The situation on the ground is unchanged - the amount of labor being generated per person has not really changed, but the overall pie has grown massively around us.

https://equitablegrowth.org/new-data-reveal-how-u-s-economic...

"The past three economic expansions have largely benefitted the top 10 percent. In each, the top decile received between 47 percent and 59 percent of all income growth in the expansion."

Automation, robots, software etc. they are all capital share.

I highly doubt automation and robots are a meaningful factor here, but IP and outsourcing have the exact same as automation.

There's a return on capital than is not spent on employees. That reflects how much capital is growing and how much can be spent on employees in the future.

not true, labor productivity has been steadily increasing: https://fred.stlouisfed.org/series/OPHNFB

workers are simply capturing less of the economic value generated by their labor.

- The amount I'm working hasn't increased. Still an 8 hour day.

- My job honestly is easier than it used to be; certainly less menial.

- Strictly speaking, the education requirement is actually lower. It's easier and a lower bar to learn to become a decent designer in AutoCad than to learn to effectively use old drafting tools (even though the formal four year engineering degree still takes four years).

But it's also true that in spite of this, my output is higher. Should I capture the increased output or should the innovators of the tools? What about the firms that invest in procuring these tools and production technology? Should the customers capture the increased output through lower prices? Or should the innovators, firms, and customers all get less, and instead my wages should get bigger?

https://fred.stlouisfed.org/graph/?g=tjto

So in terms of how much consumers are making in relation to their expenses, it's been remarkably steady this whole time.

household expenses have been increasing without commensurate wage growth, resulting in lower savings: https://fred.stlouisfed.org/series/PSAVERT

observation_date OPHNFB_PC1

2000-01-01 2.99256

2001-01-01 2.58092

2002-01-01 4.27146

2003-01-01 3.68422

2004-01-01 2.97991

2005-01-01 2.18582

2006-01-01 0.99665

2007-01-01 1.58927

2008-01-01 1.30737

2009-01-01 4.07061

2010-01-01 3.15513

2011-01-01 -0.02491

2012-01-01 0.93870

2013-01-01 0.59941

2014-01-01 1.00795

2015-01-01 1.27023

2016-01-01 0.61567

2017-01-01 1.49513

2018-01-01 1.40965

2019-01-01 2.13337

2020-01-01 5.30657

2021-01-01 2.06281

2022-01-01 -1.46786

2023-01-01 2.13277

2024-01-01 2.91010

2025-01-01 2.25154

Ford now makes more cars, with fewer people. Sears used to have people who took photos, laid out catalogs, opened envelopes (with checks in them).... Amazon has none of that. We replaced switch board operators, with mechanical, then digital switching. More calls routed, fewer people required. go back 45 years and "draftsmen" was a job - replaced by auto cad.

All these industries have seen massive productivity.

Are the people flipping burgers more productive? Plumbers? Welders? Teachers? Nurses? -- to some extent yes, because of technology but not to the same extent as the previous businesses. Anything that qualifies as "service economy" work has not seen the same gains as Ford (see: https://www.aei.org/carpe-diem/phenomenal-gains-in-manufactu... )

My understanding is that "fixed" costs like rent and groceries have gone up and taken more of people's budgets, while wages failed to catch up with this inflation.

If that's the case, it's markedly different from "situation on the ground is unchanged". I don't know how the overall pie is doing, but it has not grown enough to compensate for the labor share drops shown in the article. The slice on my plate is certainly lighter.

I don't see where the article made that claim. Are you making it yourself and can you support it? That sounds like something that would happen when technology improves. What the article does do, is pose a question that it never answers: "When the labor share falls, it means that productivity, prices, or both [which?] are growing faster than wages."

Unit cost on labor has increased at a more or less steady pace this whole time. Ergo, it's not so much that labor is decreasing as other things are increasing faster.

It's hard to argue that technology is increasing labor productivity an order of magnitude faster than it was in the 50s. It's more likely something else in the dataset (returns on capital/rent) is exploding in value.

I would encourage you to go work with average Americans in average towns. The facts on the ground are stark and eroding.

But even this feels like it is overstating things. You say folks are one car repair away from being homeless. And there is a lot of polling that shows people would struggle to pay for repairs. But full on homelessness? I can only assume that you are describing towns/cities that offer no transport assistance at all, that lands people into being so dependent on a car. I believe it, but I struggle to think this is literally half the nation.

So, the people you are mentioning making 12-18/hr, are literally below 1 in 4, to less than 1 in 10. These are not “average middle class Americans” except maybe in that higher end. These are low wage earners and are far below “average”.

I mean absolutely nothing normative by this statement, nothing about whether this is good or bad or what we should do policy, socially, whatever. But saying someone making below the 10th percentile is average is like saying someone making $75/hr is average.

That is, Henry Ford changed the world because he deployed capital to make workers so productive that they could afford to buy the cars they make.

A person paid to do child care in an organization with overhead, who has to pay taxes, etc. is not productive enough to put their own children in child care. So child care fails to revolutionize the world the way the car did.

See https://en.wikipedia.org/wiki/Baumol_effect

They are highly productive but the market doesn't value them. It values the backup forward on a basketball team - an almost completely non-productive job - more than a doctor. It values the owner of a company at $1 trillion, which is obviously absurd.

A $1T founder is rewarded for building a massive system that employs hundreds of thousands of people, moved technological progress forward dramatically, and has positively affected the lives millions.

A doctor provides life-saving care, but they are physically limited to helping one person at a time. A backup NBA forward might not save lives, but their work is broadcast and monetized across millions of screens at once.

Arguing that entertainment is "non-productive" ignores human nature. People gladly pay to be entertained. If sports have no value, do you feel the same way about books, art, and movies?

In Capitalism surplus economic value goes to the Capital class, so it seems like it is working as designed.

Look at the good deal that the UAW has gotten for auto workers in the system, both US car makers and the union are pretty happy right to keep this system in place and shrink in the face of technological change like electrification not to mention abandoning small cars for large cars that are profitable for now.

(Funny how I often I see "good old boys" driving Asian compacts because they can afford Asian compacts, and I see office workers driving big-ass trucks)

There's an extreme selection bias there. If you run an agency that works with low income families you're not going to see a representative sample of the overall population.

Maybe. Unfortunately, what digitaltrees wrote here is ambiguous. It could also be read as this:

Our caregivers serve low income families. Those caregivers, who are our employees, earn $12-18/hr which is above minimum wage. Our employees absolutely struggle. Our employees are the ones using food banks and housing assistance because many are one car repair away from homelessness.

digitaltrees: which interpretation is correct?

???

https://fred.stlouisfed.org/series/MEPAINUSA672N

Note this is already inflation adjusted, so "housing, food, gas, medical care costs are all increasing" is already accounted for.

A lot of the US looks like they're doing great but fits into the category above.

Non-poverty would look like:

* You make enough money to pay for your own food, housing, and transportation in full, with enough buffer for emergencies, without needing to borrow a cent

* You make enough money to be on trajectory to save up to pay for your own food, housing, transportation, and medical expenses in retirement when you are physically unable to serve the workforce

I think this isn't as unreasonable as it seems to everyone living it. It's like water to the fish.

We are conditioned that everything should be fueled by more and more debt, and your dollars should constantly be devalued so you can't stop grinding.

The little people can never be allowed to just work enough to accumulate what they need and then take it easy.

My definition is if you need to borrow money to put a roof over your head, at the minimum renting, you're in poverty. There are huge chunks of the US population borrowing money to pay for rent.

If your locality doesn't provide adequate public transit, then a car is a necessity, and the onus is now on the locality's economy to make sure everyone can access that; if your locality doesn't pay high enough to afford that car without borrowing money, then yes, you're in poverty. Alternatively, the locality can choose to provide adequate, safe public transit, and the bar of poverty would change.

Most of the US doesn't think this way because they're delusional and have been conditioned to feed the financial system and pay for things with money they don't have.

* Median household income in Mississippi: $44,717

* Median wage in Germany: €5,370 per month, equals $73,565.

So even the individual median wage in Germany is more than 50% higher than the median household income in Mississippi.

Sources: https://en.wikipedia.org/wiki/List_of_European_countries_by_... and https://en.wikipedia.org/wiki/List_of_U.S._states_and_territ...

But in addition to the raw numbers, you have to keep in mind that they don't account for cost of living and that different countries account for various services differently, especially health care.

I would assume this doesn't account for Germans having different healthcare costs which will aboslutely wreck the average American household with how fucked our system has become.

The best approximation would be the homeless population in the US (about 500k people), but even then most homeless would not even qualify.

"Half" is a gross exaggeration.

I assure you that when your basic housing and nutrition are uncertain and missing even a few days of income will result in cascading effects of hunger and homelessness, the underlying stress is overwhelming.

It doesn’t have to be this way, we don’t let bullies steal all the toys on the playground and destroy the very ecosystem that they want to have fun in, why are we letting capital accumulate in the hands of the most effective capitalists at the risk of destroying the very markets that let them succeed.

I say that as a capitalist, if we lose the system because we allow unchecked Monopoly and wealth concentration, we won’t get it back.

Maybe it feels good to say "actually everyone is a victim of capitalism", but it muddies real necessary work when it comes to determining whether to prioritize how resources need to be allocated between a disabled person living on the streets vs a graduate student who is currently just a little underwater on their credit card payments.

Any definition of "abject poverty" that includes a comfortable lifestyle and $12-15k excess income every year is not a serious definition.

I find it hard to believe that half the US would meet the criteria for any reasonable definition.

Source? All the ones I know of use questionable methodology like: "being able to afford a 2 bedroom apartment at median wage".

https://www.pewresearch.org/short-reads/2020/08/19/more-amer...

I'm asking you the question because a statement like 50% of [population] is making a claim to some notion of what they expect society to look like

you introduced the benchmark "not being able to afford a 2 bedroom apartment at median wage", though I would expect a modern day society that makes any claim to be wealthy to be able to have above 50% of it's population to be able to support something like that as that would indicate they can support a small family

You're saying that's not a good benchmark, so I'm trying to understand:

1) Do you have a different benchmark?

2) Is your key complaint that being unable to own a 2 bedroom house doesn't mean that individual or family is in "abject poverty"? In which case fair, though I would ask what does mean abject poverty for you?

It seems like you're saying 2, but I want to be sure

The exact number is heavily contested[1], so I know better than to provide my own. That said, the official poverty lines are a pretty good place to start, and it's pretty safe to say is that whatever the line for "abject poverty" actually is, "2 bedroom apartment on 1 person income" is pretty far away from that. That claim doesn't require me to provide a specific poverty line.

[1] https://en.wikipedia.org/wiki/Poverty_in_the_United_States#M...

Well, that's (at minimum) what you need to raise a family and replace yourself in the labor pool.

Why is it impossible for Americans to live with 300 sq ft per person like baby boomers did as kids, but now we must live with 600+ sq ft per person?

https://www.census.gov/library/publications/2025/demo/p60-28...

Anyone who believes this has absolutely no concept of what abject poverty looks like.

That is a very common reality.

Instead they said "abject poverty" as an emotional emphasizer, and people rightly called them out.

The median (not average) household income in the US is 80K USD. p25 is 40K. p10 is 20K. They're struggling, sure.

But I wouldn't call that abject poverty.

But you could. There is no law of the universe that is going to stop you. Words are something randomly made up by humans.

> it's just plain wrong.

Again, words are completely made up, so it can't really be wrong in the traditional mathematical sense. It could be misinterpreted, perhaps. Of course that is dependent on how you've chosen to randomly make up "wrong".

This is absolute nonsense. We use common language to refer to common things in understandable ways in order to communicate with each other. You don't get to just handwave baldly incorrect statements as "well maybe he just has a different personal definition" without basically rendering literally all conversation moot and pointless.

"Yeah, I know he said 2+2 is 5, but you don't know he defines 5" is just as patently silly.

Common doesn't mean ever-present. In practice, it is impossible for everyone to converge on a shared understanding for all terms. There are provably many people in the world who have never even heard the term "abject poverty" before. They cannot possibly understand what the term means to you. Fundamentally, "abject poverty" can only mean in that comment what the author believes it means. That may overlap with your understanding, but it also may not. We can also prove that he is not a mind reader and thus cannot tune it to your understanding. He is limited to his understanding and his understanding alone.

A good faith actor who believes there may be a discrepancy in understanding will seek clarification. That is what a discussion forum is all about. If one does not want to participate in discussion, why be here?

https://research.senedd.wales/research-articles/poverty-and-...

Does being poor cause mental health issues, or are mental heath issues a cause of poverty... The answer here clearly better access (read free) to mental heath care, and it wont have the impact one would think (see the UK data).

> Look at other stats like rising infant mortality

You mean the attributions tied directly to maternal complications: https://www.cdc.gov/nchs/data/vsrr/vsrr033.pdf

The thing is we changed how we collect this data, to something that would be considered bad: https://www.washingtonpost.com/health/2024/03/13/maternal-mo... - There are tons of criticism on how we collect this data, they are valid, if you dont like this source, find another its a mess of our own creation.

> dropping IQ etc.

The largest root cause is that people spend too much time on their cell phone dumbing themselves down. Think about that one... no one feels the need to elevate themselves, they are happy to spend time on what amounts to leisure. Would you have sympathy for the person who gets fired cause they chose to play 18 holes of golf 5 days a week rather than do their job?

This is a functionaly unmovable number. https://fred.stlouisfed.org/series/RHORUSQ156N

> you can't afford rent

Because we as a society have drastically changed how we use housing: https://www.census.gov/library/stories/2023/06/more-than-a-q... -- Multi generational housing was a thing. Having roommates was a thing... the premise of "golden girls" would be lost to a modern audience, because cohabitation is dead. The premise of "bosom buddies" would get canceled for its insensitivity, but no one would understand because boarding houses are all but gone.

Building every one in the world an American style house, would cripple the globe. Concrete, Sand, Copper, Wood are going to become massive problems long before we get close to getting the job done.

> Ignore my vacation homes in Aspen, Jackson Hole and Nantucket.

You think that vacation homes are causing the housing crisis? Are eroding wages elsewhere? The industry of these locations is TOURISM, and a fair bit of it is international. (Not Nantucket).

It's not like whaling is going to make a comeback to make Nantucket a viable place to live again.

> Just think about how much better you have it than the people in Haiti and get back to work!"

Plenty of Americans look at musk and say "lets eat the rich" ... the problem is that the rest of the world has those same hungry eyes for us.

https://www.federalreserve.gov/releases/z1/dataviz/dfa/distr...

>link for "Distribution of Household Wealth in the U.S. since 1989"

income =/= wealth

That's still measuring wealth, not income. The correct statement to draw from the chart is that top 1% by income have nearly as much wealth as the bottom 80%.

im not really understanding what you mean. i dont get how labor is generated, in particular. do you mean to say the amount of total hours dedicated to labor per person or something else?

however, unit labor costs has also been increasing (although they remain variable): https://www.bls.gov/opub/ted/2026/productivity-up-0-3-percen...

AI is going to further exacerbate this inequality.

Time to re-read Capital In the 21st Century.

Rent for the homes we live in (including "rent" as mortgage payments to the bank)

Rent passed through as costs to the consumer for the businesses we patronize.

We're stuck at home more affording to be able to do less so the people who own don't have to work.

But the underlying problem that people aren't paid enough is still true. Outside a few fields, most people are underpaid. It's even more stark when measured against productivity increases during the same time periods. That wealth went somewhere. It wasn't to most people.

People have a tendency to get upset when they realize these kinds of things.

Rents in general are part of this. Both for housing and commercial property. Somehow getting profit from both rent and appreciation is the goal of the system.

Well that is what population voted for and choose not to overthrow system for so maybe they deserve it.

While we must be mindful of greed and abuse, we need to include all underlying costs before just assuming people are cranking up rents. I'm not a landlord but I own property and the costs are gotten vicious lately. Labor is expensive, materials are insane, energy costs, and now insurance are suffocating. And in states with high property taxes, watch out.

But my thesis really is that these things are not underlying the rents. But rents are actually underlying these costs. And well in general the rent seeking economic process build on ever growing valuations of everything.

You can say restaurant workers need to be paid more, and ok sure, but where is that money coming from? You pay labor, food suppliers, rent, utilities, taxes, and... where exactly is the money to pay workers more coming from?

With the number of empty storefronts in my city (not to mention restaurant closures) it's clear owners aren't making money hand over fist or there would be many more restaurants.

Restaurant workers in my experience are more likely to go to more restaurants and they can't because... their rent is too high and the price of food at restaurants is too high.

The common denominator with all of it is money being sucked away from people doing work and people hiring work by... rent seekers.

The "labor share of income" is exactly this. How much money is getting sucked out of the rest of the economy to prop up the do-nothing class. Retired people whose retirement investment was selling a house for much more labor than they bought it for and real estate owners doing as little as they can to maximize income they aren't earning.

https://sdhc.org/wp-content/uploads/2025/04/107_Workshop_RAN...

This sets a price cap, makes these high density spaces affordable for people who want to live their whole lives there and not just their single 20's, brings diversity into communities and drops the floor out of the prices on these single occupancy closets going for $2000 per month.

Office buildings sit mostly empty for the same reason.

Tax the owners to punish the bad bets and eternal growth expectations of banks to force them to use the space to the benefit of the community or be forced to sell when they run out of money. Use zoning laws to prevent the destruction of units to avoid taxes.

The US Federal Housing and Urban Development Department was intimately involved in the Savings and Loan collapse of the late 1980s. It was punted around and repeated in the 1990s, but the stock market gains of the late 1990s diluted the news in public. That phase culminated with a dot-com bubble collapse and ultimately, the 2007 dollar credit crisis. Leveraged purchases of real estate were part of that financial soup. Many of the players from that time were "boomers" and their seniors, so living memory of those circumstances are now fading. There are many, many non-fiction books about these topics.

"Is this decline a distinct change from the recent behavior of the labor share in the U.S.? Along the two key dimensions we investigate, our answer is no. <later> ... and they provide little evidence that it will evolve differently from past episodes."

This conclusion seems to be against "this time is different" arguments. Should we be generally encouraged by similarity to past declines pre-2000 or bearish and think that there is more drop to come like the 2000-2007 and 2007-2019 periods they graph out?

I guess there is no way to predict other than check back in after time passes.

Welcome to the dismal science of economics, where the rear-view mirror is crystal clear but the windshield is totally fogged up.

> Is this decline a distinct change from the recent behavior of the labor share in the U.S.? Along the two key dimensions we investigate, our answer is no. First, the labor share’s trajectory post-COVID broadly follows the cyclical patterns observed in earlier recessions, with a decline during the recovery phase that mirrors historical dynamics. Second, the decline in the labor share since COVID is driven primarily by within-industry changes rather than shifts in economic activity across sectors. Taken together, these results suggest that the post-COVID decline follows the same cyclical patterns as earlier recessions and is driven by the same within-industry forces, and they provide little evidence that it will evolve differently from past episodes.

What I find more interesting is the sharp drop around the early 2000s

> The labor share of income in the U.S. is currently at its lowest-ever level in the post-war period.

Agreed on the 2000 drop though. Would be interesting to read a retrospective on that.

May the low-waged ever be trodden upon and forever know their true place.

Those that died or became disabled during covid are mewling degenerates.

Their cries of 'illness', 'poverty', and 'homelessness' are precisely as useless as the wailing and lamentation of women in their menses, a farcical thing to be dismissed and ignored.

May the Fed be ever in your favor, Amen

"Related to or marked by Hysteria" https://www.merriam-webster.com/dictionary/hysterical

Hysteria being "behavior exhibiting overwhelming or unmanageable fear or emotional excess" which seems to be exactly what OP was trying to say.

We should all just stop speaking. The origin of too many words is problematic. Just think of how many were coined by racists and misogynists!

the capital/labor class gap increases when total returns on capital investment exceed total wages+redistribution to the labor class, and the gap shrinks when that's reversed. the market ~controls the capital gains and labor wages knobs, and society decides where to set the redistribution knob.

the article investigating the post-covid drop and concluding that it's normal is an interesting rhetorical device. on one hand, relief that nothing crazy is happening. on the other hand, disappointment that we've accepted a growing inequality gap as normal. the gap was already at a post-war max going into covid, the floor gave out 20 years earlier and covid was just gas on the fire.

advancements in automation and tax codes that benefit capex over payroll will continue to incentivize business to shift budgets from labor to robots.

Without data, it just sounds like "my social circle is more indicative of reality than yours". Maybe it is! But maybe not, so it's not particularly convincing

The middle class (especially upper middle) saw their share of income drop, but the bottom 50% increased.

https://equitablegrowth.org/u-s-income-data-for-2024-shows-t...

"The Census Bureau measure overstates current income inequality between the highest and lowest 20% of earners by more than 300% and claims that income inequality has risen by 21% since 1967, when in fact it has fallen by 3% ... In 2017, among working-age households, the bottom 20% earned only $6,941 on average, and only 36% were employed. But after transfer payments and taxes, those households had an average income of $48,806. The average working-age household in the second quintile earned $31,811 and 85% of them were employed. But after transfers and taxes, they had income of $50,492, a mere 3.5% more than the bottom quintile."

[1] https://www.wsj.com/opinion/income-equality-not-inequality-i...

Small-time landlords are an example, as would be anyone who owns a small business and draws cash from profits rather than taking a salary.

> landlord

If you think these two things are compatible you need to talk to more people outside of your bubble.

These gains might be realized at any point if they're willing to pay taxes for them.

Having lots of money but choosing not to spend it doesn't make you any less wealthy.

    being born into money is not a requirement to own several houses before 30.

Buying a fixer-upper outside of town with high-school and early 20s grinding, renting out 3+ rooms to cover the mortgage for painful years, working 80 hour weeks, refinancing against that first house into another under-maintained property where you live in half while upgrading the other, ending up with a rental duplex and drastically reduced living cost, is viable by 30. Maximizing youth savings, first house programs, and primary residence rules create less punitive economics.

It sucks and will let one learn why landlord is a pain in the ass job, and relies on sweat equity and modest lifestyle, wanting to commit to real estate, and non-ideal properties. Trade school or skipping college for early income and low debt make the numbers crunch easier.

Investing consistently into the market in your 20s probably out performs it by 65, and a young bankers lifestyle is a joy of its own, but: owning property young is achievable for electricians, security guards, and janitors.

It has nothing to do with the IRS or taxes.

As such, when comparing income tax and capital gains, you should add the impact of corporate taxes. Incidentally, corporate taxes are why many small business owners pay themselves wage income, rather than doing stock buybacks or dividends.

Sure, the stock price should somehow be tied to the actual value of the company, but for a while now it's been mostly indistinguishable from a Ponzi scheme other than a few companies that do sometimes decide to buy back some stock, which makes it slightly less sketchy but if the value is from the company buying it back, it's a lot closer to debt or a bond, which is not at all how anyone treats it.

You've been sold some BS. Usually this is because you're required to take a "reasonable" wage for your role in a company. Otherwise I guarantee you every independent contractor out there (among others) would be operating in a way that made 100% of their income business profit, rather than wages, as it has enormous tax advantages. Approximately everybody tries to find out the least they can take as wage income without pissing off the IRS, and sets their "wage" to whatever that is.

Silicon Valley Is Obsessed with 'Trust Stacking,' and the IRS Doesn't Like It - https://news.ycombinator.com/item?id=48727963 - June 2026

"Spending for the public benefit" has a lot of latitude.

If I was talking about "ultra obese" people, you wouldn't assume I was talking about everybody who has a couple of extra pounds?

https://www.starbucksbenefits.com/en-us/home/stock-savings/s...

https://fred.stlouisfed.org/series/PRS85006173

Corporate profit vs Labor income divergence (only up to 2018)

https://fredblog.stlouisfed.org/2018/08/corporate-profits-ve...

I think in the case of US literally killing workers and union people is a huge part of why US workers lack power and why US unions are so impotent.[0]

[0] see Battle of Blair Mountain and what work Pinkerton mainly did from its founding to WW2, as examples.

Such as? They might have managed to maintain it for privileged subgroups of the workforce but not for the average worker.

https://www.brookings.edu/wp-content/uploads/2016/07/2013b_e... https://home.treasury.gov/system/files/131/wp-107.pdf https://eml.berkeley.edu/~yagan/LaborShare.pdf

How much of an effect it has at the national statistical level I'm not sure.

https://bfi.uchicago.edu/insight/research-summary/the-rise-o...

Do you have a source?

That is, if they're successful.

Who knows. I think it's better to err on the side of optimism despite the grim outlook.

There's nothing about being in the C-suite that magically endows one with motivation based upon stock price, but we pretend that there is.

Ie, why can one guy who is insanely wealthy due to stock valuations take loans against that to pull various levers of power. We didn't elect him, we need a way to control that outsized influence.

No political administration in my lifetime (!) has made policy decisions against the interests of tech monopolists. The closest we got was Lina Kahn's FTC.

We shouldn't just be pointing at the (very much real) stupid greed, there are many rotten components occurring simultaneously.

How much of the trend is due to employment trends vs. printing money for the wealthy to get their hands on it first(and profit) post recession?

Why would you own them, instead of some well capitalized billionaire?

To the extent that you do have capital, why do you assume that your 'minimal direction and guidance' would outcompete a full time specialist working for that billionaire?

Thank you for coming to my Ted Talk, please leave a downvote to indicate I caused you emotional distress.

How deeply puerile.

capitalism will always seek to reduce labor cost. during the epoch of neoliberalism it achieved great strides in this by reducing labor power through union busting by both thatcher and reagan in the UK and US respectively. it has also effectively curtailed any increase in the minimum wage for nearly 20 years as well as reduced protections, regulation and prosecution for wage theft and overtime pay violations which it maintains as exclusively as civil matters while ensuring theft itself from a merchant in turn is always a criminal matter through the primacy of private property.

to learn more i recommend reading Marx's "Das Kapital," albeit its rather academic. Engels "wage labor" is also a good read to understand why housing is so persistently unaffortable but helps to understand why any other good or service slowly becomes so as well.

So basically you are squeezed between the public demanding lower prices and the investors demanding record returns. If you are not a monopoly, that is an impossible ask

Basically the only truly profitable businesses left out there is selling hopes and dreams to investors, and shovels to those who build them, which just about describes tech & AI, with companies who regularly manage to 10x their valuations (and P/E ratios)

His worldview is primarily that capitalists 'steal' the valuable labor. However it doesn't seem that that is actually the world we are in. Instead the intrinsic value of human labor seems to be slowly trending towards zero.

And it kind of makes sense, same has happened with oxen labor, horse labor, etc.

Sounds like we should start imagining a world where we don't treat people like literal livestock, and then figure out how to get there fast

If you landscaper had one like the plumbers do he'd have his own yacht.

Or he wouldn't exist because you'd buy about as much of his services as you do a plumber's.

Marxism was an idea formulated especially as a reaction against a world where labor has lost almost all of its value. Which is precisely the origin of capitalism - the idea that money itself can be productive, and thus people who have lots of money can be expected to get more of it.

This was an untrue idea for most of human history, outside of the circles of moneylending and banking.

What's changing is how much of that surplus value is captured by the workers doing the labor.

Labour theory of value is useless. Falling rate of profit is not empirical. Capitalism didn’t go away as he predicted.

Workers enjoy highest living standards of any time in history.

It's entirely possible for someone to be paid a lot in absolute terms, while at the same time paid very little relative to the value that they produce which is monetarily captured by their organization. The truth of the first does not invalidate the injustice of the second.

There will be a few who brand themselves as such. But actually seizing the means of production and handing them over to the people? -- The oligarchs will burn this country to the ground before they permit that to happen.

All companies are rent-seeking. Selling something is no longer a goal.

Prices go up up up up up.

Oligopolies and price fixing is normal.

Monopolies are normal with little/no controls.

People are getting paid a pittance to the work done.

Unions are their weakest in a century.

NLRB is basically frozen due to no quorum on the head board.

Companies routinely scam and lie at multiple places in hiring pipeline. FTC does nothing.

Neither party (Republicans or Democrats), save the DSA, fights for the American people.

Its all coming to a head, and baskets, and guillotines. Anybody who studies history knows what kind of powderkeg this situation is. Its also the reason the Ancient Romans made panem et circunses (bread and circus) cheap or free. You get riots and revolts otherwise.

There is a need for proper pricing for the rich, i.e. Elon can pay a million dollars per meal. Someone is leaving money on the table.

Parking and speeding tickets should have income brackets, at least.

In the early Internet I saw this thing, no idea if it’s true but it sounds good (someone can math check it), goes something like:

A person pays $2 to play basketball on a public court.

Michael Jordan gets paid $2k to play on the same one.

A person pays $100 for basketball shoes.

Michael Jordan gets paid $100k to wear the same ones.

A person pays $40 to go see a basketball game.

Jordan gets paid $400k to attend the same game.

Michael Jordan makes about $5 per second.

If Michael Jordan saved all his money without spending a penny for 250 years…

He wouldn’t even have half as much as Bill Gates!

It made me think differently about money and consumer spending.

AFAIK in some countries this exist but my case is more capitalist oriented. Rich people obviously can pay more since they keep accumulating wealth. It is an obvious sub optimal pricing since the low and even middle class rent/mortgage and other services quickly approaching the most they can pay so they can’t actually save and make wealth.

The big picture here is increasing wealth inequality and that has been on steroids since the pandemic.

The only shocking part to me is how people continually and intentionally don't see it or, worse, think they'll be unaffected by it so don't care. You see this on HN where so many people seem to think they'll be Jeff Bezos one day.

But even if that's true, don't you want to live in a society where you don't need armed guards at your house and you don't need armed escorts to go anywhere? Because that's what we're heading towards. One of the problems with American society (in particular) being so car-centric is that it lets people insulate themselves from the rest of society more easily. In cities like NYC you're forced to see and deal with the less fortunate. You can't hide from it so easily.

We don't need trillionaires. We need to raise basic living standards so people have food and shelter and we don't need to separate society into slums and armored compounds.

[1]: https://www.epi.org/productivity-pay-gap/

Software engineers are a special kind of stupid: the kind that thinks they're smarter than everyone else.

And no, there's no simple solution to this problem. The notion that something like "Medicare for All" would solve the problem is a total fantasy, disconnected from actual US healthcare economics. Any real solution will have to work on multiple angles including preventive care, PBMs, provider wages, rationing, drug prices, fraud, malpractice insurance, interoperability technology, etc.

Provider organizations spend a huge amount of effort dealing with Medicare and Medicaid, which are pretty close to being a "single-payer solution" already in many cases. From an administrative overhead perspective they aren't always easier to work with than commercial health plans. Plus they have enormous problems with fraud, waste, and abuse.

https://www.theguardian.com/society/2025/apr/06/englands-nhs...

I'm not trying to be snarky here, the point is that there is no easy solution and optimizing based on what politicians subjectively consider "humane" isn't going to get us anywhere. If we want to actually fix the problem then we need to focus on what's economically feasible rather than low-effort hot takes and sound bites. Free markets, with reasonable limits, can be part of that solution by revealing consumer preferences and allowing for efficient allocation of limited resources.

I think painting the inhumanity of that as a consequence of the structure of the healthcare system is disengenuous at best, especially as the implicit solution you're proposing is to artificially lower utilization rate and access. Deflecting patient deaths into "technically not our fault, they didn't try to get help" by exploiting economics is in no small terms extremely inhumane.

The answer to that is that near universally in the world, our labor pool of medical personnel is too small, and almost all of it has to deal with an arbitrary restriction of labor supply. Stupidly, I have felt this many times in America, so trivially it's a problem no matter the structure of the healthcare system. Optimizing towards maximizing the number of nurses, doctors, pharmacists, the whole spread, in a society is underdiscussed but obviously beneficial (for everybody but those who profit off of the labor scarcity)

How many man-hours are spent dealing with insurance paperwork? How much do hospitals and doctors spend each year just dealing with that interaction, rather than treating patients?

> Plus they have enormous problems with fraud, waste, and abuse.

I'd say "enormous" requires some evidentiary proof. Obviously there is fraud and waste. But almost all large scale systems have that. We should certainly try to minimize it wherever we can but I don't think "waste and fraud exist" are a reason to not pursue a path.

Are you living in the same country as the rest of us? There is plentiful evidence of the enormous fraud and waste. It’s not even a point of debate anymore.

That said!

1) In the big picture isn't the US clearly paying more than other countries? I'm sure some of this is eg a janitor in the US costs more than a janitor elsewhere, but still...

2) Isn't the cap for the margin that insurance companies can take 20%? That is, they have to pay out 80% as claims take 20% for overhead

3) Doesn't insurance also induce more work done by everyone else who has to deal with them? So the margin the insurance company itself takes is not the only cost they add. Maybe they make providers do more paperwork, or let patients order tests etc that they would not if they were not spending other people's money, or some other reason. Say insurance pays out 80%, but 30% of documentation or actual work is not done by insurance but only exists because of them, now we're down to 56%.

I say this because literally yesterday, my wife, a pediatrician, after she spent the day seeing patients and got home to go through notes, had to leave a message with an insurance company: she saw they faxed her clinic on Saturday, when the clinic was closed, to cancel care for a patient with an ongoing chronic condition with no changes unless the insurance company got a reply in 48 hours (again, while the clinic was closed!). Now she has to schedule some kind of I don't even know what with them, to confirm the condition is the exact same, except she sees patients all day so it's a pain to schedule...

idk the fact that BCBS is a non profit and has no margin in some technical sense does not seem like a big consolation, something is rotten no?

(edit - the insurance company in the anecdote is not BCBS)

It's true that no matter how you look at it, the USA spends a lot more per capita on healthcare relative to outcomes. But you have to be careful what outcome metric you look at. Like we're not doing great on life expectancy, but much of that is due to factors largely outside the healthcare system like violence, vehicle crashes, and lifestyle choices. And in other areas like 5-year cancer survival rates or new drug development we're at or near the top. Part of the problem in the USA is that we seem to be culturally incapable of admitting that rationing is needed, and that it simply isn't feasible to deliver excellent care to everyone, so political reform debates devolve into sound bites about "death panels".

The Affordable Care Act (Obamacare) set a minimum health plan medical loss ratio of 80%, or actually 85% for larger plans. And in practice most come in higher than that due to competitive pressures.

https://www.cms.gov/marketplace/private-health-insurance/med...

There's a huge amount of administrative overhead in dealing with health plans for things like claims and prior authorization. Much of that is imposed not so much by insurers themselves but by employers who want to hold down costs. Like a commercial insurer would be happy to sell a plan that would pay every claim immediately at 100% with no questions asked. It would be less work for them. But no one would buy it because costs would explode. Medicare and Medicaid plans also have prior authorization and peer review processes. Something like a quarter of all healthcare services are "low value care" which doesn't align with evidence-based clinical practice guidelines and may even harm the patient, so when health plans apply review processes the right way then ideally it's better for patients and holds down costs for everyone.

To be clear, I'm not here to defend commercial health insurance companies. They are part of the problem and some reforms in that area are sorely needed. But let's have an honest debate about it and stop pretending that eliminating them would solve the deeper systemic problems.

It dramatically lowered the cost to consumers. Further, conflating overall healthcare spend with the portion of spend tied to a significantly lower-cost population is apples and oranges at best and represents a fundamental misunderstanding of healthcare cost in general. It's ok to not have opinions about things you know you don't understand.

i am not familiar with universal system. In that system if your doctor thinks something is medically necessary then thats the end of it and its gets done?

In most countries where there is universal coverage with a single payer, certain expensive treatments have long waiting lists or are simply unavailable at any price. Thus we see wealthy Canadians coming to the USA as medical tourists and paying cash for procedures like MRI scans or joint replacements in order to avoid the queue back home. There are always trade-offs, it's just a matter of what we want to prioritize.

i wasnt sure if it simply takes a different form or gets eliminated completly.

Employers might be contributing more to healthcare costs, but that's because they have to in order to keep coverage for their employees at all as premiums increase, and individual out-of-pocket costs are still rising as a result of coverage denial and high deductibles.

[0] https://www.bls.gov/opub/hom/opt/calculation.htm

Too much money in the system being flawed, look at pricing for any HIPAA safe products and thats just technology. Money is so hard to get for healthcare providers it is its own industry of revenue cycle management and thrid party billers. Most of these physician lead practices charge more is because planning your account around reemburcement cycles from insurance companies are 30-120 days if your lucky is an advanced accounting problem. (Thats excluding complexities of audits, LOPs, network rates etc.) Medicare/medicaid the fraud side has lots of tiny wins through leaning on tax information more, taking the model from the successful basic income studies and trials worked out.

There aren't as many physician-led practices anymore. Most of them have been rolled up into larger health systems in order to achieve economies of scale and increase negotiating power with commercial health plans. Which is one of the factors driving up overall healthcare system costs.

I have been saying this for years. I'm so tired of social media memes turning into sage wisdom for an entire generation who can barely spell healthcare, let alone have any vague understanding of it.

I'm and-then'ing, not disagreeing, but the big healthcare cost fix, IMO, still centers around education cost reform, and fixing the supply of mid-levels+ across the country.

It may not be simple but it's clear the United States is doing something catastrophically wrong. All the other healthcare systems on the planet in developed countries have problems, sure. But we spend magnitudes more money to receive middling-to-shit healthcare. Medical debt and bankruptcy is a unique American problem that also happens to be the most reliable way for otherwise productive and prosperous members of our society to end up fucking homeless. Because they got SICK. I rarely use the word "evil" but that really fits IMO.

Like you cannot tell me with a straight face that the insurance industry couldn't be blown the fuck off the map tomorrow and literally everyone who doesn't own an insurance company isn't instantly better off.

The insane thing is denying it to half of the population doesn't really mean the other half gets to save that much money in real terms.

Significantly increasing the supply of doctors would solve that, though.

Part of the problem is that we force physicians to waste too much time on administrative work. Some of this could be delegated to cheaper employees or not done at all, thus effectively increasing supply. Administrative overhead is also one of the factors driving physicians to quit and pivot to other careers or retire early, which further constrains supply.

This part is controversial but we'll also have to shift a lot of primary care to Physician Assistants and Nurse Practitioners. Care quality might be lower in some cases but for routine conditions it's probably better to see a PA/NP today instead of waiting weeks for a physician.

I'm sure he'll manage.

When we fix the price of something below the market clearing price then there will always be a shortage. This is inevitable. We might decide that having a shortage of orthopedic surgeons is acceptable but let's not pretend that there are no trade-offs.

Germany has a stagnant economy so it's easy for their healthcare system to pay doctors lower wages because they have few other options. Baumol's cost disease is a real factor in healthcare, and it impacts the USA more than most other countries precisely because our overall economic growth has been so robust.

And as to your comments about shortages, we already have shortages.

Then why is there a shortage? Are you telling me the $750,000 yearly compensation still isn't enough?

It fails to follow logically that one specific way the government got involved that drove costs up means that any possible intervention is worse than completely being hands-off. How do you explain pretty much every other developed country in the world having more government involvement but lower costs than the US?

When something is paid for from a big nebulous ball of money rather than straight out of people's pockets, the downward pressure on prices just isn't there in the same way. The conversations between practitioners and insurers are about whether something is necessary, not about whether or not the practitioner is charging too much for it.

Here in the UK we see it, too - not so much in human healthcare since we have the NHS - but very definitely in animal healthcare; vets' bills have skyrocketed over the last couple of decades, in a mutually-reinforcing feedback loop with the rise in pet health insurance.

This is not some spurious speculation. That market-based systems drive down costs enormously is replicated across dozens upon dozens of industries. It's one of the most replicable results in economics to the extent that economics can be replicable. As for why the costs in other countries are not quite as high as the U.S., it's because health care costs also increase as per capita GDP increases and the U.S. has higher per capita GDP. Moreover, because the U.S. has some aspects of its health care system still living more in the private sector, there is less top-down rationing. Other countries see very clear examples of rationing, so people spend less on end-of-life care.

It would eliminate the tens of billions that are wasted on insurance company profits.

The idea seems to have merit, but it's unconvincing to people outside your bubble and I'm dubious.