January 25, 2004

Inequality

The New York Times's David Leonhardt slams Gregg Easterbrook:

Economic View: Time to Slay the Inequality Myth? Not So Fast: In recent weeks, a new book has challenged this conventional wisdom, calling it a statistical mirage, and its striking claim has begun to receive national attention. Among native-born Americans, lower- and middle-income families have actually received proportionately bigger raises than the wealthy, according to "The Progress Paradox" (Random House), written by Gregg Easterbrook, a Washington journalist. Only a great influx of immigrants - many of them poor, but richer than they were in their home countries - has made inequality appear to widen in the statistics, Mr. Easterbrook says. "Factor out immigration," he writes, "and the rise in American inequality disappears." The idea has echoed from the book into the pages of the Washington Post, The Chicago Sun-Times, The San Diego Union-Tribune, The Times of London and Business Week magazine, among other publications. It seems like one of those facts that could rewrite conventional wisdom about the American economy.

It happens, however, not to be true. The millions of immigrants who have entered the country in recent decades have indeed made inequality look larger than it otherwise would. But even among households headed by native-born Americans, the rich have done far better than others over the past 20 years - as well as over the past 30, 40 or 50 years, according to government statistics and the economists who study them. The reasons will sound familiar. The long bull market... the rising value of a college degree... the overseas exodus of factory jobs, the stagnation of the minimum wage, the shrinking power of labor unions, the automation of the workplace and - yes - the immigration boom have all helped keep a lid on raises. "The fact of the matter is, income trends have favored people at the top of the income distribution, and that's true of native-borns, too," said Gary Burtless, a senior fellow at the Brookings Institution in Washington, whose research is cited in Mr. Easterbrook's book. "There is no data source that disagrees with that simple statement. In fact, the better the data, the more that the skew appears."

Mr. Easterbrook, a senior editor at The New Republic who is a visiting fellow at Brookings, acknowledged last week that he had gone too far in the book. His discussion of inequality occupies a very small part of "The Progress Paradox," he said, and he was mainly arguing that immigration played a role in the rise in inequality. "Even if there were not that increase in immigration, there would certainly be a rise in inequality," he said in an interview. "I did a poor job of writing that page."

An errata page seems called for, perhaps?

Leonhardt goes on:

The book's central argument is that Americans do not realize quite how good they have it. Diseases that once ended thousands of lives are now just a nuisance, and life expectancy has soared. Home heating and air-conditioning are almost ubiquitous. The prices of air travel and telephone calls have plummeted.... In the typical household, all the children have rooms of their own. "All told, except for the clamor and speed of society, and for trends in popular music," writes Mr. Easterbrook, "your great-great-grandparents might say the contemporary United States is the realization of utopia."

The rise in income at all steps on the economic ladder is crucial to the story. Even in the bottom half of the distribution, the average native-born family makes about 20 percent more than it did in 1970, after adjusting for inflation, according to an analysis of census data by Andrew A. Beveridge and Susan Weber, both of Queens College. But as real as this increase is, it hides an important part of the story, which in turn explains why the inequality question and Mr. Easterbrook's exaggeration matter. Less than half of the rise in pay among lower-income households comes from actual wage increases. Most of the rise is a result of families putting in more hours on the job as many women have joined the work force. This has obvious benefits, giving today's women economic freedom that their grandmothers did not have, but it also leaves less time for children, aging parents and everything else outside the office.

The pay increases for upper-middle-class and wealthy households, on the other hand, stem largely from healthy jumps in how much they earn each hour. Over all, a native family at the 90th percentile - earning more than 9 in 10 others - made 68 percent more in 1999 than in 1969, after adjusting for inflation...

I think that what Leonhardt describes as the main thrust of Easterbook's book is simply, completely, totally wrong. Americans do too realize how good they have got it. Americans remember well how their grandparents used to live. I know of nobody who would want to live in 1900 or even 1950 (unless they could be in the upper upper class, and take along their own private refillable stashes of penicillin and tetracycline). There is no "progress paradox" when you ask people to compare today to the 1940s or the 1930s or the 1920s or the 1910s. (My father-in-law spent the Great Depression walking alongside the train tracks, picking up lumps of coal that had fallen off the trains so that they would have something to burn to keep warm.)

What worries non-upper-class Americans (and what worries upper-class Americans who see their kids headed for low SAT scores) has been that material progress for the non-upper-classes has been so slow since 1970. We have expected, pretty much since the beginning of the twentieth century, that relative material living standards in America will rise between 50% and 100% every generation. Since 1970 that has been true only for those of us lucky enough to be in America's upper class. Posted by DeLong at January 25, 2004 01:51 PM | TrackBack | | Other weblogs commenting on this post

Comments

The upshot being that those of us in the non-upper class are having to work harder to even come close to the relative standard of living of our parent's generation.

Posted by: Melanie on January 25, 2004 02:50 PM

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Just because our expectations are not being met, doesn't mean that we do not have sufficient income. This ever increasing rise in incomes has to end sometime. What also should be noted that the increases, such as they are, have not resulted in an increase in happiness. I am far more concerned about the lack of equity and the continuing assault on our environment.

And what about the future. That's where me will probably see an absolute decrease in incomes. And is that all bad as long as we can start addressing some of our urgent needs, like health care and alternative energy.

Posted by: tstreet on January 25, 2004 02:56 PM

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tstreet-

Why must the increase end? If productivity continues to increase as technology increases, which it has, there is no reason that the increase shou;d end.

Posted by: Rob on January 25, 2004 02:58 PM

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Brad -

I think that what Leonhardt describes as the main thrust of Easterbook's book is simply, completely, totally wrong. Americans do too realize how good they have got it. Americans remember well how their grandparents used to live. I know of nobody who would want to live in 1900 or even 1950 (unless they could be in the upper upper class, and take along their own private refillable stashes of penicillin and tetracycline).

I should introduce you to my in-laws. Then you would know at least a handful of people who think that everything was better in their romanticized version of the past. While rational people should all see how our lives have improved materially generation to generation, I know many who don't see it that way.

Posted by: timshel on January 25, 2004 03:40 PM

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Gregg Easterbrook is regularly slammed by Rand Simberg and others in the space movement for inaccurate facts and blatant lies. Interesting that he's perceived this way in other spheres as well.

Posted by: Brian on January 25, 2004 03:53 PM

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Rob,

It is possible that increases in technology could result in steady increases in productivity. However, unless the technology advances result in impressive improvements in manufacturing, transportation and distribution efficiency (eco-efficiency), then resource depletion, particularly petroleum, will put limits on the productivity.

A scenario that also needs to be considered is that these will be considered the good old days, because the standards of living over the next several generations could contract to where they were in the 18th and 19th century. This is the "overshoot" hypothesis favored by the devotees of ecological footprint analysis (modern disciples of Paul Ehrlich's population bomb concept), which predicts that levels of consumption and global human population will be reined in to levels commensurate with Earth's carrying capacity - potentially the hard way.

Posted by: JLowe on January 25, 2004 03:59 PM

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I would join the in-laws of the fellow above. While I wouldn't return to 1950 (penicillin and tetracycline fan that I am), I would return to the mid- to late 1950s, and a solidly middle class household. I realize that materially I would be worse off, but spiritually and intellectually I would probably be much better off, not to mention a lot less distracted and potentially much more in control of my life.

Posted by: Lborg on January 25, 2004 04:23 PM

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Lborg --

So, here I am in 2004; very much lower middle class, if that, economically.

I have ten thousand books on this machine, the same one that lets me talk to people all over the world, shows me pictures of colour photographs of the surface of Mars, browses library catalogs and immense listings of darn near every book in print in the English language, has access to vast stores of helpful instructional material on every subject from knitting to complex physics, plays movies with better stereo sound than available anywhere in the world in 1950, and which will typeset entire books if I happen to feel like writing them.

All of that capability beyond the hardware was free. The per-month connection cost, with tax, is a bit less than ten hours work at the minimum wage.

How exactly would I be intellectually better off in 1955?

Posted by: Graydon on January 25, 2004 04:39 PM

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Lborg,

Those who would trade non-essential knowledge for the illusion of security, deserve neither :-)

Posted by: synykyl on January 25, 2004 04:43 PM

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Thomas Sowell writes in his 1/22 Townhall oped that the real income of the bottom quintile is rising. He gives no time frame or source for his assertion. But does this sound correct in any sense to anyone?

Posted by: Harold McClure on January 25, 2004 04:56 PM

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Graydon,
Nice you have so much stuff on your computer. Are you grown-up? Do you have a college education? Do you own property? If you were a kid now, I'm not sure whether your opportunities for intellectual and cultural enrichment would be better today than in the late 50s through the late 70s.
I'm too young to be on official baby boomer, but I do remember the following in my lower middle class high school, some of which I particpated in: music education (band, orchestra, chamber music, jazz, classical and popular chorus) a wide variety of intra-mural (as well as varsity) sports, debating club, after school science (I remember bio and physics chapters) and history clubs. (OK the history club spend most of its time playing war games -the battle of Jutland was about the most soporific Saturday I ever spent and I dropped out soon after that. We never even found each other after 8 hours of futzing around in the vast ocean.) Drama society with money for actually putting on plays.

A public college education was affordable. Community College was well funded, and a reliable step to a state university of UC, rather than an underfuded escape valve for people who couldn't find room at CSU or UC. A person could finish in four years if they studied. There was no pressure to work so much that you had to sacrifice studying for getting the money to finish. The classes scheduled were actually offered. Graduates didn't have heavy debt burdens.

How much of that is left in lower-middle or even middle-middle high neighborhoods?

If you are a typical lower-middle class parent with a family, how much time would you have to read all those books on your computer today? Just having them there is not much. Many of the titles have probably been in the library for years. And back then you might have had time to actually take an afternoon to go to the library.

OK, so that is an anecdote, but so was your post. I think that there is evidence that for many people in society, the resources that were there several decades ago are not there now. Some of this is due to less redistribution of resources, some of of it is due to squeezed middle class taxpayers not willing to put up to dough for local and state programs.

Anyone have anything other than anecdotes on the recent growth in income inequality and how that has affected life for the poor to middle-middle class, for different age groups? I would be interested.

My anecdotal evidence, and comparison of what I see today with my youth, tells me there has been a big change, and not one for the better.

Posted by: jml on January 25, 2004 05:19 PM

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Given that Easterbrook fancies himself a religious philosopher, I think what he means by "The Progress Paradox" isn't that people don't realize how good they have it, it's that they seem to be more strssed out and not any happier than people were in the past. At the very least, their increase in happiness has'nt been proportional to their increase in material wealth. How exactly one would quantify happiness I don't know, but it seems to be a valid point, albeit an utterly obvious (grass is greener) one.

Posted by: DZ on January 25, 2004 05:26 PM

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I wouldn't be willing to trade places with my grandparent's generation (WWII) - mostly due to my love of information technology and video entertainments.

HOWEVER, their generation enjoyed strong unions, the G.I. bill, federal housing assistance, stable employment, PENSION SECURITY, good unemployment benefits, social security, the ability to enjoy a long retirement, the ability to support a family on a single salary, etc. In short, they enjoyed the stability provided by the post-war Keynesian New Deal liberal order.

Most members of my generation don't have pensions. Most of our retirement is going to be based on stock market IRAs that we're all going to be cashing in so we can eat. We've got huge student loans that we'll be paying off for the rest of our lives. We can't expect any loyalty from our employers and most of our jobs can be farmed out to slave laborers in third world countries. Both spouses have to work increasingly long hours to support a middle class lifestyle so we need multiple cars and child care services. Economic stability is something our generation does not enjoy, whatever other advantages we have today.

Posted by: Aurelian on January 25, 2004 05:58 PM

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As someone who grew up in a working class town in Washington State in the late 40s and 50s, I remember a good school system in a very small town that permitted several of its students to make Harvard and Yale (not to mention Oberlin, Reed, Antioch and Stanford). The same school today in the same town probably doesn't send anyone anywhere. I know this because my niece and nephew went through the system. We were lucky.

It's a larger population by over 100 million people. That would make a certain kind of inequality inevitable -- there aren't any more Stanfords and Yales. But one has the sense that the schools of my youth, whose teachers were the same type of person who in my generation became university professors, don't do for ordinary peole what they did then. It's just an impression. I don't have kids. Maybe I'm wrong. I hope so.

Posted by: Knut Wicsell on January 25, 2004 06:16 PM

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A little more structure on "why do you think growth has to end":

While energy per unit of GDP has gone down (we are getting more energy efficient at that macro scale), it hasn't gone down as fast as GDP has gone up, so energy use continues to have a secular upward trend. Unless you have a story that explains why our energy efficiency will improve at faster rates than in the past, I think you have to admit the possibility that growth is limited.

One obvious story is that, eventually, energy scarcity will send strong enough price signals to bring about serious efficiency improvements. I don't rule this out, but I think the world is more complicated than that.

Posted by: karl on January 25, 2004 06:32 PM

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Of course, I'm sure most of the African-Americans in this country would love to return to the 1950s. And what was the payroll tax rate back then, anyone?

Posted by: Ugh on January 25, 2004 06:32 PM

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I think DZ makes a good point about the time squeeze. Material well-being is only one part of the equation, but if you don't find (or take) the time to enjoy the material things (or just yourself), then what is the point? Finally quality life is comprised of the time that you enjoy. Everything else can at best enable ou to do that.

Today's increasingly all-or-nothing and just-in-time work environment, where you can be either un- or underemployed, or have to work effectively 40-50+ hours on short notice in a full-time job plus commute and with little in between, sucks ever more energy out of people's lives.

Don't underestimate the reduction in life quality that results from increased stress.

Posted by: cm on January 25, 2004 06:41 PM

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Judging anecdotally, I'm making less now at 50 than my old man did, and I don't mean adjusted for inflation either. Given the real purchasing power of the dollar today, I make only half what the old man did, and he, in turn, made half what my grandpap did, when you count what he bought with it, (we're talking management jobs here and ownership shares in your own business). My kids, God knows, really. Just open your eyes and look around, unless they go to work for Lockheed or Bechtel, they're screwed (and I wouldn't wish a fascism's sleepworker career on any person.....) Everyone I know is part-timing it double-shift, or Corporate. If you didn't make your grubstake in the dot.com IPO scam, start prayin' Moon-Mars Alaska-Gas shakes down some rain, 'cause drought is coming, and all the gold, as they say, is in an offshore bank under someone else's name.

Posted by: Rick Arbitrage on January 25, 2004 07:04 PM

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On the question of education, the idea that things are worse today than they were in the 1950s or 1960s is absurd. Less than a quarter of all Americans had any kind of postsecondary education in those years, and a significant percentage of Americans never graduated from high school.

Health, obviously, is another huge improvement, even since the 1970s. Life expectancy today is nine years longer than it was then. How much would you be willing to pay to live an extra nine years?

The more fundamental problem with the comparison that's being made here is that we are comparing an America in a world in which a significant number of excellent, competitive industrialized economies exist to an America in a world in which, effectively speaking, we were the only game in town. Ford, GM, Chrysler; US Steel; Boeing: these companies had no real global competitors. They were able to sell into captive markets, and they faced no competition at home. It's hardly surprising that the industrial working class was able to reap great benefits. But it's also hard to argue that that state of affairs was sustainable, or that it was better for the global economy.

Posted by: Steve Carr on January 25, 2004 07:33 PM

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Another problem not mentioned is a fundamental shift in pricing. Consumer goods- from a tv, to a loaf of bread, -lets call it the small stuff- has been dropping in price. Food is literally cheaper.

But the medium and high cost stuff- a college education, real estate, a heart operation- has been increasing in cost well faster then inflation. Frankly Im envious. a friends parents- bought a long island mcmantion- a largeish house on a small maybe 1 acre lot- for 35K$ in the 60's. Now its worth most of half a million dollars...

Posted by: Blechh... on January 25, 2004 08:37 PM

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"The rise in income at all steps on the economic ladder is crucial to the story. ***Even in the bottom half of the distribution, the average native-born family makes about 20 percent more than it did in 1970, after adjusting for inflation,*** according to an analysis of census data by Andrew A. Beveridge and Susan Weber, both of Queens College."

I've read in other places (like Paul Krugman) that real income for the non-rich has been basically stagnant since the 70s. So who's right?

Posted by: tc on January 25, 2004 09:57 PM

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tc: Krugman.

Posted by: bobbyp on January 25, 2004 10:12 PM

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Graydon --"how could I be intellectually better off in 1950?"
You could have a real book in hand, bristling with notes perhaps, in avid conversation with an equally sweaty bookish cohort. A lot is made of the capacity of the computer/internet. Not enough is made of the liabilities or the isolation. Quantity is not quality no matter what you've read in the sex manuals.

Posted by: calmo on January 25, 2004 10:37 PM

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Easterbrook is just another Slate-style contrarian. These yuppie careerists have no political principles. They are opportunistic climbers who provide convenient excuses for those in power. The downside of this approach is that it comes at the expense of licking the boots of the powerful. But these weaselly yuppie scum are content to lick boot in return for the opportunity to lord it over the rest of the non-privileged.

Fuck you Eastercrook.

Posted by: The Fool on January 25, 2004 11:21 PM

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(My father-in-law spent the Great Depression walking alongside the train tracks, picking up lumps of coal that had fallen off the trains so that they would have something to burn to keep warm.

My father did the same thing. In fact, my father and his brothers were proactive about it: They would sometimes throw rocks at the passing trains, in hopes that the suitably angered tenders would throw coal back at them in response.

Posted by: Ray Radlein on January 26, 2004 01:26 AM

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--What worries non-upper-class Americans has been that material progress for the non-upper-classes has been so slow since 1970.--

I think that's right but not quite precise. This is how I put it in a letter about 6 years ago:

"The problem here isn't overarching acquisitiveness or an advertising-driven consumer feeding frenzy, it's more people working longer hours and still winding up worse off than they used to be and coming to believe that - directly contrary to what I would maintain is the *real* "American dream" - their children will be even worse off than they are."

What we came to believe in, to rely on, is that if we worked hard we could secure for our children a better future than our present. And that just doesn't seem to work anymore.

Posted by: LarryE on January 26, 2004 01:42 AM

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Why do you even take seriously the opinions of uninformed generalists?

Journalists are sometimes skilled at expressing themselves. But that has no bearing on the quality of the thoughts they express. It only multiplies their impact, usually for worse. (I recognize that there are exceptions.)

Academics are so afraid of being called snobs that they often overlook the obvious. Delong could easily have said of Easterbrook, "He is not schooled in the content or method of this field. What the hell did you expect? You should have ignored him."

That may seem condescending. But it is a lot less arrogant than Easterbrook's apparent belief that he can wander into a new field and resolve lonstanding technical disputes in about a year or so.

Posted by: Gerard MacDonell on January 26, 2004 03:03 AM

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I can't comment on this particular claim of Easterbrook's, not having read the book.

He *did* have a good article in _The New Republic_ outlining the case against chemical and most biological weapons being classified as WMDs, which I've summarized here:
http://www.truthandpolitics.org/html_gen.php?entryId=77

Posted by: Stephen J Fromm on January 26, 2004 05:20 AM

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TC -- the difference between the rise in the income of the average working family real income
and the opposite point that real averge wages
are stagnant is found in the wife -- women --
going to work. 30- 40 years ago in the middle class family the wife typically stayed home and they only had one income. In the 1950s-1960s my parents were teachers with both working and my mother working was the exception not the rule. Even though my mother came home in the afternoon at the same time we did this was always one of the big worries in her like that her working was unfair to her children. Now, both have to work to maintain a middle class living standard. Go back and look at the labor force parpicipation rates.
For the last 50 years the % of the population working has been on a steep upward slope. It now takes two incomes to be in the middle class -- but 40 50 years ago people did it on one income.

Posted by: spencer on January 26, 2004 05:43 AM

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Say what you will about Easterbrook, he does write a mighty fine football column.

Posted by: Dave on January 26, 2004 06:46 AM

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Can we agree that we're better off in most ways and worse off in some ways than in the 1950's. We are fortunate to have the technology and healthcare we have, and I shudder when I consider how horribly women, blacks and gays were treated not so long ago. The lack of security for average folks is due to the breakdown of our social compact, the "I got mine screw you/greed is good" attitude that began with Reagan and seems to have become pernicious under Bush II.

Reading Easterbrook, even before he was debunked, I thought: How can you draw any worthwhile conclusion about inequality if you eliminate immigrants from the equation? OF COURSE they're at the bottom of the ladder - they're IMMIGRANTS, largely from third-world countries. Few people arrive in the U.S. as rich folk. It's like leaving out "people who never finished high school" from the calculation and then saying "See! Lots more equality!"

Posted by: Lisa on January 26, 2004 08:34 AM

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Easterbrook's getting a little bit of a bad rap here. His argument about progress may be wrong, but it is not, in substance, an argument about inequality or equality. He wasn't trying, in this book, to "resolve longstanding technical disputes." The passages that Leonhardt correctly takes Easterbrook to task for make up literally about 1/100th of the book. Easterbrook's argument is that living conditions have been getting better for most Americans. It's possible to accept that and still say that living conditions have been getting a lot more better (as it were) for wealthy Americans than middle-class Americans.

As for immigration, Easterbrook's point is that the easiest way to make the distribution of income in America more equal would be to close the borders to immigration. That is, after all, what America did, in large part, between the mid-1920s and 1965. Easterbrook isn't advocating this. He's simply saying that greater inequality is, in part, a consequence of America's decision to maintain an open-borders policy. Factoring out immigration -- which is the result of a conscious political decision -- is not like factoring out "people who didn't go to high school" (unless there's some plan I don't know about to deport people who didn't finish high school). It's an attempt to say "If we want this (a steady flow of immigrants) then in part we have to accept this (greater inequality than we would otherwise have)."

Posted by: Steve Carr on January 26, 2004 08:50 AM

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I think one's opinion about whether the U.S. is becoming better or worse off depends a lot on how you weight the psychic cost of economic insecurity. Would you rather make 60K a year and have a 2% chance of getting laid off each year or 100K a year and have a 25% chance of getting laid off. Believe it or not, there are a lot of workers who would trade off income security for lower salaries. The trouble is, those jobs are rapidly disappearing. Like it or not, white-collar workers are increasingly forced into a high-risk/high-reward (or high-risk/low-reward) working life, regardless of what their own preferences might be. Seems to me that economists completely ignore the issue of psychic well-being when considering the shift of economic risk from businesses onto families.

Posted by: David on January 26, 2004 09:29 AM

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Steve Carr: "Health, obviously, is another huge improvement, even since the 1970s. Life expectancy today is nine years longer than it was then."

Not to argue the point on principle, but I want to mention that I read a study examining life expectancy estimates (I have to look it up; I think it was cited on Bonoboland some time ago). Life expectancy is estimated based on historical up to current birth, death and other demographical data, and the input is necessarily people's life span in the past, and how long people have survived until today. There are some statistical effects related do demographic dynamic that I cannot quite reproduce, and the authors argue that life expectancy may be systematically over- or underestimated when population size changes. So today's life expectancy may not be as high as current _estimates_ indicate, and yesterday's not as low.

"How much would you be willing to pay to live an extra nine years?"

Let me offer food for thought without supporting evidence (just gut feeling), what if for each year of increased life you have to sacrifice a year total of life at your young age (e.g. by having to work X min harder/longer daily in school, and working/commuting X min longer daily during your working life -- and both spouses have to work full)?

And 9 more years at what quality? There are certain things that you cannot (or would not) do in old age that you will presumably have to sacrifice at young age when you are working, or trying to get some sleep on the weekend. What if the "total enjoyment" of your life just gets spread out over more years? Would you still pay?

Posted by: cm on January 26, 2004 09:41 AM

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Steve Carr wrote, "As for immigration, Easterbrook's point is that the easiest way to make the distribution of income in America more equal would be to close the borders to immigration. That is, after all, what America did, in large part, between the mid-1920s and 1965. Easterbrook isn't advocating this. He's simply saying that greater inequality is, in part, a consequence of America's decision to maintain an open-borders policy."

It's a little more complicated than that. The open-borders policy only goes for cheap/unskilled labor. The US is still very closed for certain types of professions, notably medicine and law. In fact, some of the changes recently have made it *harder* for MDs from abroad to come here and practice medicine.

Posted by: Stephen J Fromm on January 26, 2004 11:02 AM

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Stephen, surely that strengthens Easterbrook's point. If most immigrants are unskilled and relatively undereducated, then immigration is even more likely to increase inequality.

CM, I don't have an answer, either. But just going on my gut feeling, I think people would be willing to pay for those extra years, as long as the "sacrifice" they had to make didn't involve excruciating pain or agony (that is, they'd have to be tortured for a year in order to live a year longer).

I'm not even convinced that most Americans are, in fact, working longer hours or harder than they were thirty or forty years ago. People at the top -- corporate managers, etc. -- undoubtedly are. But Easterbrook cites a number of studies suggesting that average Americans have more non-work time today than they did in 1960. They may choose to fill it with endless activities, but that's a different question.

I also think we need to abandon this idea that women didn't work before they went into the workforce. Homemakers, especially those with big families, work hard. They just aren't paid for their labor. So when women went into the official workforce, it's not like the number of hours a given family worked rose dramatically. It's just that the nature of the labor changed.

Posted by: Steve Carr on January 26, 2004 11:42 AM

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While energy per unit of GDP has gone down (we are getting more energy efficient at that macro scale), it hasn't gone down as fast as GDP has gone up, so energy use continues to have a secular upward trend. Unless you have a story that explains why our energy efficiency will improve at faster rates than in the past, I think you have to admit the possibility that growth is limited.

One obvious story is that, eventually, energy scarcity will send strong enough price signals to bring about serious efficiency improvements. I don't rule this out, but I think the world is more complicated than that.

Posted by: karl on January 25, 2004 06:32 PM

karl, the prices of many alternative energy technologies are cheaper today in real terms than most carbon based fuels were 30 years ago. If relative prices for carbon based fuels hadn't declined (neglecting the issue of externalities), we would already be switching to some of these alternative energy sources. Energy sourcing isn't a fixed constraint on growth.

Posted by: Stan on January 26, 2004 12:08 PM

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I haven't read Sowell's piece yet, but it is being spun by the rightwing punditry (Limbaugh, e.g.) to include the claim that *the majority of the poorest quintile will, at some point in their lives, be a member of the wealthiest quintile.*

That is just breathtaking in its bogosity, and could only be entertained as fact by someone who never leaves his house except to pick up his pain medication.

Posted by: melior on January 26, 2004 01:21 PM

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I didn't see a link here to the Sowell piece, did I miss it? If Sowell is refering to some of the recent research on inequality that confuses changes in income over different periods of a person's life with changes in relative incomes across different generational cohorts, then it is a bogus reslt.

In regards to Easterbrook's book, there is also research showing that people in the US are working more recently. I hope he provided a balanced discussion.

Some nice anecdotes on this thread, but I will try to do some constructive trolling (as in fishing). Is there any empirical work on these questions?

Could the US only afford the GI Bill only because it was the only economic superpower after WWII? Admittedly minorities had fewer opportunities than whites from the 50s and 60s. But was the cost of extending primary and secondary education, and increasing HS grad rates, to minorities so high that it is responsible for the cuts in programs for kids in middle class white neighborhoods?

Some more anecdotes. When I was in grad school, I was surprized that grad school friends from Africa said they were shocked at the level of educational and cultureal opportunities for the average poor, working and lower-middle class kid in the US, white and non-white. They couldn't believe the lack of after-shool programs, cut-back in intramural sports, cultural opportunities. They said that for upper-middle class and rich kids it was of course better here, but not for lower class kids. I was used to hearing lectures like this from Swedes, but to hear it from people from Ghana, Kenya and Tanzania was surprizing. So I don't think the US's deline from economic domination of the world is an explanation for the reductions.

Of course, these Africans were from small regional towns, not from villages or the countryside, but still... I was surprized at their comments.

Posted by: jml on January 26, 2004 01:37 PM

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2/3 of all Ghanians of secondary-school age are not in high school. In 1998, less than 10% of the population over 20 had finished high school.

In Kenya, the average adult has had just 4.2 years of formal schooling. Only a fifth of Kenyans of secondary-school age are in high school.

In Tanzania, the average adult has had 2.7 years of formal schooling. And only 5% of Tanzanians of secondary-school age are in high school.

Somehow I think the vast majority of Kenyans and Tanzanians would think the educational and cultural opportunities for middle-class kids in America were just fine. In fact, this comparison is so ludicrous that I can't even believe I had to spend any time writing that sentence. With all due respect, the stories told by your African graduate-school mates were not anecdotes. They were lies.

It may be worth noting that Ghana, Tanzania, and Kenya were bastions of the attempt to build what was then termed African socialism, and were fervently anti-imperialist. I'm not sure when you were in grad school, but it's possible that you were being fed a nice dose of propaganda.

Posted by: Steve Carr on January 26, 2004 02:01 PM

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No, I don't think that the Africans' were consciously dishing out propoganda. I would say that half of them would be (moderate) Republicans if they were US Citizens. Especially the Ghanaians. Many of them were quite upset about what the socialist experiments had done to their countries' economies in the 50s and 60s. Perhaps they simply saw more relative inequities between the poor and near poor here compared the more wealthy than they expected. Several of them were dong volunteer work at local schools when all after-school programs and sports were cancelled because of budget cuts. They were shocked and said that any village or town that had a school, no matter how poor, would find a way to have a soccor (excuse me, football) team and some kind of afterschool acitivity for the kids. And that wasn't done here, and they were astonished and disappointed.

Obviously I didn't mean to suggest that high school graduation rates were higher in those countries.

I was reporting subjective impressions of the relative depravation of different social classes in the US, as given by people from poorer countries -most of whom started life in villages or small towns.

Posted by: jml on January 26, 2004 02:32 PM

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Steve Carr: "I think people would be willing to pay for those extra years, as long as the "sacrifice" they had to make didn't involve excruciating pain or agony ..."

Well, the thought that _some_ (many?) work responsibilities that you have to take on (or, as certain people would carefully point out, "choose" to take on) may not be a very enjoyable way to spend your lifetime is certainly not beyond you. There are also other small insidious things that can reduce your enjoyment of the day, as argued below.

"I'm not even convinced that most Americans are, in fact, working longer hours or harder than they were thirty or forty years ago."

Harder -- probably not. Longer -- it depends. There are measures of working hours, but don't forget that they are based (roughly) on _actual_ hours of hourly workers, and _contractual_ hours of salaried workers; in other words I suspect they undermeasure the effective working hours of exempt employees (and what about working from home, checking up on correspondence in the evening and on the weekend, even if just briefly?). In addition I suspect that today the proportion of exempt jobs is higher than during the 60's/70's, which may skew the statistics. In your typical R&D-heavy company (like a software business) I would think that everybody but the secretaries and the facilities staff is exempt.

Also there is another element that is hard to quantify, which is increased on-demand or just-in-time work requirements, especially in fast-paced sectors like "high-tech". Customers expect quick turnaround, or quick response, for example in the software and IT business, where a critical patch has to be delivered to this important customer (over the weekend), or we have to quickly finish this or that by tomorrow, so that the alpha version can go to testing, or we don't know the full requirements yet, but we can already start on what we know and fly by the seat of our pants. Or you have to work late on Friday to get something "done before next week", and are good for nothing on the weekend, etc.

All this introduces a degree of uncertainty, low visibility, and short (spare time) planning horizons, making it more difficult to use your spare time effectively, even if technically the total spare time is the same. How often has it happened to you or did your friends do it to you that you had to call off dinners, could not make it to a movie/sports game in time, had to shift vacations, missed shopping opportunities in the week and had to go on weekends? You probably always could spend the ruined evening some other enjoyable way, perhaps reading a book, but you were kept off of what you originally wanted to do.

In some sense this means that you have less control of your life than you would like to. Even if you would not necessarily do other or better things, the fact that you do it when _you_ want has some quality aspect to it.

Of course choice is involved. You can choose to pursue your life the way you would like, but then you will probably be not or less successful in the kind of job that I described. That's why I said "all-or-nothing".

"So when women went into the official workforce, it's not like the number of hours a given family worked rose dramatically."

Are you sure? They stopped doing all the house work? (I'm sure you heard the phrase "double bind".) Even if some people can afford having their house cleaned by service personnel, they will still have to do the dishes. And giving the laundry to a cleaner also has drawbacks -- it's an industrial job instead of the more careful one you would do, and you have to drive forth and back, taking half the time it would take you to do it yourself. And judged by how many movies have the "missing the laundry pickup" scene, there must be something to it that people can relate to.

Bottom line, the working ex-housewife will do both work _and_ her perhaps reduced housework schedule. And the husband has to help with some things as well. I'm not saying it's bad, but in total they probably both work more, even if not dramatically.

Posted by: cm on January 26, 2004 08:23 PM

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Re: Easterbrook: Michael Parenti gave a talk where he was very funny talking about an inflation announcement he once heard that began "Aside from the energy, housing, and health sectors, inflation was low this quarter ..." --- in other words, if I take out all the things I don't want to include, I can make the numbers do whatever I want.

That's Easterbrook to a T. His prior "book" on the environment (with, basically, the same thesis: "All is wonderful, it's just those doomsday types telling you otherwise") was full of the same sort of nonsense, focusing entirely on the things that he could argue were getting better while resolutely ignoring the most difficult and pervasive problems and subtle threats. Having wasted hours trying to read that one, I certainly won't bother with his latest.

Posted by: JMG on January 26, 2004 09:44 PM

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Mr. Easterbrook complains that he is getting hit from both the left and the right in reviews:

http://www.tnr.com/easterbrook.mhtml
(this tnr link is open to thegeneralpublic)

Posted by: jml on January 27, 2004 01:05 AM

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Easterbrook is getting hit from all sides because his book is bad. It's sloppy and sanctimonious and all-round irritating. Its magic-wand approach to public policy is an insult to the reader's intelligence--and to the policy analysts across the political spectrum who grapple with the complexities of topics like health insurance. I agreed to review the book assuming that I would like it with some quibbles. I was seriously mistaken. (My review is here, with some minor elaborations blogged here. The toughest part was deciding which criticisms to focus on in the limited space allowed.) As for the inequality stats, Easterbrook's own footnotes don't back him up, as I pointed out in a late December blog post.

Posted by: Virginia Postrel on January 27, 2004 08:51 PM

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Hey, what happened to my links? I obviously don't know how to post comments.
Review here: http://www.dynamist.com/articles-speeches/opeds/easterbrook.html
Elaboration here: http://www.dynamist.com/weblog/archives/000788.html
Blog comments on stats: http://www.dynamist.com/weblog/archives/000784.html

Posted by: Virginia Postrel on January 27, 2004 08:55 PM

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The misrepresentation of someone else's work is also considered plagarism. I couldn't think of a worse think to do than to misrepresent a colleagues work. What a terrible thing to do to attribute the exact opposite of someone's findings to that person. But I guess it just shows the state of the up is down, press corps. There is so much cognitive dissonance right now that I don't Easterbrook realizes what he did. If Brookings was an institution of standards, which it is not, Easterbrook would and should lose his position there.

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