
Wage Stagnation - myle
https://slatestarcodex.com/2019/02/25/wage-stagnation-much-more-than-you-wanted-to-know/
======
gerbilly
Real wages haven't increased since 1970.

We only feel richer because:

* Most households have two wage earners now.

* We use lines of credit to borrow for discretionary purchases, we lease cars, pay by subscription for things more.

* We have more gadgets. (Note that this has been proven to make people any happier.)

~~~
iooi
This is false. [1] Real income has doubled since 1970 for individuals. I'm not
sure why so many people seem to think that, I'm constantly having to reply to
posts like this on HN and Reddit with real data but a lot of people just go
along with it even though the people that post these claims never substantiate
it with data.

I think there must be a psychological factor that makes people feel good about
how our generation has it so hard? I would truly appreciate if someone could
explain why.

[https://www.census.gov/data/tables/time-
series/demo/income-p...](https://www.census.gov/data/tables/time-
series/demo/income-poverty/historical-income-people.html)

~~~
mbell
The general claim about 'Real Wage' stagnation is based on the median of full
time workers. There is data for this in your link:

Men: 51,885 (1970) => 55,834 (2017), a 7.6% increase

Women: 30,733 (1970) => 44,379 (2017), a 41% increase

Also note that this data is using CPI-U-RS adjustment instead of CPI which is
what is normally used for 'Real Wages'. There is some debate over the accuracy
of CPI-U-RS, but it's worth noting that it's not directly calculated prior to
1978 so becomes more questionable. Comparing to 1978 your numbers are
basically equal to 2017 income for men. For women there is still significant
growth but I think it's hard to draw any conclusions since a very large number
of women entered the full time workforce and took on higher level positions
between 1970 and 2017.

I'm assuming you are getting 'doubled' by reading the per capita income data
which is not a particularly accurate way to look at this. That is just taking
the sum of the total income and dividing by the US population, i.e. it's a
mean not a median. It's going to be skewed by high income individuals and also
by the nature of labor force participation.

~~~
belorn
It would be interesting to see a graph over median wage similar to the one in
the article, but with separate lines per gender.

> very large number of women entered the full time workforce and took on
> higher level positions between 1970 and 2017

If we look at US numbers that actually not the case. As I wrote in an other
comment, between 1940 and 1970 it doubled from around 25% to around 50%, but
from 1970 to 2017 it only went up to current 55%. It actually went down from
2000 which topped at 59%.

~~~
mbell
> If we look at US numbers that actually not the case. As I wrote in an other
> comment, between 1940 and 1970 it doubled from around 25% to around 50%, but
> from 1970 to 2017 it only went up to current 55%. It actually went down from
> 2000 which topped at 59%.

Using the data source provided from the post I replied to (table P-36) the
number of full time, year-round workers looks like this:

Men: 36.1M (1970) => 66.4M (2017) increase of 84%

Women: 15.5M (1970) => 44.4M (2017) increase of 186%

So within this group we went from ~30% female to ~40% female and I would
venture that the types of employment accessible to women in this time frame
has also expanded quite a bit, though I have no immediate data handy to back
this up.

Without digging into your numbers, I suspect they may come from total labor
force participation which is a notably different metric.

------
leereeves
The problem here is that the comparison is between _median_ wages and _total_
productivity, without demonstrating that the median worker is in any way
responsible for the increased productivity.

If the median worker _isn 't_ responsible for the increased productivity, are
they entitled to a share of the work of other people?

I'm not necessarily saying they aren't, just that such an argument should be
made explicitly.

~~~
deogeo
Shall we also discuss how much of other people's work capital is 'entitled'
to?

E.g Uber's executives are very well compensated, and are nothing but middle-
men. Middle-men that are easily replaced, as demonstrated by the Uber clones
in cities that banned Uber.

~~~
leetcrew
if they're as easily replaced as you say, they won't be very well compensated
for long.

~~~
raxxorrax
It seems pretty naive to think these market mechanisms are the primary factors
affecting wages. Maybe this is the case in the US, certainly not in Europe.
Otherwise teachers and caregivers would earn at least as much as engineers.

Top managers wages are completely fictitious. Investors generally don't care
though, since it is basically nothing compared to turnover as a whole.

~~~
hattar
In the US there’s an excess of teachers (unsure about caregivers) and it seems
the market forces are expectedly causing low salaries.

I believe as an American I’m missing some important context to understand this
comment.

~~~
raxxorrax
Context: A lot of countries in Europe have problems filling positions with
teachers and caregivers, because younger people tend to evade these careers
because of bad economic conditions and huge workloads.

~~~
lotsofpulp
I would say that is still market mechanisms affecting wages.

The purchasers (taxpayers) are not willing to pay sufficient wages in order to
incentivize [the right] people to pursue it as a career.

~~~
falcolas
It's my opinion that taxpayers are the worst people to drive business
decisions around education. The median tax payer will only care about
education quality and availability for around 15 of their ~40 years as a tax
payer.

For those remaining 25 years, they will tend to prioritize money in their
pockets over a teacher's salary; a situation that does not align with the
betterment of our society at large.

~~~
lotsofpulp
A million dollar teacher won't be able to do their job effectively if the
child lives in a broken environment, so it's something that has to be attacked
from all angles simultaneously, from the teachers, to providing the child's
parents (and neighbors) with economic opportunities (and/or educating them),
and even then it would be a slow process taking effect over generations, so no
politician could claim it. Seems almost impossible to accomplish in a
democracy.

~~~
ABCLAW
There are plenty of million dollar teachers, but they work in private tutoring
or corporate education positions.

The million dollar teachers will do things like actively manage the student's
home life or business trajectory, give them personalized curricula, connect
them with opportunities to gain hands-on experience, etc.

Not saying you're wrong re: the incentives or anything, but a lot of people
don't even know this segment of the market exists.

------
mannykannot
There appears to be a section missing: the one that discusses the consequences
of the globalization of the labor market, especially with regard to non-
physical labor. Arguably, this is a consequence of policy changes, but it is
not discussed in that section, either.

~~~
CoolGuySteve
Particularly telling is that he compares the gap between the US, Germany,
Italy, Spain, and France.

I really want to see the same charts for coastal vs inland China and Mexico.
Did a rising tide lift all boats there or not?

~~~
RPLong
The problem is mostly one of data availability. China has plenty of data, but
not all of it is credulous. That, and the fact that comparisons of any two
nations will always be susceptible to the accusation that the data has been
"cherry-picked" to show a favorable result.

But the global data on poverty is basically unassailable. Poverty has declined
absolutely everywhere. The rising tide lifted at least the very poorest boats,
whatever can be said for the American middle class notwithstanding.

------
andrewla
The problem with this entire discussion is that we use terms like "wages" and
"productivity", which have meanings in the English language, and associate
them with metrics which are utterly divorced from those meanings. To have a
sane discussion, we're forced to use these shorthands, but the fact of the
matter is that if we spelled out what we were actually measuring it would be
very clear that all of these phenomena being measured refer to things
disconnected from any of our actual experience.

Even more so, the methodology for most of this data has changed so much over
time, with so little overlap between methodologies, that we have literally no
idea what the state of the world was even a few years ago. All we have are a
mixture of giant measurement artifacts, and when two of them correlate we
celebrate because we might have found a metric that can bridge the divide
between methodologies, but that correspondence disappears as soon as we try to
find out if there are systemic changes -- our ability to determine whether
something has changed has an implicit reliance on the assumption that nothing
has changed, so all of these arguments become circular.

Econometrics is a philosophical dead end that just ends up producing broken
policies disconnected from reality and causing us to make up a new suite of
politically-motivated metrics to match the outcomes that we're looking for,
and then give the metrics names that refer to things that have intuitive
meanings and pretend we've found insight.

You really have to go back to non-econometric-based economics (the Austrians,
von Mises and Hayek) to get any sort of insight into how economies can be made
to work at scale, and the answer is that we don't understand them, and that
technological progress and population changes mean that attempts to push them
in a direction will have side effects that far outweigh any of the attempted
influence.

~~~
roymurdock
This isn’t true, the study of applied economics (new Keynsian) saved the US in
2008 when the Fed decided to shore up liquidity and helped bail out industry
in concert with the government. Austrian policy would’ve let the entire system
collapse and rebuild itself to avoid the construction of perverse risk
incentives and the zombification we are seeing in the economy today. You can
argue which would be better long term (I think Austrian) but short term we
needed Keynesian measures to save jobs and lives from being consumed in a
downward spiral of debt chain triggering and collection.

Productivity has a precise economic definition - ratio of output to inputs -
and correlates highly to standard of living. We don’t fully understand how and
why technology advances, but we measure increased technology through a
variable called the solow residual. Economic policy can help lead to
technology breakthroughs that increase productivity and the standard of
living. It’s very shortsighted to dismiss economics out of hand as something
we don’t understand. A lot of it is politically motivated but let’s face it
politics is what happens when groups of people get together and try to
collaborate. There’s a lot of important work to be done around productivity
economics and I’m glad it’s getting more mainstream coverage

~~~
soVeryTired
> Productivity has a precise economic definition - ratio of output to inputs -
> and correlates highly to standard of living. We don’t fully understand how
> and why technology advances, but we measure increased technology through a
> variable called the solow residual.

What happens when you can't measure the outputs? What's the total value added
by the financial sector? Or the legal sector for that matter? If I invent an
inexpensive cure for a disease that renders expensive medicines obsolete, has
productivity gone up or down?

Regarding the Solow residual, you certainly _can_ put income on one side of a
regression, and estimates of labour and capital on the other side, and set
them equal using a residual term. I don't think you can convincingly argue to
anyone besides an undergrad economist that the residual represents technology
though. Don't think too hard about what the units of that residual are...

~~~
roymurdock
It’s an approximation that needs to be imputed, and can’t be measured
directly. It doesn’t need units to be a useful measure against itself at
different periods, to measure the rate of change of how environmental
variables effect a nation or firms production function. I think it’s cool and
useful that someone tried to quantify how much infrastructure affects
productivity by abstracting away all the immeasurable variables into one term.
It’s an extremely important concept that deserves more work because of how
closely it is tied to advances in standard of living. It’s not perfect but
it’s very interesting and could be ripe for a revamp given how much data we
are now collecting from all sources

~~~
soVeryTired
My point about units is that (depending on the exact model) if you change the
units, your conclusion may change, which is absurd.

------
soVeryTired
Once you realise that workers are compensated according to their bargaining
power rather than their productivity, none of this should be surprising.

~~~
zackmorris
I was going to say something similar. I'm 41, and when I was a child in the
early 80s, work was simultaneously higher paying, a bit more intense than
today's standards, but also had shorter hours and more leisure time. Where I
live in Idaho, my family and friends were: a dentist (dad) dental office
manager (mom), carpenter (godfather), minister, interior decorator, teacher,
artist, mechanic, lots of military workers on the airbase by my hometown, etc.
Maybe half or less of the mothers I knew worked outside the home. Fathers
hunted in the fall to feed their families.

But our community was largely self-sufficient. We didn't have Walmart yet and
its associated trade deficits which contributed to the national debt. I'll
admit that we were dependent on the nearby military base, BUT that was during
the Cold War. Had the base closed (as it probably should have after the Berlin
Wall fell, say 1990), I think my home town would have survived on ranching,
timber and mining (none of which I support by the way, as Idaho's environment
is under constant attack).

Yes I see the contradictions in what I am saying. But I also believe that we
could have had a more sustainable future had we faced facts and started the
process of transitioning to a 21st century economy earlier. That might have
even led to Gore being elected instead of Bush. So it's complicated, and not
always easy to discern cause from effect. It's all been 20 years delayed, but
there is work in green energy here today.

My feeling is that the American worker HAD MORE LEVERAGE then - in terms of
being able to walk onto any construction job, or specialize in a 2 year
education trade, or even get free college in many states. We still had unions.
We didn't have the welfare cuts that happened under Clinton or the 100,000
factories shut down under GW Bush yet. Quality of life and the feeling of
making one's own way was higher then.

If we want to fix our economy, we need to get organized and take a bigger
piece of the pie for workers (perhaps we should call them makers or
producers), rather than giving it to people who already have money. We can
moan and complain about this simple fact from all political angles, but until
we start electing people who understand how this works, our long slow decline
will continue.

------
Halluxfboy009
One more mystery: if all of this is true, why isn’t small business formation
higher? After all none of these factors (besides mismeasurement) applies to
you if you have a small business.

But if anything, business formation is down.

(Also, the charts by educational attainment are meaningless. There has been a
huge shift within categories. Being a high school dropout in 1960 meant
something completely different than today)

~~~
badpun
Is it because more and more areas of business activity are conquered by large
entities and thus are hard to enter into? As a small guy, you won't achieve
economies of scale of Wallmart or marketing of McDonalds, while 70 years ago,
if you were opening a convenience store or a restaurant, you only had to worry
about local (non-chain) competition.

~~~
pas
> Is it because more and more areas of business activity are conquered by
> large entities and thus are hard to enter into?

Is that true though? Artisanal, craft, handmade, premium, bespoke, etc. of
every kind of bullshit is booming. Etsy, indiegogo, kickstarter, eBay and
whatever else is big business for small producers of gadgets, trinkets and
everything cute, right?

That said, yes, Amazon and other forms online shopping, is pushing out small
shops, but cafés are opening everywhere in cities. (Urban revival and
whatnot.)

But ... without hard numbers there are just feely-goody impressions, so I have
no hard belief about this, just trying to offer a coutnerpoint.

~~~
dsfyu404ed
>Is that true though? Artisanal, craft, handmade, premium, bespoke, etc. of
every kind of bullshit is booming.

Only in markets where there's a high enough density of rich people with
nothing better to spend their money on. Businesses selling hand crafted bagels
don't exist outside areas where there's a lot of people willing to spend their
discretionary income on craft bagels.

~~~
JoeAltmaier
Well, the internet helps with this. But granted, you're not going to sell
artisanal sandwiches over the internet.

And folks willing to spend $40 on specially roasted and ground coffee are far,
far fewer than folks spending $2 for the grocery store brand.

------
wazoox
Because of energy. Productivity going up means one person uses more machines,
and as time goes, the machines do an ever increasing part of the job, because
the energy feeding the machines is so much cheaper than human labour (in the
order of 200 to 400 times cheaper).

This is not by chance that wage stagnation appeared in correlation with these
events: US oil production peaked in 1970. Dollar convertibility to gold ended
in 1971. Oil crisis came in 1974. OECD countries enter a permanent trend of
public deficit in 1974. Unemployment soared in OECD countries at the same
time.

As the ability to augment energy consumption became more and more capped by
the ability to extract energy from the ground, workers gradually lost their
capacity to obtain their part of the cake because it's always cheaper to put
more capital than people at work, so far. The trend intensifies, nowadays
we're talking of ending employment and of the necessity of basic income and
similar tools.

Until the (unavoidable) end of cheap energy, that is... Then we'll be back to
the ancient order of things, when a country GDP was entirely correlated to the
size of its population.

------
defertoreptar
I'm having trouble understanding why, in a society with ever-advancing
technology, why wages _would_ trend with productivity. I'm seeing it like this
(and please correct me if I'm off base):

Input = (Labor portion) + (tech & automation portion) + (other portion
including things like land, materials, and overhead)

Productivity = output / input

Wages reflect the labor portion's contribution to "input." We know that tech
and automation's portion is continuing to increase in relation to labor.
Therefore, with this understanding, wages must decrease in proportion with
productivity.

~~~
thomascgalvin
> Wages reflect the labor portion's contribution to "input." We know that tech
> and automation's portion is continuing to increase in relation to labor.
> Therefore, with this understanding, wages must decrease in proportion with
> productivity.

Let's say I make widgets for $10 an hour, and make 100 widgets per hour.
That's $0.10 per widget.

Then, a new tool comes along, and allows me to make 200 widgets per hour. The
cost of a widget is now $0.05 per widget.

Who "deserves" this extra profit? Yes, my employer paid the expense for the
new tool, but this is (more or less) a one-off expense. They will recoup this
cost, and eventually the increased productivity will be pure profit,.

I, on the other hand, am still spending eight hours a day making widgets. My
time is now worth twice as much as it was, but I'm still being paid the old
rate.

The issue we're seeing with wage stagnation is that companies are making one-
time investments and recouping increased profits _forever_ , while employees
are working just as hard, but seeing no increased benefit.

And that's just from a simple math perspective. This discussion entirely
ignores the fact that when you employ someone, you are essentially renting a
human being, and in order for our society to function, that cost must have a
floor. Society as a whole suffers when you are able to rent a person for less
than it costs to live.

~~~
derp_dee_derp
> My time is now worth twice as much as it was,

no. your time is now worth half as much as it once was. the tool is what
brings the increase in value, not you nor your time.

the owner can now replace you with someone who costs half as much and is half
as efficent and get the same result as before the new tool was brought in.
even with this decrease in time efficiency, the cheaper less efficient worker
has the same value as you did before.

so lets say the owner still wants to increase efficiency but cut costs. ok,
they fire you and hire someone else for 75% of your wage and 75% of your
efficiency. the owner can still make the same amount of widgets as before in
less time and for less cost.

your value has decreased, not increased.

------
choeger
When did China enter the global market? Am I the only one to think that this
might be a natural cause of an extreme growth in world-wide working
population? I think we are already through the worst parts and the dividends
are beginning to pay.

~~~
RPLong
I have thought that for a long time, too. It's natural that, on a global
scale, developed-economy wages would appear to "stagnate" if developing-
economy wages are increasing while competing for the same jobs.

------
TomMckenny
Returns on investment always exceed wage growth. And as wealth concentrates,
the effect is cumulative even over generations. It happens to be tech. It
could just as easily be empire.

There was a moment after the world wars when this was intentionally
compensated for and now it isn't. There is no William Beveridge, no Roosevelt
brain trust and, Keynesian is apparently a bad word now.

~~~
Gpetrium
I think one of the biggest concerns that governments are having is that the
more you try to re-balance wage stagnation and wealth, the less competitive
you are in the world, leading to other types of stagnation.

~~~
TomMckenny
Intuitively this seems quite reasonable.

Yet the period 1946-1973 saw enormous growth in all western countries and
wages kept up with growth during that time.

Of course, it seems likely there are government interventions that damage
growth. But apparently there are some that don't. In particular, progressive
tax structures and social safety nets don't seem to.

------
api
This is really great!

I have to toss something in re: unionization and the percentage it may
explain.

Executive salaries have exploded while worker salaries have stagnated. Could
this be because executives by virtue of the social networks they belong to are
effectively unionized? Unionization of executives is not necessarily explicit,
but the executive pool is smaller and more tightly connected and therefore
executives will tend to behave more like a coherent social group. The worker
pool is enormous, more diverse, and far less organized with far less
opportunity for "out-of-band" social connection.

------
shams93
It's worse than it looks when you add massive education debt and in states
like California we have seen the vast share of tax increases landing on wage
earners plus incredibly high rent.

~~~
WhompingWindows
Yes, I'm not sure if the linked post discusses education debt. Even if wages
increased 50% more than we think due to inflation issues, as the blog post
claims, I don't know how a slightly better wage makes up for vastly increased
education/housing spending. I don't know if the CPI or productivity account
for either of those, either.

------
RobertoG
>>"We shouldn’t dismiss this as irrelevant, because many things that close
only a small part of the gap may, when added together, close a large part of
the gap. But this doesn’t do much on its own."

I'm not saying is not true, but I find this idea highly suspicious when there
is a clear trend that start at some point.

I mean, what are the chances that many independent things move the trend, in
the same direction at the same time, every year?.

~~~
RootReducer
The author addresses this in the conclusion, and is also suspicious, but
presents some possibilities that explain it.

"This surprises me, because the dramatic shift in 1973 made me expect to see a
single cause (and multifactorial trends should be rare in general, maybe, I
think). It looks like there are two reasons why 1973 seems more important than
it is...."

------
omouse
I wonder if there's an impact from the increase in startups? Since most early
employees are getting paid in equity rather than real dollars wouldn't there
be a stagnation for a few years until the equity is transformed into cash?

Also any conversation about wage stagnation has to take into account
collusion, in recent years Google, Intel, Adobe and others were avoiding
poaching each other's employees.

------
amanaplanacanal
Of course, if this continues long enough...

At some point the workers rebel, and bring back the guillotine. Or something
worse (see Soviet Russia). This can't continue long term.

Populist politicians promising to make things better relieve some of the
pressure in the short run, though.

------
Chico11Kidlet
Of course any discussion about labour vs capital share of gdp needs to talk
about land as well. So ‘5. Could Wage Decoupling Be Explained By Increasing
Labor-Vs-Capital Inequality?’ would be more interesting with land.

That also came up in the discussions around Piketty.

------
3pt14159
I've thought about this for the past decade or so. It's obviously going to be
many simultaneous factors for any type of decoupling this pervasive in
society, but I tend to simulate things out in my head and here is what I've
largely ruled in and out.

1\. It isn't gross executive compensation. Holding everything else constant,
executives are very good at negotiating the very best deal for themselves and
corporations live and die by the law of the jungle. These two forces balance
each other out. Higher executive compensation probably means that executives
are more important than they used to be, which I would expect with an
increasingly technological society.

2\. That said, executives and the wealthy class pay way less in tax than they
used to because they're less tied to a region which means they're less
civically minded and they're more able to region shop for lower tax rates,
leading to a race to the bottom.

3\. Computers automate tasks that used to require a high school education. IBM
is IBM because they started with cash registers before computers came along.
There used to be a banker with a real education in every single town. There
isn't anymore and we (especially we!) know why.

4\. Communications—starting with the telegraph, but certainly not ending
there—make locality irrelevant. Combined with the forces of capitalism (e.g.,
comparative advantage, re-invested returns) this hyper concentrates
specialization.

5\. Standardized shipping, especially sea containers. The Chinese government's
greatest insight was the importance of physical freight and they leaned in
_hard_ to become the centre of the worlds manufacturing by essentially[0]
subsidizing it.

6\. Many decades of low interest rates, on the half-baked ideas of Keynesian
theory of productive capital. Surprise! It turns out that injecting liquidity
doesn't necessarily expand business activity. There's plenty of cash locked up
in corporations and monied investors. They're desperate for return, but the
hyper specialization issue stops them from getting alpha once they hit the
market's carrying capacity. Instead these low interest rates go to...

7\. Asset bubbles and arms races! Everyone needs a home. Everyone wants a good
education at a prestigious university. People buy whatever sugary drink
advertises the most. Inflation isn't really low. When a small family home in
Toronto costs more money than the _median_ family makes after tax in twenty
years we know its bullshit. The inflation rate is papered over because of
cheaper manufacturing due to technological progress and international trade,
but it doesn't work for housing and many other things.

8\. The more complex world is inherently less governable by democracies. A
ballot only has a byte of information tops and it only operates over a period
of four to six years. This is why lobbyists win, especially in larger
democracies like America where the ratio of governed to lawmakers is higher.

9\. Surveillance capitalism relies on inexplicable insights and returns. This
hyper centralizes wealth whilst simultaneously shrouding the mechanism.

[0] Solving coordination problems is a form of governmental subsidization even
if the government in question makes a huge profit. Canada does the same with
forestry. I don't know how to square it with global trade.

~~~
Loughla
That all sounds like it's well thought out - two questions.

So your entire thing is that it's a race to the bottom? What is the purpose of
it all then, and how do you think this goes for the next two or three decades?

------
zeroname
Wages have been "decoupled" from productivity because they weren't be coupled
in the first place. They were _correlated_ because productivity and economic
growth are correlated and economic growth and demand for labor are correlated.

However, wages (like all other prices) in a market are set by supply and
demand. Wages will rise to meet demand but not higher, irrespective of
productivity. Furthermore, productivity increases through automation decrease
demand for human labor and therefore suppress wages.

~~~
daze42
This, exactly. As technology continues to move forward and make things even
more efficient, I would expect this gap to continue to widen. I'm confused as
to why anyone would want it to remain linked. As the gap widens, the demand
for Universal Basic Income will rise and gobble up the working class and,
eventually, even the most complicated jobs, until money is considered
worthless and all basic needs are met by robots. Given the option to have
robots do all the work and humans reap all the benefits (besides skynet), who
wouldn't take it?

~~~
helen___keller
> As the gap widens, the demand for Universal Basic Income will rise and
> gobble up the working class and, eventually, even the most complicated jobs,
> until money is considered worthless and all basic needs are met by robots.

The problem here is that nobody knows when we'll get there, if at all. UBI
seems like a solution designed for a society where _most_ people have been
displaced from the need to work, but it doesn't look like society is there
yet. In the meantime we still have people who are struggling to even exist. If
the gap to achieve Full Automation in most sectors is multiple generations,
you might long reach social unrest before you can even "justify" UBI from a
political perspective.

Right now billions in capital investment haven't quite mastered the art of
getting cars to navigate roads by themselves, and some industry leaders (Waymo
CEO) are skeptical we'll ever get level 5 autonomous cars. And this is all for
one single and self-contained task in the human existence (which doesn't even
rely on human appendages! try to imagine automating handiwork).

If 70% of people are without work, UBI is an obvious solution. But if 1-10% of
people are without work and 40-60% are paid peanuts for shit jobs, what's the
solution? If UBI is still best here, how do we justify that to society without
appealing to Full Automation?

~~~
ozzyman700
A possible justification is crime.

I believe it is cheaper to pay someone enough money to allow them to survive
and educate themselves, than to put them in a position where they weigh the
risk of being caught with a crime with the risk of them/loved ones dying due
to not having enough wealth to purchase the things they need.

Currently progress leads to more poverty as wealth is concentrated to
landowners collecting rent. Every increase in productivity is consumed by
increases in rent payment. Holding land and waiting for it to become valuable
is absolutely insane to me. It is theft from the common good to allow that
speculation of land, out premium finite resource.

Without land and labor combined their would exist no capital.

By taxing land value, increases in productivity are swallowed up by increases
in taxes, leading to increases in social wellbeing.

I believe, along with most people who would call themselves Georgists, that
private property is theft from the public

~~~
zeroname
If you look at the results of welfare programs, it would be hard to argue that
they reduce crime. Crime isn't just about subsistence money. For a certain
segment of the population, it's the only way to make _significant_ amounts of
money and also to get some sort of respect, status and power.

If criminals could just be educated and get jobs and become ordinary members
of society, then our social programs would work. They don't, because from a
sober perspective, if you're already a criminal (or so inclined), then crime
is more attractive and ordinary members of society appear as the powerless
suckers they really are.

------
beqcq
It's because of femi nism: now every household has two wage earners, so it
makes sense for wages to split in half.

~~~
daze42
This is a good point. It's simple economics. If there is a sudden rise in
worker supply, but not a corresponding increase in demand for those workers,
wages must fall to accommodate the influx.

~~~
danharaj
No, it's not a good point. Do you think women were just shuffling their feet
at home before they became wage earners? Technological improvements that
reduced the total domestic workload for a household made it feasible to have
two earner households (as a side note it didn't eliminate domestic work which
working women continued to do disproportionately to men to this day).

So the total labor required to live and work successfully in industrialized
nations dropped but instead of that leading to more individual wealth it just
meant that households now had allocated more of their labor to wage labor
compared to before where half or more of the labor of a household was simply
unacknowledged and unpaid.

And it should be noted that poor women had _been_ working. For less
compensation than men, while performing domestic labor. Middle class and upper
class women getting jobs was another story.

Boo, hiss. Feminism. What an odious little comment thread.

~~~
Chris2048
> What an odious little comment thread.

Why? You're the one who injected the "Boo, hiss".

------
BrandonMarc
Aaaah, scott! So much information! It's a long read, and I have work to do,
but ... is there a summary?

------
RickJWagner
I'm glad for wage stagnation, so long as inflation stays down.

For people at or near retirement, it's a great thing. Nothing erodes savings
like rising prices.

~~~
close04
Wage stagnation that comes attached to increase productivity could be offset
by a shorter work week.

I mean if you are ~2.5 times more productive but the wage can't increase due
to other reasons, why not take different actions to consider employee
happiness just just employer profits?

~~~
derekp7
You could also lower the price of the items sold so that the average consumer
can afford more stuff

~~~
close04
I'm not an economist but can imagine forcing the lowering of prices could have
far more impact on the whole economy, not all good. Off the top of my head it
would lead to shortages and thus to increased prices. You'd have to produce
more while having less money available to invest in that. Possibly a whole lot
more.

But reducing the work week only impacts the employer's profit via _slightly_
decreased productivity. On the other hand with 3 free days per week you'd be
more likely to put more money back into the economy.

The problem is today's balance of productivity vs. wage is only perfect for
the employer and not much else is taken into consideration. What kind of
bargaining power do employees have to change this?

~~~
count
It would only lead to shortages if at the current price there is a perfect
match of buyer to product with no waste, AND no capacity to produce a larger
volume of supply. That's hardly ever the actual case.

~~~
close04
The price is dynamic and usually set by supply and demand. Is there a
reasonable way to enforce a decrease? The work week and day have been
historically static and more importantly _arbitrary_. To my knowledge there's
very little to support a specific number of hours (per week/day) is optimal,
except for upper limits dictated by the limitations of human biology.

Can price drops be forced on things that are in very limited supply, like
homes in coveted areas? Or even on products or services that already have very
low margins? Would the seller be there next year to tell you how it went?

The technicalities of forcing a price drop feel out of reach while shortening
the work week has been done successfully twice already just in the past 100
years. Profitability is still higher than ever.

