
America has two economies, and they’re diverging fast - siberianbear
https://www.brookings.edu/blog/the-avenue/2019/09/10/america-has-two-economies-and-theyre-diverging-fast/
======
nemetroid
The charts have a number of issues. With some changes, they can easily show
the significance along with the trend itself. I created a new version of
figure 2, which fixes some of the issues:

[https://svgur.com/i/F35.svg](https://svgur.com/i/F35.svg) [SVG]

* Bar charts are preferred when presenting a population of something (people or jobs)

* Each Y-axis starts at zero

* Charts that (by definition) add up to 100% are shown as stacked

* The y-axis max is set to 100% where possible (except in one case, where this obscured the trend)

(I couldn't get Google Sheets to make a nice x-axis for the first chart)

~~~
jpster
Thank you! And how did you learn these guidelines? Is there a book or blog
post you recommend for data visualization best practices?

~~~
kk58
Nathan yau has a great book

------
Merrill
>"As such, the Democratic Party is now anchored in the nation’s booming, but
highly unequal, metro areas, while the GOP relies on aging and economically
stagnant manufacturing-reliant rural and exurban communities."

The analysis of averages can be misleading. Democratic districts appear to
include both some of the poorest urban cores and wealthiest suburbs. I wonder
how the GINI coefficient of Republican versus Democratic districts compares?

Also, the makeup of the 111th House was 256 D, 178 R and the makeup of the
116th House was 235 D, 199 R, a swing of about 10 districts to the
Republicans. But note that in the 114th House the makeup had been 188 D, 247 R
and the map was even redder.

~~~
mynameishere
_GINI coefficient of Republican versus Democratic districts_

You can get an idea from the states.

[https://en.wikipedia.org/wiki/List_of_U.S._states_by_Gini_co...](https://en.wikipedia.org/wiki/List_of_U.S._states_by_Gini_coefficient)

It won't surprise you to reveal that Utah features the greatest amount of
economic equality. When you chart Democrats' income it tends to be bimodal--
poor people voting for tax money and rich people voting for [insert mystery
reasons here--stopping climate change? ethnic interests? to please TV
clowns?].

~~~
notacoward
Mostly, the "mystery reason" is that self-interested voting is prevalent only
among the needy and the greedy. At one end are those who feel it's necessary
for their own survival (even when they're wrong or when the policies they vote
for actually harm them). At the other end are the rentiers who never had any
guiding principle other than self-interest. In between are the many
reasonably-prosperous and mostly-urban folks who can afford to vote their
conscience. When the personal effect of a policy ranges from slight benefit to
slight harm, in neither case affecting one's basic quality of life or social
standing, it becomes a lot easier to vote for policies that one sincerely and
logically believes are best in a utilitarian sense.

~~~
scarface74
I’ve heard more than one person on the greedy in say “I find candidate X
detestable as a person but I knew I had a better chance at tax cuts.”

~~~
ineedasername
Sure, but we're talking about tendencies, the average ability for people in
these different groups to vote in this way, not in absolute "everyone votes
this way" terms.

------
pge
One major factor that needs to be considered when looking at these data is
that the electoral districts (the unit of measure here) were redrawn with
significant changes after the 2010 census (taking control of state
legislatures in order to redraw the maps to be much more favorable was a key
component of Republican strategy). As a result conparing 2008 and 2018 as if
those congressional districts were the same may be skewed.

~~~
vitus
Yeah. I was disappointed to see that there wasn't a comparison between 2011
and 2013 to try to identify how big that effect was.

Wikipedia has images that can give a vague idea of the geographic shift (which
I like especially because they show which districts flipped in the election).
It looks to me that some of the major shifts were independent of
gerrymandering (e.g. Dakotas becoming solidly Republican, Dem control
solidifying over coastal Pacific and around NYC), while others might have been
tied to it (e.g. compaction of Dem control in UT, AL, MS).

2010 election:
[https://upload.wikimedia.org/wikipedia/commons/thumb/a/ac/20...](https://upload.wikimedia.org/wikipedia/commons/thumb/a/ac/2010_House_elections.svg/400px-2010_House_elections.svg.png)

2012 election:
[https://upload.wikimedia.org/wikipedia/commons/thumb/b/b8/US...](https://upload.wikimedia.org/wikipedia/commons/thumb/b/b8/US_House_2012.svg/400px-
US_House_2012.svg.png)

2018 election:
[https://upload.wikimedia.org/wikipedia/commons/thumb/4/48/US...](https://upload.wikimedia.org/wikipedia/commons/thumb/4/48/US_House_2018.svg/400px-
US_House_2018.svg.png)

------
DrAwdeOccarim
Wow, this really blew my mind. The divergence is striking. Even without words,
the article really explains the contemporary social situation in the US. It
makes me wonder if remote-work, high COL in tech hubs, higher-ed cost
exhaustion, tech burn-out, and the next recession will reconfigure things.
Like the article states, the amount of unbalance here can't be sustainable
though "the market can remain irrational longer than you can remain solvent"
kind of idea should be kept front and center in this discussion. I am worried
a massive wealth transfer coordinated by the government (e.g., single payer
healthcare, UBI, basic housing guarantee, free college, etc.) will entrench
this divergence. I wish we had let the last recession ('08) actual happen
instead of cheap money for a decade allowing us to kick the can down the road.
Intervention in the capital markets a la the past decade probably amplified
this phenomenon by pulling money from productive, structural capacity
increases instead of to loss-leading Unicorns that wouldn't work in an
economic system that accurately priced risk (i.e., higher interest rates). A
company like Uber, though amazing to me and I use all the time, could only
exist with cheap money for a decade. The idea of building a company by losing
money for 10 years in order to build your client base is impossible if rates
are high. That capital would have looked for more "real" investments that
probably would have valued what these areas that lost GDP over the past decade
could have provided.

~~~
peteretep
> I am worried a massive wealth transfer ... e.g., single payer healthcare

Only in America is adequate health provision considered "massive wealth
transfer"

~~~
rayiner
It is a massive wealth transfer. It may be a good idea, too. Currently 2/3 of
non-elderly people have insurance through their employers. If we need to
extend coverage to those who don’t have it, those 2/3 will have to pay for the
other 1/3\. If we are proposing a massive income transfer of $3 trillion a
year for the good of the country, we have to be honest about it.

~~~
habnds
There's an additional wealth transfer between the owners of healthcare related
stocks and non owners. If the US approached EU type health care costs we could
easily give every one health care for free. The cost would come out of
healthcare company margins.

~~~
rayiner
Totally false. Total health industry publicly traded company profits
(including drug companies, hospitals, and insurance companies) add up to about
$50 billion per quarter, or $200 billion per year _worldwide_ :
[https://www.thefiscaltimes.com/2018/11/12/Chart-Day-Big-
Phar...](https://www.thefiscaltimes.com/2018/11/12/Chart-Day-Big-Pharmas-
Profits).

Total domestic hospital profits (including more than just public companies) is
about $74 billion per year:
[https://www.modernhealthcare.com/article/20180104/NEWS/18010...](https://www.modernhealthcare.com/article/20180104/NEWS/180109966/hospital-
profits-continued-their-rise-in-2016). Insurance companies are $25 billion
annualized: [https://www.cnbc.com/2017/08/05/top-health-insurers-
profit-s...](https://www.cnbc.com/2017/08/05/top-health-insurers-profit-
surge-29-percent-to-6-billion-dollars.html) ($7 billion per quarter for health
insurers). The link above shows $100 billion in drug company profits
worldwide; about half of revenues are in the US, so let’s say $100 billion in
profits domestically. That’s $200 billion for the US healthcare industry,
including non-public companies in addition to publicly traded companies.

Total US healthcare spending is $3.5 trillion. Profits account for just 6% of
that spending.

To reduce healthcare spending to the same levels as the rich European
countries like Germany or France we’d have to cut spending about $1.25
trillion. Cutting healthcare industry profits to zero (and note that there are
for-profit hospitals and drug companies in the EU and they don’t make zero
profit!) would reduce healthcare expenditures by just 1/6 of the amount
required.

~~~
AlexandrB
A better estimate for savings from some parts of the industry is _revenue_ not
profit. That’s because the work done by, for example, insurance companies is
largely useless paper shuffling that doesn’t need to exist under single payer.

Edit: oh yeah, and marketing. So much health industry money ends up in
marketing. Something almost completely unnecessary under single-payer as well.

~~~
rayiner
The post I was replying to was talking about wealth transfer from people to
shareholders. Profit is the proper measure of that.

As to cost savings, you can’t use insurance industry revenue because that
includes money spent on services. And a lot of the “paper shuffling” does need
to exist under single payer. Most universal healthcare systems aren’t
nationalized systems like the UK NHS. Germany for example has mandatory
membership in Public health insurance organizations for those making under
60,000 euro. There are 100+ of those. Then 15% of the population has private
health insurance. Care providers are mostly private. So there is still medical
billing that needs to be done. Most EU countries are similar in that regard,
and unlike the UK NHS.

As to marketing, now you’re talking about a drop in the bucket. Pharma
industry advertising adds up to just $6 billion per year.

~~~
mercutio2
I support pretty much any solution that provides guaranteed access to
effective acute care (the fact that the ER can’t legally turn you away doesn’t
mean it’s effective care).

But people who advocate for this position (which, again, I believe in) all too
often live in a fantasy world where we can magically switch systems and pay
less. If we keep paying US medical personnel their prevailing wages, there is
no way we’re going to lower costs.

Nurses and doctors are too popular in the US to ever even suggest that we
reduce their wages to European levels.

~~~
tptacek
Acute care, including the ER, is a small fraction of the total cost of health
care. If the health care problem was simply ensuring everyone access to a GP's
office and an ER for emergencies, we'd have solved it by now.

~~~
mercutio2
Oh, absolutely.

Providing effective and low cost chronic care is an unsolved problem
everywhere.

I can’t say that I support any and all entitlement schemes I’ve ever heard for
chronic care, is why I was singling our acute care, where I do, but you’re
right that I was mixing up arguments.

But of course when you provide low cost acute care, and don’t cover chronic
conditions, there’s strong pressure for chronic problems to wait until they’re
acute and harder to solve, and for chronic patients to use the acute system
very inefficiently.

It is indeed a hard problem.

------
mehrdadn
I wish their charts didn't just draw straight lines from 2008 to 2018 data
points. The data points in between could be meaningful.

~~~
Yhippa
I woke up early and can't get back to sleep so my phone is in Digital
Wellbeing mode (grayscale screen). Those chart lines are nearly impossible to
distinguish from each other. Should have gone with a dash or other marking.

~~~
ulfw
or I don't know, maybe you should turn off your 'Digital Wellbeing mode'?

~~~
saspiesas
They can, but that's not an option for colorblind people?

~~~
ulfw
Absolutely true. That was not the argument made though.

------
bensonn
__“Blue” territories have seen their productivity climb from $118,000 per
worker in 2008 to $139,000 in 2018. Republican-district productivity, by
contrast, remains stuck at about $110,000. __

How is productivity measured? I have wondered about this stat as I have seen
it used many times over the years but I can 't figure out what and how they
are measuring or who is doing the measuring.

Take Weyerhaeuser as an example- they own 26 million acres of land across
North America, have 10,000 employees and 7+ billion in revenue. Recently their
corporate headquarters moved to Seattle. Is their 7 billion in revenue spread
across all the loggers, drivers and mill workers in remote forest locations?
Boeing is another example with headquarters in Chicago but as far as I know
they don't make any planes in Chicago.

Are these stats pulled from census, irs, labor...? Am I wrong or cynical in
thinking these are lazy stats and most of the "productivity" is attributed to
the small percentage of employees in the corporate HQs? I can't imagine a fed
bean-counter following around logging trucks in remote areas to make sure the
productivity is attributed to the correct region.

~~~
beefman
Productivity is measured by dividing GDP by total hours worked, with the
assumptions that GDP is caused by work and that the relationship is linear.
The latter assumption is false and the former is highly suspect.

You raise a good question about localization of GDP. The global economy is a
highly-connected network. It's often unclear how to draw valid conclusions
from national accounts, let alone the local accounting attempted here.

That said, I think there most likely is a trend of the kind imagined by the
authors and that it's showing up in these figures. Showing up is the most it's
doing though.

------
georgeecollins
This article shows that districts that tend to vote democratic are more
prosperous, and the gap is growing. However, people who are more prosperous*
(income > $200k) tend to vote Republican over all. I can't explain that. If I
were going to guess it would be because older people tend to have more wealth
and income in America (in general) and older people sku more republican.

*[https://brandongaille.com/24-interesting-republican-vs-democ...](https://brandongaille.com/24-interesting-republican-vs-democrat-demographics/)

~~~
awareBrah
Why would that be hard to understand. It makes total sense.

People making >200k probably use almost no government resources, and are sick
of getting taxed up the arse left and right at any opportunity.

I’d be happy to pay more tax if I had any faith the money would be used
wisely, but I don’t. Hence, my goal when voting is tax minimization.

~~~
scarface74
If people who are wealthier are older they are getting social security and
Medicare. Everyone is getting roads to drive on, police, and other government
services. They probably are still sending their kids to public schools and
moved into the “good neighborhoods” to get into better schools.

------
theNJR
This makes me think about the book 'Coming Apart' [0] which was an eye opening
read which predicts all of this. As a tech/media person in a democratic costal
city, there is a whole other America that, it turns out, I know very little
about.

[https://en.wikipedia.org/wiki/Coming_Apart_(book)](https://en.wikipedia.org/wiki/Coming_Apart_\(book\))

~~~
galangalalgol
As a dev from flyover country what was something that surprised you? Getting
rid of misconceptions is the sort of glue that could prevent this.

------
chewbacha
I stopped reading when figure one showed only two data points on a chart
without zero based y-axis. It portrays a divergence that -looks- like a multi
factor difference, but is only a 20% at most divergence. This coupled without
historical comparison for normal variance and the repeated use of excited
adjectives, makes for an alarmist article.

------
logicchains
I really appreciate how this article just presents information without trying
to blame anyone or push a political agenda.

~~~
inimino
Not sure if you're joking, but just in case you're not... to me the political
agenda was particularly clear.

~~~
logicchains
I wasn't joking. Seems to me it could just as easily be used to support the
"liberal elites are out of touch with real Americans" narrative as the "Tump
voters are dumb bumpkins" narrative.

~~~
inimino
Well, yes it could. Because it's a brilliant example of liberal elites being
out of touch with real Americans.

~~~
dlp211
What exactly is a Real American?

~~~
inimino
If I ask you if you're American and you say yes, then guess what? You're a
Real American.

------
ethbro
YES. This article clearly answers what I was asking about a month after the
presidential election.

"Why aren't Democrats trying to answer _everyone 's_ problems? And realizing
that someone is telling you they have a _need_ if they vote for the other
party?"

Turns out, politics is in its own filter bubble. Democrats honestly can't
relate to rural or manufacturing areas anymore, and Republicans can't relate
to urban or technology areas.

~~~
throwaway6734
> "Why aren't Democrats trying to answer everyone's problems? And realizing
> that someone is telling you they have a need if they vote for the other
> party?"

Not true in all cases. Particularly look at what is going on with farmers in
the midwest voting directly against their economic self interest.

~~~
rayiner
Why is it bad when farmers in the Midwest vote their conscience, against their
supposed self interest, but it’s good for rich programmers to vote against
their self interest? The Trump tax cuts were good for me—am I obliged to vote
for him?

~~~
throwaway6734
I should have been clearer. Voting against your self interest is not an issue
(and can even be admirable).

The issue I have is farmers relying on state welfare to stay solvent while
they vote against their economic interests.

------
_edo
I would really enjoy seeing an article like this paired with analysis from
somebody with the same education level but from the University of Chicago
economics department or something like that. They'd probably tell two very
different stories. A few things that jumped out at me:

Two of the sectors where the author is touting gains for Democrats both have
significant left-leaning bias: academia and tech. How does that play into
this?

Democrats are getting more college degrees now, but which degrees?

Why start so many graphs of Democrats doing better than Republicans in 2008
when we had a big recession and a new president who didn't prioritize rural
America? Why not go back to 2000 or 1990 so we can get a bigger picture?

And pardon my ignorance, but "GDP per seat"? And why is this graph next to
_Median household income_? Are they saying that the changes in median
household income are causing "GDP per seat" to rise? Urban populations have
changed _a lot_ in the past 10 years, are we even talking about the same
households?

Household income statistics are prone to distortions[0], GDP per seat is
probably prone to even more, why not use GDP per capita? It feels like they
were just happy to find two graphs where the Democrat line went up and the
Republican line went down and they know most people will just glance at the
graph without wasting their morning thinking about what GDP per seat really
means and how it's affected by the population flows of the past decade.

[0] - [https://www.creators.com/read/thomas-
sowell/09/16/misleading...](https://www.creators.com/read/thomas-
sowell/09/16/misleading-statistics)

------
transfire
I wonder how much the lack of high-speed Internet plays into the stagnant
economic prosperity of rural America.

~~~
AdrianB1
Not a lot. High-speed Internet is good to have, but it does not make your farm
better, productivity higher and product prices higher. You don't "digitally
enhance" your manufacturing plant with faster Internet unless the speed of
Internet is keeping you from achieving better productivity - most of the time,
not the case, plants have all local systems and they use SCADA, not fancy
screens or kubernetes.

~~~
PorterDuff
Perhaps the general hope is that we can replace all wealth due to
manufacturing, resource extraction, food production, with that produced via
internet advertising.

~~~
AdrianB1
I haven't seen yet anyone eating internet advertising, living in it, heating
with it, driving it etc.

------
echelon
Something this article doesn't specifically call out is age. Anecdotally, it
seems that the upcoming generations are more liberal than the last, and that
the older population is simply dying off. Perhaps someone can cite direct
evidence of this?

~~~
fauigerzigerk
I agree. The article is generally lacking demographic data. Are younger,
better educated, more productive people moving from red to blue districts? Is
the share of the population living in the red districts shrinking? There are a
lot of open questions.

------
mystique
Are these conclusions correct though? They show the electoral map and the
districts that were lost. Those are more rural and more traditional industry
focused areas.

It is more likely that coastal Democrat's income and education was always
higher than rural leaning counties and remained at par between these two time
periods. To state that this materially changes the Democratic party is not
right.

------
austincheney
There are only two charts in that article that matter. The ones on
productivity and education. These explain everything else in the article.

The article over generalizes on geography. My city is deeply red but it
recently passed San Francisco in population and is growing faster in nearly
all metrics including jobs, housing, wages, and so forth. I think the article
is generally correct in that urban clusters tend to be more blue and rural
areas tend to be more red, but that is a product of population density more
than anything economically related. Despite my city now having more people
than San Francisco it is also growing geographically and can maintain its
average density. It is now geographically larger than Dallas. If this rate of
growth is maintained this city may enter the top ten of US cities, both area
and population, over coming decades and it will probably continue to be a red
congressional district.

Also, next door is a suburb that is possibly the wealthiest mid-sized city in
the country and it’s also in this red district.

------
agsilvio
I stopped reading at "low-skill".

~~~
PorterDuff
lol. Good point. I would like to see everyone's list on what a 'skill' really
means. It would make a good basis for a discussion.

a quick edit: It's a question that really began gnawing at my mind over the
last few minutes. What is a skill?

To tell you the (highly likely) truth, I could probably take on the jobs the
authors hold and do a perfectly acceptable professional job given a desk, a
library, a phone, a web browser, and a five minute head start. Are they
'skilled'?

------
Bubbadoo
Given much of the economic growth is in tech and tech tends to concentrate in
urban centers, urban centers tend to be blue. Can this be much of a surprise?
The Administration's self-promoted gains in manufacturing and mining are
impaired by some of that technology. Automation has played huge roles in the
very industries Trump heralded for his voter base in 2016. You no longer need
an army of humans on the production floor or even in the coal mine, making
those, formerly high-paying jobs, a thing of the past. This leaves an entire
population of disenfranchised to whom immigrants are a major threat as is
outsourcing. So these numbers and graphs should not be a surprise to anyone.

------
Havoc
I suspect this is exactly what makes the Trump-style platforms viable even if
they make no real sense.

------
danmaz74
In other words, Trump's Republican party is losing votes in more highly
educated districts, which not surprisingly fare better in the information-age
economy. Conversely, it gains votes in districts with a lower education.

~~~
AdrianB1
Are the Republicans "Trump's party" or Trump is just riding the wave?

~~~
PorterDuff
Both?

My guess is that the dividing line between 'Red' and 'Blue' is being
renegotiated as we speak. The post-WWI political arguments, largely about
economics, are being replaced by something new. Trump obviously has a good
nose for these matters.

------
inimino
In case anyone was wondering why the level of statistical sophistication on
show here would embarrass many an English major, the primary author, Mark
Muro, was educated at Harvard and Berkeley, where he was presumably better at
English literature than he now is at statistics or statistics-heavy
journalism.

Here is his CV:

[https://www.brookings.edu/wp-
content/uploads/2016/02/metro_2...](https://www.brookings.edu/wp-
content/uploads/2016/02/metro_20160809_markmurocv.pdf)

Including this gem from almost a decade ago:

“Bill Gates, Not Congress, Has the Solution to Global Warming.” The Avenue, A
blog of The New Republic. January 25, 2010.

I'm glad that worked out so well for us.

Don't miss this:

[https://www.brookings.edu/blog/the-
avenue/2019/08/23/instead...](https://www.brookings.edu/blog/the-
avenue/2019/08/23/instead-of-bemoaning-wealth-work-make-it-better/)

Tl;dr: "wealth work" is here to stay, yes it's a "servant economy" but we
should just tax and regulate, so that the servants feel better about their
jobs walking the dogs of people too rich and lazy to walk their own dogs.

------
tsss
> Democratic districts have seen their median household income soar in a
> decade—from $54,000 in 2008 to $61,000 in 2018. During that decade the US
> had an inflation rate between 1 and 2%, which is around $5-10k. So really
> there was no "soaring" at all: democrats barely manage to hold on to their
> wealth/lifestyle while republicans are continuously losing and worse off
> than the years before.

Everyone in the country is losing except for Jeff Bezos and his caste of rich
capitalists who are served by the corrupt politicians of either party.

------
helpPeople
I'm not Republican or Democrat, but I find the Math provided not agreeing with
their conclusions.

Given more than 60% of tech workers do not identify as Democrat, the
conclusions that tech workers are Democrats are silly.

I identify with only a few Democrat Candidates and fiscally think Democrats
are regressive.

That said, Republicans also don't align with my social or economic views.
(Tariffs and government spending)

If I had to guess why this article exists, they are pressuring people into
thinking educated rich people vote Democrat.

~~~
viraptor
> Given more than 60% of tech workers do not identify as Democrat

[citation needed]

But for clarity, I'd like to see "identify as X" and "identify as neither".

For some numbers which don't agree see [https://www.vox.com/policy-and-
politics/2017/9/6/16260326/te...](https://www.vox.com/policy-and-
politics/2017/9/6/16260326/tech-entrepreneurs-survey-politics-liberal-
regulation-unions)

"They found that, broadly speaking, tech entrepreneurs are pretty liberal.
75.2 percent voted for Hillary Clinton in 2016, and 61.3 percent identified as
Democrats"

~~~
stjohnswarts
Yeah dude doesn't realize there is the catch all part of independents who make
up more registered people than either dem or republican party.

------
jstewartmobile
All of these think tanks devour money from God-knows-who and shit it out into
a " _lies, damn lies, and statistics_ " narrative for God-knows-what-purpose.

All I'm reading out of this--in-between the lines of course--is " _Booga booga
red staters! You 're all going down into an abyss of poverty and opioid
addiction. Better sell the farm, borrow six figures for a new job credential,
prostrate yourself before any corporation that might take you in, move to the
city, and spend $2k/month to live in a shoebox_"

In other words, wall street wants even more tropical mansions.

