I think it might be a good idea for us to keep the corporations that have for so long benefited from the good business climate, strong infrastructure and good worker ethics in the US to dance with the ones that brung them, yes I do. Will CERTAINLY require a less laissez faire attitude towards our misbehaving corporations, and that’s a very good thing.
If they were made in America, no one would buy them unless you banned or taxed imports. That would be very bad for the economy as it would devastate our exports. Apparently you don’t know that.
I really don’t understand you conservatives. So resistant to change and always look back at some mythical golden age.
Productivity is the fall-out of many variables, not all of which are intrinsic to the skill-set of the worker, and the worker cannot claim all or even a proportional share of the improvement. If a monkey can be trained to do a job, eventually in a free market, it will pay peanuts, so long as there are lots of monkeys.
If you have two workers with basic literacy and intelligence, but no special technical skills, you could give one massive robot to operate and give the other a needle and thread. One would produce $10,000 worth of goods a day, the other would produce $10,000 worth of goods a year. In the US of 1960, the worker might have been able to negotiate a salary of $100 a day. In the India of 1960 the guy with the needle and thread is going to make a lot less, maybe $10 a day. But India neither exports not imports in 1960. In 2010, the Indian guy has the robot too. He makes $100 dollars a day, just the same as the American guy. But the Amerian guy does not want to work for $100 a day any more, because the guy who designs robots makes $1000 a day, and the dirty Indian makes $100.
This is what it means to say that a worker is “worse off” because his income in real terms only went up by 4.3%. He is worse off because someone else’s income went up by 100%, 200% or 300%.
Yes. The gains from trade and automation went disproportionately to the owners of capital, both physical and intellectual. Yes, these guys to some extent rigged the game by buying political influence. Meanwhile the worker is voting for someone because he promises to teach creationism in school, ban abortion, restore prayer in school, make everyone salute the flag, etc. In my mind that is the fundamental difference between the development of Europe and the US over the last forty years. Somehow populism in the US took a really perverse turn about thirty years ago.
Most conservatives support trade liberalization, far more than the Democrats-only old fossils like Pat Buchanan are protectionist
The reason why the increase in time at work and all the rest hasn’t produced any result on income is because of the decrease in collective bargaining over the same time period. The productivity gains are having clear results in earnings, but that increase isn’t making it down to the workers. Real hourly compensation (as per the BLS) have increased at only 1/4th of the rate of inflation since the data started in 1987. The gains have been going to investors and executives. They have a rational self-interest in keeping wages low, and will accomplish exactly that in an absence of upwards pressure from the labor force. That upwards pressure has diminished as both union membership and public support for collective bargaining has dropped over the last several decades.
Workers are pushing less against the downward forces on wages, so all the hours and productivity increases have accomplished is to keep income at the same level. Working harder just to stay afloat is a real social phenomenon.
Might not be the promise of capitalism, but it *is *the American Dream. The original one, y’know, before it was replaced by the new and improved American Dream 2.0 : sue some random corporation for millions over bullshit, never have to work again 
are you thinking of old and rich japanese men saying americans are fat and lazy? that thing ended in the mid-90s when japan had a major real estate and banking problem. military pundits stopped saying the US armed forces can run and hide but can’t fight right after desert storm. then of course, it became the “only” superpower when the wall fell.
i think this thread is a bit behind the times. nitwits in business school back in the 90s kept insisting japan will own the world. now it’s the chinese and people say it’s a certainty. what changed and what are americans supposed to be asking? definitely it’s not something that happened more than 15 years ago.
Scarcity.
There are plenty of spare Americans. So if you can use one in commerce then they get subsistence and you get all the profits.
CEOs and investment bankers? Not enough to go around. (I don’t understand how or why that can be, but it seems to be so. Anyway, a separate question entirely.) So if you can use one in commerce you get the minimum return on your capital and they get all the profits.
Profits are never shared (in a free market). The supplier of the scarce resource gets the profits, the supplier of the abundant resource gets the mimimum marginal return.
. . . There. Now, if you ever need legal advice or representation, please feel free to pull my business card out of your [ahem]. There’s plenty for your friends, too.
If labor is so cheap/abundant here, why do Mexicans seem to have the idea they can come here and it’ll be a job-seeker’s/labor-seller’s market?
The market doesn’t care what passport you hold, doesn’t have an obligation to ensure you are well informed, and anyway the Mexicans aren’t earning fat wages. If you prefer “There are plenty of spare North Americans…” or I suppose even better “There are plenty of spare workers in the USA…”
AD 2.1: Become famous for being famous, get a reality show, profit!!
That one, at least, doesn’t have merit for your argument. The Flynn-effect is a permanent and world wide phenomenon.
The numbers on income growth just posted refuted this nonsense before you wrote. Over the past decade the middle class has not made more, while the 1% have. Spending has nothing to do with it. And of course if you make a lot expenses do not go up, since you have or don’t want the things to spend more money on. Even the right doesn’t claim that the rich are going to consume their extra income - they are supposed to invest it.
As for the rest - do you feel underprivileged because you don’t have 3d holographic TV and the ability to take vacations in orbit? Didn’t think so. I assure you that when I was growing up I did not miss smartphones or computers. Sure there is more to spend on, but many things are cheaper. Long distance used to be expensive, now it is basically free. Airfare is cheaper. Cars actually don’t cost a lot more, especially when you consider that they are far more reliable and last a lot longer than they used to (and use a lot less gas.) Plenty of people had TVs in a lot of rooms back then - in the early 60s my family had more TVs than I do now.
It’s like the rich and their stupid underlings are in a fighter jet and the people protesting their rigging the game are an anti-aircraft missile.
The rich guy pilot gets to hot dog around firing hundred thousand dollar missiles willy-nilly and as the protestor missile closes in on the jet, underling co-pilot releases a cloud of aluminum flake chaff to distract the missile: “Middle class SPEND too much on crap!” “Poor people have REFRIGERATION!” “OWS people have iPhones!” “Welfare queens!” “Voter fraud!!!”
Anything to distract the plebes enough so that the jet can keep cruising along as usual. 
This is not true if you use the same inflation measure for both productivity and compensation. In 1960s the labor share of compensation in the economy averaged 62%, in the 70s it went up to 66%, and then declined in the 90s to 65% where it still is. Productivity since 1970 has gone up on average 1.9% every year and compensation per hour went up on average 1.7% every year if you use the same measure of inflation as is used to compute productivity. The reason that some statistics show that average wages have not risen as much as productivity is that we are receiving more and more of our compensation in the form of higher cost health insurance. Benefits now make up around 30% of compensation whereas 40 years ago they only made up 20%.
To read Martin Feldstein’s paper on this at the NBER click here
And contrary to all the talk about the rich getting all of the gains of recent time in 1979 the top 1% received 17.1% of after tax income and in 2009 the top 1% received 11.3% of after tax income, a decline of almost 33%..
See this article by Allan Reynolds
I can only get to the abstract of the Feldstein paper. Looking at lumped labor is not very useful, since you’d have the same result of all the growth in labor wages went to the top 1%. I’d like to see the distribution of wages over time.
No doubt our private enterprise health care system has made things worse, which is just another good argument for a national healthcare system. While employer contributions have increased, they have not increased at the same rate as costs, which means that employee contributions have increased or employees are left without insurance. Both of these things reduce their income for consumption, which prolongs the demand problem.
And whenever anyone gives income figures for 2009 as an indication that the rich are hurting too, the alarm bells should go off. They indeed got hurt by the giant drop of the great Recession. They’ve recovered pretty well, unlike the rest of us. Unless you are a purveyor of luxury goods, it would hardly matter.
Looking at lumped labor is not that useful but it at least debunks the notion that corporate profits have increased while the workers are being screwed.
The reason I have used 2009 income is that it is the most recent year for which we have data. If you have more recent data you could share that. I have also used after tax income because it is the most meaningful measure of actual money people have to spend. Alot of the sites use 2007 as the latest year to measure income because it was such a good year for the stock market and the rich earned lots of capital gains and it makes it look like income inequality is higher than normal when the latest stats show that income inequality has gotten much better as the economy has stagnated.
The fact that we are consuming more of our earning in health care is not just a result of the free market health insurance it is because our tax laws treat benefits differently and thus a expensive health insurance plans are subsidized and are thus overconsumed. This has had a benefit though, in that if you adjust for car accidents and crime the US has the longest life expectancy in the world, so you could say we are being paid in healthy years instead of money.
I don’t believe this. Cite?
You know China is exporting jobs like crazy, right? Mainly to Africa. And not all of them are in the primary sector, there’s manufacturing as well.