I like to call it the "Pee on Me and Tell Me it is Raining" plan. It's pretty similar to "trickle down". In fact, it isn't actually a plan so much as it is simply reassuring you that "trickle down" is working for you. I opened my local rag this morning to be treated to the musings of Walter Williams, corporatist shill extraordinaire.
Many economists, politicians and pundits assert that median wages have stagnated since the 1970s. That's a call for government to do something about it. But before we look at the error in their assertion, let's work through an example that might shed a bit of light on the issue.Let's ignore that he starts out using the 1970's as a baseline then quickly narrows gains down to those that occurred during the debt fueled housing boom that collapsed our economy while enriching the very rich and focus on his use of an imaginary anecdotal story as evidence. It doesn't get better. He then goes on to quote an OpEd from the WSJ in case you were skeptical of how awesome you really have it.
Suppose that you paid me a straight $20 an hour in 2004. Ten years later, I'm still earning $20 an hour, but in addition, now I'm receiving job perks such as health insurance, an employer-matched 401(k) plan, paid holidays and vacation, etc. Would it be correct to say that my wages have stagnated and I'm no better off a decade later? I'm guessing that the average person would say, "No, Williams, your wages haven't stagnated. You forgot to include your non-monetary wages."
They start out saying: "Many pundits, politicians and economists claim that wages have fallen behind productivity gains over the last generation. ... This story, though, is built on an illusion. There is no great decoupling of worker pay from productivity. Nor have workers' incomes stagnated over the past four decades." There are two routinely made mistakes when wages are compared over time. "First, the value of fringe benefits -- such as health insurance and pension contributions -- is often excluded from calculations of worker pay. Because fringe benefits today make up a larger share of the typical employee's pay than they did 40 years ago (about 19 percent today compared with 10 percent back then), excluding them fosters the illusion that the workers' slice of the (bigger) pie is shrinking."So because "fringe benefits" are "often" excluded from worker pay and these "fringe benefits" make up a larger share of the "typical" employee's pay it just makes it seem like your life sucks way more now than it did back then. But the pie is bigger and we will happily continue to give you peons the urine soaked crusts. Now smile and be happy!
After some more quoting of data from back during the housing boom we get this gem of a conclusion...
Boudreaux and Palagashvili conclude that "middle-class stagnation and the 'decoupling' of pay and productivity are illusions. Yes, the U.S. economy is in the doldrums, thanks to a variety of factors, most significantly the effect of growth-deadening government policies like ObamaCare and the Dodd-Frank Act. But by any sensible measure, most Americans are today better paid and more prosperous than in the past."It brings back memories of old Phil Gramm and his "mental recession" and "nation of whiners" quotes. Now quit whining and get back to work, slackers.