There
is an excellent article in the Nov/Dec issue of Dollars & Sense magazine, entitled, "Are we better
off today?" The authors
point out that when Ronald Reagan campaigned for the presidency in 1980, the
question he asked voters to consider was, "Are you better off than you
were four years ago?" After
he was elected, Reagan introduced a new social contract---one which we call
"Reaganomics," and we
are now nearly 40 years into that experiment. So it is entirely fair that we should ask, "Are we
better off than we were 40 years ago?"
The
article begins by looking at GDP. They concede, at the outset, that
GDP measures our well being only crudely. While this index purports to measures the production
of goods, it also measures the production of "bads," and makes no distinction between them. The profit from the sale of
tobacco is counted alongside the
medical cost of treating its effects. The profits of burning coal are counted
alongside the costs of dealing with its
pollution, and so forth. Everything is counted as a
"good," when it may well
be a "bad."
Another failing of GDP is that some things are not counted at all, especially child care. If a woman cares for other peoples'
children and gets paid for it, then child care is part of the GDP. But if the children involved are her own
children, or the children of close blood relatives---and no cash changes
hands---then this labor does not exist. Nothing counts unless you get paid for it.
But
for lack of a better index, we start by looking at GDP. In 1974, the real per capita GDP was
$24,427. Now it is $49,810, nearly twice as much. At first glance, it might appear that
we all have twice as much of everything as we did in 1974. But that's not what happened.
Productivity per worker nearly doubled in that period, but if your income is anywhere between
the 20th and the 80th percentile, your share of that increase is zero. And your real income is barely equal to
what it was 40 years ago. All of
the increase was skimmed off by the top 20%-- and within the top 20%, most went to the top 1%. And even within the top 1%, most went to the top .01%. So if we look only at our
economic well being, Reaganomics
has been a disaster for all except the very wealthiest.
While
economic equality has been in sharp decline, Racial and gender equality has improved. In the 70s, marriage was an unequal
contract that subordinated women to their husbands, and domestic violence was
rarely prosecuted. The 1994
Violence Against Women Act made women safer at home, and outside the home as
well. The term "sexual
harassment" was unknown in
1974---today it is a recognized form of discrimination that carries serious
legal consequences. And racial
equality has radically improved in the last forty years. In 1974, the Civil Rights Act of
1964 and the Equal Employment Opportunity Commission were only a decade old,
and were only beginning to have an effect. In 1974, the Jim Crow South was alive and well---today
it is gone. But just as the
doors to the middle class were opened to minorities, that class itself was under
assault, and may soon be gone.
This is a worthwhile article.
