Look, see, America always screws the little guy.
This graph is making the rounds, and it quite clearly shows how “worker’s share of the national income plummets to a new low.”
As an exercise, I wanted to see what the “conservative” interpretation of this graph would be. Would they spin it or accept it?
Almost without fail, those seeking to refute this graph relied on this paper from 2004. Regardless of its strength, everyone citing the same single primary source is a pretty sure sign you’re out of ideas.
One of the ways this graph can be interpreted is as an inverse reflection of productivity (going way up), or as mirroring the extent of “subsidizing” labor (i.e. China, technology). Also, this is “share” not total compensation, so someone might argue that a rising tide has lifted all boats and drowned bodies.
Note also periods of greatest labor share occurred during recessions, and then fell (as productivity rose (as a result of layoffs, cutting costs, etc.)) An aging population and a not-rising retirement age will further decrease labor share, especially if they draw from their savings.
It’s worth making the point that if the labor share doesn’t decrease as the population ages (i.e. the capital share doesn’t increase) that will mean less capital funding those retirement incomes, which puts a bigger burden on the remaining 7 people still employed.
But the reason I link it here is not to doubt it (I don’t) but to make an obvious point: it doesn’t have to be true to motivate people to riot. Being true is actually less important than whether enough people, the right people– government, media, whomever– want it to be true.
We would go further: not only does the US already have the core elements, should one be so inclined, to provoke a (rather active) anti-fascist movement based on some interpretations of pro-corporatists policies adopted by the administration, but should another be so inclined, the country also has the groundwork in place for another neo-Marxist revolution: just take this chart, add some slogans, mix, and simmer. And who will be the natural enemy? Why only look at the great October revolution in Russia for ideas. History always rhymes.
No related posts.
Sure, truth in this instance is going to be the product of a political debate. But riot? Potentially but doubtfully. There doesn’t seem to be any occupying of town squares, as has happened in Spain or Greece, and there doesn’t seem to be any organization. I couldn’t find any numbers on their website, but the Socialist Party USA, under “Electoral Actions” seems awful proud of their three candidates, including two for city council and one for “Freeholder” (?) in mammoth Monmouth county. The Marxist-Leninist Party USA only has a Facebook page with all of 2 (!) Likes. Something like this isn’t unthinkable, but where’s the catalyst gonna come from? Race isn’t gonna motivate much as long as the President is a Kenyan Muslim (kidding, but you get my point). Turn that graph into a symbol, give that symbol celebrity status, and we’ll talk.
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I think all that’s been established here is that David Frum doesn’t know what economists mean when they use the words “Labor Share”. Granted, I don’t either, but he seems to be the one who called it “workers’ income” and sent it out into the internet for lulz.
For fun, read the titles on the following charts. Don’t try to interpret the numbers depicted; you’re not an economist, so it’s hopeless. Just read the words and see if you have different politics-feelings than you did when you looked at the one named “Nonfarm Business Sector: Labor Share”:
http://research.stlouisfed.org/fred2/series/PRS84006173?cid=32350
http://research.stlouisfed.org/fred2/series/PRS88003173?cid=32354
http://research.stlouisfed.org/fred2/series/COMPRNFB?cid=32351
“Also, this is “share” not total compensation…”
Yes, that. And maybe also this:
“The current definition of labor compensation used the Bureau of Economic Analysis (BEA) includes the salary of business owners and payments to retired workers in labor compensation.”
(Link to paper discussing why this is problematic, <a href="http://www.nber.org/papers/w7006"here .)
Hey, Marxists! Bosses’ salaries went down.
Oops, my href tags got a bit messed up. The link is here:
http://www.nber.org/papers/w7006
They say numbers don’t lie, which is true, but they do hide very important details. Why do they want to show you an index, rather that straight-up percentages? What do they want to be true?
I can’t even begin to address the sheer number of conflating variables at hand. Which may or may not have been their goal. Even if I did, even if I took the time and laid it all bare, who could I convince? The graph is the graph.
Try it. I would like to see it.
I tend to be suspicious of numbers.