In an increasingly polarised and performative society, vibes are now often trumping objective reality
Author is heavily opinionated and Kinda uses stats as a weapon. Ignores that a lot of those jobs are part-time, non benefitted positions or that corporations are buying houses making it hard for the younger generations to buy one. Not to mention wage gaps and vanishing pensions, etc.
But certainly, tell me more about how I should be positive about end game capitalism.
These are measurable, objective things that people are getting wrong:
By huge margins, they believe inflation is still rising (it’s falling), that it has outstripped wage growth (wages have outpaced prices), and that they have become less wealthy (they’ve become much wealthier).
These are core facts about the US economy. I don’t think it’s okay to say ‘they answered incorrectly because they’re worried about other things that weren’t being asked about’.
A functioning democracy is predicted on having a rational electorate. But the repeated evidence of the last several years is that huge numbers of American voters seem unable to grasp the objective facts and reality of the country and world that they live in. For a long time we’ve all focused on the right-wing extremist angle to this - climate change denial, anti-vaxxers, 6 January denial, and so on. But the next US election is going to be centred around the economy, yet it seems like a lot of voters (drawn from both left and right?) are being influenced by a subjective worldview of the US economy that differs from objective measurable reality. They’re going up vibe themselves into a Trump presidency.
Inflation is “falling” in the sense that it’s going up less fast than it was. It’s still rising, but at a slower pace when compared to the same period last year. Americans are not wrong to think inflation is still a problem. It may be objectively “falling” but do not mistake this for deflation, which is not occurring.
This kinds of makes ops point. The us actually usually targets an inflation rate around 2-3%. The fact that we are close to those numbers means, at least if we trust the way it’s measured, inflation has been largely brought under control.
Inflation is “falling” in the sense that it’s going up less fast than it was. It’s still rising, but at a slower pace when compared to the same period last year.
You seem unsure here about the difference between inflation and prices. Inflation is the rate of change of prices.
Positive inflation means that prices are rising. Inflation is falling because prices are rising slower than they were a year ago. You seem to think that ‘falling inflation’ would lead to falling prices - it would not.
Falling prices would be a very bad thing. That’s something called deflation and tends to be associated with economic crashes like the 1930s. If prices were falling, people would put off spending money on anything except essentials because they’d be able to buy things cheaper tomorrow, which tends to lead to a self-reinforcing economic depression and mass unemployment.
The layperson’s meaning is prices going down. The above post is absolutely the correct view for everyone in the bottom 80% of income or wealth. Individual items deflate in price all the time and wanting prices to fall is a perfectly rational personal view.
If the price of one thing falls, that’s isolated. If the price level - the price of all things - falls, then that’s deflation and it’s historically been one of the most destructive economic events that can happen to an economy and to ordinary people and their jobs and livelihoods.
Wanting the price level to fall is far from rational, and the fact that people might think otherwise in spite of the historic precedents is exactly the sort of mass irrationality I am worried about.
Deflation is necessary to revert to the correct mean of prices if they were not skewed by subsidies and other regulatory manipulation of the market. Deflation may be “bad” in the same sense that it’s bad to break somebody’s leg, but sometimes doctors have to do that to get the leg to heal correctly. We are in need of deflation to bring prices closer to the real mean and restore the ability of lower economic quintiles to actually live.
Oh, so I will get to retire? Neat.
COVID highlighted a good bit of futility and pointlessness. As a well as a feeling of being locked in a cage with 30-40% of the country that’s just insane
So I guess it is rosey now for someone. Probably won’t hold and I know people who have personally suffered a nervous breakdown, without adequate care, as a result. People are fucking tired.
And let’s not even get started on climate change and the future for our children given how pathetic people acted during an acute crisis.
Not really surprising that people changing to better paying jobs are getting paid more. But when you are forced to change jobs to buy food, it’s gonna sour your opinion of the market. Or that wages have increased for those in industries with strong unions that have done things like strikes to get those benefit, many are not gonna consider that an indicator of the economy as a whole even if it’s been done over several industries.
Also, the wage increases have largely being high schooler or less workers (according to this article) that no longer were able to fill positions otherwise, which for some reason a lot of people don’t seem to think are real jobs nor is it going to influence the opinion of influencers’ opinion of the economy as a whole.
The article is paywalled, but is there are talk about the testing methodology used? Because if I really wanted to, I could find the poorest american cities, survey people there, and then use statistics about the country as a whole to make them look “unable to grasp objective facts”. It’s foolish to blindly trust statistics without understanding how they were gathered.
I get looking at things like that goes against the blinding arrogance of a neoliberal philosophy, but does it really stand up to reason that people wouldn’t know if they’ve become wealthier, if you’re even bothering to ensure they’re defining wealth in the same way your statistics are?
The article is paywalled
Lots of jobs are also contract not working for the main company and super unbalanced with C-suite getting huge benefits
Which is why the use of things like median (not mean) income is important. The poll shows most people misperceiving what is happening with median income.
How can I misperceive that I’m paying far more for my groceries than I was two years ago while my income has risen at a slower rate than inflation? And don’t tell me it didn’t unless you are going to to claim inflation across each of the last two years was less than 3.5%. https://www.usinflationcalculator.com/inflation/current-inflation-rates/
My power company has jacked its rates by double digit percent, and seemingly every single service of any kind we use has jacked up their prices also.
And what about shrinkflation which is seemingly everywhere these days with regard to consumer products?
https://www.cbsnews.com/news/inflation-households-need-extra-11400-these-states-its-even-higher/
If the problem is that I’m too ignorant to distinguish between inflation and corporate greed - fine. We’ve got a problem and it needs to be solved.
That’s just great for folks to look at lines on a chart and tell us all that the economy is doing great. Anyone I know who wasn’t already making enough money to sock plenty into savings is hurting right now, and telling us we’re wrong doesn’t change that.
yOu JuSt DoNt UnDeRsTaNd
So with statistics and numbers it can really hide the individuals experience and situation. Let’s just say you make around 50k that is over median income and you were doing better than others for last 5 years or whatever.
Well if extremely rich people get more money and more people make it big and the people under you make huge strives of making more than things are “better”. Income wise. But if your wage stagnated and everything became more expensive then your experience is worse even if you are still above median at 50k.
What this article really fails to do is marry increasing wages with cost if living. Let’s not even talk about how certain parts of America is worse too
Any stat can be a weapon if it’s right enough.
Ah yes, the vibes are the problem. Those silly, goofy vibes. They’re to blame for:
- My rent has increased 13% from lease to lease
- My grocery bill has gone up 33% in the past year
- I can’t afford to buy a new or used car
- I suddenly became unable to buy a house in the past six months
- My credit card interest rates are almost 20%, which is considered to be on the low side
- My yearly raises at work (5.5%) have not kept up
Others have pointed out problems with the article, and I want to add that economists are inherently biased because they earn a median salary that is twice the national median, meaning they do not personally experience price increases as difficult as the typical American. And finally, the description of society as “performative” makes me think they may have their head up their ass.
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That would require deflation.
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Cool your jets, buddy. This is a place for cool-headed discussion not for hurling insults around.
The inflation the Western world has experienced in the last two years was caused by an external commodity price shock, because of an actual war going on Europe and supply restrictions from Russia, a major exporter of energy commodities; not primarily domestically originating. Energy is more expensive than it used to be, for all of us.
There are two ways to react to that.
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The first way is for businesses to put up prices to maintain their profits, and for workers to demand more pay to preserve their buying power. But the higher wages leads businesses to want to put up prices even further, and the higher prices leads workers to demand even higher pay. And so on and so forth - a wage-price spiral. Britain in the 1970s.
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The second way is for businesses and workers alike to accept we’re all poorer now as a result of a core thing we all rely on being more expensive than it used to be - for reasons completely outside of the control of domestic politicians in any of our countries - and we can either all be poorer at the current price level or we can have a load of price and wage inflation that leaves us all still poorer but now at a higher price level.
The reality is that what we’ve had in response to the energy price shock was some of the former, but central banks are using monetary policy to try to push us into the latter rather than having endless wage and price inflation in the pursuit of the unattainable.
Your pay is never going to increase to compensate for what was primarily an exogenous energy price shock - and the more that workers and businesses try to make the impossible happen, the worse that inflation would get.
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Economists literally changed what they use to measure inflation.
Can you explain how and why this change leads to less accurate measurement of inflation?
It’s not a mystery, it’s a problem with averaging. The bell curve is shifting over because it is being skewed by whoever is raking it in due to artificially increased pricing. Many people keep a budget and aren’t relying on their feelings about the economy when they tell you that groceries cost them more than double their pre-covid budget thresholds for less and lower quality food, unsustainably high rents have increased from 10 to 30 percent for many (at least in cities), and electricity costs have continued to rise. If your wages didn’t increase enough to cover all those increases than you are personally worse off. Who cares how it averages out in the larger economy.
I think one of the issues is that many of these metrics don’t align with our reality. An example that appears to be wholly overlooked by the supposedly astronomically high employment is a lack of blue collar skilled workers. I’ve been trying for more than a year to schedule an appointment with a contractor to evaluate my roof for replacement because it started leaking. The waiting list is astronomical, and when I asked about why that is they said they cannot find anyone to do the work. Somehow I have to feeling that the statistics are not reflecting reality, because numbers in aggregate rarely demonstrate the root cause of a problem.
An example that appears to be wholly overlooked by the supposedly astronomically high employment is a lack of blue collar skilled workers
I don’t understand because I would expect this to be the case based on the statistics.
Yeah, if we have low employment it means that everyone is looking for workers. Now you could argue that workers are not properly distributed, but the result there would be that the roofer can charge high prices and start paying more (which would attract more roofers).
Non-paywall link: https://archive.is/BFl9w
The chart of basic facts about the state of the US economy that most voters get wrong is astonishing.
deleted by creator
You are fucking deluded.
1. Remember the human. When you communicate online, all you see is a computer screen. This doesn’t exempt you from basic politeness. No name-calling, hostility, saying horrible things you wouldn’t say to a person’s face, etc.
This forum is for civil discussion. Disagreements are natural and welcome, insults are not.
We ask you refrain from name-calling, hostility and behavior that otherwise derails the quality of the conversation.
deleted by creator
I don’t need to believe anyone. Im living in it.
It’s important to note that Americans are all over the place when it comes to the economy. To start, take this link to a bar chart from a Quinnipiac Poll in August: https://imgur.com/a/lHtPjJW
This graph shows that these types of polls are inherently inaccurate becuase Americans are answering according to their polical affiliation, not their actual economic situation. This graph also shows that the majority of democrats and republicans believe their current economic situation to be good.
An another reason why some Americans might be disgruntled is that wage growth across the US has been very uneven. This chart from the US Bureau of Labor Statistics shows that wage growth has not been consistent across the US: (https://www.bls.gov/charts/county-employment-and-wages/percent-change-aww-by-state.htm). Those living in an area of low wage-growth are probably less likley to believe the economy is doing well.
NYC, for example, has had consistently rising rents and only seen an average increase of 2.1% for wages. In contrast, Charlotte, North Carolina, has seen rents fall as much as 4.6% in some areas while having an average wage growth of 6.7%. Declines in rent in Charlotte are largely attributed to an increase in new housing. Link: https://charlotteledger.substack.com/p/charlotte-apartment-rents-fall-as?utm_campaign=post&utm_medium=web
So, it’s complicated. I think the democrats best move going forward is to hammer the republicans on things like abortion, and let the economy speak for itself.
