Monday, February 18, 2008

Paul Krugman and friends -- report the world is flat :-)

Paul Krugman (justifiably world famous progressive economist, NYT op-ed writer) says (unbelievably): "[over 40 years] most American incomes have risen in real terms while the official poverty line HAS NOT." (my emphasis)

Denis Drew (high school educated, out of work -- rarely more than part time -- cabdriver and SSI recipient says (much more believably): the official poverty line has ACTUALLY DROPPED 60% over 40 years -- in real dollars.

The official poverty rate has been adjusted for the price of food only for 40 years now. A more accurate poverty rate (described as a minimum needs level) for a family of three in my 2001 version of the book Raise the Floor is $41,111 (in 2005 dollars) including $10,000 for today's typical family health insurance policy. The official poverty rate for a family of three is $17,000 in 2005 dollars.

This means that the official poverty rate has been discounted over time to now represent only 40% of the actual rate -- and w/o any improving standards stuff.

I very simply calculated that $41,111 is 36 percentile American family income (on Census family income tables) -- meaning the incomes of 36% of American families may be below a more accurately drawn poverty line, at least without food stamps and other helps.
There is no mystery to why Americans (working 50% more hours per capita) endure so much poverty while Europeans (working 33% fewer hours per capita) see so little -- and why Europe's lower 90 percentile families get a much fairer share of the economic pie -- EUROPEAN WORKERS TAKE CARE OF THEMSELVES.

Progressive economists are to first to jump and point out that Europe has the same or better productivity and access to technology as we do. The difference in pay levels can only be due to lack of broadly accepted cultural understanding in America of how absolutely vital it is for labor to actively look after its own interests (too simple).

Looking after its own interests means wide awake to the need for checks and balances in the labor market which with today's super bean counter ownership means labor law set up to mandate sector-wide labor agreements, a sensible minimum wage (HIGHER than than the nearly $10/hr of 40 years ago -- reflecting that average income DOUBLED since), setting up universal health care, etc., etc. ...
...all the things that European workers have set up for themselves; nobody did it for them...
while American workers have slept complacently at the bargaining switch only to wake up and go to work for whatever is shoveled in front of them (notice: I am not blaming any big, oppressive capitalists here).

I may blame our progressive economists -- the only folks in our economically deaf and dumb nation who understand what is going on -- for not telling everybody else how low their pay has gone (they have no idea): beginning with shouting far and wide that the official federal poverty rate has been based on three times the price of an emergency diet (dried beans, no canned) for 40 years now and now might be the time to stop quoting it without qualification.

Krugman likes to complain that if the Republicans asserted that the world was flat that the next day the media would treat the assertion evenly and try to quote both sides. Well, when he -- and the rest of his progressive pro friends -- continue to quote the official poverty line as gospel, he and his progressive friends ARE asserting the equivalent of "the world is flat" in their field of study.

As in Columbus' time, the false assertion make fewer waves than explaining truth -- and informed people know otherwise. But, in Columbus' time it did no harm for most people to believe the world is flat. In America today the greatest hindrance of all to alleviating poverty (a.k.a., paying American workers like other modern O.E.C.D. workers) may be endlessly under reporting the official poverty line by what may be as much as 24%!

No comments: