American Economics Thread

[chgough34]

You can't blame affirmative action when the only real objective measures, are trending up.

Otherwise it's just racism or cultural racism.

Right. UCLA’s class is undeniably more merituous than any previous class - the big 2 factors - the MCAT and GPA scores - are higher than ever before. The students are failing shelf-exams because they are “black” is clearly racism and has no biological basis to stand on.

Not that I am claiming that race-based affirmative action doesn't exist. It obviously

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.

The Supreme Court did strike down affirmative action in Students For Fair Admissions,600 U.S. 181 (2023), but it exists a bit in procurement and public employment. The history of affirmative action started in the 1950s in federal contracting - since black-owned businesses had substantially less experience in federal contracting than white-owned businesses, nominally race-neutral criteria such as “how long have you been contracting with the federal government”, ended up disadvantaging black people who had been banned from contracting with the federal government. It later expanded to higher education in order to ameliorate prior discrimination - legacy admissions are effective racial proxies if black people had been banned from the school not to long ago, and black people receiving far worse education means they earn less income which passes to their children and it becomes embedded and entrenched. Affirmative action was created as a ways to solve those race-based harms

 

[chgough34]

Kind of like cherry picking individual data to support ones underlying hypothesis right?

Correct - cherry picking data is bad statistical practice. That includes, inter alia racist right-wing race bait about admissions standards at UCLA’s School of Medicine

No. It's 40% below estimates.

0.4% but sure.

 

[FriedRiceNSpice]

1. The U.S. is a large country with highly diverse experiences so there isn’t a “typical” or “average” case. However, for white-collar professionals in middle-age - by far the economic cohort with the highest combined earnings and whom contribute most to productivity - they broadly live a riskless, abundant life with infinite security and free from all social afflictions outside of Fox News ragebait about the gender of Mr. potato head.

That cohort is far smaller than you are trying to portray. It comprises only a small subset of middle-age while collar professionals, which by themselves are only a minority (substantial minority, though minority all the same) of the overall US population. You can make the same statement about any nation. Even in India, there is a small proportion of white collar professionals enjoying a very high standard of living, complete with mansions and servants.

What made the US stand out for much of the 20th century was that a relatively large proportion of the population that had the talent and work ethic would have access to opportunities that would enable them to live a pretty comfortable life. Relative to most other countries, this is still true. The US has always enjoyed favorable geography, an abundance of natural resources, and access to large pools of low-cost immigrant labor. Furthermore, post World War 2, the US control of the global financial and trade system enabled the US to collect rent from the economic activities of much of the rest of the world. However, due to the uneven nature of wealth accumulation, in conjunction with the erosion of many America's past advantages, the American Dream has become harder and harder to attain. Life has not been getting better for most stratum of the US population over the past 2-3 decades. What made the US stand out from say, Europe, was that even without generational wealth, it was possible for a significant minority of individuals/families to attain a relatively high standard of living. The proportion of people that can achieve that relatively high standard of living without access to generational wealth is getting smaller and smaller. Looking at the other end of the spectrum, despite the US having access to much more wealth and resources than just about every other large developed nation in the world, the standard of living for much of the bottom 50% of the population is not any better and often much worse than the corresponding stratum of the population in many other developed nations. The proportion of high paying white collar jobs with real wages high enough for a good standard of living is nowhere near as high as you portray, and it is becoming increasingly lower as costs and real estate prices continue to increase across the nation.

 

[chgough34]

That cohort is far smaller than you are trying to portray. It comprises only a small subset of middle-age while collar professionals, which by themselves are only a minority (substantial minority, though minority all the same) of the overall US population. You can make the same statement about any nation. Even in India, there is a small proportion of white collar professionals enjoying a very high standard of living, complete with mansions and servants.

20% of individual workers make more than 100K; 35% of individual workers make more than 70K. It is not by any stretch of the imagination a “small subset”; especially since a substantial number of low-income earners are students, disabled, sick, prematurely pregnant, retired, or foreign-born individuals without substantial education (those individuals would be low-income in any imaginable macroeconomic scenario).- see

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,

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you seem to imagine white-collar life as some austere outcome but go into the suburbs of any U.S. metro area and you are just met with row upon row upon row of houses by white collar workers (for example: everything in Collin and Tarrant Counties in Texas, Westchester and Rockland Counties in New York; all of Long Island, Orange County in California, Palm Beach County in Florida, Snohomish County in Washington, Waukesha County in Wisconsin, etc, etc) who went to Northeastern North Dakota State University, majored in business administration, and now at 45y/o make $130K/yr as a payroll specialist for a mid-sized reinsurance company.

However, due to the uneven nature of wealth accumulation, in conjunction with the erosion of many America's past advantages, the American Dream has become harder and harder to attain. Life has not been getting better for most stratum of the US population over the past 2-3 decades.

Life certainly has been getting better for most individuals - otherwise, measures of consumption would’ve be flat at all percentiles, but instead, they are going up.

 

[FriedRiceNSpice]

20% of individual workers make more than 100K; 35% of individual workers make more than 70K. It is not by any stretch of the imagination a “small subset”; especially since a substantial number of low-income earners are students, disabled, sick, prematurely pregnant, retired, or foreign-born individuals without substantial education (those individuals would be low-income in any imaginable macroeconomic scenario).- see

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,

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you seem to imagine white-collar life as some austere outcome but go into the suburbs of any U.S. metro area and you are just met with row upon row upon row of houses by white collar workers (for example: everything in Collin and Tarrant Counties in Texas, Westchester and Rockland Counties in New York; all of Long Island, Orange County in California, Palm Beach County in Florida, Snohomish County in Washington, Waukesha County in Wisconsin, etc, etc) who went to Northeastern North Dakota State University, majored in business administration, and now at 45y/o make $130K/yr as a payroll specialist for a mid-sized reinsurance company.

This discussion is going in endless circles. You are aware that there is a wide spectrum of outcomes in between "mass affluence"' and "austere?" Cost of living prices and housing costs as well as salaries are highly dependent on geographic location. In tier 1 metro areas where 130k a year jobs are relatively common, a household income of 180k (assuming spouse of the individual earning 130k is working a low-stress job with 50k salary) is going to be substantially closer to the "austere" end of the spectrum. In a mid tier city, it is going to far closer (but still short of) the "mass affluence," end of the spectrum, and there are going to be significantly less 130k salary jobs available. 130k is a mid-level accountant in NYC and a controller/accounting manager in Columbus Ohio. By the way, you do realize the suburban areas you cherry picked as being the, "norm," are all (with the exception of Wisconsin and Florida, which are still tier 2) metro areas of tier 1 cities (Seattle, New York, LA)?

I would hope at least 15% of Americans are living a comfortable living, though far from mass affluence and unbound consumption. But if I were to look at any other developed nation in the world, I am sure I can also find the top 15% of their population enjoying a comfortable living. Maybe 3-4% of the US population is living in abundant affluence, but I would expect at least 2% of the population in other developed nations to be doing so. What set America apart was that it has been relatively more feasible for an individual born outside of the top 15%, through talent and hard work, to join the ranks of the top 15%, even top 3-4%. However, given the trends in salary growth vs costs and housing, this is becoming more and more difficult. Given the amount of total wealth present in the US and the much higher per capita incomes, along with the fact that the US sits at the top of the global financial system, life in the US should be much better than most of the other developed nations, but it's not.

Life certainly has been getting better for most individuals - otherwise, measures of consumption would’ve be flat at all percentiles, but instead, they are going up.

No, measures in dollar terms of consumption are essentially meaningless in isolation so I suggest you drop it. The only thing it indicates is that there is a shortcoming in your critical thinking and analysis abilities.

 

[chgough34]

I’m This discussion is going in endless circles. You are aware that there is a wide spectrum of outcomes in between "mass affluence"' and "austere?" Cost of living prices and housing costs as well as salaries are highly dependent on geographic location. In tier 1 metro areas where 130k a year jobs are relatively common, a household income of 180k (assuming spouse of

Let’s continue this NYC hypothetical - a household in NYC has a post-tax income of $117,888; a monthly income of $9,824; and using the quick rule of thumb that housing costs shouldn’t exceed 1/3 of income, a $3,241 monthly budget for housing. The median mortgage+utility payment in the New York metro area is $3000 (

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), with a median home size of ~1,500 sq ft (

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). So yes, again, mass affluence by your example.

130k is a mid-level accountant in NYC and a controller/accounting manager in Columbus Ohio.

20% of individuals in metro Columbus, OH make >130K/yr. Since the U.S. is so wealthy and has been for so long, and has no internal barriers to trade, investment, or migration, inequality between regions (due to a series of genius Supreme Court decisions from the 1800s - see Crandall v. Nevada, 73 U.S. (6 Wall.) 35 (1868) and Willson v. Black-Bird Creek Co., 27 U.S. (2 Pet.) 245 (1829) isn’t that large and economic gains are broadly shared geographically.

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I would hope at least 15% of Americans are living a comfortable living, though far from mass affluence and unbound consumption.

Yes: for individuals who aren’t a student, retired, disabled, sick, foreign-born without much formal education, or prematurely pregnant (I.e., individuals who are doing poorly for noneconomic reasons and who would do poorly regardless) - they by in large, live a comfortable white-collar life of mass-affluence regardless of their geographic location.

No, measures in dollar terms of consumption are essentially meaningless in isolation so I suggest you drop it. The only thing it indicates is that there is a shortcoming in your critical thinking and analysis abilities.

You don’t need to measure in “dollar terms”. The average size and median size of housing units, the amount of protein calories consumed (vs. say carbohydrate calories), the number of miles driven, the number of cars per household, etc. all of these have gone up. Since housing, food, and transport are by far, the largest line items in household budgets - alas, we have our answer.

 

[MortyandRick]

Correct - cherry picking data is bad statistical practice. That includes, inter alia racist right-wing race bait about admissions standards at UCLA’s School of Medicine

Also includes cherry picking one good stock and have it represent the economy at a while

0.4% but sure.

Expected 2.4%, got 1.6%
So actually 50% below estimates. 0.8% less growth on GDP than expected. With such a large numbers for GDP, that's no chump change

 

[FriedRiceNSpice]

Let’s continue this NYC hypothetical - a household in NYC has a post-tax income of $117,888; a monthly income of $9,824; and using the quick rule of thumb that housing costs shouldn’t exceed 1/3 of income, a $3,241 monthly budget for housing. The median mortgage+utility payment in the New York metro area is $3000 (

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), with a median home size of ~1,500 sq ft (

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). So yes, again, mass affluence by your example.

It is hilarious how much your numbers are off by. Median home prices are $650,000 for Long Island and Westchester. Assuming 20% down, given current interests rates and property taxes, that is a monthly payment of around $5000 per month. Median home prices in NYC itself is $700,000. Much lower real estate taxes in NYC, but you are going to be hit with HOA (sometimes in excess of $1000/month) and also a 6% tax on income from NYC. And the median home in all of these 3 areas are baseline, "comfortable," - by living in a median home in these 3 areas you are already not enjoying an affluent lifestyle. You are going to be living in a 3 bedroom house built 50+ years ago with low ceilings and ancient heating system and barebones interiors. A modern 2500 sq ft 4 bedroom home built in the last 30 years in a town with a decent school district is going to cost about 1M. Utilities in Long Island/Westchester are going to be around $500 per month, given in New York you will be running heating at least 5 months a year and AC 3-4 months. In the city, it is going to be much less, but you are also going to be paying at least $200 a month for a parking space. You can rent a 3 bedroom apartment in Brooklyn/Queens for $3200 a month, but if you have a family of at least 1 kid, then again you are not going to be enjoying an affluent lifestyle living in those conditions.

20% of individuals in metro Columbus, OH make >130K/yr. Since the U.S. is so wealthy and has been for so long, and has no internal barriers to trade, investment, or migration, inequality between regions (due to a series of genius Supreme Court decisions from the 1800s - see Crandall v. Nevada, 73 U.S. (6 Wall.) 35 (1868) and Willson v. Black-Bird Creek Co., 27 U.S. (2 Pet.) 245 (1829) isn’t that large and economic gains are broadly shared geographically.

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Are you seriously suggesting that wages are the same across all cities in the US??? If that was the case, why is there such a large discrepancy between housing prices and living costs? Why are people staying in high cost metros like New Yor, Bay Area and Seattle rather than migrating en mass to the Midwest!?!?! Out of the many outrageous claims you have made over the past 100+ posts, this has to be by far the most ludicrous.

Yes: for individuals who aren’t a student, retired, disabled, sick, foreign-born without much formal education, or prematurely pregnant (I.e., individuals who are doing poorly for noneconomic reasons and who would do poorly regardless) - they by in large, live a comfortable white-collar life of mass-affluence regardless of their geographic location.

You are missing a few qualifiers there. The amount of high paying jobs and spots in high ranked universities are limited, so it is a competition to attain those jobs/university spots. Adding the proper qualifiers, you can make the same general statement about any developed nation in the world.

You don’t need to measure in “dollar terms”. The average size and median size of housing units, the amount of protein calories consumed (vs. say carbohydrate calories), the number of miles driven, the number of cars per household, etc. all of these have gone up. Since housing, food, and transport are by far, the largest line items in household budgets - alas, we have our answer.

You never astound me with your ability to pick the most meaningless metrics. Bravo. Only metric worth with any level of consideration is number of cars per household. Are you about to point to obesity rate as a sign of wealth, because Americans are eating so well and it demonstrates that Americans can afford all of the healthcare costs associated with obesity?

 

[FriedRiceNSpice]

-duplicate post please delete-

 

[chgough34]

It is hilarious how much your numbers are off by. Median home prices are $650,000 for Long Island and Westchester.

My numbers aren’t wrong - they are lifted straight from the American Community Survey. The discrepancy may be due to that people who bought houses previously are unaffected by current prices and due to government financial innovation by Freddie Mac and Fannie Mae, they pay a fixed rate mortgage for 30 years. For new homebuyers, outside of a handful of metro areas that simply don’t build enough (New York being one of them - NYS has the oldest housing stock in the U.S. -

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), housing stock is new and affordable for young people - henceforth the youth homeownership rate being well within normal range, slightly lower than older cohorts when they were the same age (

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).

Finally - the American Community Survey asks about income, home ownership, education, and household structure. From here, we know that the median household that owns a 3 bedroom home with 2 cars and has children in college has household income of 125K. For a 2 income household, that simply requires each household income earner to be making ~60K. Hardly unreasonable or unattainable.

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Are you seriously suggesting that wages are the same across all cities in the US???

No: I said regional disparities aren’t that large due to open trade/investment/migration between states and within states (a function of the Supreme Court’s continuous genius)

If that was the case, why is there such a large discrepancy between housing prices and living costs?

Because of the different housing politics in different places. The cost of everything else is pretty uniform.

Why are people staying in high cost metros like New Yor, Bay Area and Seattle rather than migrating en mass to the Midwest!?!?!

Simply because while there are no formal internal barriers to migration - people stay in their hometown metro areas because of attachment to family and friends, knowledge of the local geography, social and professional networks, risk-aversion, and home metro preference by employers - see

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You are missing a few qualifiers there. The amount of high paying jobs and spots in high ranked universities are limited,

Spots at regional universities are functionally unlimited and graduates, even of lower ranked schools and their career outcomes are good. For example, at the University of Northern Colorado, the median business major is making 74K 10 years after graduation (

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)

employment is not a zero-sum game. The number of jobs in the economy is not static.

You never astound me with your ability to pick the most meaningless metrics. Bravo. Only metric worth with any level of consideration is number of cars per household. Are you about to point to obesity rate as a sign of wealth, because Americans are eating so well and it demonstrates that Americans can afford all of the healthcare costs associated with obesity?

You asked for evidence of more consumption. Are bigger houses, more cars, and eating more expensive food (such as meat compared to bread) not evidence of more? But with respect to obesity - yes, it’s widely regarded as a disease of mass affluence -https://scielosp.org/pdf/bwho/2010.v88n2/86-87/en , and in any society that is able to abundantly produce agricultural products so inexpensively that the biggest problem is overconsumption instead of underconsumption (as has been the common affliction for most of history) is a sign of wealth (heavily caveated of course)