Donald Trump: wages are 'too high'

[Benton]

(11-13-2015, 02:06 PM)EatonFan Wrote: This is true.  If you think you are worth more, then show those skills and prove you are worth more.  If your current job does not allow you to support yourself -- look for another one that will.  Gaining skills will never hurt anyone. 

Beyond this the real problem is how government structures its benefits.  The incentive is to stay in a certain income range (an income box).

If you take government benefits into account (and treated them as compensation) I'd bet wages have risen in the last 25 years instead of being flat. 

What are some of these benefits?

Earned income credit
Additional child tax credit
Daycare
HUD housing
Utility subsidies
'Free' YMCA memberships
Food stamps
Cash assistance
Medicaid
Student Aid


There's more.

The problem with every one of those programs is that in order to get them you must keep your income low -- IN the box.  Both parties support these programs, but for different reasons.

I dunno. Those benefits are largely for those in the bottom-most brackets. Like Matt, that's pretty much out the window for a lot of us who have decent jobs. I've got two kids and pretty soundly in the middle class, but I don't qualify for any of that outside of possibly the child tax credit (I know we deduct medical expenses, but I generally stay out of the tax stuff for our household, I've got enough of that at work).

Those benefits have increased, I'm sure, for the lower earners, but that doesn't do anything to offset the wage and hiring freeze my company has. I guess eventually if the wages don't come up, I'll qualify for social aide. Which is a depressing thought.


http://www.epi.org/publication/a-decade-of-flat-wages-the-key-barrier-to-shared-prosperity-and-a-rising-middle-class/

Quote:

• According to every major data source, the vast majority of U.S. workers—including white-collar and blue-collar workers and those with and without a college degree—have endured more than a decade of wage stagnation. Wage growth has significantly underperformed productivity growth regardless of occupation, gender, race/ethnicity, or education level.
• During the Great Recession and its aftermath (i.e., between 2007 and 2012), wages fell for the entire bottom 70 percent of the wage distribution, despite productivity growth of 7.7 percent.
• Weak wage growth predates the Great Recession. Between 2000 and 2007, the median worker saw wage growth of just 2.6 percent, despite productivity growth of 16.0 percent, while the 20th percentile worker saw wage growth of just 1.0 percent and the 80th percentile worker saw wage growth of just 4.6 percent.
• The weak wage growth over 2000–2007, combined with the wage losses for most workers from 2007 to 2012, mean that between 2000 and 2012, wages were flat or declined for the entire bottom 60 percent of the wage distribution (despite productivity growing by nearly 25 percent over this period).
• Wage growth in the very early part of the 2000–2012 period, between 2000 and 2002, was still being bolstered by momentum from the strong wage growth of the late 1990s. Between 2002 and 2012, wages were stagnant or declined for the entire bottom 70 percent of the wage distribution. In other words, the vast majority of wage earners have already experienced a lost decade, one where real wages were either flat or in decline.
• This lost decade for wages comes on the heels of decades of inadequate wage growth. For virtually the entire period since 1979 (with the one exception being the strong wage growth of the late 1990s), wage growth for most workers has been weak. The median worker saw an increase of just 5.0 percent between 1979 and 2012, despite productivity growth of 74.5 percent—while the 20th percentile worker saw wage erosion of 0.4 percent and the 80th percentile worker saw wage growth of just 17.5 percent.
  

[Belsnickel]

(11-13-2015, 02:55 PM)Benton Wrote: I dunno. Those benefits are largely for those in the bottom-most brackets. Like Matt, that's pretty much out the window for a lot of us who have decent jobs. I've got two kids and pretty soundly in the middle class, but I don't qualify for any of that outside of possibly the child tax credit (I know we deduct medical expenses, but I generally stay out of the tax stuff for our household, I've got enough of that at work).

Those benefits have increased, I'm sure, for the lower earners, but that doesn't do anything to offset the wage and hiring freeze my company has. I guess eventually if the wages don't come up, I'll qualify for social aide. Which is a depressing thought.

This has been a hot topic of discussion here because during this most recent legislative session, our advocacy group (public employees aren't unionized in Virginia, but we have an advocacy organization at least) put forth that not only were we the worst state in compensating our public employees, but the number of public employees receiving welfare assistance (be it SNAP or what have you) increased by 2000% over the past decade.

[fredtoast]

(11-13-2015, 02:12 PM)Benton Wrote:   there's no consideration to sustainable long term growth outside of their own company. 

With CEOs changing jobs constantly this is often not even a consideration within a company.  The current CEO will sacrifice long-term sustainability for short term profit because he/she will be gone when the company goes down the tubes.  And a lot of stockholders don't care because it is easy to trade stock.  But it is never easy for society as a whole to re-build the damage done in loss of jobs from a company going under.  

[Benton]

(11-13-2015, 03:06 PM)Belsnickel Wrote: This has been a hot topic of discussion here because during this most recent legislative session, our advocacy group (public employees aren't unionized in Virginia, but we have an advocacy organization at least) put forth that not only were we the worst state in compensating our public employees, but the number of public employees receiving welfare assistance (be it SNAP or what have you) increased by 2000% over the past decade.

It's been a concern for a lot of companies locally. I work in an area where tourism is the #1 revenue generator. Most of the businesses employee low wage earners and many are seasonal. Lots of restaurants, services industry jobs, etc. The employers are concerned they won't be able to stay profitable or competitive with other markets if they have to pay help $15 an hour. And the long-term, career employees (managers, branch operators, boat mechanics, etc) are worried they won't be able to have much of a living as their wages here fall in the $12-18 range. Their (the workers) concern is their rent, food prices and other cost of living will mean they will basically offset and they'll be on some kind of public assistance.

(11-13-2015, 03:48 PM)fredtoast Wrote: With CEOs changing jobs constantly at some times this is not even a consideration within a company.  The current CEO will sacrifice long-term sustainability for short term profit because he/she will be gone when the company goes down the tubes.  And a lot of stockholders don't care because it is easy to trade stock.  But it is never easy for society as a whole to re-build the damage done in loss of jobs from a company going under.  

It's not just the CEOs. Like you mention with the stockholders, it's rampant in some companies once you get into any management position.

[fredtoast]

Cheap interest rates are supposed to spur more investment in research, development, and business expansion.  Instead companies are using the low interest rate to buy back their own stock or make other purely financial moves that increase profits but don't produce anything or employ more people.

And the whole shell game that is the "financial industry" has become a much larger percentage of the US economy.  We have become the "money changers" for the world instead of the people who make something.

Except food.  I am pretty sure we are among the world leaders in food production and export.

And weapons.  We build kick ass weapons.

[JustWinBaby]

(11-13-2015, 01:37 PM)fredtoast Wrote: Income disparity causes lots of problems in society.  /

Most of those are "manufactured" (read: fake) problems.  Yes, the rich are getting richer shaving off a % of that wealth transfer to developing countries.  But that wealth transfer is almost entirely from the lower and middle class to those countries, not to the rich.  And that growing wealth gap is global - there's nothing inherent to or special about the US economy enabling the rich to steal from everyone else.

And wage growth has slowed, but what's driven the stagnation has largely been a transfer from wages to benefits (specifically, health care).  Now we would have seen our purchasing power grow some with declining prices, but the prices have been inflated by monetary policy (i.e. hidden taxation).

Barring protectionist intervention (which I think bears considering, because classic economic models tend to focus on labor more than resources - if resources are limited then productivity and labor can become almost irrelevant), our standard of living will continue to be exported to developing countries.

[JustWinBaby]

(11-13-2015, 01:38 PM)GMDino Wrote: I never said "tax the rich".

I said the wage gap is increasing because the haves are seeing increases while the workers are not.

But liberals keep whining about CEO pay as if that's the reason the poor and middle class aren't doing better.  It's a drop in the bucket.  It's not class warfare it's scapegoating because no one is prepared to offer real solutions.

Yeah, I have a problem with CEO pay and incentives as a shareholder and employee, but that's not the source of our economic problems.

The simple reality is globalization was great before disruptive technology like the internet and computers started eliminating jobs. And, thus far, all the developed economies are struggling mightily with globalization and all they've really been able to do is use deflation to print free money to redistribute in benefits and entitlements.

[JustWinBaby]

(11-13-2015, 01:58 PM)Belsnickel Wrote: I think the reason it is so easy to look to the upper classes for where to direct the ire of the workers is because of the ever increasing wage gap, but also because those jobs getting shoved overseas is the result of decisions made by those in those upper classes. Be they executives or politicians, those decisions were made at levels above the pay grade of the average worker, while they are suffering from it.

That's all true, but it's also born out of ignorance.  The reality is that in a largely free and open global economy, you react to stay competitive or your company slowly dies and then the paychecks aren't smaller they're just gone.

I think if you want to fix it you have to figure out a way for workers to participate in equity gains.  But that's a bandaid and deceptive, because while stock price increases and the incomes of the 1% are staggering, that's only a fraction of the value transferring to developing economies.

[JustWinBaby]

(11-13-2015, 02:12 PM)Benton Wrote: It's not like a company spending $5 million in US worker salaries is shutting down domestic production and outsourcing it with a Chinese company to spend $5 million in Chinese worker salaries. They're spending a smaller percentage of what they're spending here and then using the rest as profit.

That's a gross oversimplification.  It ignores capital investment, it ignores that the price of those goods might be lower there.  It's not paying the people and companies to ship the good overseas - it's taking with it jobs at suppliers.  Those workers aren't paying taxes into our coffers.  Those workers aren't buying food and clothes at our restaurants and stores.

Those companies might be saving several million and wages, but the total loss to our economy is many multiples of that.  That's what I mean when I say the savings to the company is only a fraction of the wealth transfer.

Now the theory goes that as those developing economies become wealthier, they start buying more of our goods and the pie gets bigger for everyone.  And while that may ultimately be the case the problem is it's clearly a slow and painful transition or adjustment, and the developing economies haven't figured out how to manage it.  And that's on top of a slow down caused by an aging population and slower population growth.

[Belsnickel]

(11-13-2015, 05:51 PM)JustWinBaby Wrote: That's all true, but it's also born out of ignorance.  The reality is that in a largely free and open global economy, you react to stay competitive or your company slowly dies and then the paychecks aren't smaller they're just gone.

I think if you want to fix it you have to figure out a way for workers to participate in equity gains.  But that's a bandaid and deceptive, because while stock price increases and the incomes of the 1% are staggering, that's only a fraction of the value transferring to developing economies.

It's interesting. When I read your posts, the message I get is we just have to suck it up and live with the fact that the buying power for lower to middle class workers is just going to continually decrease and there isn't much we can do about it and there is no one to blame.

[JustWinBaby]

(11-13-2015, 06:01 PM)Belsnickel Wrote: It's interesting. When I read your posts, the message I get is we just have to suck it up and live with the fact that the buying power for lower to middle class workers is just going to continually decrease and there isn't much we can do about it and there is no one to blame.

Yes, you get it.  Blame globalization.  Blame yourself for not buying American.  Blame whoever you want, but scapegoating the rich won't fix a damn thing.

But I look forward to your solution of how to justify paying the American worker 10X the wages over someone equally capable and smart in China or India.  Of course, a person truly concerned with poverty and a living wage would never attempt to make that argument.

[Belsnickel]

(11-13-2015, 06:09 PM)JustWinBaby Wrote: Yes, you get it.  Blame globalization.  Blame yourself for not buying American.  Blame whoever you want, but scapegoating the rich won't fix a damn thing.

But I look forward to your solution of how to justify paying the American worker 10X the wages over someone equally capable and smart in China or India.  Of course, a person truly concerned with poverty and a living wage would never attempt to make that argument.

You act as if I don't consider these things part of the problem, when in fact I do. I also don't justify paying our workers so much more. My concern is not about wages, because wages are just something superficial to focus on in the discussion of quality of life. This is why I discuss things like buying power, because that is about more than just wages. It is about multiple facets of our economy, of which wages only play a part.

But I look forward to your continued assumptions about my views on our current economic situation and the global economy as a whole.

[GMDino]

(11-13-2015, 05:38 PM)JustWinBaby Wrote: But liberals keep whining about CEO pay as if that's the reason the poor and middle class aren't doing better.  It's a drop in the bucket.  It's not class warfare it's scapegoating because no one is prepared to offer real solutions.

Yeah, I have a problem with CEO pay and incentives as a shareholder and employee, but that's not the source of our economic problems.

The simple reality is globalization was great before disruptive technology like the internet and computers started eliminating jobs.  And, thus far, all the developed economies are struggling mightily with globalization and all they've really been able to do is use deflation to print free money to redistribute in benefits and entitlements.

Its a real world symbol and neon flashing sign of what the problems have created.

[JustWinBaby]

(11-13-2015, 06:18 PM)Belsnickel Wrote: You act as if I don't consider these things part of the problem, when in fact I do.

Well, it's practically the entire problem.  Myself, I don't get why people continue to passionately debate trivial factors and then get defensive when told they're pissing into the wind.

And buying power vs. wages aren't always dramatically different arguments, at least not in the US. But when people talk about buying power, they aren't really looking at REAL buying power. Your parents/grandparents had more buying power, yet they probably didn't have two cars, a big screen tv, a wash and dryer, a computer and a cellphone...or live in as big of a house. Our buying power has stagnated even while our quality of living continues to improve dramatically.

[JustWinBaby]

(11-13-2015, 06:23 PM)GMDino Wrote: Its a real world symbol and neon flashing sign of what the problems have created.

And that problem is?

And before you say "wealth gap", please be explicit as to which wealth gap you are referring to.

[GMDino]

(11-13-2015, 06:31 PM)JustWinBaby Wrote: And that problem is?

And before you say "wealth gap", please be explicit as to which wealth gap you are referring to.

The problem is the the businesses are top heavy.  One person making a large amount...many workers making way less.  And when there is a "profit problem"? Cut the workers. 

Makes total sense, doesn't it?

Maybe you don't have a problem with the wage gap growing every year.  I do.  Especially as it has lead to the dismantling of the middle class in America.

1 person making $1 million and 100 making $1000 is bad.

1 making $500,000 and 100 making $5000 is better.

[*Nately120*]

(11-13-2015, 06:31 PM)JustWinBaby Wrote: And that problem is?

And before you say "wealth gap", please be explicit as to which wealth gap you are referring to.

The gap between me and wealth.  Duh.

[EatonFan]

(11-13-2015, 02:55 PM)Benton Wrote: I dunno. Those benefits are largely for those in the bottom-most brackets. Like Matt, that's pretty much out the window for a lot of us who have decent jobs. I've got two kids and pretty soundly in the middle class, but I don't qualify for any of that outside of possibly the child tax credit (I know we deduct medical expenses, but I generally stay out of the tax stuff for our household, I've got enough of that at work).

Those benefits have increased, I'm sure, for the lower earners, but that doesn't do anything to offset the wage and hiring freeze my company has. I guess eventually if the wages don't come up, I'll qualify for social aide. Which is a depressing thought.


http://www.epi.org/publication/a-decade-of-flat-wages-the-key-barrier-to-shared-prosperity-and-a-rising-middle-class/

I'd just like to see an actual chart of wages with government benefits contained in the wage figure.  That chart -- as far as I know -- does not exist.  The bottom 20% for sure would be much higher while the 2nd 20% (percentile) would also rise.  It's the middle 20% that would see the stagnation or decline IMHO. 

We are creating a generation that do not aspire to be great.  Use to be that people strove towards goals.  Now mediocrity and acceptance of one's lot in life is admired.  I get that a person could get a factory job and support their family back in the 50s to 70s.  Things are vastly different now.  Two wage earners and no stay-at-home parent.  Plus all of our government programs are geared toward the wrong message -- don't work harder and do not get married.

[JustWinBaby]

(11-13-2015, 06:38 PM)GMDino Wrote: Makes total sense, doesn't it?

So eliminate the CEO and pay everyone a quarter more?  Ohhhh, you said "SENSE" not "CENTS".

Wait, let me check my math...the average F500 CEO made $13.5M in 2014 while the average worker made $36k. So if we get rid of the CEO's....carry the 2....we can give all those F500 workers an extra $250 per year. Gee, I guess my math was wrong - that's only 12 cents an hour.

[*Wyche'sWarrior*]

(11-13-2015, 01:25 PM)JustWinBaby Wrote: Middle class wages aren't going to the rich, it's going to China and India.  People trying to convince you otherwise are just hoping you'll vote for them under the misguided belief they can do something about it.

I literally want to beat math and economics out my head with a hammer so, I too, can believe all we have to do is tax the rich.

They're BOTH wrong.  Don't overtax anyone , and don't screw the working man.  Go back to FAIR trade policies , and reimplement Glass - Steagall. Pretty simple start in the right direction....but they're both too scared to piss off the campaign contributors pulling the strings.

On a side note.....does this mean the Donald will be taking a pay cut?