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Getting the ball rolling faster and in a good direction

mmi

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Average real GDP growth in the US has been relatively slow since the turn of the century, around two percent, interrupted as we all know by a terrible recession Dec 2007 — June 2009.

In the 1990s, we did better (around 3.5%), in part because there was just one brief and shallow downturn at the beginning of the decade. We also benefited from the Information Revolution during those years.

The 1980s were an unstable period, with the economy in recession for two of the first three years, then a big spike of 7.8% in 1983, followed by some more of those fairly good years at about 3.5%.

The 1970s were also unstable, in large part due to the oil shocks with average growth a little less than 3.5%. We did well in the 1960s at around 4.5%.

Americans would like to know what we can do to get incomes rising more rapidly. Of course, proposals are quite varied. Some observers, but very few if any economists, are calling for a return to the gold standard. Others support efforts to use deficit spending to leverage growth through investments in education, infrastructure, and R & D.

But there's a serious problem that many believe must be resolved — the widening income and wealth inequality that has only worsened over the past thirty-five years.

change_real_wages_by_decile_1973_2012.jpg (source)

An expanding pace of GDP growth that benefits only those in upper-income households won't do us any good and could lead to a dangerous level of political instability.

It should be noted that we're already doing a lot to try to address this issue. In 2014, the various income support programs that provide government assistance to low-income households (the so-called "safety net") reduced the poverty rate in the US from 27% to 15%, nearly cutting it in half. But this is only a short-term solution, one that leads to a variety of social breakdowns if it continues for too many years. Income subsidies are, at some point, a poor substitute for increasing employment earnings.

I'm not much of an economic theorist, but my understanding is that the problem with returning to a system in which the value of the dollar is tied to a commodity such as gold is that it effectively ties the hands of the government when the need to adjust to destabilizing events arises. I figure we simply can't return to the boom and bust cycles we experienced before the Second World War.

Otoh, I find myself drawn to the monetarist argument that a so-called "managed currency" like the one we had 1948-70 had an important component that might be very useful today — it lowered the risk, or at least the perceived risk, associated with investment because it did more to control the cost of capital.

I've tried to gain some understanding of the federal budget and its impact on the economy over the years, but I''m pretty much ignorant of the factors involved in stuff like ways to properly incentivize and prudently direct investment in the private sector. I'm hoping for an informative discussion of how public policies can be shaped in the next few years to both spur more economic growth and draw a larger share of income to working- and middle-class households.

I've become more or less satisfied with my views about tax policy and efforts to further reduce poverty, but I'm thinking my vision may be more limited than I've realized. I'm hoping to move away from what I see as a narrow field of increasingly bitter political struggles to find more common ground with proponents of an approach to economic development that focuses more on the private sector.

How can we get a measure like the following back up closer to ten percent annual growth, and do so in a way that creates very positive social outcomes?

gross_private_investment_1960_2015.jpg

Or this my thinking simply off-base entirely?

"The Economy Is ​Great; the​ Economy Is Terrible," Atlantic, May 3, 2016
 
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dimensionallava

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your question is a bit garbled, your first graph is real wages and the second is related to GDP, the two are unrelated. So are you asking how do we get back to 10% GDP growth, or 10% real wage growth? Also the gold standard isnt seriously reccomended by anyone except for maybe a few crank theorists
 

mmi

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First, I'm thinking this thread should perhaps be moved to the Economics board. If a moderator stumbles into it, I'd appreciate yer moving it. Thanks.

your question is a bit garbled, your first graph is real wages and the second is related to GDP, the two are unrelated.

Unrelated? Isn't GDP the same thing as national income? Of course, there's more to that than simply employment income, but I don't see how they're "unrelated."

>>So are you asking how do we get back to 10% GDP growth, or 10% real wage growth?

We're never gonna get close to ten percent annual growth in either measure, are we? We never have.

>>Also the gold standard isnt seriously reccomended by anyone except for maybe a few crank theorists

Ted Cruz called for it in a GOP presidential debate this year, and a watered-down version of it was in the 2012 Republican platform.
 

dimensionallava

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Unrelated? Isn't GDP the same thing as national income? Of course, there's more to that than simply employment income, but I don't see how they're "unrelated."
gross national income is called GNI what you posted is GPDI which is one of many things used to calculate GDP
Gross Domestic Product (GDP) Definition | Investopedia
Gross National Income (GNI) Definition | Investopedia

>>So are you asking how do we get back to 10% GDP growth, or 10% real wage growth?

We're never gonna get close to ten percent annual growth in either measure, are we? We never have.
GDP yes we have
saupload_09_02_02f_gdp_since_1930.png

average income (which is different from wages)would depend on what tax bracket you mean
chart.gif

>>Also the gold standard isnt seriously reccomended by anyone except for maybe a few crank theorists

Ted Cruz called for it in a GOP presidential debate this year, and a watered-down version of it was in the 2012 Republican platform.
he was most likely pandering to the "birther crowd" theres a pretty popular federal reserve conspiracy theory, involving the illuminati and the jews stealing our gold and somehow, we need the gold standard, to get all the gold back or something, but if you want to ask about that... your better off starting this thread in the conspiracy theory section

No serious economist recommends the gold standard, its probably one of the only things they almost all agree on
In 2012, the Booth School asked its panel of roughly 40 economists if the average American would be better off, as measured by price stability and employment, if the U.S. replaced its current fiat currency with a "dollar" defined as a fixed quantity of gold – in other words, a return to the gold standard.

How many of the experts answered that this would be a good idea for the U.S.? None. Zero. For the record, in all the years that I have been following the Chicago Booth economic surveys (called the IGM Forum), there has never been unanimous agreement on any other question posed.
Trump and Cruz's Call for Gold Standard Is Impractical and Dangerous | US News Opinion
 

joG

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Average real GDP growth in the US has been relatively slow since the turn of the century, around two percent, interrupted as we all know by a terrible recession Dec 2007 — June 2009.

In the 1990s, we did better (around 3.5%), in part because there was just one brief and shallow downturn at the beginning of the decade. We also benefited from the Information Revolution during those years.

The 1980s were an unstable period, with the economy in recession for two of the first three years, then a big spike of 7.8% in 1983, followed by some more of those fairly good years at about 3.5%.

The 1970s were also unstable, in large part due to the oil shocks with average growth a little less than 3.5%. We did well in the 1960s at around 4.5%.

Americans would like to know what we can do to get incomes rising more rapidly. Of course, proposals are quite varied. Some observers, but very few if any economists, are calling for a return to the gold standard. Others support efforts to use deficit spending to leverage growth through investments in education, infrastructure, and R & D.

But there's a serious problem that many believe must be resolved — the widening income and wealth inequality that has only worsened over the past thirty-five years.

View attachment 67202723 (source)

An expanding pace of GDP growth that benefits only those in upper-income households won't do us any good and could lead to a dangerous level of political instability.

It should be noted that we're already doing a lot to try to address this issue. In 2014, the various income support programs that provide government assistance to low-income households (the so-called "safety net") reduced the poverty rate in the US from 27% to 15%, nearly cutting it in half. But this is only a short-term solution, one that leads to a variety of social breakdowns if it continues for too many years. Income subsidies are, at some point, a poor substitute for increasing employment earnings.

I'm not much of an economic theorist, but my understanding is that the problem with returning to a system in which the value of the dollar is tied to a commodity such as gold is that it effectively ties the hands of the government when the need to adjust to destabilizing events arises. I figure we simply can't return to the boom and bust cycles we experienced before the Second World War.

Otoh, I find myself drawn to the monetarist argument that a so-called "managed currency" like the one we had 1948-70 had an important component that might be very useful today — it lowered the risk, or at least the perceived risk, associated with investment because it did more to control the cost of capital.

I've tried to gain some understanding of the federal budget and its impact on the economy over the years, but I''m pretty much ignorant of the factors involved in stuff like ways to properly incentivize and prudently direct investment in the private sector. I'm hoping for an informative discussion of how public policies can be shaped in the next few years to both spur more economic growth and draw a larger share of income to working- and middle-class households.

I've become more or less satisfied with my views about tax policy and efforts to further reduce poverty, but I'm thinking my vision may be more limited than I've realized. I'm hoping to move away from what I see as a narrow field of increasingly bitter political struggles to find more common ground with proponents of an approach to economic development that focuses more on the private sector.

How can we get a measure like the following back up closer to ten percent annual growth, and do so in a way that creates very positive social outcomes?

View attachment 67202724

Or this my thinking simply off-base entirely?

"The Economy Is ​Great; the​ Economy Is Terrible," Atlantic, May 3, 2016

The rule of thumb is that making it it more profitable to invest and easier to employ increases investment and employment.
 

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I've become more or less satisfied with my views about tax policy and efforts to further reduce poverty, but I'm thinking my vision may be more limited than I've realized. I'm hoping to move away from what I see as a narrow field of increasingly bitter political struggles to find more common ground with proponents of an approach to economic development that focuses more on the private sector.

In what way do you want to focus? For me it's about balance - demand vs supply. As it is right now, it's a really tough sell that supply is short. There is that side, that wants more "natural" or organic private sector investment, but the question is why? What indicators are there that there needs to be more? I'm more on the side that capital is already in "super abundance", so even if we're not talking about taxes, the target is still more of the public sector regulating the private sector. I think there are ways to do that that allows for a lot more flexibility - ie work week and overtime limitations over straight up minimum wages. But they are regulations all the same.
 

mmi

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gross national income is called GNI what you posted is GPDI which is one of many things used to calculate GDP

I've never heard of GDPI. Can you tell me about it? I don't think I posted it. I posted some data on employment income.

Now I am familiar with GNI (gross national income), which, predictably, is the level of production (or income, same thing) generated domestically plus income derived form overseas, such as interest and dividends. For the US, GDP makes up almost all of GNI. In 2014, GDP was $17.6T while GNI was $17.8T. That's 99%. In my experience, GNI is almost never discussed except in some very narrow contexts.

>>GDP yes we have [had annual real growth above ten percent]

I stand corrected. I was thinking of years other than, first, those during the Second World War (1943-45) when gubmint expenditures were forty percent of GDP, and secondly 1936 and 1938, when we were recovering from the terrible declines in production earlier in that decade that resulted from the Great Depression. So I'll amend my statement to, "We have never seen ten percent annual real GDP growth … other than in those five years when we were involved in either recovering from a worldwide depression or involved in a world war." I expect you'll agree that those high growth rates are not something we want to return to if we would need to pay the associated costs.

>>average income (which is different from wages)would depend on what tax bracket you mean

I agree that employment income is only part of total income. I already said that in #3. You said that they are "unrelated." I still don't know why you said that, and I have no idea why yer referring to tax brackets.

>>there's a pretty popular federal reserve conspiracy theory, … but if you ... your better off starting this thread in the conspiracy theory section

No, I don't "want to ask about that," and I didn't. I brought it up to dismiss it, as I very clearly did, and to contrast it with the other monetarist idea I mentioned related to risk and the cost of capital.

>>No serious economist recommends the gold standard

I said that very clearly in the OP — "very few if any economists."

The rule of thumb is that making it it more profitable to invest and easier to employ increases investment and employment.

Yes, that makes sense, but I'm looking for more specificity.

In what way do you want to focus? For me it's about balance - demand vs supply. As it is right now, it's a really tough sell that supply is short. … I'm more on the side that capital is already in "super abundance"

That seems to make sense. I'm looking for ways to spur investment, and I'm thinking that may involve the cost of capital and changing perceptions of risk.
 

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That seems to make sense. I'm looking for ways to spur investment, and I'm thinking that may involve the cost of capital and changing perceptions of risk.

It's interesting that you put it that way. Many countries with a stronger "socialist" safety net actually see better rates of startups, entrepreneurial endeavors, and more risk into unknown frontiers. The more a person can believe they'll be ok if they fail, the more they might risk. Here on the other hand, we have gotten really good at creating entrepreneurs by necessity - people starting smaller versions of what they already know simply to stay employed.
 

mmi

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Many countries with a stronger "socialist" safety net actually see better rates of startups, entrepreneurial endeavors, and more risk into unknown frontiers. The more a person can believe they'll be ok if they fail, the more they might risk.

A very good point. I was thinking of "big capital." I feel you've made a valuable contribution to the thread. Thanks.

>>we have gotten really good at creating entrepreneurs by necessity - people starting smaller versions of what they already know simply to stay employed.

That's pretty much what happened to me. I got to where I couldn't hack it in 100° restaurant kitchens anymore, so I started a small business providing a copyediting service and building websites. Never made much money. Then I was lucky enough to get hired by Uncle Sam, and now happily continue that life of teat-sucking. ☺
 

dimensionallava

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I've never heard of GDPI. Can you tell me about it? I don't think I posted it. I posted some data on employment income.
GPDI=Gross Private Domestic Investment (see your 2nd chart) it basically means businesses are buying new inventory or "making investments" so they can sell stuff in the future

https://en.wikipedia.org/wiki/Gross_private_domestic_investment

Now I am familiar with GNI (gross national income), which, predictably, is the level of production (or income, same thing) generated domestically plus income derived form overseas, such as interest and dividends. For the US, GDP makes up almost all of GNI. In 2014, GDP was $17.6T while GNI was $17.8T. That's 99%. In my experience, GNI is almost never discussed except in some very narrow contexts.
GNI can be an important economic indicator in smaller nations, but for a country the size of the USA, yes it is usually considered a negligible, or unused number


I stand corrected. I was thinking of years other than, first, those during the Second World War (1943-45) when gubmint expenditures were forty percent of GDP, and secondly 1936 and 1938
we should go back to that
, when we were recovering from the terrible declines in production earlier in that decade that resulted from the Great Depression. So I'll amend my statement to, "We have never seen ten percent annual real GDP growth … other than in those five years when we were involved in either recovering from a worldwide depression or involved in a world war." I expect you'll agree that those high growth rates are not something we want to return to if we would need to pay the associated costs.
it depends on what those expenditures are, they could spend it on books instead of bombs

I agree that employment income is only part of total income. I already said that in #3. You said that they are "unrelated." I still don't know why you said that, and I have no idea why yer referring to tax brackets.
what i meant by "unrelated" was that one can go up, while the other goes down, theyre not directly connected. GDP can increase while median wages goes down, which has been happening for the past 40-50 years

No, I don't "want to ask about that," and I didn't. I brought it up to dismiss it, as I very clearly did, and to contrast it with the other monetarist idea I mentioned related to risk and the cost of capital.

I said that very clearly in the OP — "very few if any economists."
okay :)
 
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mmi

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GPDI=Gross Private Domestic Investment

Ahh, thanks for that. ☺

>>GNI … for …the USA … is … a negligible … number

Of course you mean the difference between GDP and GNI.

>>we should go back to [ten percent annual real GDP growth] … it depends on what those expenditures are, they could spend it on books instead of bombs

True, but I figure something like four to five percent is much more realistic, and that itself would be difficult to accomplish.

>>what i meant by "unrelated" was that one can go up, while the other goes down, theyre not directly connected.

That's sometimes described as something like "not necessarily positively correlated." I'd say they are "directly related" in that one is an element contained in the other.

>>GDP can increase while median wages goes down

Yes.

>>which has been happening for the past 40-50 years

Average real hourly earnings of production/nonsupervisory grew by fourteen percent 1964-72, then fell fairly steadily until 1993, but have been increasing with some fluctuation in the years since. We're now within $1.20/hr, or five percent, of the all-time high.

average_real_hourly_earnings_1964_2015.jpg
 
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dimensionallava

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Average real hourly earnings of production/nonsupervisory grew by fourteen percent 1964-72, then fell fairly steadily until 1993, but have been increasing with some fluctuation in the years since. We're now within $1.20/hr, or five percent, of the all-time high.

where are you getting these graphs? Average real hourly earnings of production/nonsupervisory isn't a normal economic indicator neither is gross private domestic investment. these are really specific things that dont give an accurate picture of the whole US economy.
 

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A very good point. I was thinking of "big capital." I feel you've made a valuable contribution to the thread. Thanks.

Thanks mmi, I try ;). What do you mean by "big capital"?

>>we have gotten really good at creating entrepreneurs by necessity - people starting smaller versions of what they already know simply to stay employed.

That's pretty much what happened to me. I got to where I couldn't hack it in 100° restaurant kitchens anymore, so I started a small business providing a copyediting service and building websites. Never made much money. Then I was lucky enough to get hired by Uncle Sam, and now happily continue that life of teat-sucking. ☺

Yeah I'm sure you're breaking windows and then turning around and just replacing them ;).

It sounds like you made a huge shift. With a better safety net maybe you would have taking a bigger risk on something else and created something truly novel. I find it funny when people say the wealthy take all the risk, when they actually risk very little beyond extra cash. They do not risk home, or food, or life, or limb. The result is that we have a very small pool of people that we rely on being innovative.
 

mmi

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where are you getting these graphs?

There's a lot of data with "pretty graphs," as some here who don't like the information they provide describe them, available online from the Federal Reserve Bank of St. Louis. The site offers tools that allow you to tailor a graph for a specific purpose.

The search engine can be a little tricky, or else I'm just not that good at using it. In my experience , you need to get used to the way they label things. E.g, if you search on "median wages," you get a list that may not offer what you want. Ya might do better using "earnings."

If you click on "Browse data by … Category," you get a list that doesn't have wages or earnings or anything like it. But there is a link to the "Current Population Survey," the source they use for employment data.

If you go back to the main page, you can click on "Browse data by … Tag." Nothing useful for this on page one, but "wages" is listed on page two.

Anyway, under "Need Help?," you can find out a lot more. There's a link to "Tutorials" that has a lot of useful stuff to help you manipulate graphs. I haven't looked at those yet, but of course I should. I typically look at "the directions" for something only as a last resort. (Where's the fun in that?) The site can be a little frustrating, but it's got lots of good information, and you get better at using it over time.

>>Average real hourly earnings of production/nonsupervisory isn't a normal economic indicator neither is gross private domestic investment. these are really specific things that dont give an accurate picture of the whole US economy.

I figure that's true of a lot of statistics. I agree that you need to be very careful to be aware of what it is yer referencing.

What do you mean by "big capital"?

It's a technical term economists use. Nah. You referred to "startups, entrepreneurial endeavors," by "little guys" like me who are seeking employment, and I was just saying that I had forgotten about that and had instead been focused on people with millions of dollars who invest in one thing or another that would be included in that "gross private domestic investment" category.

>>I'm sure you're breaking windows and then turning around and just replacing them.

My job is to annoy people and then attempt to persuade them to talk to me about things they don't want to talk about. Sort of like what I do here at DP.

>>It sounds like you made a huge shift.

Enh. I had to do something.

>>With a better safety net maybe you would have taking a bigger risk on something else and created something truly novel.

I dunno, maybe. My thought is that I see Americans as a labor resource that the country should do what it can to exploit. I could have made a lot more money, generated a lot more national wealth, and paid a lot more taxes over the years. I view myself and a LOT of other people as underutilized resources in that sense. We often look at things as a competition to make money where yer more or less on yer own, both as individuals and organizations. We do a great job at searching for natural resources like oil and gas and doing everything we can to "monetize" them, sometimes with rather incredible skill and innovation. I'd say there are lots and lots of labor resources in this country that we aren't getting maximum value from, not even close. We should work on doing better there.
 
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JohnfrmClevelan

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In what way do you want to focus? For me it's about balance - demand vs supply. As it is right now, it's a really tough sell that supply is short. There is that side, that wants more "natural" or organic private sector investment, but the question is why? What indicators are there that there needs to be more? I'm more on the side that capital is already in "super abundance", so even if we're not talking about taxes, the target is still more of the public sector regulating the private sector. I think there are ways to do that that allows for a lot more flexibility - ie work week and overtime limitations over straight up minimum wages. But they are regulations all the same.

I am basically in agreement with this. Demand is the key to most things.

I think that our overall level is fine - GDP per capita is still very high. A better distribution of the same income would solve a lot of social problems, plus it would increase demand, and therefore "big investment." I wouldn't even hazard a guess as to the rate of growth that might lead to, but it would be an improvement.

I don't think we get there, though, without seriously increasing public sector employment, especially middle-class level positions. That's the "organic" part - creating a genuine demand for labor at all levels, and hoping that private sector wages increase in response.
 

mmi

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Demand is the key to most things.

Seems to make sense.

>>I think that our overall level is fine - GDP per capita is still very high.

Yeah.

>>A better distribution of the same income would solve a lot of social problems, plus it would increase demand, and therefore "big investment."

Absolutely.

>>I don't think we get there, though, without seriously increasing public sector employment, especially middle-class level positions.

Well, I suppose I agree with the way you worded that. What about moderately sized "smart" public investments in education, infrastructure, and R & D? Wouldn't that boost demand to some degree in the short term and add to "organic" demand down the road?

>>the "organic" part - creating a genuine demand for labor at all levels, and hoping that private sector wages increase in response.

Any ideas on how to accomplish more of that?
 

JohnfrmClevelan

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>>I don't think we get there, though, without seriously increasing public sector employment, especially middle-class level positions.

Well, I suppose I agree with the way you worded that. What about moderately sized "smart" public investments in education, infrastructure, and R & D? Wouldn't that boost demand to some degree in the short term and add to "organic" demand down the road?

Well, those public investments generally do go toward employment. We generally fix our infrastructure by hiring private firms to do the work. (I don't even know if most cities still have a crew of their own guys to fill potholes, or if they contract out for the small stuff as well.) R & D, as I know it, means federal grants to do research, something they don't do nearly enough of. "Investing in education" should mean hiring more teachers, and not buying technology.

Any increase in income (that ends up being permanent) should lead to an organic increase in demand.

>>the "organic" part - creating a genuine demand for labor at all levels, and hoping that private sector wages increase in response.

Any ideas on how to accomplish more of that?

I think that the government should just hire more people directly. Trying to lower unemployment by increasing private sector demand isn't an efficient use of money.

More grants to researchers. More grants to artists. Grants to state and local governments, so they can hire back all the staff they cut after the crisis. More federal money put toward teachers, cops, firemen, and any other public employees. It would be a drop in the bucket compared to the money spent on "defense."
 

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Can we just cut to the chase?

Have Government, (led by smart benificent people like Obama , Bernie Sanders and Hillary Clinton) , run the economy so we don't get the negative greed influences from the private sector.
Wages should be set by a govt commission since the it it obvious that the laws of supply and demand don't work.
 

dimensionallava

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There's a lot of data with "pretty graphs," as some here who don't like the information they provide describe them, available online from the Federal Reserve Bank of St. Louis. The site offers tools that allow you to tailor a graph for a specific purpose.

The search engine can be a little tricky, or else I'm just not that good at using it. In my experience , you need to get used to the way they label things. E.g, if you search on "median wages," you get a list that may not offer what you want. Ya might do better using "earnings."

If you click on "Browse data by … Category," you get a list that doesn't have wages or earnings or anything like it. But there is a link to the "Current Population Survey," the source they use for employment data.

If you go back to the main page, you can click on "Browse data by … Tag." Nothing useful for this on page one, but "wages" is listed on page two.

Anyway, under "Need Help?," you can find out a lot more. There's a link to "Tutorials" that has a lot of useful stuff to help you manipulate graphs. I haven't looked at those yet, but of course I should. I typically look at "the directions" for something only as a last resort. (Where's the fun in that?) The site can be a little frustrating, but it's got lots of good information, and you get better at using it over time.

>>Average real hourly earnings of production/nonsupervisory isn't a normal economic indicator neither is gross private domestic investment. these are really specific things that dont give an accurate picture of the whole US economy.

I figure that's true of a lot of statistics. I agree that you need to be very careful to be aware of what it is yer referencing.

I know what the website is i was just wondering if you were copying them from an article or blog you haven't sourced. Average real hourly earnings of production/nonsupervisory wasn't even measured separately until a few years ago

but to answer your questions, i would have to first ask, would you rather see 10% GDP growth and average wages go down 10%, or would you rather see average wages go up by 10% but GDP decrease by 10%?
 

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i was just wondering if you were copying them from an article or blog you haven't sourced.

No, I was not.

>>Average real hourly earnings of production/nonsupervisory wasn't even measured separately until a few years ago

That series goes back to 1964. You may be thinking of another that is similar — Average Hourly Earnings of All Employees: Total Private, which starts in 2006.

>>would you rather see 10% GDP growth and average wages go down 10% or would you rather see average wages go up by 10% but GDP decrease by 10%?

My first thought is that neither is at all likely to occur. I should note, first, that I'm thinking of dollar values that are adjusted for inflation. The nominal values are, of course, very much positively correlated. But especially in the case of real figures, annual changes of ten percent are, imo, completely unrealistic. Perhaps yer not thinking of annual shifts.

I'd like to see earnings and GDP increases of perhaps three to four percent annually. I don't think we could really hope for much more.
 

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I'd like to see earnings and GDP increases of perhaps three to four percent annually. I don't think we could really hope for much more.

So would everyone but unfortunately theres no guaranteed way for that happen, if there was then everyone would be doing that.
 

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So would everyone but unfortunately theres no guaranteed way for that happen

There aren't a whole lot of guarantees in life, but we continue to struggle along nevertheless … until the curtain falls and we get the final data assessment on our existence.
 

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There aren't a whole lot of guarantees in life, but we struggle along nevertheless.

thats why I asked you too choose.... there are 2 basic arguments...the first is that any growth is good growth meaning even if 50% of income goes to the top 1% of society its still a good thing for the rest of the country because its spurs innovation, motivates the bottom classes, and eventually "trickles down", as long as there is some safety nets for the poor. The other argument is that progressive taxation of the wealthiest citizens, the increasing of welfare benefits and the increasing of public employment can allow capitalism to progress without experiencing the negative aspects of the ups and downs of the capitalist economy.
 

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2 basic arguments …the first … any growth is good growth … The other argument … that progressive taxation of the wealthiest citizens, the increasing of welfare benefits and the increasing of public employment can allow capitalism to progress without experiencing the negative aspects of the ups and downs of the capitalist economy.

Well, I certainly reject the first one. On the second, yes, I support progressive taxation. It's a lot more fair, and without it, the public sector could not be adequately funded. As for "increasing welfare benefits and increasing public employment," there may be some benefit associated with those policies, but I don't necessarily see them as priorities.

My prescription is increased public investment in education, infrastructure, and R & D. And as to "ups and downs," yes, I support efforts to apply fiscal and monetary policy that seeks to avoid bubbles and recessions.

My purpose in starting this thread is to ask members for suggestions related to ways to increase private investment, perhaps with a focus on addressing the idea that the current level could be expanded by finding ways to diminish perceived risk. That's why I asked for a mod to move it to the Economics section.
 

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As for "increasing welfare benefits and increasing public employment," there may be some benefit associated with those policies, but I don't necessarily see them as priorities.
why not?

My purpose in starting this thread is to ask members for suggestions related to ways to increase private investment, perhaps with a focus on addressing the idea that the current level could be expanded by finding ways to diminish perceived risk.

theres not much difference between public and private investment, the government still prints it either way lol, if you take $1 from 1 mllion people, or if you take $1 million from one person you still end up with $1 million. the same is true here.

Small countries for years have benefited from lowering taxes to attract "investors" as have many small towns and cities. But on a national scale with an economy the size of America there is little or no reason to keep taxes comparably low to other nations, since a simple few percentage points in tax savings is not anyone's primary reason for investing in the USA

so while lowering taxes in your city might attract a few new business' there is no equal tax cut, that can attract international investors to the USA. One interesting thing about the tea party's recent shutdown of the US government was that it attacked one of the main reasons people invest in america which is americas credit rating. which they lowered for the first time since the great depression. This was probably the worst thing you could possibly do as far as "attracting investors" to the USA is concerned

If you want a way to decrease perceived risk and increase foreign investment preventing that from happening again would be the best thing
 
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