Krugman: "Why have workers done so badly in a rich nation getting richer?"

[swag]

Sept 1, 2006 Times Select subscription required, or buy tomorrow's NYT.

There are still some pundits out there lecturing people about how great the economy is. But most analysts seem to finally realize that Americans have good reasons to be unhappy with the state of the economy: although G.D.P. growth has been pretty good for the last few years, most workers have seen their wages lag behind inflation and their benefits deteriorate.

The disconnect between overall economic growth and the growing squeeze on many working Americans will probably play a big role this November, partly because President Bush seems so out of touch: the more he insists that it’s a great economy, the angrier voters seem to get. But the disconnect didn’t begin with Mr. Bush, and it won’t end with him, unless we have a major change in policies.

The stagnation of real wages — wages adjusted for inflation — actually goes back more than 30 years. The real wage of nonsupervisory workers reached a peak in the early 1970’s, at the end of the postwar boom. Since then workers have sometimes gained ground, sometimes lost it, but they have never earned as much per hour as they did in 1973.

Meanwhile, the decline of employer benefits began in the Reagan years, although there was a temporary improvement during the Clinton-era boom. The most crucial benefit, employment-based health insurance, has been in rapid decline since 2000.

Ordinary American workers seem to understand the long-term disconnect between economic growth and their own fortunes better than most political analysts. Consider, for example, the results of a new poll of American workers by the Pew Research Center. . .

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[madrchsod]

1. i make less than i did 40 years ago

in 1967 i was making 3 an hour, i reached a high of 12.50 several years ago then lost that job and now i am making 8.50. the only thing the american worker can look forward to is more misery...

[ConcernedCanuk]

2. The "nation" ain't getting richer - just the robber barons

.
.
.

It will never change without a revolution in the USA.

The rich will get richer, and the poor will get poorer.

But the peasants always revolt eventually . .

WHY WAIT? . . . .

[Erika]

4. that revolution will be coming

It has happened in every oppressed nation in the world. Our lack of caring for our own, while spending the workers $ on imperialism, is doomed.

[Selatius]

12. Comfortable people sleep. Uncomfortable people don't.

It's the reason why all these people in Latin America are electing leftist and center-leftist governments. Brutal, bone-crushing, painful, miserable poverty made them wake up.

Horrendous poverty burns away the fat of laziness and apathy. It beats the body of the people into shape, the kind of shape it needs to be in to fight the masters. Nothing is harder or leaner than a poor, desperate population with little left to lose.

When people are in such a state, they become radicalized. Those who advocate confrontation with power, socialists, anarchists, activists, unionists, all of them--they all start looking a little more appealing than they did before when everybody was well-off. Their message is appealing, and it spreads like an infectious disease through the minds of the population. The seeds of revolution have been sown.

Soil, once sour, has been made fertile for the seeds of revolt by the very wealthy who allowed their greed to get the best of them. Were it not for that, the soil would still be too sour for revolt.

[Blue_Tires]

15. well said

[Erika]

3. W has screwed the American worker

Health care costs up, gas costs up, inflation rising.

W was put into office to tear down the American dream and redistribute workers earning power to the top 1%.

The silly bushbots bought into it.

[oscar111]

5. 116 Trillion is US wealth: no need at all for poverty here

source: go to google Demopedia, see page on Wealth
link is to fed reserve.

http://demopedia.democraticunderground.com/index.php/Wealth

wages drop because of the GOP... their utopia is to copy Mexico today.. NO middle class... dirty and dangerous mexico.

[Kailassa]

6. Exactly, America is still a wealthy country.

But the robbers and thieves have worked out how to screw everyone
in the country but their own little group of inbred traitorous thugs.

[vssmith]

10. The owner class will find out how Marie Antoinette felt

when the unwashed masses are climbing the walls or their gated-communities. And it will happen!!

[Kolesar]

7. Sometimes I wonder about the "inflation index" they use to normalize data

...so that they can correlate modern wages to 1970s wages. They have to introduce products like PCs and VCRs into the data. Then they have to adjust the "values" of the PCs because modern ones are getting new features like real time video or internet access. I remember people buying Apple IIe and 11c computers before they could get on the internet. There is obviously more "wealth" being created here.

[swag]

8. Economist's View has more of the article, for those who don't NYT:

http://economistsview.typepad.com/economistsview/2006/09/paul_krugman_th.html

[rman]

9. Is that lefty economist asking complicated questions again?

k&r for the man

[bettyellen]

11. good stuff

thanks!

[Hand]

13. Link to full article at The Progressive American...

http://64.226.238.78/PA/pk/pk230.shtml

[bhikkhu]

14. peak US wages occurred at peak US oil

an interesting and entirely to be expected correlation, in spite of all the economic blather.