patrick.net

http://www.usgovernmentrevenue.com/yearrev2012_US.html

shows $1.4T in income taxes in 2012.

vs $1.2T in 2000:

http://www.usgovernmentrevenue.com/yearrev2000_US.html

$200B more in taxation on a $6T bigger economy?

http://research.stlouisfed.org/fred2/series/GDP

That's only a 3.3% tax hit on the incremental GDP increase.

If it were 20% we'd have a balanced budget.

There's your problem, mate.

Germany, Denmark, Sweden, Norway do not enjoy their high tax to GDP ratios, but they pay them.

Australia has a 31% tax to GDP ratio, low compared to the Eurosocialists, but enough. That's about what we need here, going forward as the baby boom hits their benefit years this decade and next.

http://research.stlouisfed.org/fred2/series/CP/

after-tax corporate profits now a trillion higher than 10 years ago, LOL

Make believe indeed

Let's look at median wages and median household income.

Huge difference there. No wonder those who blame the non-existent wage pressure want to use the average instead of the median, it's an increase of almost triple for the average, but only about ~80% for the median. Over 20+ years, what are we talking about, 1 or 2% a year, and in most of those years, CPI was generally 2% or above.

Household income for Whites is about the same it was in 1995. Is housing also at 1995 prices? Education? Medical Care? Food? Gas? I remember paying around a dollar for eggs as a college student in NJ in the mid 90s, and filling up my 1982 Ford Econoline "Cheech and Chong" Mobile at Raceway Gas Station for 97 cents a gallon. Damned if you can find a dozen eggs for anywhere near $1 today, and 97 cent gasoline? No way.

This explains why, in 2011 dollars, then there has been no gains for the median household in 15+ years.

Nevermind computers, domestic appliances and TVs, something most households buy only when the old one is on the fritz every couple of years. They're overweighted on every index.

Productivity more than doubled in the past 15 years, but little of the gains went to the highly trained, well educated employees. Note that every parent around the world kills themselves to send their kids to US schools, and not just Harvard, Yale, and Berkeley, but also UCLA, SUNY, and FSU. How bad are our higher ed institutions? World Class.

Could some of this be due to a shift in the definition of "affordable"? Decades ago, the word meant what someone could afford to pay for, in a lump-sum. Today, people basically shop for a monthly payment on darn near everything....TVs, cars, houses, appliances, whatever. To me, it seems like an increase in goods prices combined with relatively-stagnant wages is due to the shift to debt-dependence. Affordability today is only in respect to the monthly payment required on something. Given that interest rates are at historic lows, I think that there is actually some factual correctness in stating that "affordability is at all-time highs" on just about everything. The only fly in the ointment pops up when questions about sustainability arise. Debt eventually needs to be paid back, especially when it is packaged into investment-grade instruments and stuffed into places like pension funds.

bmwman91 says

I think that there is actually some factual correctness in stating that "affordability is at all-time highs" on just about everything

problem is that affordability in other things just result in higher rents.

Rents have doubled since 1990:

http://research.stlouisfed.org/fred2/series/CUUR0000SEHA

Up 20% in real terms:

http://research.stlouisfed.org/fred2/graph/?g=dYe

So much for "affordability"

It kills me that apparently nobody understands the central importance of housing in our economy. Wish I did 20 years ago, I would have played the game MUCH differently.

I am not trying to make an argument that it is GOOD. My opinion is just the opposite...in the long run, it is bad for everyone.

I think that it is all the result of our unsustainable lifestyles. Just maintaining the status-quo requires growth. Growth is an exponential function. We live in a finite world. It's a big problem.

People here have had a very high material quality of life for a long time, and for a lot less work than much of the rest of the world. Americans have forgotten what exactly made America special and are now entirely fixated on shiny baubles. People do not value freedom and liberty because they have never lived without them. Freedom and liberty are far more important than material wealth (material wealth is a by-product), but everyone is focused on the wrong things now. The short answer for what I think is "right" is that people need to be happy with less STUFF and find things to DO with their time other than being entertained.

Cheap debt is just another mechanism of wealth extraction from the productive class to the gilded class. Just wait until there is a way to pay your rent with credit cards...you ain't seen NOTHING yet! The productive class is selling their freedom for STUFF and is happy to do it because they are not interested in the big picture. American kids are born into a consumer-brainwashing setting where they are inundated with consumerist dogma from the moment they set eyes on just about anything. They are taught that happiness is purchased, one trinket at a time, and that freedom is the ability to take their money to a different retailer if they do not like the sales staff at the one they are currently in. If you are not getting exactly what you want when you want it, you are by definition "unhappy" and it's the result of someone owing you something that you have yet to be given. Welcome to America. Eventually this will cease to work and people will wake up to see just how good they had things. Maybe then they will live and operate in a fashion where they appreciate America, especially given that they will need to do some very hard work to make it a wonderful place worth fighting for again.

I've had 25 years to accumulate stuff.

$20,000 in Macs, plus ~$5000 in PC purchases.
$1,000 in iOS devices
$3,000 in musical instruments

$275,000 on housing expenses.

http://en.wikipedia.org/wiki/Rent_Is_Too_Damn_High_Party

Spending to GDP is all that's relevant, not spending: hourly wages. The latter can be skewed by wealth disparity.

Reduce defense by 90% and cut personnel benefits to be inline with private employ. Dismantle VA & pension and replace with HMO & 401K-type offerings.

Problem solved.

Vicente says

Reduce defense by 90%

Blasphemy, blasphemy!! You are asking to reduce the only thing in congress that has bipartisan support-defense spending. They would rather end medicare and social security, before cutting defense spending.