Let's move from public health to public policy and US economics.
Over the last several years there has been a lot of discussion in the news regarding increases -- or the lack thereof -- of year to year income. To do this, I went to the US Bureau of Economic Analysis (be a.gov) website and pull-down all the data regarding year-to-year differences in personal income from 1929 to 2017.
The fuzzy line in the middle of the drawing is zero, so everything above is an increase and everything below is a decrease income. By clicking on the image, you'll be able to see the full size image. In addition, the value of the dollar has been normalized to 2017 dollar value. If that were not the case, the increase in the early 1940s would have been substantially greater than the base wages at the time.
What's interesting about this curve beyond the fact that it's incredibly complex (with a trend line that is a 6th order polynomial) is that it appears to have several curves attached together.
The years of the Depression, World War II and immediate Post World War II including the Korean War were incredibly turbulent times economy. So I decided to take a look at two time frames. The Eisenhower years up to the beginning of the second term of the Nixon Administration. And the second time frame from the beginning of the second term of the Nixon Administration to 2017.
Here's the data from the first time frame from 1951 to 1974.
Over the last several years there has been a lot of discussion in the news regarding increases -- or the lack thereof -- of year to year income. To do this, I went to the US Bureau of Economic Analysis (be a.gov) website and pull-down all the data regarding year-to-year differences in personal income from 1929 to 2017.
The fuzzy line in the middle of the drawing is zero, so everything above is an increase and everything below is a decrease income. By clicking on the image, you'll be able to see the full size image. In addition, the value of the dollar has been normalized to 2017 dollar value. If that were not the case, the increase in the early 1940s would have been substantially greater than the base wages at the time.
What's interesting about this curve beyond the fact that it's incredibly complex (with a trend line that is a 6th order polynomial) is that it appears to have several curves attached together.
The years of the Depression, World War II and immediate Post World War II including the Korean War were incredibly turbulent times economy. So I decided to take a look at two time frames. The Eisenhower years up to the beginning of the second term of the Nixon Administration. And the second time frame from the beginning of the second term of the Nixon Administration to 2017.
Here's the data from the first time frame from 1951 to 1974.
Although this is not the best fitting trend line, it does make the point I want to make and that is, year to year wages are increasing during this time period.
Let's take a look at the time frame from 1972 to 2017
Personal income over this time frame instead of increasing as it was during the earlier years shown above, personal income is decreasing. And when you consider that those who have the greatest amount of wealth (Highest 1%) receive an increasing percentage of the year to year increase. (In 1993 the highest 1% received 45% of the benefit of the increase in personal income. In 2017, the 1% received 65% of the increase in personal income.)
20 Year View: Last 10 years, Projected 10 years
Let's take a look at the last 10 years and project forward 10 years using the linear trend line equation shown in the graph above.
The last point on the graph showing an actual data point is 2016-2017. All the points to the right of 2016-2017 are projected values based on the linear trend equation y=-0.1852x+10.684.
What is important are not the individual values, but projected trend for the future. The trend line is approaching the fuzzy line which is zero growth in year to year personal income.
I'm not an economist. I had one year of college economics. ( I seriously considered changing my major to economics.) I continue to read books about economics and economic trends. From what I know, this could be a formula for unrest. This is something for social scientists to contemplate. If you have read Thomas Piketty's Capital, these curves and the projection for the future should not be surprising, but expected.
What I do find interesting is that those people who probably are the most dissatisfied with our economic situation are those who have experienced both the steady rise in year to year personal income (probably grew up experiencing the increasing trend considered it the norm, something to be expected) and the steady loss in year to year personal income.
I may have something more to say on this topic in the future. But for now, I leave it you to contemplate and consider what might happen in the future.
