Also, "family income" now includes the wife, kids and dog. It used to be that ONE person could earn enough to pay for housing, food, car, Healthcare, etc.
So "family income" is NOT "keeping up with the cost of inflation" despite what the business world wants us to think.
The wealthy are much better off though. If you looked at the wage increase of the top 1%, if has risen by $800,000 a year (https://www.commondreams.org/news/2019/12/09/staggering-new-data-shows-income-top-1-has-grown-100-times-faster-bottom-50-1970) since 1970.
So capitalism is working exactly the way it is supposed to. Exploiting the middle and lower classes for the rich. This is exactly the progress they want.
It's a trickle-up economy.
The working class gives the wealthy their blood and sweat and the wealthy turn it into urine and piss it back on their heads and then tell the working class the reason they smell like piss is because of immigrants.
It's a sunshine economy: The wealth (moisture) slowly evaporates upwards.
Sadly it does more than merely trickle up.
It's more like a torrent going upwards.
I would say in capitalism "middle class" however you define it is something that is not ideal to have. Rich will be employers who underpay poor people 50 cents a day or less (speaking in fully open market without state intervention on minimum wage and other basic needs) poor won't have enough resources to fight for their right and will just pray to live to see better future or just die. Middle class is basically only ones who will have enough resources to fight but not have enough to be enslave other that's why they are problem in state with pure open market and pure capitalism.
My definition of middle class is someone who has enough money to live somewhat peaceful life but don't have enough money to call themselves rich.
There's an old definition of middle class that goes something like: has enough time to participate in politics.
Much more than that. The richest men in the country doubled their net worth this year alone.
It's actually even worse than that. The doubling was just in the last few months. Essentially, election time. You can practically hear them salivating at an incoming Trump admin.
Progress? ... don't you mean maintaining the status quo of human inequality for the past 10,000 years?
The rich are getting progressively richer relative to everyone else, so I'd call it accurate.
But somehow people are mad at queer folks and foreigners instead of the C-suite and their boards.
Somehow? If it's not obvious that there are several engineered distractions, then people aren't paying attention.
Easy: people get their "news" from places controlled by those C-suites and their boards.
Last week at a get-together I actually heard a conservative family member say how the drones in the news are to distract from the important issues like immigration.
This is a standard boomer that keeps news on the living room TV all the damn time. It’s not even the disconnect from both reality and compassion that gets to me any more. It’s how widespread it is, and how the propaganda works even better in the real world than in fiction.
The most disturbing stat is that our contempt for the rich hasn’t really multiplied at all.
Speak for your damn self
Luigi converted a few people but so much more work to be done.
There is an economic rule about this
Basically what it says is that new developments - like electricity, cars, computers - cause a temporary increase in demand for labor - and therefore higher wages.
As the technology becomes routine, optimization and automation remove the need for labor - demand for labor decreases and by the rule of the market wages go down.
This development is natural and has nothing to do with who's currently president, policies or anything like that. To quote from the link above:
Stephen Cullenberg stated that the TRPF (Tendency of the rate of profit to fall) "remains one of the most important and highly debated issues of all of economics" because it raises "the fundamental question of whether, as capitalism grows, this very process of growth will undermine its conditions of existence and thereby engender periodic or secular crises."
The only thing that guarantees that the population in the US can continue to live in the long-term is Universal Basic Income - which says that the state should distribute resources among the population even if the people don't work. Basically a form of state-backed social welfare. Without it, the issue will continue to get worse, until people will die on the streets by hunger and cold in masses. UBI is a necessity for the person and for peace.
Serious question: wouldn't Universal Basic Income rely on everyone paying their taxes instead of certain groups trying to hide or avoid paying it? I can't see governments affording this without a serious look at their spending to pull back om somethings, or there being a sufficient amount in the coffers from taxation.
Debt money is constantly being created for the benefit of the already rich. Taxes are just another punishment for the poor. It's not a real issue, just political theater/distraction.
There's some monetary theory that suggests careful creation of money is actually fine and won't lead to hyperinflation. So potentially, measured money printing to support UBI and stabilize the world economy might actually be fine? Honestly I don't know enough about the theory and proofs to really say, but there's some interesting possibilities if you allow for measured money creation
We have UBI in my country.
600-1300€ (depending number of children) as of this year. Over that you have to add up another series of subsidies. Most important one probably rent one that halves the cost of renting a house (the government takes care of about 50% of your rent if your income is bellow some threshold)
For reference minimum wage is 1134€
Most common salary is around 1200€
And healthcare is obviously free at the point of service.
But life is not as golden as you may thing. I used to be hardcore defendant of UBI until it became a reality. Now I'm not really into that. I think is faulty and actually bad for society. Many people are starting to have a feeling that breaking their asses 40 hours a week for getting the exactly same level of life quality that someone that does not work at all is just unfair. And tensions are on the rise. And I see a bad ending for it, it's like a ticking bomb. And it's bringing the contrary of peace, is creating confronting groups among our society.
Nowadays I am more defendant of reducing number of workhours. If there's not enough work for everyone then maybe instead of working 40 hours a week people should be working just 20 hours a week, but everyone capable of doing work should be working, so everyone could work less hours and enjoy more life. I think it is more fair than UBI. And more likely to create social harmony.
Universal Basic Income. No strings attached. Everybody gets it. There is no income threshold.
- Regular human: UBI
- McDonalds worker: UBI + McDonalds income
- Bus driver: UBI + Bus driver income
- Doctor: UBI + Doctor's income
- Billionaire tech CEO: UBI + Tech CEO money
Yeah, the inflationary pressure would probably be insane and would constantly negate any progress. I'm not an economist so I don't really know.
It should be universal human needs (food, shelter, healthcare, etc.)
If they're just giving out paper money, it'll be worthless by the time it reaches the poor.
This development is natural
lmao.
Any actual notes or thoughts?
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Important to note here the important difference between "mean", aka the average, and "median", the middle number in a set. Assuming Krueger intentionally used "median", the situation is actually worse than people realize.
The average can be affected by large outliers - like billionaires. IF the "average" American makes $50,000 a year, the median could actually be more like $30,000 (totally made up numbers, as an example).
In other words, the median is the more "accurate" number to use in these comparisons because the income of the extremely wealthy has less of an impact on the result.
You're right about everything, but the post explicitly talks about median for everything but healthcare, so it should be fairly accurate already
The land of the free and the poor \o/
Free*
*Terms and conditions apply
Free to be a profit producer for the capital-owning class, free to slip and end up a number in the prison industrial complex. Free to die of a preventable disease, homeless and destitute on the streets. All kinds of freedom!
But… I stopped going to Starbucks and quit buying Avocado toast? Can I buy a house yet?
You're posting here from a mobile or computer, right? Unless that PC is at the library, you're paying an internet bill of some sort! /s
Ugh, so lavish. I bet this guy also owns a water heater. No wonder he's poor!
Well there at a library right? To use a library computer you need a library card, and we can't expect poor people to be responsible with a library card. Obviously the commenter is irresponsible with their money paying late fees. Maybe if they stopped buying a new phone every year, or wasting money on a library they could buy a house. However keep buying the new phone we make because the shareholders demand higher returns each year. They need to do as we say and give us their money but it's their fault for any consequences they face for us forcing them to give us their money. A perfect capitalist system. /S
I blame Reagan.
You have good reason to.
Reagan ruined everything.
But the 1% got 100 x wealthier! Ain't that great?
That means the economy is booming. Fuck yeah! 😎
And the difference went to fill the coffers of the rich.
Don't forget that Medicaid and Social Security Disability still have the same $2,000 MAX asset limit (aside from a car and low-value residence). Back in 1974, that was a down payment on a house. Now that isn't enough to rent a place to live, not enough to fix a car, and if you somehow have more than $2k in assets,( (DHS does bank and tax monitoring) they take your medical and food away, despite being disabled. If adjusted for inflation, it would be about $13k. Enough to put a down payment on a small house. A 2k limit enough for people with disabilities is BARBARIC.
I've written to so many politicians about this archaic rule and Lisa McClain told me that it's that low, so that only the truly destitute use it... despite us paying taxes all our lives to protect us from starving. I was told that the disabled weren't as important as older voters who deserve retirement disability.
I was told that the disabled weren’t as important as older voters who deserve retirement disability.
As a voting block with UBI (Social security) and Medicare, lifting the ladder up after them as a class is a reliable voting influence, and they turn out to vote. A lifetime of Israel first warmongering rulership brainwashing makes them an important constituency.
Oh oh I got one too. Your McChicken, since 2014 alone, has risen in price 200% from $1 to $2.99. Along with most of their other items. They're artisan dining now, not fast food.
https://www.voronoiapp.com/economy/How-Have-McDonalds-Prices-Changed-Since-2014-1392
Yeah, this kind of comparison really drives it home. The inflation figures, while not cooked in some grand conspiracy sense, really completely fail to capture the real price increases experienced by real people.
The limitation of CPI is that it is designed for one specific thing, but we end up using it for others. If you want to measure the value of a commodity over time, like a bushel of wheat or a barrel of oil, CPI is OK for that. A bushel of wheat or a barrel of oil now are pretty similar to ones in 1970. But most goods we purchase are not so directly comparable. The CPI calculation tries to compare like goods to like goods, and it applies adjustment factors to the price of goods that aren't constant through time. For example, the TV you can get in 2024 is far, far better than one you could get in 1970. In CPI terms, this means that the real cost of TVs has plummeted by orders of magnitude.
But it goes beyond electronics. Think of homes. People will wring their hands and decry Americans as greedy by citing the size of new homes today vs in 1970, as they have significantly increased. But it's not a matter of greed; you simply cannot buy a new 1200 ft^2 modest home in post places in the country today. They don't make them anymore. Zoning has so restricted housing construction that all new housing has to be luxury housing. Yes, if you actually could find a duplicate of some c. 1970 1200 ft^2 home built new today, it would likely be quite affordable. But in terms of both size and construction details, it's not legal to build homes like that anymore. But this won't show up in the inflation figure. They'll compare the 1200 ft^2 entry-level home in 1970 to whatever rare example of that they can find that is built today of someone building one of those in unzoned farmland in rural North Dakota, and conclude that house prices haven't risen so much. In reality, no one can actually find those homes near job centers.
Or consider college. The college experience of 2024 is vastly different from that of 1970. The MBA class wormed their way into university administration and kicked all the actual academics out of admin. The MBA class see the kids as "customers" rather than pupils or students. And all the colleges and universities, even the state ones, went into MBA customer-seeking overdrive. Colleges have been luxurified. Big fancy dorms, extravagant student unions and study spaces, decadent gym facilities, etc. College at a state school in 1970 was 4 people crowded in a tiny dorm room, where your 'gym' was the campus running track. CPI looks at what it would cost to run a 1970s-style university in 2024, and concludes that college hasn't gone up in price as much as it has. This is one reason community colleges have remained so relatively affordable. By their nature, they deal mostly with commuter students who wouldn't want to use your stupid fancy gym even if you built one.
And the same thing for vehicles. Automakers have chased higher and higher rates of return by making bigger and heavier vehicles. Yes, if you could find a car made today that was an exact duplicate of a 1970s vehicle, it wouldn't have inflated as much. And that's what CPI shows. But it doesn't capture the actual buying options Americans have at their fingertips.
Ultimately, here is what you are doing when you use an inflation calculator and put in 10,000 in 1970 and calculate to today. You are fundamentally saying, "consider the kinds of goods and services average people bought in 1970. If I bought that exact same basket of goods, literal exact duplicates, what would they cost today?"
And for economists, that kind of analysis is useful. If you want to calculate interest rates and GDP growth, CPI works great for that. But for real people in the real world, they cannot simply live like it's still 1970. The affordable options they had then simply no longer exist in the market. Sometimes things have changed for good reasons like product safety, but more often it is simply because the MBA class has turned everything into a luxury good to maximize return on investment. Everything has become a luxury good aimed at the top 20% of earners. And our policy tools for dealing with inflation have been utterly unprepared for this.
That sounds interesting but are you sure it’s correct? My understanding is that CPI traces a bundle of goods that is typical at the time. This means that current CPI contains a current TV while 1970 CPI contains a 1970 tv. CPI inflation is the relative price change of these typical bundles.
My understanding (but again correct me if I am wrong) is that the type of technology adjustment you discuss affect GDP, but not CPI.
What I'm getting at is hedonic adjustment in economic terms. The BLS specifically tries to factor out the effect of increased quality of goods. They don't just look at what's typical at any given time, they specifically and explicitly want CPI to show the underlying change of goods in relation to the money supply. If overnight, the quality of all goods doubled but the price also doubled, the CPI rate for that change would be 0%. CPI says that you're now effectively buying twice as much stuff for twice as much money, so no real inflation has occurred.
This is the primary cause of the disconnect people experience between the figures they see on the news. Kamala tried to run on, "real wages have never been higher!" She was comparing wages measured in CPI inflation. People then looked at their actual lived experience, the actual price of actual goods and services they purchase, and concluded she was lying. Yes, if you're just talking commodities, an hour of work today buy more of basic commodities than at any time before. For ascetic monks who wander the Earth and never buy anything other than bulk rice and beans, there's never been a better time than now. But for people just trying to live a life of some basic dignity and comfort, they find that the only options available in category after category are things that would have been considered luxury versions of products generations past.
The ultimate cause of a lot of this is corporate consolidation. The entire economy is owned by a handful of major investment funds, and most goods have only a handful of suppliers. And the consultant/MBA class at the top all copy each others' homework. They ultimately have very few ideas. In a free economy, some companies in a sector could try to offer discount goods, like many industrialists have done in the past. But it's currently fashionable in the oligarch class to pursue a strategy of maximum profit per minimum unit, rather than trying to make modest profits per unit and make big profits through huge sales. And since the same small club of people effectively controls every publicly traded company, they all end up following the same strategies. All of them are following the strategy of "turn my market into a luxury good, as that has a superior profit margin per unit sold." What we're seeing is a direct result of the cult maximizing shareholder rate of return. If you want to maximize profit while absolutely minimizing capital investment, then you have to pursue a luxury brand strategy.
More than 50% of classes in universities are now taught by poorly paid adjuncts with no benefits who can have their classes cut up to the day before classes start. It's insane what the MBAs have done to higher education.
Another limitation of CPI is that it does not account for the devaluation of a currency due to the increase in circulating currency supply which is something the price of gold does perfectly. We can also put the rise in the price of gold next to a chart showing the increase in us circulating currency and they are very close to each other.
The price of gold was constant, only fluctuating 80% from $19 to $35 in the first 172 years of the us dollar’s history. Then nixon ended the gold standard in 1972 and within 8 years the price of gold increased 2000% from $35 to just under $800 one year later the us printed its first one trillion in circulating currency now we print 1 trillion every 3-4 months and the price of gold has increased 7500% since nixon withdrew from the bretton woods agreement. In 1956 minimum wage of $1/hr equaled 60 ounces of gold annually ($160,000 today) in 1968 it was $1.60 which is $250,000 in todays money. Gold has alwaus been considered an inflation proof asset, it has retained its value for all of history. An ounce of gold will always be able to purchase a fine set of garments, liek a really nice 3 piexe suit with undergarments, a button shirt and tie and leather shoes, a months rent in a 2 bedroom in a nice part of town or between 300-400 loaves of good bread from a bakery.
But cue in the “economics experts” telling me the price of gold has nothing to do with the value of currency
It's an interesting thought:
Today's economy forces obesity in the quantity and quality in the products bought, even when people don't actually care about that.
It reminds me of car companies saying "people want grossly oversized cars" even though a lot of people would prefer smaller, compact cars. But these aren't even sold. In the big seller houses, it's one oversized SUV after another.
Exactly. You know what I would love to buy? I do lot of woodworking, so I would like to have a pickup truck. But I don't want one of the giant clown car pickups. I want a pickup truck with a generous bed size and modest cabin, the type they made back in the 70s and 80s. That size of small compact pickup. Ideally, I would like something like that, but electric. Just a simple small spartan pickup with a stupid reliable electric drive train, the kind my grandfather used to drive around the farm.
I really do not care about cars. Right now our only vehicle is 2006 Toyota Corolla. And we're well enough off that we could go buy a luxury car in cash if we wanted to. Neither me or my partner really give a damn about cars. We just want something that will get us from point A to point B. In fact, we barely ever drive. I'm a PhD student and take my e-bike or the bus to campus, while my partner works remotely from home. We really, really do not give a damn about cars. We do not want some giant luxury vehicle. If we had to buy something new today, we would probably just buy something similar to a Corolla, though something with a bed would again be nice. But just looking at car prices gives us a heart attack.
The first stat is a little misleading IMO. While the median car cost has increased ~2x (inflation adjusted), an entry level car price has only gone up ~1.2x (1971 AMC Gremlin vs 2023 Kia Rio LX; $1.8k/$14.8k vs $17.8k) and that's more important for measuring relative quality of life.
Of course add on to that the fact that there's easy access to second hand car markets and the number of features included with that base model vs the 1971 AMC Gremlin and it doesn't seem like things are much worse.
Basically, average car prices increasing could just indicate that people are willing to spend more on cars for whatever reason that may be (better features, more car-centric culture, etc.). For this reason I'd like to see similar stats but about entry level options within each category. Probably less sensationalistic but still interesting.
That being said, I bet stats for the housing market and others would still show a notable increase even at the entry level, but I'd still like to verify this before blindly jumping on the sensationalist bandwagon.
There's another important part of this equation: these are the things being sold. If someone can't afford any car at all, they still wouldn't show up in the entry-level car stats. But I think with how car-centric the US is, there won't be many people going carless? But like you said, if the second hand market is good, everyone could be driving a barely used BMW and they still wouldn't show up in any stats about new cars.
Basically, the only thing these stats tell us is that some people would have to spend a higher proportion of their income if they want to buy these things new. It doesn't tell us if that means they don't buy it, they buy it and go hungry, they buy an alternative, or they buy it without issue (because some other expense is cheaper or disappeared).
Inflation calculations try to account for this by considering a mix of products and services. If everything goes up across the board, people will get in trouble no matter their exact spending habits. You could also look at buying power or discretionary income to see if a population is doing alright.
The prices above increased a little harder than inflation, so you'd expect to see that as a decrease in discretionary income. The same would happen if wages didn't keep up with inflation, which is a happy coincidence? Or exactly what the discretionary income stat is designed to do: show how much financial breathing room people have.
people are willing to spend more on cars for whatever reason
The reason is stifling car dependency, complete lack of alternatives, and large number of hyper-privileged man babies.
Also massive fuel subsidies allowing vehicles to just get bigger and bigger, you can't even find small trucks anymore and there are only a handful of minivan options. EVERYTHING is an SUV!
I also want to know what those $25k houses are selling for now. Comparing to houses built in 2024 is stupid.
My house was 75k in 1990, I bought it in 2000 for 130k, the unimproved land value for the block it sits on (approximately the lowest value you could sell for according to local land titles) is now 400k
Income inequality is also much higher than it was in 1971, it's about where it was at the start of the Great Depression
But screens have gotten cheaper per unit of area!
Our progress party was compromised, and by compromised I mean bribed to work against progress starting in the 1980s. Today's neoliberals.
Both parties are well paid to protect the rigged economy that exploits you that they spent decades rigging against you from you, while they war about social issue symptoms you get to vote on for the illusion of freedom.
We don't get a vote on shape or priorities of the economy. Well bribed Republicans and Democrats will lock arms, declare martial law, and authorize lethal force on us before they'll let the people end their legal Wall Street bribe gravy train. A shining example of why legality should never, ever be conflated with morality, especially post Reagan.
That's where we're at and why. Jimmy Carter was the last POTUS who wasn't all in on turning their constituents into desperate capital batteries. That is a prerequisite for party support.
Up vs. Down. Large shareholders vs everyone else. Everything else is dancing to their pfife. Pity their class traitor capitalism worshipping sycophants, but our true enemies can be identified by net worth.
Also was the 1971 household income number a single income or dual income like today? If not dual then we are working twice as muchh to make the 5.5x increase
I hate the "household income" statistic for this exact reason. It obfuscates the number of people working. Not just both parents but also adult children living with their parents and working.
If you look at Canada's single income household data from 2000-2020, the average income for males went from $30k to $34k CAD and females were roughly $17k to $25k. I would bet the US wages went up by a similar amount.
People see all this and then continue worshiping the state, promoting its fiat paper covered in slavemasters, and actively participating in its planetary destruction. The whole system is a scam. It's completely obvious.
It's ok if people want to criticize crypto because it's also garbage capitalism. But that's nothing compared to what the state is doing...
How would you guarantee my safety without a state? What would stop some group of people who decided to rape and pillage from doing so?
B...b...but you have smart phones!
The cake is being eaten. They let us eat it and we ate it.
Leaders don't care about you or me. If we collectively can't get off our lazy assess and force changes to happen that benefit us, they won't. It's really that simple. The working class needs to take responsibility for civilization back from politicians and corporations or well all continue to be genocided by the greed of a relatively few powerful human beings.
Leaders don’t care about you or me.
Too broad. Bernie clearly cares. Lots of politicians care. Not all, of course.
The problem is that not enough people care to figure out which is which. And somehow Matt Gaetz and Jim Jordan keep getting reelected.
Not really too broad. There are aspiring leaders who might care but they don't end up leading. Bernie doesn't seem to ever end up leading much does he? Business leaders keep choosing political leaders. It's leaders everywhere, not just political leadership. People who run things don't seem to give a shit about anyone but themselves and they meddle in everything to make sure leaders help them first and foremost. Half the political class also is the business class so...
Also one exception tends to prove the rule. The vast majority of our leaders, political and business, religious and cultural, are horrible fucking people who only do good when forced to and we have utterly failed as a citizenry to make sure they do.
The only thing I disagree with in this post is using the average cost of an Ivy League education. If they're comparing averages, either use all higher education or state universities.
Why did they switch from median to average for healthcare?
Prolly don't even know the difference or they actually do and are telling what data points they are using.
But this guy will make it great again, surely.
Now do CEOs.
I can’t count that high
This is surely not the reason here, but at least cars have gotten a lot more complex, and the possibilities of health care have also increased a lot. So not all of this increase goes into rich people's pockets. But likely still quite some.
Cars have gotten needlessly complex. And they're charging subscriptions and spying on people. Selling off the data too.
I need a new radio for my car. I’d love to have one that is capable of having a back-up camera but that isn’t a touch-screen. Apparently those are incompatible requests. (Unless I want to pay $3000 to the dealer to replace my busted radio with the same kind of 10-year-old radio that my car came with. Which is absurd.)
I know I can theoretically purchase a radio online, but I lack the know-how to install it. I don’t know anyone who’d do that for me either, so… despite our technological wonderland, guess I’m stuck with quiet drives for now. :(
Cars are more complex so that they can spy on you, steal your data, and make even more money as data brokers.
Both can be true.
I would take cars off the original post. Cars are basically cheaper now today than in 1971.
The average car in 1970 was 5.6 years old. By 2022, the average age stretched up to 12 years old. Machine parts are being built to tighter tolerances, and the lubricants and paints and other coatings that protect against corrosion mean that cars are expected to last to around 200,000 miles, rather than the 100,000 miles that were normal up through most of the 80's.
In other words, that new car in 1971 would be expected to last half as long as the new car in 2024. And the robust used car market allows for people to choose pretty much any model of the last 20 years, when the typical buyer in 1971 didn't have that option.
Not to mention, today's cars are far faster and more fuel efficient than the cars of the 60's and 70's. A 2023 Prius does 0-60 in 7.1 seconds and gets 57 mpg. That's around sports car performance in the 1970s.
All the while, the industry has standardized catalytic converters, seat belts, airbags, automatic transmissions, air conditioning, power steering, power windows, power locks, etc.
And there's more to come, too. Electrification may make cars even cheaper, including/especially with maintenance and fuel.
Health care, though, no, that should stay in the original post. Yes there are new procedures and treatments that weren't available in 1970, but a lot of the procedures and treatments that have been around that long have become unreasonably expensive, from regular saline IVs to bandages to insulin to an overnight stay in a hospital. So the overall costs are still way up, even when accounting for the quality differences.
What good is all that extra durability if all the cost savings are swallowed up by a much higher purchase price? We can always make things last longer; that doesn't mean its worth it. Financially, a $40k car that lasts twenty years is actually worse than two $20k cars that last ten years each. With the two $20k cars, I can spend half as much at today and invest the other half. In ten years time, that $20k will likely have grown enough to buy a whole new $20k car. And it will have newer features. And that's less assets that I'm driving around all day just waiting to get wrapped around a tree.
And it gets even worse when you consider insurance and maintenance. When cars are relatively disposable, you don't need to bother getting full coverage policies on them. If you get in a wreck, oh well, that's life, but you can afford to replace it. Few people have insurance plans on their bicycle or clothing for that reason. But when a car is so expensive that it represents a substantial chunk of your financial world, well then it being wrecked is as ruinous as your house burning down. You have to pay some third party for insurance, and the profit margin and admin costs they will demand. Averaged out, every insurance policy you have to buy is a losing game. You lose money every time you buy insurance, on average. The more things you have to insure, the poorer you are.
Automakers have realized that cars are more durable, and they have raised their prices to compensate. We as citizens don't actually receive any of the benefit of increased car durability, as the automakers have simply swallowed it all with price increases.
The car market in the US has changed dramatically since COVID, and for the worse. This time last year, I was looking for a new car and I saw that the price for used cars jumped 20% over the course of December. 20% in a single month, and that was for used cars, and it continued to climb like that through January.
55k sounds really low for a family income. Is that per person?
Got some news for you…. That’s family.
Probably worse than you think. In 1971, the family income was more often than not achieved by one person working. Now it's usually two.
Federal minimum wage is $15,080 assuming you work 40 hours a week and never get sick or take time off.
$55,000 is two people working $13.22 or a single person working $26.44
Libertarian trash. It literally quotes their god Hayek at the end.
I don't see how any of Hayek's ideas apply here.
If e.g. money was treated like outlined in his "Denationalization of money" the inflation rate would look vastly different, because the supply inflation of the USD couldn't have been forced the way it was done.
And that supply inflation caused devaluation of the USD and inflation of prices.
I'm not saying that all of the inflation rate has been caused by USD supply inflation, but Hayek might be not so bad, if you look closer.
I mean, Austrian economics barely plays any role in any economy; why blame them for the shortcomings of our current economic schemes?
Why isn't he using inflation-adjusted figures for 1971?
Why isn't he comparing the cost per square foot of houses instead, since the average house today is much, much larger than the average house in 1971?
Because they are comparing inflation of different things. If it all was done inflation adjusted, income would have gone down, many prices would remain the same and some would go up. It would be less clear
Why isn't he using inflation-adjusted figures for 1971?
Official inflation rates calculation formulas have been adjusted too many times for it to have any value to compare prices over 50 year period.
Why isn't he comparing the cost per square foot of houses instead,
This is a valid point, it would more precisely account for "hedonistic" adjustment
e average house today is much, much larger than the average house in 1971
is it 5.5x larger?
If the number is 4x instead of 5.5, how would your analysis change on the trend we see here?
Doesn't the quotes just ruin his whole thing? You either say "so much for progress" or something like "thanks for the 'progress'". 'So much for "progress" ' feels like a double negative
Strong disagree.
Putting it in quotes highlights the alleged progress that gets talked about. But it calls it out as false. This isn't uncommon in English, not sure of other languages.
I bought a 3br 2ba 1.7k sqr house in the suburbs in 2017 for 135k and a hybrid car with 10k miles on it for 20k a few years ago. I'm really confused at these numbers. Are people just living outside their means and hoping collectors won't come knocking? I was making 55k at the time and I had no real financial troubles.
Huh. I wonder what happened between 2017 and today?
https://www.businessinsider.com/personal-finance/mortgages/housing-bubble
Also...
https://www.bankrate.com/mortgages/historical-mortgage-rates/
This has some serious boomer "I paid $25 a credit in college so I don't see why you are all taking out big loans" vibes to it.
Can't speak for everyone, but COVID really drove up prices. Imo, there has been some gauging since then by keeping supply low. However, at least in my neck of the woods, prices seem to be going down and feels like we are getting back to pre-covid.
The car metric is for a new car. I think it's a valid assessment even if buying a used car is the better option for most people.
A 17k Sq ft house for 135k? I'm calling bullshit. Maybe 1.7k.
Ah, yes, you're absolutely correct.
Not a meme.
Every time you paste that in one of my threads, I'm going to let everyone see what a lie your bio is:
If you think we are not better off now than in the 70s, you have selective amnesia or possibly brain damage.
The world of Bladerunner has flying cars, androids, space settlements, holographic projections. Advancement is not the same as "better off", especially if you're in the groups that see all of it but can't take part in any improvements. From my own perspective as white male from the 70s (a demographic that would benefit far more than others then and now) things are both better and worse, depending on what you look at. In the subjects the meme touches, it's worse for most everyone but the wealthy. If you look around and don't see it, then you don't have brain damage, you're just isolated in your own shiny world (by choice or not).
Fiscally
alive > not alive
So I'm better off
