Not Hard to See

In recent years, American workers have received an ever-decreasing share of what our economy produces.

Is it any wonder that many Americans aren't feeling so happy about the so-called recovery (assuming, of course, it's more than just smoke and mirrors)?

Comments

[roger]

In recent years, American workers have received an ever-decreasing share of what our economy produces.

And yet,,,And yet....they are the one that produce
all the real wealth!
Do cows at the dairy ranch get to drink any of the
milk they produce? makes you wonder,did Karl Marx get it right? Brains come up with bright ideas (sic) but no
hands, no stuff.

[Doable Finance]

Unemployment still very high. Underemployment is still high. How can American workers not achieve an ever-decreasing share of what our economy produces? America may still offer a lot but it's getting harder and harder day in day out.

[Boros1124]

Everywhere I know of high unemployment. I live in Hungary. Half of the people are unemployed in the country. Youth 3 / 4 of you think you have to leave the country. The driving is getting worse. Poverty and everything is taxed. It will be the economic crisis. But this is not a convenience store there. The same way and are interested in purchasing new products. Employers thus saving. Does not provide jobs and saving on salaries. The minimum wage alone can not make a living. Were similar to the popular books: www.konyv-konyvek.hu/book_images/12a/999631712a.jpg

[John Hudock]

The chart is just a natural effect of the decline in employment participation rates which have been on a sharp steady downtrend for the past 3-4 years.

See http://www.bearishnews.com/post/3901

Which is not to say its a good thing, but just to point out that workers with jobs are not necessarily feeling a pinch, but there are large numbers of people who have dropped out of the labor market (either by choice, i.e. early retirement because they have gotten tired of navigating a difficult job market, or not by choice because they just can't find a job and have given up). This creates an even larger secular problem because people who've been out of the job market for years, lose skills and find it increasingly difficult to re-enter as time goes on.

[How much sugar does he put in his kool aid?]

The Federal Reserve bombs in Queens.

Mr. Dudley has been one of the leading proponents of negative real interest rates and quantitative easing, so this common-man razzing is a case of rough justice. If Mr. Dudley were wise, he'd take it to heart and understand that Americans aren't buying the Fed's line that rising commodity prices are no big deal. Unlike banks and hedge funds, they can't borrow at near-zero interest rates, and most of them don't have big stock portfolios. Wall Street and Congress may love the Fed's free-money policy, but Mr. Dudley and Chairman Ben Bernanke ought to worry about losing the confidence of the middle class.

http://online.wsj.com/article/SB10001424052748704893604576199113452719274.html#articleTabs%3Darticle

[Keating Willcox]

I'm not crazy about this chart. The actual change is small because of the y-axis scalling. Also, a previous commment mentioned that there are fewer workers as a percentage of all citizens. And, I think there is always evidence of an enormous increase in very poor, uneducated illegal aliens.

I think the story here and in Europe and Japan, is that successful automation has destroyed many factory and manufacturing jobs. The man-hours required to make something has much decreased.

[Left out...how about you?]

...And guess who got an ever increasing share?

Federal Reserve wild financial beast of Maiden Lane – How the Fed silently helped Hilton and Waldorf properties for the benefit of JPMorgan while placing the cost on working and middle class Americans.

The bailouts were marketed and branded as a way of helping out the working and middle class. Given the massive financial destruction that the working and middle class still face it is easy to conclude that the stated policy failed. Yet looking at banking profits it did succeed for this segment of our economy. The Federal Reserve doesn’t even bother hiding this massive bailout and even labels these toxic vehicle hotels with its own address. Let us look closely at the Maiden Lane product.

http://www.mybudget360.com/federal-reserve-financial-beast-maiden-lane-commercial-real-estate-bailout-hilton-waldorf-jpmorgan-bank-fed/

[Squared_Hedge]

The point of this chart, and others, is that they present irrefutable evidence of a declining standard of living for most people in the US. I have seen charts that show a smaller percentage of people make most of the money in the US with rising incomes when most people have seen a decline of income. Despite the cry for help in 2008 banks and Wall Street reported all-time record profits in 2009 and 2010. Companies that have the capacity to hire or retain more workers refuse to do so instead force fewer and fewer works to do more and more work. We have FoxConn right here in the US. Entrepreneurs find themselves unable to borrow money for small business startups because banks won't lend to risky business ventures when they can borrow from the FRB at 0% and reinvest at 3% in treasuries. The imbalances and inequalities cropping up in the American economy are more pronounced, and at the same time more harmful, to capital formation and free markets that at anytime since 1930-32 - perhaps even moreso.

I see no sign of any trickle down effect caused by wealth - or the accumulators of wealth. Nor do I think there is any evidence whatsoever that the rich create jobs. Businesses create jobs and small businesses create the most jobs. But the barriers to entry are too high due to regulations and taxes. Yet the ultra-rich pay less in taxes under the mistaken belief that this is good for the economy. Good for what economy? Good for whom?

We have lived in a low tax environment (historically - look at tax rates in the 50s and 60s) for a long time now. We were sold this bill of goods by those who said low tax rates created capital which would be good for everyone. Yet, for the past 30 years we have gone through a continuous series of boom and bust cycles that has sucked the life out of the middle class. I'm not ready to say we've been robbed, but I'm getting close.

All this to say one thing. Every generation since WWII (maybe before) has had it worse than the one before. Real incomes have not kept up and the standard of living has declined for the majority of Americans. Is this successful capitalism? Is this a successful democracy?

[Rocky]

It makes you wonder why, in 2010, so many working stiff Americans voted for politicians who promised to protect the low 15% Federal income tax rate on hedge fund profits. Who knew there were so many hedge fund traders in rural Louisiana? We get the government we deserve.

[They were hit so many times on the right, they were begging for a left]

@Rocky...and what was the other choice????????????....

"When plunder becomes a way of life for a group of men living together in society, they create for themselves in the course of time a legal system that authorizes it and a moral code that glorifies it."
–Frederic Bastiat

[mvw]

You never hear big execs of large companies getting together and talking (bragging) about how high they pay their workers. They talk about keeping labor costs down. Lowes recently chopped several thousand full time jobs to be replaced with part time jobs. Full time employees buy cars, appliances, houses, lawn mowers etc,etc. Part timers are not likely to do this (though they are sometimes using the secomd job just to make ends meet. When will they see that they are just making customers of their company (and other companies) unable to buy their product or service? I envision a much poorer America if this trend continues.