The passages below were copied directly from an analytical paper of the Economic Policy Institute 9/2/15 Presented by Josh Bevins and Lawrence Mistral ” Understanding the Historic Divergence between Productivity & the Typical Workers Pay” Why it matters….
“Why income tax does not explain the wage stagnation we see today? The hourly wage since 1973 has not kept pace with inflation while the wealthy have gotten most of the money to be had in America! There has always been tax evasion. There has not always been excessive compensation for little work at the top!”
Productivity & wages grew from 1948 to 1973. After 1973, to paraphrase, productivity increases while worker salaries stagnate. “This divergence of pay and productivity has meant that the vast majority of workers were not benefiting much from productivity growth; the economy could afford higher pay but was not providing it.”
The entirety of the gap between productivity and hourly pay growth is income accruing somewhere in the economy besides the paychecks of typical workers. Mostly, this “somewhere” has been in the pockets of extraordinarily highly paid managers and owners of capital. While the rise in transfer income (government programs such as unemployment insurance and Social Security and Medicare) has blunted some of the sting of the growing gap between pay and productivity, this transfer income has grown much more slowly in the post-1979 period relative to before. Further, since transfer incomes are a much smaller share of typical household incomes than are labor earnings, it would have taken a huge increase in these transfers to fully compensate for the near stagnation of hourly pay. This has not happened.”
- Neither SS, Medicaid or Medicare are sufficient to compensate the average worker for their decrease in annual wages. That’s why we have a society where the working poor can never make ends meet. They are perpetually living paycheck to paycheck.
Breaking the ever-upward spiral of inequality and the near stagnation of hourly wages will require relinking productivity growth and the pay of typical American workers.
That is why the Economic Policy Institute launched Raising America’s Pay—an initiative that explains the role of labor market policies in wage and benefit patterns, and identifies policies that will generate broad- based wage growth by tilting bargaining power back toward low- and moderate-wage workers. Their policies include:
- Raising the minimum wage
Updating overtime rules
Strengthening collective bargaining rights
Regularizing undocumented workers
Providing earned sick leave and paid family leave
Ending discriminatory practices that contribute to race and gender inequalities
Supporting strong enforcement of labor standards
Prioritizing very low rates of unemployment when making monetary policy
Enacting targeted employment programs and investing in public infrastructure to create jobs Reducing our trade deficit by stopping destructive currency manipulation
Using the tax code to restrain top 1 percent incomes”
My previous Posts have detailed how tax policies could incentivize the top 10% earners to transfer money back to those wage earners in the main economy. It can be done when the resurrection of a thriving Middle Class is America’s priority!
That’s why I’m advocating for #RockingTheVoteIn2018ForDemocrats in the hope that many assuming Legislative positions on the Local, State and Federal level, represent us, “We the People”.
“The heart and pulse of the Middle Class”
Phase one: Produce a book based upon my Blog Posts dating from 2012- to the present. Than, support travel to countries showing excellence in Healthcare, Education and Infrastructure programs. Phase 3, Run for the Political office of the President of the United States, “as the People’s President. Support : AmericaSpeaks The Voice of Joyce LLC
I wish to reach Common Ground on the Social Issues and I’m Fiscally Conservative on Monetary Policy. I would be willing to run on a split ticket moving the Country & our Society toward the center. I support a robust prosperous Middle Class. Decent wages, Healthcare, Education & Infrastructure are my concerns. Review my Blog Posts: The Voice of Joyce.wp.me Support my efforts through your contributions of $5 or more. Happy Holidays