Good News about the World 3

Brad Wright, in his new, important book (Upside: Surprising Good News About the State of Our World), asks if the following claims are true or not, and I apologize for the quality of this image but it’s readable and I created it on a free app for my iPhone and if you click it the image will get big and you can read it.

Brad Wright’s conclusion, fully supported with strong facts from social scientific studies, is this:

The answer? According to Federal Reserve Bank economists W. Michael Cox and David Alm, all twelve of these commonly accepted economic beliefs are false.

Once you’ve read this post:  What do you see here? Any suggestions? ideas? proposals?

Just because various thinkers or news media repeat these ideas over and over doesn’t make them true, and Michael Kruse, who often comments here, has been reminding us of just these sorts of data over the years. So we need to ask what the evidence is actually telling us, and that is what Wright’s book does.

Are we doing better financially? Wright says over the last decade — great; the last decade — just okay. Notice this: Since 1947, and these figures are adjusted for inflation, the average family income has gone up 240%. From the 1940s to the 1970s the numbers were dizzyingly good.

In the last 35 years male incomes are roughly the same; the big difference is in womens’ income: from 40% working to 75% working. In the last ten years, since 1999, American family income has stayed about the same. And fringe benefits — like insurance — have increased as well (roughly 1/3d better since the 1970s). Factor into this that families have gotten smaller, that money is actually more per person.

Bigger picture: from 1929 to 2004 “personal consumption” has grown (adjusted for inflation) from $5000 to $25000 per person.

The gender gap is lessening in income. Since the 70s it has shifted from women earning about 60% of what men earn to 77%. Wright discusses discrimination with finesse — yes, it’s clear, there is discrimination and some of the numbers are overdrawn and sometimes other factors are at work, but there are systemic issues in need of reparation. Wright’s big one: things are getting better.

Wright treats each of these claims this way. I can’t examine each since it would take pages and pages, and blogs aren’t supposed to be books. I want to mention briefly one other topic: income inequality.

Brad Wright’s conclusion:

America has “a Gini score of 40.8, which puts it right in the middle. It ranks 73 out of 142 countries based on data from the World Bank. Among wealthy countries, however, the U.S. has a relatively high level of inequality. Of the twenty-five richest countries in the world, the United States has the third highest level of inequality. Only Singapore and Hong Kong are wealthy countries with more inequality. This suggest that, overall, we Americans could distribute income more fairly (67).

OK, one more: to buy a Big Mac,

Americans work 12 minutes
Nairobi Kenyans work 158 minutes
Mexico City folks work 129 minutes.