Mark Antony]

I would've killed for 16.50 at some point.

 

[crcballer55]

So let's say that we do start taxing the wealthy are a significantly higher rate than we already do. What happens then? Money tends to flow to the place of least resistance. Hence why we buy things when they're on sale and why Swiss banks and tax havens exist.

We had this artificially high standard of living for most of the 20th century because Europe had virtually destroyed themselves and we were the only country with the capability to manufacture what they needed. It was Nixon why opened the doors to trade with Asia. Sure, wages may be lower, but so is the relative price of most everything else we buy. Phones used to be $900 in the 80's and a desktop computer that served the same function as a typewriter was $5000. Now both items are 1/10th of that.

inflation is a built-in mechanism of upward wealth redistribution and a hidden tax on the population. So it's not a question of taxation but more of a money supply issue as well as interest rate fixing. "Taxing the rich" is a red herring imo.

Much of the inflation we have experienced over the last century is a result of us going off the gold standard. Without anything backing the currency other than the "faith and trust of the U.S. government" there is nothing keeping us from just printing more money. Our problem now is that we as citizens have become addicted to the debt required to sustain our current lifestyles the government provides to us. As a result, any cuts to programs we benefit from are met with waling and crying to our congressmen rather than figuring out how we can do the same thing more efficiently in the private sector (which in most cases already exists).

 

[$tacy]

I would've killed for 16.50 at some point.

id kill for it now

 

[ricky409]

$16.50 and JB prices would be $350 for every retro and $500 for foambz.

this

looking at it from the perspective of the companies, i dont think that woul work b/c more and more jobs would be outsourced to other areas to not deal w/ the rising wages here in the states.

plus, the economy would adjust... and toyota corollas would be 45k...

 

[andycrazn]

what happened in 1971? we dropped out of the gold standard. thats what causes the disconnects we see today. dont believe me? look at the debt accumulated over a 50 year span and everything else

C'mon now.  This is such a weak and misguided argument.  This suggests that if we hadn't switched to a fiat currency then the decisions made by the wealthy business owners that lined their pockets and took from those less fortunate then them.   There's a ton of very valid economic reasons why a fiat economy makes 1000X more sense than any sort of hard metal/concrete material backed currency.

1st off.  We tried that in Mercantilism and when wealth is defined by possession of gold then those in power can have an even more obscene effect on those less fortunate.  Not to mention a tangible thing that could be stolen/destroyed/etc which would compromise the economy completely.   

The decisions of the few negatively affected the many and until those many decide to stand up for themselves this isn't going to stop.  And whether we have a silver/gold/platinum/uranium/etc.

Hey I know, why don't we provide an even greater target for those who hate us to attack to attempt to cripple our economy.  9/11 was aimed at insulting/embarassing/crippling the US economy, through symbolism, because America had won the symbolism war (how could they not after getting to be the good guys despite dropping 2 atomic bombs on a country mere weeks away from total surrender...)  Anyways i went on a small tangent.

gold has no counter party risk. if a government goes down, its currency goes down with it especially if its fiat. we had 3 CENTRAL BANKS in america, what makes you think that our fiat currency will still be here in another 10, 20, 50 years? gold doesnt evaporate when its burned, it just melts into a hot liquid. try doing that with paper money and see what happens.

 

[ricky409]

gold has no counter party risk. if a government goes down, its currency goes down with it especially if its fiat. we had 3 CENTRAL BANKS in america, what makes you think that our fiat currency will still be here in another 10, 20, 50 years? gold doesnt evaporate when its burned, it just melts into a hot liquid. try doing that with paper money and see what happens.

backed currency is only what we put value into.

if gold is 2000 / oz... then we flood the market with more paper dollars and reduce the value of the dollar, what difference does it make?

also, backed currency is only what OTHER nations will recognize it for.

if it only depended on assets found inside its borders, AFRICA would rule the world.

 

[25thhour]

gold has no counter party risk. if a government goes down, its currency goes down with it especially if its fiat. we had 3 CENTRAL BANKS in america, what makes you think that our fiat currency will still be here in another 10, 20, 50 years? gold doesnt evaporate when its burned, it just melts into a hot liquid. try doing that with paper money and see what happens.

this.

 

[andycrazn]

gold has no counter party risk. if a government goes down, its currency goes down with it especially if its fiat. we had 3 CENTRAL BANKS in america, what makes you think that our fiat currency will still be here in another 10, 20, 50 years? gold doesnt evaporate when its burned, it just melts into a hot liquid. try doing that with paper money and see what happens.

backed currency is only what we put value into.

if gold is 2000 / oz... then we flood the market with more paper dollars and reduce the value of the dollar, what difference does it make?

also, backed currency is only what OTHER nations will recognize it for.

if it only depended on assets found inside its borders, AFRICA would rule the world.

why back it? why not just let the currency be. gold is the black market currency. word to all the james bond movies and other movies involving bad guys trying to rule the world.

us americans think its just for jewelry purposes but everyone else around the world view it as money. save in it to protect themselves from fiat devaluation.

 

[andycrazn]

A guy sitting in an office in Dallas, Texas, making sweeping claims about the future of countries he’d hardly set foot in: how on earth could he know how a bunch of people he’d never met might behave? As he laid out his ideas I had an experience I’ve often had, while listening to people who seem perfectly certain about uncertain events. One part of me was swept away by his argument and began to worry the world was about to collapse; the other part suspected he might be nuts. “That’s great,” I said, but I was already thinking about the flight I needed to catch. “But even if you’re right, what can any normal person do about it?”



He stared at me as if he’d just seen an interesting sight: the world’s stupidest man.



“What do you tell your mother when she asks you where to put her money?” I asked.



“Guns and gold,” he said simply.



“Guns and gold,” I said. So he was nuts.



But not gold futures,” he said, paying no attention to my thoughts.



"You need physical gold.” He explained that when the next crisis struck, the gold futures market was likely to seize up, as there were more outstanding futures contracts than available gold. People who thought they owned gold would find they owned pieces of paper instead. He opened his desk drawer, hauled out a giant gold brick, and dropped it on the desk. “We’ve bought a lot of this stuff.” At this point, I was giggling nervously and glancing toward the door.

So many others were giggling along. They were giggling all the way as gold rose from $800 to $1900. Probably not giggling now...

On nickels:

He still owned stacks of gold and platinum bars that had roughly doubled in value, but he remained on the lookout for hard stores of wealth as a hedge against what he assumed was the coming debasement of fiat currency. Nickels, for instance.



“The value of the metal in a nickel is worth six point eight cents,” he said. “Did you know that?”



I didn’t.



“I just bought a million dollars’ worth of them,” he said, and then, perhaps sensing I couldn’t do the math: “twenty million nickels.”



“You bought twenty million nickels?”



“Uh-huh.”



“How do you buy twenty million nickels?”



“Actually, it’s very difficult,” he said, and then explained that he had to call his bank and talk them into ordering him twenty million nickels. The bank had finally done it, but the Federal Reserve had its own questions. “The Fed apparently called my guy at the bank,” he says. “They asked him, ‘Why do you want all these nickels?’ So he called me and asked, ‘Why do you want all these nickels?’ And I said, ‘I just like nickels.’”



He pulled out a photograph of his nickels and handed it to me. There they were, piled up on giant wooden pallets in a Brink’s vault in downtown Dallas.



“I’m telling you, in the next two years they’ll change the content of the nickel,” he said. “You really ought to call your bank and buy some now.”

And on how to prepare for what is coming and why it is coming:

We hopped into his Hummer, decorated with bumper stickers (God Bless Our Troops, Especially Our Snipers) and customized to maximize the amount of fun its owner could have in it: for instance, he could press a button and, James Bond–like, coat the road behind him in giant tacks. We roared out into the Texas hill country, where, with the fortune he’d made off the subprime crisis, Kyle Bass had purchased what amounted to a fort: a forty-thousand-square-foot ranch house on thousands of acres in the middle of nowhere, with its own water supply, and an arsenal of automatic weapons and sniper rifles and small explosives to equip a battalion. That night we tore around his property in the back of his U.S. Army jeep, firing the very latest-issue U.S. Army sniper rifles, equipped with infrared scopes, at the beavers that he felt were a menace to his waterways. “There are these explosives you can buy on the Internet,” he said, as we bounded over the yellow hills. “It’s a molecular reaction. FedEx will deliver hundreds of pounds of these things.” The few beavers that survived the initial night rifle assault would wake up to watch their dams being more or less vaporized.



“It doesn’t exactly sound like a fair fight,” I said.



“Beavers are rodents,” he said.



Whatever else he was doing, he was clearly having fun. He’d spent two and a half years watching the global financial system, and the people who ran it, confirm his dark view of them. It didn’t get him down. It thrilled him to have gotten his mind around seemingly incomprehensible events. “I’m not someone who is hell-bent on being negative his whole life,” he said. “I think this is something we need to go through. It’s atonement. It’s atonement for the sins of the past.”

 

[fraij da 5 11]

$16.50 and JB prices would be $350 for every retro and $500 for foambz.

this

looking at it from the perspective of the companies, i dont think that woul work b/c more and more jobs would be outsourced to other areas to not deal w/ the rising wages here in the states.

plus, the economy would adjust... and toyota corollas would be 45k...

I tried telling a friend of mine this who posted up a pic saying that Min wage should be some $21.13 or something by now... Cause all else would be equal if the dude that pulls the fry's out the fryer at McD's was making $44k per year? Okay...

 

[nixonjames]

Suffice it to say I'm not going to keep belaboring the point.  Individual decision making with no risk of backlash/punishment is the cause of our wealth inequality, our weakened economy, and our pervesely in the pocket of big business political structure.

Instead of trying to go backwards in progress by decades why not try to motivate folks to get people in Congress that are motivated to overturn corporate citizenship and keep Presidents in office who will appoint Supreme Court justices who are focused on protecting the citizenry more than the special interests.

Lastly.

For anyone trying to argue Fiat/Gold standard.  Go take a class on Mercantilism or Latin American Economic History.  You'll find plenty of counter-part risks as you put them for the Gold standard.  It does not work.  Sorry.