David Harvey and Libertarians

[Questionable]

So I was looking for David Harvey lectures on Youtube and came across this video by a user named "HowTheWorldWorks."

http://www.youtube.com/watch?v=NJGAs2KwoWk&feature=relmfu

It's supposed to be a critique of David Harvey's critique of capitalism, but most of it is just the standard Libertarian tactic of moralizing and glorifying the flaws of capitalism.

However, there was one part in the video that concerned me. He claims that he debunks Harvey's entire lecture because of Harvey's statement that wages are stagnant. HowTheWorldWorks then brings up some census data which apparently proves that wages have actually been increasing.

I'm not an expert in economics quite yet, so what's the deal here? Is this Libertarian guy onto something, or did he (As I'm leaning towards) totally misinterpret the census data on wages? I mean, do those wages take into account things like inflation?

[Os Cangaceiros]

Judge for yourself:

(chart is for US wages)

http://upload.wikimedia.org/wikipedia/commons/b/b1/US_Real_Wages_1964-2004.gif

From the short wikipedia article on the "real wage" (ie wage adjusted for inflation)

[Dean]

Judge for yourself:

(chart is for US wages)

http://upload.wikimedia.org/wikipedia/commons/b/b1/US_Real_Wages_1964-2004.gif

From the short wikipedia article on the "real wage" (ie wage adjusted for inflation)

Good quote. The peak there is also the peak for US social program spending (both under Nixon).

[Drosophila]

I hate this guy. During the Wisconsin strike in 2011 he called for all of the striking workers to be fired from their jobs. After saying that, he's shown to be a complete moron who shouldn't be taken seriously. Kind of like a conservative version of Maoist Rebel News.

[cynicles]

Hey guys! I like Ron Paul and read the federalist papers! Ima start a youtube channel and be a cocky little shit.

[Let's Get Free]

Wages aren't stagnant? Countless numbers of independent studies have shown that wages have indeed been stagnant for the vast majority of people in the U.S. since the 70s.

[Bakunin Knight]

Judge for yourself:

(chart is for US wages)

http://upload.wikimedia.org/wikipedia/commons/b/b1/US_Real_Wages_1964-2004.gif

From the short wikipedia article on the "real wage" (ie wage adjusted for inflation)
So how do we reconcile that with the census statistics? Is it that people work more hours now? I tried to find that out, found this:

http://3.bp.blogspot.com/_3bGnkNeoPxk/S0knrf3iQZI/AAAAAAAADTY/YsrlgSFaob0/s400/aggregate-weekly-hours-worked-december-2009.png

Doesn't show any large increase in work-hours. Or should the statistics themselves (or their adjustment for inflation) be called into question?

[Blake's Baby]

What do you think the disconnect is? I don't understand why you need to correlate with the census data. Are you trying to work out individual income based on inflation-adjusted hourly wage rates mapped onto average hours worked, or something?

[samyang]

That cringe-worthy "critique" is a basic math fail. It rests on the fallacy that the average of a set of numbers can tell you anything about the distribution of those numbers.

Here's the logic of that laughable "critique" - Bill Gates walks into a neighborhood bar. Now *on average* everyone in the bar is a millionaire. But can anyone in that bar cash that check except Bill Gates? Obviously not.

So the fact that per capita income is rising is totally consistent with Professor Harvey's basic point- which is an empirical fact that is not in question by any serious person- that income inequality has been increasing in the US over the last 30 years. The bottom 80% of wage earners have seen their income flat or falling, while the top 20% in general, and the top 1% in particular, have made off with nearly all the gains in wealth.

[Bakunin Knight]

Well if the real income went up significantly, how did the real wages per hour go down without more hours being worked?

[#FF0000]

Are more people working multiple jobs, maybe?

[Bakunin Knight]

A theoretical possibility if the above graph was hours worked by job rather than by individual worker, but it doesn't seem to be the actual case:

"Overall, about 6.5 million people were working two jobs — or more — to make ends meet in July, according to the Bureau of Labor Statistics. That represents 4.7 percent of the work force, the lowest percentage in at least 15 years."

[Os Cangaceiros]

I've posted this image (https://www.nytimes.com/imagepages/2011/09/04/opinion/04reich-graphic.html) on this site a couple times before, but you can also look at the very bottom of it and research the sources if you want.

Basically productivity rose out-of-step with wages. There are a couple factors involved with that I think, including perhaps increased production because of new technology, but I think the narrative the left has of job out-sourcing after the 1970's eroding some of the employee's advantage over the employers is convincing.

(plus note the general trajectory of wages...it is the same general trend that I previously posted.)

[Bakunin Knight]

But can you explain to me how the real income went up a lot while real hourly earnings didn't? Is it that the gains in income are not included in the 'hourly earnings' graph for some reason (e.g. if the latter only counts wages rather than other forms of income)?

[Os Cangaceiros]

I don't know how people would be getting money outside of their wages/work. Maybe something to do with tax policy or something?

[Bakunin Knight]

I don't know how people would be getting money outside of their wages/work. Maybe something to do with tax policy or something?
Well actually thinking about it I'm pretty sure the census statistics would only refer to the same income counted for income tax, which therefore would be the same amount as earnings for hours worked, correct?

[Let's Get Free]

Real wages have actually declined by 3% over the past 30 years. In reaction to the stagnating real wages, workers' households sent out more of their members to do hours of labor. Men took second or even third jobs, and/or worked additional hours at first jobs. Teenagers took jobs after school. Retirees returned to full or part time work. And most important, millions of women entered the labor market. These responses helped raise real income, but the increased supply of labor decreased any chance for real wages to resume rising.

[blake 3:17]

@ Questionable -- where in the video is this? I don't have time to watch an idiot rightist steal a David Harvey video. I can take the time to figure out a particular issue raised in something like this.

In North America, wages are completely stagnant, while debt continues to increase.

In dollars per hour (ie a wage) I receive exactly the same dollar amount as I received in the year 2000. This is after earning a university degree, a college diploma, and maintaining standing in a non-voluntary professional association. But in 2000 I got medical benefits!

Within the workers movement in North America a large number of people have taken direct 50% pay cuts, never mind inflation.

I think the North American economy is seriously wrecked indefinitely and the outcome won't be decided by simple policy decisions. There are some relatively simple reforms that would ease the pain, but I think we really need to start imagining and implementing some very practical ecologically sound alternatives as soon as possible.

[Bakunin Knight]

These responses helped raise real income, but the increased supply of labor decreased any chance for real wages to resume rising.
Are you talking about household income? The census data was for per capita income, which shows a significant increase. Hence my questions about how the stagnant wages and rising per capita income fit together. Anyone have any ideas?

[Let's Get Free]

Well, the incomes of the top, say 5% have gone up drastically, which could be pushing up the average.

[Bakunin Knight]

Well, the incomes of the top, say 5% have gone up drastically, which could be pushing up the average.
Yeah, so is that excluded from the hourly earnings graph above for some reason?

[Let's Get Free]

Yeah, I think they exclude the top earners.

[Bakunin Knight]

Yeah, I think they exclude the top earners.
I looked at the sources for the image on Wikipedia and it seems that 'earnings' only refers to the data of earnings of 'employees on nonfarm payrolls', as defined by the Bureau of Labor Statistics (of course, it doesn't include employee benefits other than wages). There is, therefore, room for income gains in other professions to reconcile the original graph with the census data referred to in the OP's video, and it is increases in the income of those non-wage earners that shows up in the overall income increases in the census data. So I think that solves his problem. The video refers to the income of all income-earners, not just wage-earners, while the graph refers only to the earnings of wage-earners.

[Os Cangaceiros]

Of course, it doesn't include employee benefits other than wages.

Healthcare probably wouldn't account at all for that, though, as employee-sponsored healthcare coverage has been going steadily downward, for the past 12 years at least.

[Bakunin Knight]

No, I wasn't saying that that was the cause of the census data showing increased incomes, but rather that it is the income of non-wage earners that has increased. I'll edit the post so that it's less confusing.

[Demilich]

Harvey said "wages".

People working on Wall Street don't earn wages.

Income would include wages, salaries, bonuses, interest, inheritance, and capitals gains as far as I know.

Just google "ucsc who rules america".

[Jimmie Higgins]

I looked at the sources for the image on Wikipedia and it seems that 'earnings' only refers to the data of earnings of 'employees on nonfarm payrolls', as defined by the Bureau of Labor Statistics (of course, it doesn't include employee benefits other than wages). There is, therefore, room for income gains in other professions to reconcile the original graph with the census data referred to in the OP's video, and it is increases in the income of those non-wage earners that shows up in the overall income increases in the census data. So I think that solves his problem. The video refers to the income of all income-earners, not just wage-earners, while the graph refers only to the earnings of wage-earners.

Yeah ignoring the context and form of something in society is the bread and butter of capitalist apologists - especially since the 1970s when it was important to provide cover for increasing inequality. I don't know where the statistics in the video come from, but most likely they are comparing $10/hr job today vs. a $4/hr job in 1975 without adjusting for inflation, or they are including things like the value of home assets (which would have increased home-possessing workers wealth during the period of the housing bubble). Also the transfer from traditional benefits to stock-based benifits may also play into this if one is not considered income whereas the stock holdings are. I'm not really sure where they are drawing this conclusion from - if not a shallow and unscientific presentation of data.

But even if wages of workers were increasing - I'm totally convinced from everything I've read both radical and bourgeois that US wages have stagnated, and personally in effect I think the stagnation is more like an experienced decline for people (working harder for less) - it doesn't tell us much about the relationship of workers in production. I think comparing wages to productivity gives a better picture of how the ruling class has been able to greatly increase its control of wealth while workers have lost ground:

http://www.irle.berkeley.edu/events/spring08/feller/productivity_wages_graph.gif

So induvidually workers may be working harder - or they may be more precarious and working part time, but on a whole the class has increased the wealth of the bosses while progressively loosing the percentage of the surplus that comes back to workers both in wages/benefits but also in social spending.