Capitalism is Broken
This is quite an infamous chart among armchair economists, but it still a mind blower. It so clearly marks the point where our current Western model came undone, perhaps irreparably.
Blue is the total real productivity of the USA in $ per hour. Red is real hourly wages of the USA. The data are compiled by the BSL and BEA and are provided by Federal Reserve. For the comparison I have normalised the data so that 1 Jan 1970 = 100. Real means corrected for inflation.
Clearly the period after WW2 until 1973 can be viewed as the Golden Age of stable capitalism in the USA, also known as the American Dream. As we see the wages of non-supervisory employees, i.e. regular Joes, increased in line with the total productivity of the nation. This means that citizens were collectively rewarded on a performance basis, thus making them stakeholders in the future success of their country. They were therefore motivated to preserve existing economic, political and social structure. In short people voted for the right people and rounded on extremist ideas (communism) which they were taught to despise. The compact with the elites must have been something like work hard and love your country and you and your children will get a decent share.
This all changed under Nixon... hopefully I will find the data to discuss this series further in Part 2. Any with wages have stagnated in real terms since the early 1970s. If you are a wage earner in the US you have pretty much been living with 1970s stagflation for the last 50 years while the owners of the means of production (rofl) have never had it so good. (Obviously a reference to British Prime Minister, Harold Macmillan who told the workers of that country that they'd never had it so good back in 1957.)
Thanks to globalisation and automation we have seen massive cost savings in production in recent decades, e.g. computers, consumer electronics, cars etc... yet for basic necessities such as housing, education and medical care costs have sky rocketed. The cost of annual tuition in the United Kingdom has increased by 800% in twenty years! While almost 10% of citizens in the world's richest country have no health coverage (according to US Census).
This applies to varying degree in all the democracies with Western-style economies.
This is quite an infamous chart among armchair economists, but it still a mind blower. It so clearly marks the point where our current Western model came undone, perhaps irreparably.
Blue is the total real productivity of the USA in $ per hour. Red is real hourly wages of the USA. The data are compiled by the BSL and BEA and are provided by Federal Reserve. For the comparison I have normalised the data so that 1 Jan 1970 = 100. Real means corrected for inflation.
Clearly the period after WW2 until 1973 can be viewed as the Golden Age of stable capitalism in the USA, also known as the American Dream. As we see the wages of non-supervisory employees, i.e. regular Joes, increased in line with the total productivity of the nation. This means that citizens were collectively rewarded on a performance basis, thus making them stakeholders in the future success of their country. They were therefore motivated to preserve existing economic, political and social structure. In short people voted for the right people and rounded on extremist ideas (communism) which they were taught to despise. The compact with the elites must have been something like work hard and love your country and you and your children will get a decent share.
This all changed under Nixon... hopefully I will find the data to discuss this series further in Part 2. Any with wages have stagnated in real terms since the early 1970s. If you are a wage earner in the US you have pretty much been living with 1970s stagflation for the last 50 years while the owners of the means of production (rofl) have never had it so good. (Obviously a reference to British Prime Minister, Harold Macmillan who told the workers of that country that they'd never had it so good back in 1957.)
Thanks to globalisation and automation we have seen massive cost savings in production in recent decades, e.g. computers, consumer electronics, cars etc... yet for basic necessities such as housing, education and medical care costs have sky rocketed. The cost of annual tuition in the United Kingdom has increased by 800% in twenty years! While almost 10% of citizens in the world's richest country have no health coverage (according to US Census).
This applies to varying degree in all the democracies with Western-style economies.
CHART:
neweconomics.org/upl...-4_190913_185428.png
REPORT:
neweconomics.org/201...28-below-2008-levels