
$1T. That's How Much Workers Are Losing to Owners Each Year - mitchbob
https://www.nytimes.com/2020/06/24/opinion/income-wealth-inequality-america.html
======
rayiner
Dammit just give me the numbers. This should be an entirely mathematical
exercise. I shouldn’t have to scroll through weird Star Wars text and a story
about student protesters in 1970 to see what the basis for your number is.
What on earth is wrong with journalists?

This is a very complicated subject. Here is an analysis that shows the
contrary result: [https://www.econlib.org/the-real-wage-
myth](https://www.econlib.org/the-real-wage-myth). One important observation:
looking at wages alone, like the article does, excludes the value of benefits
such as healthcare:

> BTW, these time series understate the growth in total labor compensation, as
> the cost of fringe benefits such as health care has risen faster than
> nominal wage growth. Alternatively, if you believe that health benefits are
> nearly worthless (my view), then the nominal wage series should be deflated
> by a price index that excludes health care. That would show even more rapid
> growth in real wages.

Basically, at the very least you’re not comparing like with like. Either
include the value of health benefits in compensation, or exclude the
contribution of healthcare in overall economic growth. There are also numerous
other mathematical complexities. You need to adjust wages for inflation (using
some index) and convert GDP to current dollars (using some index) but
generally different indexes are used for the two. You also need to pick a
baseline. 1970 is often used, but that was a recessionary period. Counter-
intuitively, the ratio of wages to the overall economy is highest during
recessions. Also, it’s not just workers and owners in the pirate ship analogy.
Landowners also get a cut and their cut is growing. Accounting for both
effects, the share of income going to non-housing capital owners is up a bit,
but was about the same in 2005 as in 1960:
[http://voxeu.org/sites/default/files/image/FromMay2014/lacav...](http://voxeu.org/sites/default/files/image/FromMay2014/lacavafig1.png)

I’m not sure what the right answer is. What I’m sure about is that cobbled
together vignettes sprinkled with uncited, unexplained numbers that are more
garnish than substance does not help anyone understand the issue at all. It’s
empty calories.

~~~
scoopdewoop
The numbers already exist and have existed. It is their job to be journalists,
convey a comprehensible narrative from facts. Also keep in mind that is the
opinion section. I doubt the author would object to changes in tax structure,
etc. to grow more home ownership. Why not putting people in houses and unions?
Do you think that unions are not effective?

~~~
rayiner
> It is their job to be journalists, convey a comprehensible narrative from
> facts.

This is not a comprehensible narrative. What the heck is a random aside about
student protesters in the 1970s doing in the middle of—what? An advocacy piece
about tax structure? Can you imagine if your boss asked you to put together a
white paper on some issue to present to management, and you presented her
something like this, with a few facts facts thrown in randomly between
irrelevant filler anecdotes?

If you want to tell stories, then fine. If you want to write advocacy white
papers making a factual argument, fine. But this is neither thing. It’s a
hybrid form that uses narrative and anecdote to fill in for the extremely thin
facts and analysis. What is the social value of this type of writing?

As to unions: what do they have to do with anything? Many countries with
strong unions have see a similar or even greater decline in labor share of
income. The US is not really much different than any other advanced economy on
that front:
[https://www.mckinsey.com/~/media/mckinsey/featured%20insight...](https://www.mckinsey.com/~/media/mckinsey/featured%20insights/employment%20and%20growth/a%20new%20look%20at%20the%20declining%20labor%20share%20of%20income%20in%20the%20united%20states/mgi-
a-new-look-at-the-declining-labor-share-of-income-in-the-united-states.ashx).
In the US, labor’s share of income is less than France, about the same as
Germany, and more than Spain. It’s significantly higher than Sweden, which has
robust unions.

Moreover, nearly all the decline in labor’s share of income happened between
2000 and today. The decrease was very slight from 1947 to 2000. But unions
stopped being a significant force in the US long before 2000.

------
nullc
I apologize for not reading the whole article, but after hitting

> Picture the nation as a pirate crew: In recent decades, the owners of the
> ship have gradually claimed a larger share of booty at the expense of the
> crew. The annual sum that has shifted from workers to owners now tops $1
> trillion.

I couldn't help but feel that if they failed to research their examples that
the rest of the article is probably not well researched either.

(You wouldn't want to use pirate ships of yore as an example of poor or
inequitable labor conditions, because they were often much better than the
alternatives: [https://en.wikipedia.org/wiki/Governance_in_18th-
century_pir...](https://en.wikipedia.org/wiki/Governance_in_18th-
century_piracy) )

~~~
adjkant
The purpose of the bit you quoted is not meant to be a literal example, it's a
thought experiment using a pirate stereotype/myth familiar to most readers.
The history of pirates and equitable labor is interesting of course, but its
factual accuracy in the example is not relevant.

It's very odd to write off a full piece based on this choice, especially so
for "accuracy reasons" than rhetorical device choices.

~~~
nullc
How many other statements in it were chosen for rhetorical flourish, because
they appealed to readers biases, rather than being grounded on some rigorous
researched basis?

It's impossible to tell without far more work than the article justified.

The history of pirate labour isn't particularly obscure. So either the article
wasn't reviewed by someone with more than a passing interest in labour
relations or it was and they just didn't care that they used probably one of
the worst historical examples they could have used just because it made for
good imagery.

------
0xy
I found this to be very wishy-washy on numbers, and using questionable
sourcing. For example:

>In the nation’s slaughterhouses, the average worker in 1982 made $24 an hour
in inflation-adjusted dollars, or $50,000 a year. Today the average meatpacker
processes significantly more meat — and makes less than $14 an hour.

Uh, no. Not really. If this was an honest comparison you'd be comparing their
profit output, not meat output. Because the output of significantly more meat
does not mean significantly more profit. It can mean significantly less
profit. Meat is a razor-thin margin industry.

>Even in the high-flying technology sector, companies have found ways to leave
their workers behind. More than half of the people who work for Google do not
actually work for Google. They are classified as contractors, which means they
do not need to be treated as employees.

Why is a voluntary contract a problem here? Why is this bad?

>The Economic Policy Institute estimates that employers illegally deprive
workers of more than $50 billion in wages each year by underpaying them or
requiring unpaid work; violators are rarely punished.

So, a union think-tank. Any reputable source?

>And those who waited longest for new opportunities after the 2008 financial
crisis have often been among the first to lose their jobs. Black people and
women have been especially hard-hit.

Absolute dishonesty, bordering on straight-up lies. Black unemployment is at a
50 year low.

~~~
nullc
Here is another:

> Americans in the bottom 90 percent of the income distribution would be
> making an extra $12,000 per year, on average.

This is misleading. $12k sounds like a lot compared to someone making the
poverty line, but it's as much compared to a household at the 90-percentile
income (~$200k), and high percentile incomes dominate that average because
incomes in the bottom 90% are also rather unequally distributed too.

The point that additional wealth has consolidated at the top due to wage
stagnation is a fine point to make, but they way they chose to represent it
exaggerates the point.

------
kneel
Politicians are deaf to this issue, they can no longer hear that tone.

Business rhetoric promises to do better, but they're incentivized to do
otherwise.

I don't see much hope for solutions, politically or economically. Maybe I'm
just in a mood but things look grim.

------
friedman23
Why do I need to contribute anything to society? Why does anyone need to
contribute to society?

~~~
runawaybottle
So we can keep having a society.

~~~
friedman23
This is circular reasoning.

