Edward Conard

Top Ten New York Times Bestselling Author

  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
  • “Unintended Consequences offers deep and well-argued analyses on almost every issue.” - The New York Times
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
  • “Unintended Consequences represents the most cogent and persuasive analysis of the Financial Crisis to date.” - Andrei Shleifer, 1999 John Bates Clark Medal Winner
  • “There are an amazing number of good ideas and interesting points made in Unintended Consequences. The thinking underlying it, and the obvious depth of understanding of the author, are very impressive.” - Steven Levitt, coauthor of Freakonomics; 2004 John Bates Clark Medal
  • “…a comprehensive explanation of the modern economy.” - Julian Robertson, Founder, Tiger Management
  • “A full-throated defense of economic dynamism.” - The Wall Street Journal
  • “…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “Unintended Consequences should be read by anyone who takes for granted the superiority of progressive taxation and has not thought carefully about the trade-offs involved.” - The New Republic
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
Upside of Inequality Oxford Unintended Consequences

Macro Roundup


Friday, January 31, 2020

AI Summary. The median US household's inflation-adjusted market income rose 21% between 1990 and 2016, and income after taxes and transfers rose 44%, with a 66% gain for the bottom 20%. The share of households earning over $100,000 tripled from 10% to 30% between 1967 and 2018.

Michael R. Strain Wall Street Journal
Date Posted:
Is Database:
Database

The American Dream is alive and well. Btw 1990 & 2016, median household market income rose 21% & post-tax-transfer income grew 44%. @MichaelRStrain @WSJ.

Have American household incomes risen across the distribution?

Core argument: Median household inflation-adjusted market income rose 21% between 1990 and 2016, while post-tax-and-transfer income grew 44%, and households in the bottom 20% saw a 66% increase in post-tax-and-transfer income, Michael Strain reports.

Michael Strain highlights the dangers of populism by emphasizing the positive economic trends that contradict populist narratives. Between 1990 and 2016, the median household's inflation-adjusted market income rose by 21%, while post-tax-and-transfer income grew by 44%. Households in the bottom 20% saw a 66% increase in post-tax-and-transfer income. The share of households earning over $100,000 tripled from 10% to 30% between 1967 and 2018, while those earning less than $35,000 fell from 36% to 28%. Employment in high-skill occupations has increased, indicating upward mobility. A hot economy benefits all workers, including the least skilled. Strain warns that populist messages portraying the economy as rigged can demoralize workers and hinder their economic prospects, despite evidence that hard work continues to yield positive outcomes.

Takeaways by Macro Roundup® AI

  1. Median household inflation-adjusted market income rose 21% between 1990 and 2016, while post-tax-and-transfer income grew 44%, and households in the bottom 20% saw a 66% increase in post-tax-and-transfer income, Michael Strain reports.
  2. The share of households earning over $100,000 tripled from 10% to 30% between 1967 and 2018, while the share earning less than $35,000 fell from 36% to 28%.
  3. Michael Strain argues that populist messages portraying the economy as rigged can demoralize workers and hinder their economic prospects, despite rising employment in high-skill occupations and evidence that hard work continues to yield positive outcomes.

AEI’s Strain excerpts his new book in WSJ, just an FYI, he makes the points that wages are up, “hollowing out” of middle class driven by people graduating up and warns of the dangers of populist narratives. Just an FYI

"..The nonpartisan Congressional Budget Office (CBO) computes a comprehensive measure of inflation-adjusted market income that includes labor market earnings, the value of employer-provided health insurance, and business and capital income. The median household saw market income gains of 21% between 1990 and 2016, the last year for which data are available. The CBO also computes inflation-adjusted income after taxes and government transfers, which grew by 44% for the median household during this period. Households in the bottom 20% saw their post-tax-and-transfer income grow by 66% over these years....Another part of the story that is often overlooked:Hollowing out is mostly a story of upward mobility. Employment in high-skill occupations has grown as employment in middle-skill occupations has shrunk. On balance, the share of employment in low-skill occupations hasn’t increased.
Data from the U.S. Census Bureau from 1967 through 2018 shows a 12 point drop in the share of households with inflation-adjusted income between $35,000 and $100,000. The share of low-income households—those earning less than $35,000—has also fallen over this period, from 36% to 28%. And the share of households earning over $100,000 has tripled, rising from 10% to 30%.... Recent experience demonstrates that a hot economy benefits all workers, including the lowest paid, least skilled and most vulnerable. Hard work continues to pay off, and workers still enjoy the fruits of their labor and can improve economic outcomes for themselves and their families. And that is precisely why the constant message that American capitalism is broken is so harmful. Messages matter. If all people hear is that the economy has failed them—is rigged against them, in fact—it dims their aspirations and saps their energy, hurting their economic prospects. The populist narrative that workers are victims without agency or personal responsibility may have political power in these unsettled times, but it is also deeply demoralizing and damaging….”

The American Dream Is Alive and Well: Extended Excerpt Image 1


Michael R. Strain, "The American Dream Is Alive and Well,"Wall Street Journal, January 31, 2020, https://www.wsj.com/articles/the-american-dream-is-alive-and-well-11580486386

Sunday, February 2, 2020

AI Summary. A Gallup survey found only 6% of Japanese workers are classified as "engaged," ranking Japan 132nd of 139 countries, compared with a 13% global average and 29% in the US and Canada. Of Japanese workers, 71% are "not engaged" and 23% are "actively disengaged.

Sora News Sora News
Date Posted:
Is Database:
Database

Japanese workers’ engagement is alarmingly low, with only 6% classified as “engaged”, ranking 132nd out of 139 countries surveyed in a 2017 Gallup poll.

How engaged are Japanese workers compared with workers worldwide?

Core argument: Only 6% of Japanese workers are classified as "engaged" in a 2017 Gallup poll, ranking Japan 132nd of 139 countries and below the global average of 13%.

Japan's workforce engagement is alarmingly low, with only 6% of workers classified as "engaged," ranking it 132nd out of 139 countries surveyed in a 2017 Gallup poll. This figure is significantly below the global average of 13% and starkly contrasts with the USA and Canada, where 29% of workers are engaged. The majority of Japanese workers, 71%, are "not engaged," while 23% are "actively disengaged," highlighting a critical issue in workforce motivation. The Parento principle suggests that optimal productivity requires about 20% engagement, indicating Japan's current levels are insufficient for economic efficiency. This lack of motivation may contribute to broader economic inefficiencies and challenges, such as stagnant wage growth and a reluctance to invest in long-term career development, potentially impacting Japan's GDP growth and overall economic competitiveness.

Takeaways by Macro Roundup® AI

  1. Only 6% of Japanese workers are classified as "engaged" in a 2017 Gallup poll, ranking Japan 132nd of 139 countries and below the global average of 13%.
  2. Engagement in the USA and Canada reaches 29% of workers, compared with 6% in Japan, according to the same Gallup survey.
  3. In Japan, 71% of workers are "not engaged" and 23% are "actively disengaged," short of the roughly 20% engagement the Pareto principle suggests is needed for optimal productivity.

"...Fittingly, the Japan Business Federation couldn’t be bothered to conduct a survey themselves, so instead they referred to a 2017 Gallup poll which measured work engagement in 139 countries. The motivation of company employees were rated as “engaged,” “not engaged,” and “actively disengaged.”The USA and Canada came out on top with about 29 percent of workers “engaged” in their jobs. That might not sound like a lot, but it’s over twice the global average of 13 percent. Japan, meanwhile, is roughly half of the average with only six percent claiming to be engaged...."

Master Blaster, "Survey finds only six percent of Japanese workers motivated, seventh lowest in the world,"Sora News, February 2, 2020, https://soranews24.com/2020/02/02/survey-finds-only-6-percent-of-japanese-workers-motivated-seventh-lowest-in-the-world/

Survey finds only six percent of Japanese workers motivated, seventh lowest in the world

Read all about this troubling social trend…or don’t. What do I care?

A lot has been said about the quality of service in Japan, from companies’ polite and helpful staff to their remorse over even the slightest misstep…so I’m not going to bother saying any of it again.

You see, beneath all this is a troubling development in the spirit and mentality of the workforce in Japan. It’s a problem that has recently been brought to light by the Japan Business Federation in which the average worker in Japan simply isn’t engaged in their work.

Fittingly, the Japan Business Federation couldn’t be bothered to conduct a survey themselves, so instead they referred to a 2017 Gallup poll which measured work engagement in 139 countries. The motivation of company employees were rated as “engaged,” “not engaged,” and “actively disengaged.”

The USA and Canada came out on top with about 29 percent of workers “engaged” in their jobs. That might not sound like a lot, but it’s over twice the global average of 13 percent. Japan, meanwhile, is roughly half of the average with only six percent claiming to be engaged.

On the other hand, a whopping 71 percent are said to be “not engaged” and a further 23 percent “actively disengaged.” In terms of engagement, Japan was ranked 132nd, ahead of only Iraq (6%), Tunisia (5%), Israel (5%), Azerbaijan (5%), Hong Kong (4%), Croatia (3%), and Syria (0%).

So, what does this mean? The Japan Business Federation cited the Parento principle which states that 80 percent of effects come from 20 percent of causes. Applying that to these results, a country should hope to have about 20 percent of its workforce “engaged” in order to get a realistically optimal output.

In this way, countries like the US could be seen as over-performing, whereas Japan is woefully shorthanded. Conversely, Japan’s “actively disengaged” population fits the Parento principle better, making it a driving force of inefficiency across the country.

All that explaining was way more work than I was planning to do today, so let’s hear what some random people in Japan have to say about it all.

“Most people just work to avoid starving, so they’ll do just enough not to get fired.”
“If companies would offer stability and the ability to retire, it would be very different.”
“It’s stupid. Even if you work hard and raise your salary, you’ll just get laid off when you’re too old to get another meaningful job.”
“If I don’t work, I don’t eat…”
“Being motivated isn’t all that great. I think some people are too motivated and dangerous.”
“The companies just keep stockpiling the money without increasing wages.”
“It goes beyond work, people aren’t even motivated enough to start a family any more. It’s too expensive.”

This demotivational trend certainly isn’t surprising anyone here. The cracks have been showing for a while now, from cops leaving their guns lying around in record numbers to convenience store franchisees rebelling against corporate owners for not sharing enough in profits.

I would suggest some solutions to all this, but screw it. I don’t get paid enough for that kind of crap and I got my own problems. It’s also time for my two o’clock toilet nap, so smell y’all later.