Rounds VS ASE's Which To Buy

Just curious, but could there be lurking variables that influence the graph above?

For example, have households changed over the past 25 years? i.e. Marriage rates, divorce rates, single parents, work/life balance. Have workers changed? Delayed entry into the workforce, early exits from professional careers, depression, incarceration rates, etc..

Here's a graph for incarceration rates. it doesn't match as closely as GDP to median household income, but it certainly could account for some of the stagnation in wages.



I believe it is indeed obvious that "more capital does not necessarily produce higher wages", but could the inverse be true? i.e. Lower capital produces lower wages? Given the dips in 1990, 2000, and 2007, I suspect it may be the case. Which means to me that when the earnings of the 1% rise, they don't necessarily share those profits with the 99%, but when they lose money, they're quick to lay off workers.

 

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I’m surprised none of the economists here have pointed out the three blaringly obvious reasons for income inequality. Lower income tax rates, as well as other tax benefits for the wealthy, unfair trade agreements that have move millions of jobs offshore, and the breaking of labor unions.

 

Lower income tax rates? Lower than what? "Income tax" rates for the 1% are certainly higher than those for the average household. The problem is, most of the 1% do not have traditional "income" because they do not work, they invest.

Capital gains taxes are a different animal and I do think income from capital gains should be taxed at a higher rate than income from labor, including Social Security and Medicare taxes, which are not currently assessed on capital gains.

 

Labor unions are a touchy subject as discussions on them often descend into political discussions, which are verboten here.

What do you mean when you say "the breaking of labor unions"?

Are you referring to the old "Union Busting" tactics used in the early 1900's? Or the simple fact that unions seem to be on the decline for a wide range of reasons?

 

Income tax rates at 1/3 to 1/2 of the rates that built the middle class in the 1950's and 1960's.

Yeah, capital gains, Social Security, and Medicare are just a few of the benefits that allow the wealthy to pay at lower overall rates than the middleclass or actually 99% of us (the working class).

 

Well, let's not get into the political reasons why union representation declined to what, less than 10% from 2000 to 2008.