Somehow, it sounded unlikely.
JPod at The Corner:
Hugh Hewitt gracefully and with calm understatement eviscerates the Washington Post's Harold Meyerson.
Possibly JPod is being sarcastic. But on the off chance he isn't, let's look at the columns in question.
Meyerson is writing in the Post about the threat of escalating outsourcing to the American middle class standard of living, basing his arguments on two recent studies by center-left economists Alan Blinder and Bradford Jensen & Lori Kletzer. They argue that advances in globalization and information transmission are making white-collar service and R&D-type jobs, including highly skilled ones, increasingly vulnerable to the same sort outsourcing that has lowered wages and displaced jobs in traditional manufacturing jobs like automaking. The result, Meyerson argues, is a continuing and potentially accelerating hollowing-out of middle class lifestyle and a reduction in the return to, and hence the incentive to acquire, the sort of skills that enhance productivity (i.e. engineering rather than divorce lawyering).
Meyerson writes about aggregates too: "The threat of globalization and the reality of de-unionization have combined to make the raise, for most Americans, a thing of the past. Between 2001 and 2004, median household income inched up by a meager 1.6 percent, even as productivity was expanding at a robust 11.7 percent." In the current American Prospect he fleshes out his argument, and provides additional supporting statistics:
The decline in income is hardly limited to manufacturing. A new survey of the nation’s 361 metropolitan areas, which account for 86.3 percent of the nation’s GDP, has found that the average wage of jobs lost in the recession of 2001-2003 was $43,629, while the average wage of jobs created in 2004-2005 was $34,378 -- a tidy 21 percent decline... Indeed, as Northwestern University economists Ian Dew-Becker and Robert Gordon have demonstrated in a recent study, over the past couple of decades, all the income from productivity gains have gone to the wealthiest 10 percent of our countrymen.
Now, ready for Hewitt's powerful "evisceration" of this? Well, it apparently rests entirely on the fact" that the WaPo's current "advertising pitch" is touting Washington DC's great wealth as a reason to consider moving to the city.
To be fair, I think Hugh's wants us to look and reflect on those big "average household income" numbers quoted for the top ten American cities, the idea being that they don't square well with Meyerson's doom and gloom about falling incomes and rising insecurity. But who is especially concentrated in big cities? Wealthy people (as well as desperately poor people). And which measure of prosperity is enormously sensitive to the inclusion of super rich urban dwellers? "Average", also known as the "mean" (though don't tell Roger L Simon). Briefly, if the median household income of a city is $50,000, even the very poorest of the 50% of households below that level can't drag down the average by more than about $35,000 per household. But incomes aren't bounded above, so the 50% of households above the median can potentially haul the average up a lot. Throw in a few billionaires, and the city-wide mean becomes very unrepresentative of the typical standard of living.
So what does the ad tell us? Well, start with the fact that readers of newspapers tend to be relatively affluent to begin with. Then add the fact that this particular ad is obviously targeted at the most affluent members of their readership -- those who might be attracted by the confluence of other wealthy people in Washington D.C., or specifically in the rich parts of town, where the city-wide mean is more likely to approch the local median. But Meyerson isn't arguing that, in the near-term anyway, current trends are reducing aggregate affluence. He's arguing that these trends -- the global pressures forcing down wages, discouraging North workers from acquiring productive skills and declining unionization rates among occupations that remain non-outsourcable -- are concentrating wealth and security... on the sort of people Hewitt's "eviscerating" ad is geared at.
Maybe I'm being charitable in assuming that Hewitt (and JPod) are being sophistic rather than ignorant. Hell, in Hewitt's case, I definitely am. But I hate to think conservatives are really this stupid. How to manage globalization and the shifting of returns to productivity from labour to capital is the major debate of our time, our era. Meyerson is holding up his end of the debate. Marc Schmidt, from a somewhat more neoliberal perspective, made some appealing arguments on the same subject recently, focussing on redirecting the returns to capital (through taxation and redistribution of stock ownership) rather than trying to shift them them back to wage-labour, per Meyerson's ideas. Both liberal approaches are valuable. Conservative pundits might have important things to add to the discussion too. But we won't know as long as Hewitt is telling us to LOOK AT THE BIG SHINY NUMBERS and JPod, who ought to know better, is encouraging him. It's tragic, really.
Update: Shit. While I was in seminar this afternoon and before posting, Jonathan Chait already made all the same arguments. I swear, I didn't rip the above off his post.
Hugh Hewitt gracefully and with calm understatement eviscerates the Washington Post's Harold Meyerson.
Possibly JPod is being sarcastic. But on the off chance he isn't, let's look at the columns in question.
Meyerson is writing in the Post about the threat of escalating outsourcing to the American middle class standard of living, basing his arguments on two recent studies by center-left economists Alan Blinder and Bradford Jensen & Lori Kletzer. They argue that advances in globalization and information transmission are making white-collar service and R&D-type jobs, including highly skilled ones, increasingly vulnerable to the same sort outsourcing that has lowered wages and displaced jobs in traditional manufacturing jobs like automaking. The result, Meyerson argues, is a continuing and potentially accelerating hollowing-out of middle class lifestyle and a reduction in the return to, and hence the incentive to acquire, the sort of skills that enhance productivity (i.e. engineering rather than divorce lawyering).
Meyerson writes about aggregates too: "The threat of globalization and the reality of de-unionization have combined to make the raise, for most Americans, a thing of the past. Between 2001 and 2004, median household income inched up by a meager 1.6 percent, even as productivity was expanding at a robust 11.7 percent." In the current American Prospect he fleshes out his argument, and provides additional supporting statistics:
The decline in income is hardly limited to manufacturing. A new survey of the nation’s 361 metropolitan areas, which account for 86.3 percent of the nation’s GDP, has found that the average wage of jobs lost in the recession of 2001-2003 was $43,629, while the average wage of jobs created in 2004-2005 was $34,378 -- a tidy 21 percent decline... Indeed, as Northwestern University economists Ian Dew-Becker and Robert Gordon have demonstrated in a recent study, over the past couple of decades, all the income from productivity gains have gone to the wealthiest 10 percent of our countrymen.
Now, ready for Hewitt's powerful "evisceration" of this? Well, it apparently rests entirely on the fact" that the WaPo's current "advertising pitch" is touting Washington DC's great wealth as a reason to consider moving to the city.
To be fair, I think Hugh's wants us to look and reflect on those big "average household income" numbers quoted for the top ten American cities, the idea being that they don't square well with Meyerson's doom and gloom about falling incomes and rising insecurity. But who is especially concentrated in big cities? Wealthy people (as well as desperately poor people). And which measure of prosperity is enormously sensitive to the inclusion of super rich urban dwellers? "Average", also known as the "mean" (though don't tell Roger L Simon). Briefly, if the median household income of a city is $50,000, even the very poorest of the 50% of households below that level can't drag down the average by more than about $35,000 per household. But incomes aren't bounded above, so the 50% of households above the median can potentially haul the average up a lot. Throw in a few billionaires, and the city-wide mean becomes very unrepresentative of the typical standard of living.
So what does the ad tell us? Well, start with the fact that readers of newspapers tend to be relatively affluent to begin with. Then add the fact that this particular ad is obviously targeted at the most affluent members of their readership -- those who might be attracted by the confluence of other wealthy people in Washington D.C., or specifically in the rich parts of town, where the city-wide mean is more likely to approch the local median. But Meyerson isn't arguing that, in the near-term anyway, current trends are reducing aggregate affluence. He's arguing that these trends -- the global pressures forcing down wages, discouraging North workers from acquiring productive skills and declining unionization rates among occupations that remain non-outsourcable -- are concentrating wealth and security... on the sort of people Hewitt's "eviscerating" ad is geared at.
Maybe I'm being charitable in assuming that Hewitt (and JPod) are being sophistic rather than ignorant. Hell, in Hewitt's case, I definitely am. But I hate to think conservatives are really this stupid. How to manage globalization and the shifting of returns to productivity from labour to capital is the major debate of our time, our era. Meyerson is holding up his end of the debate. Marc Schmidt, from a somewhat more neoliberal perspective, made some appealing arguments on the same subject recently, focussing on redirecting the returns to capital (through taxation and redistribution of stock ownership) rather than trying to shift them them back to wage-labour, per Meyerson's ideas. Both liberal approaches are valuable. Conservative pundits might have important things to add to the discussion too. But we won't know as long as Hewitt is telling us to LOOK AT THE BIG SHINY NUMBERS and JPod, who ought to know better, is encouraging him. It's tragic, really.
Update: Shit. While I was in seminar this afternoon and before posting, Jonathan Chait already made all the same arguments. I swear, I didn't rip the above off his post.
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