Democratic Underground Latest Greatest Lobby Journals Search Options Help Login
Google

The American Dream died in February 1973.

Printer-friendly format Printer-friendly format
Printer-friendly format Email this thread to a friend
Printer-friendly format Bookmark this thread
This topic is archived.
Home » Discuss » Archives » General Discussion (1/22-2007 thru 12/14/2010) Donate to DU
 
NNN0LHI Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Nov-24-09 05:58 PM
Original message
The American Dream died in February 1973.
http://www.realitybase.org/journal/2009/3/11/the-americ...

Since Bob Herbert wrote about Reviving the Dream today, this is a good time to put up the problem-defining graphs from a longer analysis I haven't finished.

The American middle class and working class are essentially the more than 90 million non-supervisory "production workers" who constitute 84% of non-government, non-farm employment. For 26 years, from 1947 to January 1973, their average hourly pre-tax earnings, adjusted for inflation using current methods, grew robustly and steadily at an average annual "real" rate of about 2.2%. At that rate, average purchasing power would double in 33 years. Parents expected their children to have more prosperous lives than their own, and it was happening. It was the Golden Age of the Middle Class. Then, suddenly and permanently, it ended in February 1973.

http://www.realitybase.org/storage/macroeconomics/Nomin...

The proximate cause of the sudden change is obvious. By definition, all of these "production workers" are "employed," and the BLS hourly earnings statistics are gathered from payroll records. Before 1973, employers as a group were giving their existing workforces average annual pay increases that exceeded the inflation rate by 2.2 percentage points. After 1972, they handed out increases that on average only just kept even with inflation.

http://www.realitybase.org/storage/macroeconomics/Nomin...

Meanwhile, the larger economy measured by real GDP per employee had a stagnant decade from 1973 to 1983. But then it took off and averaged 1.14% annual average growth for 25 years. That is modest growth compared to the 2.69% average from 1947 to 1973, but since 5/6 of American workers got a zero share of the post-1983 growth, those who did presumably management and the owners of capitaldid quite nicely.

http://www.realitybase.org/storage/macroeconomics/hourl...

So, here's the problem in a nutshell. Average real earnings of the 5/6 of Americans who are production workers cannot go upand the American Dream cannot be revivedunless employers consistently grant annual wage/salary increases that on average exceed the inflation rate. What changes would motivate and enable large, trend-setting employers to return to giving average annual wage increasesfor their existing workforcesthat exceed inflation by 1% or 2%?
Printer Friendly | Permalink |  | Top
RagAss Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Nov-24-09 06:03 PM
Response to Original message
1. Nobody stood up to them...Nobody said a word...That's when they knew they could fuck us forever !
Printer Friendly | Permalink |  | Top
 
kimmerspixelated Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Nov-24-09 06:13 PM
Response to Original message
2. Isn't that also about the time that
the gold standard was lost, and we just started printing money instead of backing it up with something, or do I stand to be corrected?
Printer Friendly | Permalink |  | Top
 
NNN0LHI Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Nov-24-09 06:17 PM
Response to Reply #2
4. Union membership began to decline
Printer Friendly | Permalink |  | Top
 
mimitabby Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Nov-24-09 06:13 PM
Response to Original message
3. sort of a narrow perspective
there's no way american workers are going to get payraises like you're talking as long as we continue with this global economy. Why pay me $50K when they can pay someone in China $5K for the same job. To me it appears much downhill scooting must continue before we can slowly build up.
Printer Friendly | Permalink |  | Top
 
DJ13 Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Nov-24-09 06:26 PM
Response to Original message
5. Our societal focus on stock investments as income will prevent us from recovery
The constant focus on increased profits every year has stagnated wages to the point these companies have choked off their own growth prospects.

Printer Friendly | Permalink |  | Top
 
NNN0LHI Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Nov-24-09 06:32 PM
Response to Reply #5
6. What did people use to make up for their stagnant wages with prices increasing?
My guess is easy credit.

Don
Printer Friendly | Permalink |  | Top
 
DJ13 Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Nov-24-09 06:46 PM
Response to Reply #6
8. Before wages stagnated it was savings
Easy credit came into being to disguise the fact wages had stopped increasing if the article in the OP is correct.
Printer Friendly | Permalink |  | Top
 
branders seine Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Nov-24-09 06:35 PM
Response to Original message
7. capitalists will never reward their workers. Ever cheaper labor is the only "free"
resource left to exploit.
Printer Friendly | Permalink |  | Top
 
NYC_SKP Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Nov-24-09 06:49 PM
Response to Original message
9. kick and rec.. nt
Printer Friendly | Permalink |  | Top
 
European Socialist Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Nov-24-09 08:06 PM
Response to Original message
10. Yup, The 70's were a pivotal time--The age of the average guy ended....
and lifestyles of the rich and famous began.
Printer Friendly | Permalink |  | Top
 
BrklynLiberal Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Nov-24-09 11:40 PM
Response to Original message
11. kick..
Printer Friendly | Permalink |  | Top
 
leveymg Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Nov-25-09 03:38 AM
Response to Original message
12. You need a real F/T job to get an annual wage increase. Fewer and fewer do.
Edited on Wed Nov-25-09 03:39 AM by leveymg
Self-employment, P/T and temp employment without benefits has become the norm for a growing segment of the American work force. Even temp positions are becoming harder to find.

What we're seeing is a hollowing out of the U.S. employment base as big corporations move operations overseas. This is reflected in the U6 figures, that show a 17 percent underemployment rate, and even that underestimates the true situation by about half. About one-third of Americans who want and need a F/T job can't find one.

Of course standards of living for the bottom half are declining.
Printer Friendly | Permalink |  | Top
 
Electric Monk Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Nov-25-09 03:40 AM
Response to Original message
13. Oddly enough, that's when I was born
Now I'm even more confused than I used to be :(
Printer Friendly | Permalink |  | Top
 
B Calm Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Nov-25-09 05:51 AM
Response to Reply #13
14. The year I got out of the Navy
Printer Friendly | Permalink |  | Top
 
NNN0LHI Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Nov-25-09 08:53 AM
Response to Reply #14
16. It was the year I graduated HS and entered the work force
And I didn't realize what was happening at the time but as I look back this is exactly what happened.

Don
Printer Friendly | Permalink |  | Top
 
moondust Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Nov-25-09 06:34 AM
Response to Original message
15. The bad guys won.
Printer Friendly | Permalink |  | Top
 
earth mom Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Nov-25-09 09:40 PM
Response to Original message
17. K & R & Bookmarked. nt
Printer Friendly | Permalink |  | Top
 
DU AdBot (1000+ posts) Click to send private message to this author Click to view 
this author's profile Click to add 
this author to your buddy list Click to add 
this author to your Ignore list Mon Nov 18th 2019, 04:59 PM
Response to Original message
Advertisements [?]
 Top

Home » Discuss » Archives » General Discussion (1/22-2007 thru 12/14/2010) Donate to DU

Powered by DCForum+ Version 1.1 Copyright 1997-2002 DCScripts.com
Software has been extensively modified by the DU administrators


Important Notices: By participating on this discussion board, visitors agree to abide by the rules outlined on our Rules page. Messages posted on the Democratic Underground Discussion Forums are the opinions of the individuals who post them, and do not necessarily represent the opinions of Democratic Underground, LLC.

Home  |  Discussion Forums  |  Journals |  Store  |  Donate

About DU  |  Contact Us  |  Privacy Policy

Got a message for Democratic Underground? Click here to send us a message.

© 2001 - 2011 Democratic Underground, LLC