NationStates Jolt Archive

This is something I'm getting mixed messages about. In absolute terms, has the purchasing power of the impoverished people of the increased or decreased over the last fifty years?

That is, would you rather be poor now or fifty years ago?

Now. Poverty was a lot worse in the 1950's in objective terms than it is now.

I think you have asked 2 very different questions...

My understanding is that the gap is getting wider between rich and poor. The poor are better off than they were 50 years ago, but the rich are much much better off than they were 50 years ago.

I think given the way the human psyche tends to work you would probably be better off in actual terms now as a poor person than you were 50 years ago.. but you would feel worse about being poor now than people did 50 years ago because of the larger gap.

People tend not to be humiliated by having low rank but by losing rank.

So answer to first question is yes people are better off now than 50 years ago

Answer to the second question is I would probably rather be poor 50 years ago..

I think given the way the human psyche tends to work you would probably be better off in actual terms now as a poor person than you were 50 years ago.. but you would feel worse about being poor now than people did 50 years ago because of the larger gap.

http://en.wikipedia.org/wiki/Relative_deprivation

http://en.wikipedia.org/wiki/Relative_deprivation

This generation's wants will be the next generation's needs...

This generation's wants will be the next generation's needs...

That is how it seems to work. 15 years ago a cell phone was a luxury item, today it's as though most people would die if they didn't have them buried in their ears at all times.

People increase exponentially. Resources increase linearly or remain static. Of course the poor are getting poorer.

The "wants become needs" does have an element of truth to it though. As the gap gets larger the positions become more rigidly enforced. If you are really poor you can't afford to properly resource your children at school neither can you afford to keep them in the education system for as long. Consequently they are more likely to stay poor.

As the social norm for "Properly resourcing" and "adequetly educating" children increases those wants really do become needs if you want to be anything but poor.

Within which context? On a world level, absolutely. Within Western countries, maybe not so much (yet it remains a possibility).

That is, would you rather be poor now or fifty years ago?

Depends on where one is poor. In the US, the poor are better off now then they were 50 years ago. But in Africa, Latin America, and the former soviet block it can be argued that they are a good deal worse off.

People increase exponentially. Resources increase linearly or remain static. Of course the poor are getting poorer.
People only increase exponentially until they are restrained by other factors, like bacteria filling up a petri dish, though I have been considering that situation to a certain degree.

This generation's wants will be the next generation's needs...


Absolutely. In deprived areas in the UK in the 1950s, 'deprivation' was not being able to feed or clothe your family. Now it comes down to which Sky TV package one can afford.

My parents began teaching in a deprived part of Liverpool in the 1960s. Poor families 'papered-in' their kids for the winter - wrapping brown paper around their upper bodies and stitching a vest over the top for insulation. This was cut off, encrusted with lice, in the spring when the weather was warmer. Shoes were not universally affordable.

Does this sound like your childhood, because it doesn't sound like mine!

In the western world we don't know how prosperous we have become. But, with all things being relative, we're not satisfied and never will be...

In absolute terms, has the purchasing power of the impoverished people of the increased or decreased over the last fifty years?

That is, would you rather be poor now or fifty years ago?

These are two very different questions. Purchasing power isn't everything - not even close.

Absolutely. In deprived areas in the UK in the 1950s, 'deprivation' was not being able to feed or clothe your family. Now it comes down to which Sky TV package one can afford.

My parents began teaching in a deprived part of Liverpool in the 1960s. Poor families 'papered-in' their kids for the winter - wrapping brown paper around their upper bodies and stitching a vest over the top for insulation. This was cut off, encrusted with lice, in the spring when the weather was warmer. Shoes were not universally affordable.

Wow...and that was in the 1950's, my parents' generation! It just goes to show how much things have changed and how thankful we should be that such dire conditions are mostly a thing of the past. Sadly, however, most people aren't; it's always more and more, and each generation seems to be less satisfied with what they have then the one before them.

Does this sound like your childhood, because it doesn't sound like mine!

In the western world we don't know how prosperous we have become. But, with all things being relative, we're not satisfied and never will be...

In fact, it seems like many people are getting less satisfied the better off they are.

These are two very different questions. Purchasing power isn't everything - not even close.
Fair enough. Anyway, free marketeers like myself always maintain that while the rich have gotten richer, the poor have also gotten richer, and that this is thanks to capitalism, which is where I was trying to go with the question.

in objective terms

Which objective terms?

Anyway, free marketeers like myself always maintain that while the rich have gotten richer, the poor have also gotten richer, and that this is thanks to capitalism, which is where I was trying to go with the question.

Of course, but I just reject the logic of this argument. "Relative" poverty is quite absolute in terms of the harm it causes.

I might even go as far to say that as long as basic human needs are materially met, "relative" poverty is the only unacceptable kind of poverty. Human beings have, after all, survived and prospered with levels of "purchasing power" that were negligible compared to what we have now.

Which objective terms?

50 years ago, poverty was more along the lines of actually having a house, heat, and food on the table. Now, the situation has changed and a lot of people in poverty have TVs, Playstations, and even two cars and a house.

I'm speaking of material well being, which has vastly improved compared to the 1950's.

50 years ago, poverty was more along the lines of actually having a house, heat, and food on the table. Now, the situation has changed and a lot of people in poverty have TVs, Playstations, and even two cars and a house.

I'm speaking of material well being, which has vastly improved compared to the 1950's.

But even "material well-being" needs better measures.

No one really needs a television or a PlayStation. As someone who has never used the latter and almost never uses the former, I can testify to that. They are relatively cheap luxuries; they don't say much about the actual welfare of the family.

As for "two cars", perhaps that is the case, but it is also true that the necessity of car ownership has grown in fifty years, in part because cars have spread across the population. If owning two cars is just a response to social modes that require it, then not only does it not indicate much of an increase even in "material well-being," but it might even represent a decrease. How much time is spent driving? How much money is spent on cars that might be better spent elsewhere? And so on.

But even "material well-being" needs better measures.

No one really needs a television or a PlayStation. As someone who has never used the latter and almost never uses the former, I can testify to that. They are relatively cheap luxuries; they don't say much about the actual welfare of the family.

As for "two cars", perhaps that is the case, but it is also true that the necessity of car ownership has grown in fifty years, in part because cars have spread across the population. If owning two cars is just a response to social modes that require it, then not only does it not indicate much of an increase even in "material well-being," but it might even represent a decrease. How much time is spent driving? How much money is spent on cars that might be better spent elsewhere? And so on.

I think we could say that the economic situation has moved away from survival in its most literal sense and more towards discretionary things, with the side effect that those discretionary items have become illusory "survival" needs, with the added social effects that you describe that actually end up worsening the situation.

So, our lives have become more comfortable but there is the added problems that come from that additional sense of "need" for things that aren't really necessary.

I think we could say that the economic situation has moved away from survival in its most literal sense and more towards discretionary things

For most people, anyway. We still have some progress to make in that arena.

So, our lives have become more comfortable but there is the added problems that come from that additional sense of "need" for things that aren't really necessary.

Once basic human survival needs have been met, our next concern ought to be guaranteeing everyone freedom and a dignified existence.

Increased material "comfort" has been a failure in both respects.

I know for sure that in EU and US the gap between the buying power of rich and poor people is widening.
20 years ago, a CEO's income (in the greater industries) was about 10 times greater than the income of his employees. Now it is in the order of 100 times greater. Plus, the middle class (lower bourgoisie) is being shifted down into the ranks of proletarians, and some proletarians are being shifted down into the lumpen.

Now. Poverty was a lot worse in the 1950's in objective terms than it is now.
I totally disagree.

Relative measures of poverty

Another way of looking at poverty is in relative terms. "Relative poverty" can be defined as having significantly less access to income and wealth than other members of society. In 1999, the income of a family at the poverty line was $17,020. This was 28.49% of the median income in the U.S. In 1959 a family at the poverty line had an income that was 42.64% of the median income. Thus a poor family in 1999 had relatively less income and therefore considerable less purchasing power than a poor family in 1959.
That is also borne out by the crime rates then and now. Although the chart I link to is 46 years ago (1960), the fact remains that crime was about 1/3 of what it is now in the US.

http://www.disastercenter.com/crime/uscrime.htm

It is also borne out by the fact that among the 17 OECD countries, the US is second to last in poverty rates.

Human poverty index (HPI-2) Rank (http://hdr.undp.org/hdr2006/statistics/indicators/27.html)

A composite index measuring deprivations in the three basic dimensions captured in the human development index— a long and healthy life, knowledge and a decent standard of living—and also capturing social exclusion.

This is something I'm getting mixed messages about. In absolute terms, has the purchasing power of the impoverished people of the increased or decreased over the last fifty years?

That is, would you rather be poor now or fifty years ago?

i'm not sure about the last 50 years, but in the last 30 wages for the poorest sector of society have gone down in real terms, while the cost of living has consistently risen (in real terms, ie. above standard price rises), according to Polly Toynbee's research in her book Hard Work.

the rich, however, have gotten compartitively richer in that time.
hence why the GINI index of the UK is over .31 now


though of course that's for this country.... i'm not sure about others

i'm not sure about the last 50 years, but in the last 30 wages for the poorest sector of society have gone down in real terms, while the cost of living has consistently risen (in real terms, ie. above standard price rises), according to Polly Toynbee's research in her book Hard Work.

the rich, however, have gotten compartitively richer in that time.
hence why the GINI index of the UK is over .31 now


though of course that's for this country.... i'm not sure about others

Damn ya beat me to it.

In fact, it seems like many people are getting less satisfied the better off they are.
Who says that people at the bottom end are better off today? It doesn't appear that way to me.

50 years ago, for the most part, unemployment (http://upload.wikimedia.org/wikipedia/commons/thumb/c/c3/Us_unemployment_rates_1950_2005.png/800px-Us_unemployment_rates_1950_2005.png) was fairly low and stable. Many families had a stay at home mom. Job security was far more prevalent. Drug usage was much lower. Families were more stable i.e. less divorce. More affordable housing. And as I stated earlier, far less crime and far greater purchasing power.

There are so many variables to "relative poverty" that I think it's pointless to try to compare the 1950s to now and reach any conclusions about whether this or that economic philosophy works or not.

What is far more important is the gap between rich and poor, and that has definitely increased, rather shockingly so, to my mind. One thing to keep in mind about that gap is that although the poor of today are materially better off, on average, than the poor of the 1950s, the fact is that, due to the increased income gap, there are MORE poor people now, and fewer rich(er) people. The gap indicates a concentration of wealth in the hands of fewer and fewer people, leaving more and more people without the financial resources to survive personal disaster, such as serious illness. It doesn't matter if fewer poor people are actually hungry today. We have MORE people teetering on the brink of hunger and homelessness than we did before.

Also, the fact that this gap exists is an indicator that economic models that hold that, as the rich get richer, they will generate jobs and wealth for others down the ladder, are not actually true. The "trickle down" is not happening.

Note: I'm talking about conditions in developed nations like the US and European nations. In the third world, conditions remain horrendous for the majority.

By the way, some people here have been talking about "relative poverty" and how yesterday's wants become tomorrow's needs, but why don't we take a look at actual needs that don't vary from one generation to the next? Needs like food, for instance.

http://newstandardnews.net/content/index.cfm/items/2553

US Hunger Rates Continue to Rise
by Brendan Coyne

Nov. 2, 2005 – Over one-tenth of the United States population faced "food insecurity" last year, continuing a five-year trend in growing hunger and household food shortages. According to US Department of Agriculture statistics released last week, hunger affects single-parent and minority households at much higher rates than other demographic groups.

Reports of food insecurity were up by more than 7 million from 1999 to 2004. At least 38.2 million, or 13 percent, of all US residents lived in households that did not have enough food for all members at all times for an active, healthy life. One-third in such households were children.

In order to be classified by the USDA as "food insecure," households had to agree with at least three statements like: "The food that we bought just didn’t last and we didn’t have money to get more," "We couldn’t afford to eat balanced meals," or "The children were not eating enough because we just couldn’t afford enough food."

In an analysis of the USDA numbers, the Center on Hunger and Poverty noted that nearly half of all households lacking enough food in 2004 had incomes above 130 percent of the poverty rate, an income level that makes them ineligible for food stamps under the budget plans currently under congressional consideration.

According to a Center on Budget and Policy Priorities report published last week, the House-proposed agriculture budget would cut about 225,000 people from the food-stamp program. Additionally, 70,000 or more documented immigrants would have their access to such aid delayed or denied under the plan.

Here's a related article about proposed cuts to the US food stamps program:
http://newstandardnews.net/content/index.cfm/items/2170

The fact of the matter is that it was a lot harder for working families to reach this kind of brink-of-crisis situation than it is now, and that has a lot to do with the same factors that contribute to the wage gap. Significant among those, in my opinion, are wages that have not increased in 30 years and have failed to keep pace with the cost of living, and a failure on the part of industry or government to do anything at all to try to reign in the cost of living. I particularly blame the US government for deregulating the credit industry, allowing banks to participate, and encouraging a culture of debt, and for kowtowing to the health insurance and pharmaceutical industries leading to a cost for health care that is absolutely shocking.

A composite index measuring deprivations in the three basic dimensions captured in the human development index— a long and healthy life, knowledge and a decent standard of living—and also capturing social exclusion.

Why would social exclusion count? Or, for that matter, relative deprivation?

Poverty involves what you need and what you can afford, and the relationship between those two amounts.

And clearly, the poor are getting richer. The poor of the western world are some of the richest people on the planet.

I know for sure that in EU and US the gap between the buying power of rich and poor people is widening.
20 years ago, a CEO's income (in the greater industries) was about 10 times greater than the income of his employees. Now it is in the order of 100 times greater. Plus, the middle class (lower bourgoisie) is being shifted down into the ranks of proletarians, and some proletarians are being shifted down into the lumpen.
The average CEO's income is now 400 times greater than the income of his employees.

http://www.workplacefairness.org/sc/incomegap.php

There's an annotated sidebar to tell you where they got that number.

See also:
http://www.commondreams.org/views01/0906-03.htm

Despite some improving city conditions, write Mr. Dreier & Co., "We accept as 'normal' levels of poverty, crime and homelessness that would cause national alarm in Canada, Western Europe or Australia."

It doesn't matter if fewer poor people are actually hungry today.
Yes it does. That's exactly what we're trying to measure.
Also, the fact that this gap exists is an indicator that economic models that hold that, as the rich get richer, they will generate jobs and wealth for others down the ladder, are not actually true. The "trickle down" is not happening.
But it is happening. That's why the poor are getting richer.

Ron Reagan (Ronald Reagan's son) once attempted to refute the trickle down by saying, "There's no trickle down. Rich people aren't going to give their money to the poor; they're going to go out and buy a yacht."

This demonstrated an appalling lack of understanding of the trickle down. Buying a yacht is exactly what rich people need to do if their wealth is to trickle down. Because poorer people built that yacht. And poorer people still grew the food that fed those yacht builders, or supplied those yacht builders with materials.
In the third world, conditions remain horrendous for the majority.
We could improve those by opening sweatshops.

The average CEO's income is now 400 times greater than the income of his employees.
Why is that a bad thing?

Why would social exclusion count? Or, for that matter, relative deprivation?

Poverty involves what you need and what you can afford, and the relationship between those two amounts.

And clearly, the poor are getting richer. The poor of the western world are some of the richest people on the planet.
I am not comforted by the fact that I am not as badly off as the people in Darfur.

Of course, but I just reject the logic of this argument. "Relative" poverty is quite absolute in terms of the harm it causes.

I might even go as far to say that as long as basic human needs are materially met, "relative" poverty is the only unacceptable kind of poverty. Human beings have, after all, survived and prospered with levels of "purchasing power" that were negligible compared to what we have now.
I'm not so sure that I consider it a major issue if there is a large gap between the richest and the poorest people. I am certainly willing to be charitable so that a person does not need to go hungry or worry about paying rent, but when it comes to making them feel better about themselves when they do work that people don't value as much as the work I do, I'm not so sure you have my support. My father is a lawyer. He worked sixteen hours a day when I was very young and made a lot of money. His earnings were the product of a number of factors, most notably the mental strain it put on him to read tens of thousands of pages of documents and analyze them to form a case. I, on the other hand, currently work at a grocery store while I'm going to school. Even if I put in sixteen hours of solid work, I would not expect to be paid nearly as much money for my work as my father was for his. After all, it is simplistic. I can turn my brain off and there are numerous other people just as qualified to do my job.

Basically, I don't buy that everyone has the right to be free of the frusturation caused by envy because sometimes they should be envious.

Yes it does. That's exactly what we're trying to measure.
Then you'll be glad that I posted a link to an article showing that hunger in the US is actually on the rise.

But it is happening. That's why the poor are getting richer.
No, it isn't, and I already explained how we know that.

Ron Reagan (Ronald Reagan's son) once attempted to refute the trickle down by saying, "There's no trickle down. Rich people aren't going to give their money to the poor; they're going to go out and buy a yacht."

This demonstrated an appalling lack of understanding of the trickle down. Buying a yacht is exactly what rich people need to do if their wealth is to trickle down. Because poorer people built that yacht. And poorer people still grew the food that fed those yacht builders, or supplied those yacht builders with materials.
HAHAHAHAHAHA!!!

Sorry, I got taken over there for a moment by the hilarious notion that I should feel privileged to wax your yacht for you, Marie Antoinette.

Like I said, I already stated that the existence of the vast and increasing income gap is evidence that "trickle down" doesn't.

We could improve those by opening sweatshops.
No, we couldn't. People like you give capitalism a bad name.

I am not comforted by the fact that I am not as badly off as the people in Darfur.

in Darfur, what food there is is probably cheaper than it is over here.
its relative


but lets not also forget that purchasing power can easily artificially raised by borrowing from the bank. here, most people do not own their homes, but owe 70% (stab-in-the-dark figure) to the banks. other things like cars tend to be purchased with loans or other finance, and more short-term purchases (like xmas presents) tend to go on credit cards.

in short: the poor in the west may not be starving, and appear quite wealthy, but that's mostly because we owe our souls to debt.

Why is that a bad thing?

I already told you why. Did you not understand my posts, or is your belief in -- whatever it is you believe in -- free market? trickle down? -- so blind that you actually, physically cannot see the arguments against it?

Basically, I don't buy that everyone has the right to be free of the frusturation caused by envy because sometimes they should be envious.

I am not talking about the "frustration caused by envy."

I am talking about the way societies, through the way they are structured, make certain economic necessities relative.

No one two hundred years ago needed a car. In first world countries, most people do in 2006.

I'm not so sure that I consider it a major issue if there is a large gap between the richest and the poorest people. I am certainly willing to be charitable so that a person does not need to go hungry or worry about paying rent, but when it comes to making them feel better about themselves when they do work that people don't value as much as the work I do, I'm not so sure you have my support.
How large of you. Now tell me why I should be satisfied with remaining poor and dependent on your goodwill rather than seek a social system which will allow me access to the resources I need to create my own wealth. And if such a social system will reduce the average US CEO's income down to $3 million/year from the current $13.5 million/year, explain to me why I should give a shit.

My father is a lawyer. He worked sixteen hours a day when I was very young and made a lot of money. His earnings were the product of a number of factors, most notably the mental strain it put on him to read tens of thousands of pages of documents and analyze them to form a case. I, on the other hand, currently work at a grocery store while I'm going to school. Even if I put in sixteen hours of solid work, I would not expect to be paid nearly as much money for my work as my father was for his. After all, it is simplistic. I can turn my brain off and there are numerous other people just as qualified to do my job.

Basically, I don't buy that everyone has the right to be free of the frusturation caused by envy because sometimes they should be envious.
A lawyer. A white collar professional in a business that pays, on average upwards of $60 US/hour. For the upper tier lawyers, the average rates are in the neighborhood of $250+/hour. You poor bastard, how did you and your family get by?

I worked 16-18 hours a day, 6-7 days a week as an editor for a graphic design company and got paid a measly $25,000/year, salaried (that means no overtime) even though the clients were billed hourly for my work. A friend of mine worked just as long hours as the manager of a business, overseeing finances, inventory, and a staff of over 20 people, for the same pay.

Yes, it's true that some jobs are worth more than others because of the skills required to do them, but that has nothing at all to do with the fact that the lower level wages in the US do not match the cost of living. I don't care if a lawyer deserves more than an editor. I only care whether the editor can make her rent or not. And I don't see any reason why "editor" should not be a job that can pay an average rent on its own.

Also, I'd like to point out that there really is no such thing as "unskilled work." Every job requires at least some level of skill, so I see no justification for the US income gap in any argument about skilled versus unskilled.

Here's a book you might find interesting on the subject:
http://www.henryholt.com/holt/nickelanddimed.htm

Another point you fail to address is that, while a lawyer has to prove he has the skills to match his pay (by completing educational requirements and passing state bar exams to get a license to practice), there is no such skills-proof requirement for CEOs. A lawyer may be able to justify his $250/hour. Now I'd like to see the justification for the average US CEO's $13 million, which comes out to an hourly rate of about $30,952.38/hour (assuming the average 35-hour corporate pay-period week).

I already told you why. Did you not understand my posts, or is your belief in -- whatever it is you believe in -- free market? trickle down? -- so blind that you actually, physically cannot see the arguments against it?
The trickle down isn't supposed to shrink the gap between rich and poor - it's just supposed to provide for the poor and make them richer. That the gap is widening is NOT evidence that the trickle down isn't working.

And the gap is not, in and of itself, a bad thing. How much money you have has no bearing over how happy I am with how much money I have. Positional desires are irrational.

There's a lot more of a rich/poor gap than there used to be. And it seems economic mobility isn't what it was fifty years ago. This is supposed to be the first generation that doesn't do better than it's parents generation.

On the other hand, I can remember when I was a kid, my mom always looking at stuff like dishwashers and central A/C and saying "My mother would have thought she'd died and gone to heaven." Growing up, Mom's family never even had indoor plumbing or electricity.

How large of you. Now tell me why I should be satisfied with remaining poor and dependent on your goodwill rather than seek a social system which will allow me access to the resources I need to create my own wealth. And if such a social system will reduce the average US CEO's income down to $3 million/year from the current $13.5 million/year, explain to me why I should give a shit.
The system that will impose such circumstances will inevitably be arbitrary.

Yes, it's true that some jobs are worth more than others because of the skills required to do them, but that has nothing at all to do with the fact that the lower level wages in the US do not match the cost of living. I don't care if a lawyer deserves more than an editor. I only care whether the editor can make her rent or not. And I don't see any reason why "editor" should not be a job that can pay an average rent on its own.

Also, I'd like to point out that there really is no such thing as "unskilled work." Every job requires at least some level of skill, so I see no justification for the US income gap in any argument about skilled versus unskilled.
I'm always open to the possibility that I missed something, but these seem contradictory.

Another point you fail to address is that, while a lawyer has to prove he has the skills to match his pay (by completing educational requirements and passing state bar exams to get a license to practice), there is no such skills-proof requirement for CEOs. A lawyer may be able to justify his $250/hour. Now I'd like to see the justification for the average US CEO's $13 million, which comes out to an hourly rate of about $30,952.38/hour (assuming the average 35-hour corporate pay-period week).
The Board of Director have decided the CEO provides leadership that is worth 13 million dollars to them. The great thing is that in a freer market than our current one, competition between corporations would force their CEO salaries down a great deal. If the CEO's work is not worth that much, his company will be beaten out by more competitive firms who don't waste money on large CEO salaries.

A lawyer. A white collar professional in a business that pays, on average upwards of $60 US/hour. For the upper tier lawyers, the average rates are in the neighborhood of $250+/hour. You poor bastard, how did you and your family get by?

I worked 16-18 hours a day, 6-7 days a week as an editor for a graphic design company and got paid a measly $25,000/year, salaried (that means no overtime) even though the clients were billed hourly for my work. A friend of mine worked just as long hours as the manager of a business, overseeing finances, inventory, and a staff of over 20 people, for the same pay.
I'm forced to wonder why you took your job. Perhaps you enjoyed it a great deal, in which case the pay was not the only value you got out of your job. This is quite common with people in religious institutions and people taking government jobs, like those who work at the White House. Perhaps you had no other option, in which case you should welcome the growth of business in your community because it gives you more employers to compete over your skills and raises the rate you can demand. Only you know the answer to that question, and maybe you don't want to share it, but there is more to your scenario than your original post indicated. If there weren't, you would not have worked there very long.

Why would social exclusion count? Or, for that matter, relative deprivation?

Poverty involves what you need and what you can afford, and the relationship between those two amounts.

And clearly, the poor are getting richer. The poor of the western world are some of the richest people on the planet.
Please show me some comparators that prove that the poor are "getting richer" in relation to 50 years ago.

unemployment (http://upload.wikimedia.org/wikipedia/commons/thumb/c/c3/Us_unemployment_rates_1950_2005.png/800px-Us_unemployment_rates_1950_2005.png) was fairly low and stable. Many families had a stay at home mom. Job security was far more prevalent. Drug usage was much lower. Families were more stable i.e. less divorce. More affordable housing. And as I stated earlier, far less crime and far greater purchasing power.

I don't know, I see people with a lot more things and a lot bigger houses than they had back then. Real income is rising and has risen for the vast majority of the US population; it's no question that America overall is better off than it was in the 1950's, but the problem is that a lot of people are being left behind and they are the ones seeing the problems worsen over time.

Labour force participation was also much lower in the fifties.

Labour force participation was also much lower in the fifties.

As was productivity. If you worked, you tended to have to work harder rather than smarter and spend time doing menial things that didn't enhance your primary task.

That is how it seems to work. 15 years ago a cell phone was a luxury item, today it's as though most people would die if they didn't have them buried in their ears at all times.

Of course, that's over simplifying a bit.

Society was built so that a cell phone was unecessary 15 years ago. I would still have no cell phone of not for the fact that payphones are no longer ubiquitous, often broken, and only allow 30 second phonecalls. It was payphones that pushed me to get a cellphone, not status. I felt thouroughly beaten the day I walked into the Verizon store.

Once upon a time running water was a luxury. Now there's absolutely no source of well water in most communities. You either have it in your house or you don't have it.

Good luck finding a spot for an outhouse!

And open fire places?

See? In some circumstances yesterdays necessity becomes todays luxury too. Glass baby bottles. Good Furniture (not made of particle board.) Guess wealth isn't the only thing that's relative.

The trickle down isn't supposed to shrink the gap between rich and poor - it's just supposed to provide for the poor and make them richer. That the gap is widening is NOT evidence that the trickle down isn't working.Well, at least you're honest about it, which is more than I can say for most Reaganomics adherents.

And the gap is not, in and of itself, a bad thing. How much money you have has no bearing over how happy I am with how much money I have. Positional desires are irrational.
Depends on what side of the gap you're on, doesn't it? I mean, if you're on the "I'm eating out of garbage cans" side of the gap, then yeah, the fact that some guy is paying more for a meal than you've made in a year just might have an effect on your happiness. It's called empathy--you might try it sometime.

I don't know, I see people with a lot more things and a lot bigger houses than they had back then.

though this is almost entirely a technological artifact, rather than an indicator of wealth per se.

The poor is still poor no matter how much richer they have got, thats why they are poor....

50 years ago, easily. There was no compulsory consumerism*cough*insurance*cough* or heinously high gas prices.

The Board of Director have decided the CEO provides leadership that is worth 13 million dollars to them. The great thing is that in a freer market than our current one, competition between corporations would force their CEO salaries down a great deal. If the CEO's work is not worth that much, his company will be beaten out by more competitive firms who don't waste money on large CEO salaries.


i'm not sure any one person is worth 100,000 percent more than any other.

50 years ago, poverty was more along the lines of actually having a house, heat, and food on the table. Now, the situation has changed and a lot of people in poverty have TVs, Playstations, and even two cars and a house.

I'm speaking of material well being, which has vastly improved compared to the 1950's.This is pretty much solely because...

but lets not also forget that purchasing power can easily artificially raised by borrowing from the bank. here, most people do not own their homes, but owe 70% (stab-in-the-dark figure) to the banks. other things like cars tend to be purchased with loans or other finance, and more short-term purchases (like xmas presents) tend to go on credit cards.

in short: the poor in the west may not be starving, and appear quite wealthy, but that's mostly because we owe our souls to debt.

How much money you have has no bearing over how happy I am with how much money I have. Positional desires are irrational.

Wealth is a sign of social status, at least to some degree. Social status is a positional good. The more you have the less I have. Its a zero-sum game. If positional desires are irrational then human nature is irrational.

i'm not sure any one person is worth 100,000 percent more than any other.
And I'm pretty sure that a company paying out that much money to a CEO is going to run into trouble along the way. However, if the individual in question has set up this company and turned it into a multi-billion dollar enterprise providing jobs for thousands of people, I can live with him getting paid more. He's done a lot for society, even through his own self-interest.

I don't know, I see people with a lot more things and a lot bigger houses than they had back then. Real income is rising and has risen for the vast majority of the US population; it's no question that America overall is better off than it was in the 1950's, but the problem is that a lot of people are being left behind and they are the ones seeing the problems worsen over time.
It is all an illusion my friend. I think PM hit the nail on the head.......it is all debt:

the poor in the west may not be starving, and appear quite wealthy, but that's mostly because we owe our souls to debt.
Someone will have to pay for all this. Considering that most recent debt has been acquired with very low borrowing rates. Watch what happens when the next inflationary cycle kicks in and the next recession. People have very little wiggle room left, unless of course they are independently wealthy.

http://www.kwaves.com/debt_gdp.gif

When I was growing up, there were not too many people living on the streets, and food banks were basically non-existent.

A decade ago, a DVD player cost over 200 dollars, as did a 27" Color Television, and it rarely lasted for more than a full year. Now you can buy a DVD player/VHS player for thirty bucks, and a 27" Color Televsion for seventy at WalMart that will last until hell freezes over. I'd say the purchasing power of the poor has thoroughly increased.

i'm not sure any one person is worth 100,000 percent more than any other.

To you perhaps, but to someone else that might not be so. Value is entirely subjective.

A decade ago, a DVD player cost over 200 dollars, as did a 27" Color Television, and it rarely lasted for more than a full year. Now you can buy a DVD player/VHS player for thirty bucks, and a 27" Color Televsion for seventy at WalMart that will last until hell freezes over. I'd say the purchasing power of the poor has thoroughly increased.
So life's values are measured by the cost of DVD players and TVs? How about living wages, and the cost of putting a roof over ones head, and the cost of essentials such as food. Also, in the US, you have 46 Million people without healthcare insurance.

BTW, the cheap DVD players and TVs are just that.....cheap and no, they don't last until hell freezes over.

It is all an illusion my friend. I think PM hit the nail on the head.......it is all debt:


Someone will have to pay for all this. Considering that most recent debt has been acquired with very low borrowing rates. Watch what happens when the next inflationary cycle kicks in and the next recession. People have very little wiggle room left, unless of course they are independently wealthy.

http://www.kwaves.com/debt_gdp.gif

Debt in and of itself isn't a bad thing; ultimately, there have been no signs that consumers are unable to manage their debt loads and the American debt-to-income ratio has in fact been falling since 2002 and is almost back to its levels in the late 1990's. The consumer can ultimately control their spending, and that's why I think debt is not as big a problem as it seems.

The collapse of the debt-based economy has been predicted time and again and it hasn't come true, which is why I'm skeptical of any argument that debt is an unsustainable and unsolvable crisis for our economy.

When I was growing up, there were not too many people living on the streets, and food banks were basically non-existent.

A lot of that was because poverty was ignored rather than acknowledged like it is today. Those people were there, they just weren't given any attention and were left to the vagaries of private charity.

And I'm pretty sure that a company paying out that much money to a CEO is going to run into trouble along the way. However, if the individual in question has set up this company and turned it into a multi-billion dollar enterprise providing jobs for thousands of people, I can live with him getting paid more. He's done a lot for society, even through his own self-interest.

What about someone who cleans toilets for a living.
They probably save literally thousands of people from suffering debilitating disease over the course of their employment. They provide an enormous benefit to society.

It was suggested that this kind of labour was "unskilled" but how many CEOs would be able to clean toilets year after year. Sure they may be able to clean the toilet once or twice.. they may even last a week... but you think they would still be doing just as good a job a year later.. 10?? There is more to being skilled than a piece of paper...

Wages tend to have very little bearing on worth. Most companies have some person employed who essentially keeps the company together. As an IT consultant I have worked in all sorts of work places.. but in almost every one its not the people paid the most that are the most valuable. They tend to be the ones who think they are most valuable. It will invariably be a warehouse manager.. a secretary.. a data manager... And when they leave the company folds.. As an example I witnessed one company go from making 150million a year profit to being bankrupt in a year because one guy on $40,000 a year left after getting fed up with not being recognised.

The poor are not usually poor because they are less worthwhile people.. or even that they do less valuable work. Its just that people who make lots of money tend to value people who do similar work to them. Its that some peoples value is difficult to measure. How do you measure the value of a good teacher who changes the lives of hundreds of kids.... at about $35,000 apparently?? while a CEO who comes in to "improve productivity" by sacking 100 people and then moves on before the place collapses is worth $3,500,000?? Give me a break...

The gap getting wider is very important. People don't feel bad about being poor when everyone is poor. If you ever get the chance check out the change in happiness levels going from India to Nepal. In India the wealth differential is massive. Poor people are desperate. and desperately aware of how poor they are. In Nepal however, there are essentially no rich folk.. everyone is poor.. poor but happy. They don't feel poor because everyone else is in the same boat. That may not be the truth of the matter but it was certainly what I observed...

Debt in and of itself isn't a bad thing; ultimately, there have been no signs that consumers are unable to manage their debt loads and the American debt-to-income ratio has in fact been falling since 2002 and is almost back to its levels in the late 1990's. The consumer can ultimately control their spending, and that's why I think debt is not as big a problem as it seems.

The collapse of the debt-based economy has been predicted time and again and it hasn't come true, which is why I'm skeptical of any argument that debt is an unsustainable and unsolvable crisis for our economy.
I hope that you are right, but I have severe misgivings about the economic future of the US. If people continue to run red lights, eventually they will get T-boned. The following is a perspective:

http://www.kwaves.com/depression.gif (http://www.kwaves.com/debt_art.htm)

A lot of that was because poverty was ignored rather than acknowledged like it is today. Those people were there, they just weren't given any attention and were left to the vagaries of private charity.
I think that you are wrong on that. The numbers were far less then they are now. Part of that could be that welfare rates were much higher then they are today, at least where I live.

I hope that you are right, but I have severe misgivings about the economic future of the US. If people continue to run red lights, eventually they will get T-boned. The following is a perspective:

http://www.kwaves.com/depression.gif (http://www.kwaves.com/debt_art.htm)

It's government debt that concerns me a lot more, because individual consumers have limits on their borrowing. The government's limit is either the printing press, its military, or the willingness of other countries to finance it. We're talking 400, 500, even 1000% of GDP; that would be like an average consumer having $500,000 or more in non-mortgage debt.


I think that you are wrong on that. The numbers were far less then they are now. Part of that could be that welfare rates were much higher then they are today, at least where I live.

Well, in the US, poverty is about half of what it was in percentage terms in the 50's and about 6 million less in population terms.

Poverty Rate 1959-2003 (Poverty Rate 1959-2005)

If anything, the concerning part isn't that poverty has worsened but rather improvements in the poverty rate have stagnated. Although poverty is again falling, each recession has had the disturbing trend of the poverty rate rising for a longer and longer period during each recovery.

The more you have the less I have. Its a zero-sum game. If positional desires are irrational then human nature is irrational.
Probably.

But as sentient beings, we can overcome that. We can choose to be rational.

If i had to guess i would say it is because of the rise of Monoploys that has been slowly happening, that and the fact that Companys are a tyranical Model within a Democratic system and the more thay own the less power the democratic system will have, but thats just a guess so take it or leave it.