Saturday, December 28, 2013

The first economic number everyone looks at every quarter is ...

The first economic number everyone looks at every quarter is the rate of GDP growth.  The last number anyone ever seems to cite when comparing today's wages to past decades' (especially the minimum wage) is economic growth -- like 180 quarters of mostly growth since 1968 never happened.

Time to get the growth eighth-grade math into our cultural DNA too, folks.
Since 1974, the income share story has been that the top 97-98%, maybe 99% kept about full pace with per capita economic growth (per capita income, productivity, whatever) -- while the 50-90% kept up from not at all to fully, varied along that curve.  The top 1% glommed all the excess growth that _bottom_ 90% missed out on (or the _bottom_ 50% might have lost that they had before).

Since the 2007 recession, I keep seeing figures suggesting the top 1% now take in all the per capita growth.  We now have wheels within wheels of so-called "inequality" (I in my clunky way call it the "Great Wage Depression.)

I got my income share numbers (past tense, 6/24/2006), 18 comments down on Dean Baker's old blog (his comment).  Without these numbers I would have no idea at all of what is happening in the American labor market proportionately.  Be nice is these numbers (much updated) were widely available to non-economic types (like politicians and cab drivers).
Harold Meyerson in his epic essay The 40-Year Slump, Nov 12, 2013 nears the end with: "Amassing the power to secure those remedies will require an extraordinary, sustained, and heroic political mobilization."


He, like every other American progressive never says a word about the most appealing, ultimately easy to implement potential reform of the American labor market: legally mandated, centralized bargaining (all similar jobs in relevant locales under one contract) which would automatically reverse American labor's economic and political decline.  

This labor market alternative way is in use for decades around the world -- beginning on continental Europe, post-WWII (instituted by management).  American labor will kill for centralized bargaining if they ever heard about it (every American laborer I explain the setup to says it sounds like a good idea -- not because they are scared of me :-]).

Unlike most eras when the tradeoff to political do-gooding scared off over intelligent type presidents who are super smart about re-arranging the deck chairs --getting the best that can be had from the current consensus -- but unable to change the consensus (MLK changed the culture -- while JFK did his best to avoid civil rights) -- Obama has a unique opportunity to change the culture with only his deck rearranging skills.  

There is a reason the "zombie" party keeps neck and neck if not ahead of the progressive party in election after election.  Voters will tell you that the Democrats don't really do anything to substantially change their lives (health care a rare exception -- that most didn't need).  The core of economic life -- and most of human life -- is about pay and benefits and these forever drop even as the economy grows.  Try to restore labor's preeminence and the Democrats will restore their predominance even if they don't succeed!

Supermarket workers (I know, I talk to them) and airline workers would kill for centralized bargaining.  But the Harold Meyerson's of the world wont even broach the subject, no matter how tentatively ... .  ???  Even when there is no other labor market setup under the sun which could possibly create a fair and balanced labor market. 

1 comment:

Bob Hertz said...

I like your blog a lot. In fact I have an article I would like you to review.

Could you give me your email address?

Bob Hertz, The Health Care Crusade