Corporate Profits: Record Highs. Worker Wages: Record Lows

[Zalatix]

Now everyone on the left sit back and watch all the right wingers come in and tell us how workers should keep working for less and less and less, while the corporations and guys on top watch their wealth go to infinity and beyond.

Meanwhile, in honor of their responses let us remember what the great Arthur Young said back in 1771: "Everyone but an idiot knows that the lower classes must be kept poor, or they will never be industrious.”

Do note that most of the Conservatives who defend this trend are themselves workers. They're not as rich as they would have you think they are. Most of them have seen their wages go down. They're happy with that. They think that's how free market Capitalism should be.

And they're right. It is how free market Capitalism should be. Which is why free market Capitalism doesn't deserve to go on existing.

 

[Juiposa]

Such huge skews are wrong on so many levels. Corporations cannot be trusted to work for the greater good of society and thier workers, the government must intervene and make it so.

But of course the US gov't can't and wont do anything about.

 

[RGacky3]

Its obviously because everyone in America has gotten lazier and corporations have gotten smarter and better suddenly (sarcasm).

 

[Juiposa]

Its obviously because everyone in America has gotten lazier and corporations have gotten smarter and better suddenly (sarcasm).

Indeed, it seems to be a common flag flown by rightists that everything wrong with the economy is either the fault of the gov't or the workers/unions.

 

[RGacky3]

Except it can't be the unions, since they've been in a decline since the late 70s, or the government since the keynsian new deal state has been stripped down since the 80s ... Now they are just saying people are suddenly more greedy and less moral ... basically all they have left is that individuals are lazier and dumber and executives and corporations are suddenly magically way more valuble and productive and awesome .... Its nonsense.

 

[johnny_rebson]

Such huge skews are wrong on so many levels. Corporations cannot be trusted to work for the greater good of society and thier workers, the government must intervene and make it so.

But of course the US gov't can't and wont do anything about.

Ummm, why do you think we buy favors from our politicians???

 

[Tigger]

If you want to fix that problem, you're going to find it's a double-edged sword.

First off, it will require the government to force American companies to become American again.... that is to actually hire American workers and do their work here in the US. That will require them to pay higher wages and more for their product which will bring profits down and worker salaries up.

Of course what this will then cause is the price of the products to go up as well, which will eventually bring us back to a very similar looking graph. At which time, the Government will simply have to cap what can be charged for certain products and force these companies into taking lower profits, which in turn will prompt some of these companies to leave the United States entirely.

How can I be so sure of this?..... I work in a regulated industry (electric utility), and it's what happens to us all the time.

 

[RGacky3]

If you want to fix that problem, you're going to find it's a double-edged sword.

First off, it will require the government to force American companies to become American again.... that is to actually hire American workers and do their work here in the US. That will require them to pay higher wages and more for their product which will bring profits down and worker salaries up.

Of course what this will then cause is the price of the products to go up as well, which will eventually bring us back to a very similar looking graph. At which time, the Government will simply have to cap what can be charged for certain products and force these companies into taking lower profits, which in turn will prompt some of these companies to leave the United States entirely.

How can I be so sure of this?..... I work in a regulated industry (electric utility), and it's what happens to us all the time.

Actually no ... inflation would NOT outweigh wages

Your assuming
A: people are not saving any money
B: consumption for necessary goods are unlimited (they arn't you can only eat so much food, a middle class household won't buy extra houses if they have some extra cash)
C: Your assuming That supply won't meet demand (of coarse it will move in that direction)
D: Your also leaving out tons of other factors, for example people with disposable income and more time can shop around more, thus putting a downward pressure, or the fact that they don't spend extra money on things like food or electricity, but rather more luxury goods, or say the fact that higher wages may mean you only need one person working rather than 2 and so on and so forth."

And when people have money to spend you have an incentive for investment to meet that demand, thus all the excess capacity gets put to use ... thats where the production comes from ... We HAVE excess capacity, get that through your head, the capital is there, but without demand there is no incentive to put people to work.

 

[Juiposa]

If you want to fix that problem, you're going to find it's a double-edged sword.

First off, it will require the government to force American companies to become American again.... that is to actually hire American workers and do their work here in the US. That will require them to pay higher wages and more for their product which will bring profits down and worker salaries up.

Of course what this will then cause is the price of the products to go up as well, which will eventually bring us back to a very similar looking graph. At which time, the Government will simply have to cap what can be charged for certain products and force these companies into taking lower profits, which in turn will prompt some of these companies to leave the United States entirely.

How can I be so sure of this?..... I work in a regulated industry (electric utility), and it's what happens to us all the time.

It is indeed double edged. There is no one solution. We as a world need to find a balance between a free market economy and socialism, as both extremes result in exploitative unstable economies, for corporations and the government respectively.

But this sort of trend is deplorable and requires immediate attention.

 

[austrianecon]

Here's a way to think of this..

There is "high" unemployment and underemployment, especially if you use the u-6. But shh Uncle Sam doesn't want you to know about that. So more unemployed or underemployed equals slack in the labor market meaning wages are not competitive. Then you have that whole Globalization thing. Bet if Unions went to China and unionized you'd see Global wages rise but they don't want to do that.

 

[Tigger]

Actually no ... inflation would NOT outweigh wages

Your assuming
A: people are not saving any money
B: consumption for necessary goods are unlimited (they arn't you can only eat so much food, a middle class household won't buy extra houses if they have some extra cash)
C: Your assuming That supply won't meet demand (of coarse it will move in that direction)
D: Your also leaving out tons of other factors, for example people with disposable income and more time can shop around more, thus putting a downward pressure, or the fact that they don't spend extra money on things like food or electricity, but rather more luxury goods, or say the fact that higher wages may mean you only need one person working rather than 2 and so on and so forth."

And when people have money to spend you have an incentive for investment to meet that demand, thus all the excess capacity gets put to use ... thats where the production comes from ... We HAVE excess capacity, get that through your head, the capital is there, but without demand there is no incentive to put people to work.

What you are failing to factor in is that these companies are not interested in simply giving things away. They are businesses. They expect to make a profit at a certain level. That means if you increase their costs to make a product, the cost of that product must necessarily go up as well, in order to maintain the profit level. It's great that the amount their paying their employees goes up until you realize that the cost of everything that employee buys is going up as well.

I say this as an employee of a company that cut 1400 jobs last year; not becasue we didn't need the people but because they had promised the investors a certain return on that investment and cutting people was the only way they had of reducing overhead enough to meet that profit level after three states individually chose not to give us the amount of increase in our rates that we had requested.

 

[MaggieD]

Now everyone on the left sit back and watch all the right wingers come in and tell us how workers should keep working for less and less and less, while the corporations and guys on top watch their wealth go to infinity and beyond.

Meanwhile, in honor of their responses let us remember what the great Arthur Young said back in 1771: "Everyone but an idiot knows that the lower classes must be kept poor, or they will never be industrious.”

Do note that most of the Conservatives who defend this trend are themselves workers. They're not as rich as they would have you think they are. Most of them have seen their wages go down. They're happy with that. They think that's how free market Capitalism should be.

And they're right. It is how free market Capitalism should be. Which is why free market Capitalism doesn't deserve to go on existing.

It's been working quite well for several hundred years. Our standard of living has gone nothing but up-up-up. The 'average poor person' in the United States lives better than (WAG) 90% of all the people in the world living today or having lived in the past. Our system isn't perfect, but your way? Whatever that is? **** it.

 

[Fenton]

http://i1357.photobucket.com/albums/
q756/ineedanick/corporateprofitsvswages1.png

Now everyone on the left sit back and watch all the right wingers come in and tell us how workers should keep working for less and less and less, while the corporations and guys on top watch their wealth go to infinity and beyond.

Meanwhile, in honor of their responses let us remember what the great Arthur Young said back in 1771: "Everyone but an idiot knows that the lower classes must be kept poor, or they will never be industrious.”

Do note that most of the Conservatives who defend this trend are themselves workers. They're not as rich as they would have you think they are. Most of them have seen their wages go down. They're happy with that. They think that's how free market Capitalism should be.

And they're right. It is how free market Capitalism should be. Which is why free market Capitalism doesn't deserve to go on existing.

Sorry but until the useful idiots realize that these corporations are responding to a anti free market administration whos put a target on the back of private investors and the private sector their only recourse will be to roll out ridiculous eat the rich rhetoric like the OP.

Blame the policies that pushed real wealth away from the private sector.

Blame Obama care and the stimulus not people who have every right to do what they wish with their capital and employees.

 

[Paul Austin]

It's been working quite well for several hundred years. Our standard of living has gone nothing but up-up-up. The 'average poor person' in the United States lives better than (WAG) 90% of all the people in the world living today or having lived in the past. Our system isn't perfect, but your way? Whatever that is? **** it.

Well his lean says Socialist so Im figuring you need to compare with Mexico, or the old USSR, or something.

So, yes, America isnt perfect, but it could be a lot, lot worse.

 

[Simon W. Moon]

Now everyone on the left sit back and watch all the right wingers come in and tell us how workers should keep working for less and less and less, while the corporations and guys on top watch their wealth go to infinity and beyond.

Meanwhile, in honor of their responses let us remember what the great Arthur Young said back in 1771: "Everyone but an idiot knows that the lower classes must be kept poor, or they will never be industrious.”

Do note that most of the Conservatives who defend this trend are themselves workers. They're not as rich as they would have you think they are. Most of them have seen their wages go down. They're happy with that. They think that's how free market Capitalism should be.

And they're right. It is how free market Capitalism should be. Which is why free market Capitalism doesn't deserve to go on existing.

I find you perspective somewhat objectionable. But, that's neither here not there.

What you should have noted is that these profits are not the kind of money which can be used to create jobs. The only money which can be used to create jobs is money which is not paid in taxes--regular old profits don't work for creating jobs. If regular profit worked to create jobs, then these companies with record profit would be creating jobs already.

tldr, more profits ≠ more jobs, but less taxes = more jobs.

That's the real story, imho.

I can do w/o the psycho-babble and your Marxism from the quad.

 

[sookster]

It is indeed double edged. There is no one solution. We as a world need to find a balance between a free market economy and socialism, as both extremes result in exploitative unstable economies, for corporations and the government respectively.

I kindly disagree. I think a central solution to a lot of our problems would be to get rid of lobbying in Washington. It would free up the government into doing what is necessary for the American people. Since corporations aren't doing it on their own, I believe there should be a regulation in place that mandates a certain percentage of profits to be put back into the company and their work force. Maybe there is another way to shorten the gap between business owners and their employees, and whatever it might be, I am for it. I wouldn't be surprised if it would be better for our economy, as people would have more money to consume, assuming the business stays in the United States. Anyways, done rambling.

 

[Harry Guerrilla]

I'd like to see some reasonable numbers, that show total compensation, rather than just wages.
Wages alone, is not enough to judge anything.

 

[Neomalthusian]

Now everyone on the left sit back and watch all the right wingers come in and tell us how workers should keep working for less and less and less, while the corporations and guys on top watch their wealth go to infinity and beyond.

When there are always more people looking for work, and technology is making that work easier and more efficient, requiring fewer and fewer people over time, where would you expect wages will trend?

Do note that most of the Conservatives who defend this trend are themselves workers. They're not as rich as they would have you think they are. Most of them have seen their wages go down. They're happy with that. They think that's how free market Capitalism should be.

What "should" be in your utopian little mind is not necessarily what can be, because people tend to resist having their actions controlled. Maybe our conditions "should" be utopian. Maybe there "should" be as many working age people as well-paying jobs. Maybe economic reality isn't the way it "should" be.

And they're right. It is how free market Capitalism should be. Which is why free market Capitalism doesn't deserve to go on existing.

For example, American consumers have, over the last 30-40 years, done more and more of their business with huge, multinational corporations (explaining the success of the largest ones). They have done this because it's their free choice and because it saves them money. This leads to things you find problematic. Your impulsive reaction to this is that people in general should not have free choices, or that their free choices should not have consequences. You want to control their choices, or the consequences of those choices, for them because you think you can rig the system to everyone's advantage.

Your philosophy is, at its very core, a deep desire to control people and keep them oblivious to the consequences of their actions.

 

[Helix]

it would be interesting to see the graph in the OP with trendlines reflecting increased productivity, as well.

however, there is one factor that the graph doesn't take into account : technology. rising productivity isn't just because people work harder. technology plays an enormous role. this leads me to ask : where are we at in our transition to a post labor economy, and once we are very close to it, how do we distribute resources? currently, the gateway to resource access is job : salary : purchase goods. when there aren't enough jobs, then what? not everyone can design new technology for a living. i think we're seeing it a bit now. one side of the political spectrum likes to view increased government aid as the result of failing government, and the other side blames it on corporate entities. but what if a large factor of it is technology?

many of those outsourced manufacturing jobs are only done by humans because in some places, it's still cheaper to do it that way than by machine. if the workers started wanting more money, at some point, they'd all be canned and the Iphone would just be made by a machine. it's only a matter of time. then what?

 

[Fenton]

I find you
perspective somewhat objectionable. But, that's neither here not there.

What you should have noted is that these profits are not the kind of money which can be used to create jobs. The only money which can be used to create jobs is money which is not paid in taxes--regular old profits don't work for creating jobs. If regular profit worked to create jobs, then these companies with record profit would be creating jobs already.

tldr, more profits ≠ more jobs, but less taxes = more jobs.

That's the real story, imho.

I can do w/o the psycho-babble and your Marxism from the quad.

Profits absolutley can be used to create jobs IF the person or corporate entity view the market as stable enough to increase thier workforce.

The private sector has a target on its back and is reacting in kind by hunkering down.

You have to look at how the market is being percieved not according to the liberal fools but the people who actually participate on a level that creates employment.

 

[Simon W. Moon]

Profits absolutley can be used to create jobs IF the person or corporate entity view the market as stable enough to increase thier workforce.
The private sector has a target on its back and is reacting in kind by hunkering down.
You have to look at how the market is being percieved not according to the liberal fools but the people who actually participate on a level that creates employment.

So tax breaks won't create more jobs? That can't be right, can it? As I understand it, we need the tax breaks so that the job creators can create some jobs.

But you're telling me that the job creators can use just any old money which they happen to have laying around and don't need special monies to create jobs.


You're saying that someone is going to shoot the private sector in the back.
I assume you're being metaphorical.

What is the metaphorical gun which is being aimed @ the private sector?

 

[Zalatix]

If you want to fix that problem, you're going to find it's a double-edged sword.

First off, it will require the government to force American companies to become American again.... that is to actually hire American workers and do their work here in the US. That will require them to pay higher wages and more for their product which will bring profits down and worker salaries up.

Of course what this will then cause is the price of the products to go up as well, which will eventually bring us back to a very similar looking graph. At which time, the Government will simply have to cap what can be charged for certain products and force these companies into taking lower profits, which in turn will prompt some of these companies to leave the United States entirely.

How can I be so sure of this?..... I work in a regulated industry (electric utility), and it's what happens to us all the time.

Let them leave - and then don't let them sell anything to the US market at all. They'll be replaced.

 

[Zalatix]

Here's a way to think of this..

There is "high" unemployment and underemployment, especially if you use the u-6. But shh Uncle Sam doesn't want you to know about that. So more unemployed or underemployed equals slack in the labor market meaning wages are not competitive. Then you have that whole Globalization thing. Bet if Unions went to China and unionized you'd see Global wages rise but they don't want to do that.

Global unionization would kill offshoring faster than tariffs and just as fast as a currency collapse.

 

[Zalatix]

It's been working quite well for several hundred years. Our standard of living has gone nothing but up-up-up. The 'average poor person' in the United States lives better than (WAG) 90% of all the people in the world living today or having lived in the past. Our system isn't perfect, but your way? Whatever that is? **** it.

1) Tell that to America's growing homeless population.
2) Much of that "standard of living" is due to welfare. Which is unsustainable when so many people don't even have good paying jobs.
3) America's standard of living is going down now, and has been since this pattern has arisen.
4) HALF of the wealth held by the 99% evaporated after 2008.
5) Corporate profits, meanwhile, skyrocketed during that same 4-year period. Don't even dare try to say people's standard of living has gone up since then.

 

[Tigger]

Let them leave - and then don't let them sell anything to the US market at all. They'll be replaced.

They won't necessarily be replaced with anything of the same quality or value.