Independientemente del año, la remuneración promedio de un asalariado norteamericano, en dólares constantes, nunca sobrepasó el nivel alcanzado en...... ¡1978!
You just gotta' love Spanish exclamation points! For those of you who don't read Spanish, I read the above quote in today's Clarin, a well-known local newspaper in Argentina. They have had other stories about the American economy this week, but today's article, The Gap Widens Between Rich and Poor in the US, called for a diary. Here is what that quote actually means:
Regardless of the year, the average salary of an American employee, in constant dollars, never surpassed the level reached in ......1978!
Basically, folks, we're making 1970's salaries and the rest of the world is noticing. Today's article originated with Le Monde and the New York Times Syndicate. I am sure that Argentines won't be the only ones reading this news today.
Why does it matter? Why should other nations be concerned about the earning potential of the average American? Perhaps because many of these countries have been using us as a model. We are quickly proving that a Democracy run on the Capitalist model may not be sustainable in the long run.
Those of us in progressive circles have been discussing this issue for a long time. We understand that our economic prosperity is also tied to climate change and to our unsustainable lifestyles. Many people fear that as countries like China and India gain economic clout and their huge populations enter the middle class, we will no longer have sufficient resources to supply goods to all of those middle class families.
But what is a nation to do? Many countries thought that by following the US model, they were creating an economy that could support their citizens while providing room for growth. After all, a country whose economy cannot grow is deemed a failure in the broader scheme of things.
What the US is beginning prove is that growth cannot be sustained forever. Our current double dip recession is proof of that. I would imagine that what scares many world citizens, though, isn't that the US model is failing - it's that the US model is proof that the status quo of many other nations, like Argentina, where the gap between rich and poor is huge and there are few pathways to leave poverty and enter the middle class, will remain. What's worse in the United States is that we are also demonstrating that it is easier to leave the middle class and become poor. The article in Clarin quotes are own Census Bureau Report released earlier this week:
El ingreso promedio por hogar está en Estados Unidos en su nivel más bajo en quince años. La gran pobreza explota. El ingreso anual de un hogar promedio, en dólares, bajó a partir de ahora por debajo del nivel que tenía en Estados Unidos hace quince años. Esto es lo que se desprende del informe titulado “Ingresos, pobreza y cobertura de salud en los EE.UU en 2010”, publicado el martes por la Oficina de Censo.The median household income in the United States is at its lowest level in fifteen years. Extreme poverty explodes. The annual income of an average household in dollars recently fell below its lowest level in the United States fifteen years ago. This is stated in the report titled "Income, Poverty and Health Coverage in the U.S. in 2010," released Tuesday by the Census Bureau.
As world citizens, we might rejoice and think that our failure could be a warning knell that lets other nations know they are on the wrong track. But I have my doubts. Corporations run more than just the United States and few nations know how to measure their gross national product in ways other than measuring the market value of final goods and services. According to Wikipedia, GDP is common indicator of measuring a countries standard of living as well. We just don't know any other way to measure success. Or do we?
As we in the US are struggling with our own economic model and demanding changes from our government, perhaps it is also time for us to start demanding changes in how we measure our economic success. This won't necessarily create jobs, but it would force the government to stop making economic decisions based on what is best for the market and started making decision based on what is best for the population of the country.
There are many different methods to chose from and all of them remove corporations as the center of attention though they don't ignore economic growth all together. They place it in balance with other items:
- Human development index (HDI)– up until 2009 report HDI used GDP as a part of its calculation and then factors in indicators of life expectancy and education levels. In 2010 the GDP component has been replaced with GNI.
- Genuine progress indicator (GPI) or Index of Sustainable Economic Welfare (ISEW) –
- The GPI and the ISEW attempt to address many of the above criticisms by taking the same raw information supplied for GDP and then adjust for income distribution, add for the value of household and volunteer work, and subtract for crime and pollution.
- Gross national happiness (GNH) – GNH measures quality of life or social progress in more holistic and psychological terms than GDP.
- European Quality of Life Survey – The survey, first published in 2005, assessed quality of life across European countries through a series of questions on overall subjective life satisfaction, satisfaction with different aspects of life, and sets of questions used to calculate deficits of time, loving, being and having.
- Gross national happiness – The Centre for Bhutanese Studies in Bhutan is working on a complex set of subjective and objective indicators to measure 'national happiness' in various domains (living standards, health, education, eco-system diversity and resilience, cultural vitality and diversity, time use and balance, good governance, community vitality and psychological well-being). This set of indicators would be used to assess progress towards gross national happiness, which they have already identified as being the nation's priority, above GDP.
- Happy Planet Index – The happy planet index (HPI) is an index of human well-being and environmental impact, introduced by the New Economics Foundation (NEF) in 2006. It measures the environmental efficiency with which human well-being is achieved within a given country or group. Human well-being is defined in terms of subjective life satisfaction and life expectancy while environmental impact is defined by the Ecological Footprint.
- OECD Better Lives Dashboard - The better lives compendium of indicators produced in 2011 reflects some 10 years by the organisation to develop a wider of set of indicators more closed attuned to the measurement of wellbeing or welfare outcomes. There is felt to be considerable convergence (in 2011) in high income countries about the kinds of dimensions that should be included in such multi-dimensional approaches to welfare measurement - see for instance the capabilities measurement research project capabilities approach.
I have to admit that of all these models, the one that resonates with me the most is the Gross National Happiness or GNH index. Here in the US, there is a movement to inform more people of this index and to remind folks that in our own Constitution we are guaranteed three rights - Life, Liberty, and the Pursuit of Happiness. We have a Constitutional Mandate to offer Congress - they should measure the very thing that we pursue, Happiness. The Seattle City Council has already adopted the Happiness Initiative.
This is one of the joys about living in a foreign country. I can read an article about the United States in a foreign language, start thinking about connections between our own nation and others in the world, investigate a little on the internet, and find people who are already talking about solutions to the problems I am thinking about. One of the sorrows about living in a foreign country is that I have no recourse for action in the United States itself; I have no place I call home where I can lobby local politicians in person to begin considering the kind of changes that are happening in places like Seattle. But you can. Those of you who live in the US can take this idea to your local city councils, to your state representatives, even to your US Representatives, and have a conversation with them. You can plant the next seed.