Wednesday, November 12, 2014

More Amazing Paul Krugman Chart Reading

He writes:
Wages for ordinary workers have in fact been stagnant since the 1970s...with the only major break during part of the Clinton boom. 
Here's the Clinton "boom," using the same data that Krugman uses. Inflation adjusted  hourly wages climbed by approximately $1.20 over the period of the Clinton presidency.


Here's what has occurred since then. Despite the financial crisis, wages have climbed by exactly the same amount as during the Clinton years, $1.20.

To be sure the inflation adjusted peak level of January 1973 of $22.18 per hour is a record high, not since surpassed, but that was a period when price inflation was just starting to take off and the CPI most likely underestimated the real price inflation at the time of the "record" wage level. A properly inflation adjusted 1973 wage would have been significantly lower and unlikely to still be a record real wage period.

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