Wage gains at this point would occur when labor pressures / basically existentially threatens capital, and probably nothing else. We don’t see a lot of labor pressure; there is no organized labor movement left anymore.
There has been more and more talk about developers unionizing, although less about money and more about ethics (e.g. the AI stuff with Google).
I say that to suggest we might see other areas unionize, and obviously they will demand more money, and then wages will rise.
Unfortunately, the catalyst for pressure on capital / resurrection of labor power might be a “more-severe-than-2008” style depression. Because even if wages aren’t rising now, things are kind-of-sort-of good / not terrible for a lot of people. I think most people would be scared to risk it if life is bearable.
Such a recession (if it occurs) would undoubtedly strip away any of the defenses of the ruling classes that remained after 2008 (and have slowly been hammered at ever since), so the ppl with the power will be weak and those with the demands will be extraordinarily motivated and with nothing to lose.
Most minimum wage workers can’t afford a 1br apartment in most of the country. “Kind of sort of not terrible” may actually be a high target to aim for.
Many young people - eg those making minimum wage - live with roommates or in studio apartments and don't really feel significantly disadvantaged by the fact that they can't afford a 1br apartment.
I say this not to say that everyone is doing fine, but that the details can matter a lot.
On a different note, for a fixed amount of housing stock, it is a purely positional good, you can't improve the number of people who can afford a 1br by simply paying people more, you have to build more, or enforce strict rent controls which makes it not a problem of income, but one of luck and inevitably corruption.
If someone loses their job or abondons the property (an almost inevetalbe eventuallity in a group of young people) whoever's left is stuck holding the bag to clean up the mess and pay more rent than they can afford, or get saddled with an eviction or abandonment on their credit so they can't rent again. It's like playing contract chicken. Also, many leases include maximum occupancy and/or charge more for more tennants, such that tennants are not legally allowed to reduce consumption to within their means.
In my hometown (in Alaska) the lowest rent was more then full time minimum wage. Ther was no road out of town, so you couldn't even leave if you couldn't afford a plane ticket to Seattle. Lots of people I know were sleeping on couches and in closets trying not to get caught by the leasor's landlord.
I'm guessing E.B. White was doing this before the Equifax era.
In New Zealand it's considered normal to share a house until you have a long term partner who you move in with, then you find your own house.
I know people in their 30's who still share a house or apartment. It's a social thing as much as a financial thing, your roommates are like platonic partners.
People always ask me how I managed to live like that, but they don't realise that you tend to adapt to your living conditions fairly quickly. If you can manage a couple of months, you can manage a year.
It's actually weird for me to live in a house with only a couple of other people now. I got so used to having people to hang out with practically on tap. There's always somebody to drink with, or watch a movie with, or snuggle up next to. It's strange for me to come home from work to an empty house.
Maybe it's a cultural thing, but in New Zealand it would be expected that in that situation you share a house/apartment with other people.
This is probably true. But there's also no evidence to support that it hurt either. It's quite disingenuous and misleading to make such claims when there hasn't even been a single year of tax filings since the new tax policies have taken effect. Policies, especially tax policies, have long lag effects.
Also, there are so many variables and other factors to consider that it is impossible to think so 1-dimensionally.
There are times for the federal government to run a deficit and inject money into the economy, but when it's done largely as a corporate tax cut in a time of full employment and record corporate profits (both indicating that businesses don't see many opportunities to reinvest in themselves), you'd expect to see that money go out as stock buybacks and dividends. And that's exactly what we've been seeing. There's no need to wait for long term lag effects if the short term investments that are the only plausible story for those effects materializing simply haven't happened.
Yes, the stock market has been propped up, but it's with
fool's gold; there are no gains in either productivity or national capital stocks (public or private). Meanwhile, increase in debt service as a percentage of the federal budget has been guaranteed. The burden of proof is on the tax cut authors to prove the short term growth that justifies it.
If your point is "well, the economy is a very complicated system", that's an argument for avoiding a large drastic action done to that system against the vast majority of expert economic advice, not for it. This tax cut wasn't even the typical "We need to do something. This is something!" fallacy, it was "We don't need to do anything. This is something!".
If you have to pay more on your mortgage and credit cards then that's less you can put into the stock market and invest in other things.
If the tax cuts didn't vastly improve performance then they hurt a lot. They increased an already large deficit even more for which future generations will have to the pay the price.
The timescale for the determination is not left up to months. I don't personally think they were good, but to assert that you can tell right away, is disingenuous. The debt is already so large that this barely affects the momentum.
The idea that a 66% increase in the deficit "barely affects the momentum" is absurd reflects either your ignorance or your bad faith. Apply that logic to your personal spending and see how long it takes before you're bankrupt.
You’re free to disagree, but it will help the discussion if you can find a way to do so without the ad hominems.
Again, I’m not arguing that it’s a good idea. It is irresponsible, for sure. But the scale of it is akin to somebody with $10k in credit card debt opting to go out for dinner once.
Yes, there is. People seem to forget that a tax cut is actually a government subsidy. Coupled with increased spending, if the assumption is that if the macroeconomic performance hasn't been improved that means it hasn't been hurt, then it remained constant despite the 'cuts' + 'increased spending'. Which means that it could have grown/improved if the tax cuts were not in place.
Do you also believe that reducing drag on a moving object is actually increasing the force to move it?
A government subsidy is when public money is SPENT on a good or service to artificially encourage investment in it (or someone just has good lobbyists).
An income tax cut is reducing the burden businesses and individuals must incur from producing economic value.
While taxes and subsidies can both be used by government to encourage selective behavior, they are not the same. They are different instruments and operate differently.
You're making the assumption that everything has an immediate effect. Some things incur a cost in the present for a payout in the future.
If you go to college for 6 months (the amount of time the tax bill has been in place) and still don't have a degree or job, does that imply that going to college doesn't work?
You're also making the assumption that this is a controlled experiment with no other variables. Which is not the case. There are many other things in play.
Let me guess, cutting welfare payments is stealing?
And yes, cutting welfare payments while welfare payouts are constant/growing will be taking money from other sources to keep the balance. So depending on one's definition of stealing, it can be.
All of this seems like gross oversimplification and it worries me that it is so common.
Words have definitions and meanings and when you conflate them you reduce your ability to understand and reason about the world.
I see why people think not doing something is equivalent of its opposite but this is not the case.
Not taxing someone is not the same things as subsidizing them for the same reason that not expressing hate is not the same thing as expressing love. Not attacking someone is not the same as healing them. Hospitals can't heal people by simply not attacking them.
Police reduce violent crime but it would be inaccurate to say that police are the same as hospitals because they both reduce personal injury.
Not doing harmful drugs and studying both make you smarter, but not doing drugs is not the same as studying.
That’s not how it works.
That's literally one form of subsidy. Also, did you know that inflation is a form of taxation? And it is indeed rising. So no, it's not actually letting people keep more of the money, especially if it's cash.
When a word gets used incorrectly or conflated enough even official dictionaries will change.
What's important is to understand the distinctions.
There's something called Sapir-Whorf theory and one of the important concepts is that the more precision your definitions the more capable you are at cognition and understanding and interacting with the world.
It's been said that Eskimos have 37 words for snow. This means that each different type of snow has different properties. They can more effectively operate in that environment compared to someone who thinks all snow is the same.
Some would say that ice and water are the same, and in many ways they are correct, they are the exact same molecules, but if you are going to jump 3 stories off of a diving board onto solid ice instead of water you are going to learn that subtle distinction real fast.
Similarly, conflating taxes and subsidizes reduces your ability to understand the distinctions and their different consequences. And when it comes to implementing policies can have similar effects as mistaking ice for water.
It's important to understand things precisely and not conflate things. Even more so when your votes and actions have a consequence on other people's lives as well.
We understand why you think they are the same, and in many contexts they can safely be conflated, but in many others it is dangerous to assume they are the same.
Which would imply that any gains (or losses) now would have to do with policy changes during the prior administration, supporting the author's point.
So, alright, what's misleading the implication that they could have any significant effect by now.
Wages would be going way up if Trump were actually delivering in terms of deportations and the cessation of guest worker programs.
There are three graphs, none of which are about wages.
Call me crazy, but I would like to see a graph of, you know, "most Americans' wages" over the last few years if we are talking about the trend in most Americans' wages.
Particularly healthcare costs… largely accelerated since the ACA, which NYMag supports wholeheartedly and is IMO a glaring omission in an article like this.
Things like the definition of "unemployment" have changed. If you work 1 hour a month you are employed. If you have been unemployed for longer than 3 months, you are no longer among the unemployed. The reasons cited by the officials always sound rational, but their net effect is to make government statistics look a lot better than they actually are.
There is a discussion of this here
or here https://www.sprottmoney.com/Blog/big-mac-index-suggests-amer...
If I read that article in combination with the one we're discussing it looks like there is a race to the bottom whether its temp jobs or contractors. For instance here in Florida we employ lots of people in the hospitality industry and in the outskirts of those bigger cities (Tampa Bay for example) average wages are so low its shocking. Just take a look some time, whether this is good or bad is up for you to decide. For me I think unless we subsidize education more and do it fast that will be the new crisis.
One way of viewing Trump’s actions might be in terms of “crisis theory”, or the idea in the 70’s to destroy the welfare system by overpopulating its sign-ups, thus forcing the creation of something new.
He pouring gasoline on the economy to ignite and bring about its ruin. If you’re poor right now, you can probably live in some very creative ways. The wealthy are not very good at dealing with large declines in income, as evidenced by the German billionaire who killed him self in 2009 after his net worth dropped from $8 billion to $5 billion: https://www.reuters.com/article/us-merckle-newsmaker-sb-idUS...
The opposite goal of this is the elites of the world who want to run a steady, slow-mo bubble ala Japan of the last 25 years. It definitely would be stable and work, but it would preserve the status quo and not really offer anything new to the working class.
Obviously there are the surface indicators of truth (a statistic here, a fact there, a nice quote from somebody), but big picture, the issue is not “is this Trump guy a good tinkerer economist/engineer of the US stock market”, but how the bipartisan monopoly of power in Washington has stabbed the working class in the back at every turn.
The big clue that the author would
never understand this was his conflating of Koch and Trump. That would be like saying Shite and Sunni Muslims are the same. It’s an incredible cultural oversight.
A good example of btw of this “stab you in the back” elite is Madeline Albright, Bill Clinton’s Secretary of State. For all her work promoting freedom and women’s rights, the network marketing scam company Herbalife paid her $6 million to promote increased legalization of its products. It’s a scam company that preys on the poor.
The ALEC club may not like Trump's views on immigration or tariffs, but they're in perfect sync when it comes to more or less every other economic issue. And the administration's energy policy is another massive win for them as well.
> A separate Labor Department report on Tuesday illustrated how higher prices are pinching wallets: average hourly wages, adjusted for inflation, were unchanged in May from a year earlier, even as nominal pay accelerated to a 2.7 percent annual gain from 2.6 percent in April. For production and nonsupervisory workers, real average hourly earnings fell 0.1 percent from a year earlier.
The article I linked is an impartial example but it is not better.
The simple truth is the underlying numbers haven't really improved since the GOP took the reigns. We are in a sideways holding pattern of 0% real wage growth and 2% of the working-age population has stopped looking for work since 2000.
The effects of the outgoing administration's economic policy last ~1 year after they leave office since the government doesn't really turn on a dime. The trends, honestly, are the same as they were under Obama and the GOP has done nothing but claim "Well we did it! Everything is fine now" despite the fact nothing of any real substance has changed since they took control of all 3 branches of government.
Not at this 'news' source. Here the argument is twisted to be about tangential issues. Odd, there was none of this a few years ago...
Exciting new-economy opportunities, like delivering for Doordash or recharging Bird scooters, pay very poorly.