Mailvox: showing a little kneejerk

Miraclewhip can’t get her head around the S/D curve:

The likelihood of this advice being taken to heart is actually DECREASED though, when it is “bolstered” by cockamamy economic arguments such as “women in the workforce are driving real U.S. wages down more than the exportation of textile, IT, electronics, furniture-making (are there any North Carolinians in the room tonight?) industries today, or the swelling of federal programs and the attendant tax increases in the 70’s.”

I don’t recall Miraclewhip being a feminist, but her defensive reaction here might as well be. I’ll try to put this in very simple terms. The 1970 US workforce was 78 million. 34 million women entered it in 30 years. Had every other variable remained the same, this would indicate a 44 percent reduction in wages. But real wages did not fall 44 percent, they’ve only fallen 16.3 percent since 1973 because there are a number of other factors involved, including positive factors such as economic growth and negative factors such as immigration and outsourcing.

It is a mathematical fact that women working is a bigger effect on wages than immigration. It is an open question as to whether outsourcing or women working has had a more deleterious effect on wages, but no one has given the slightest bit of evidence that more than 34 million jobs have been lost to outsourcing in the last 30 years. Still, we can make some extremely rough estimates considering the following effects on wages:

1. The economy doubled in size. +100 percent
2. 24 million more American men. -31 percent
3. 34 million more American women -44 percent
4. 21 million immigrants -27 percent

This would leave -14.3 percent unaccounted for, which we would presumably ascribe to the outsourcing factor. That effect would be even higher if, as I suspect, those 21 million immigrants are already factored into (1) and (2). After all, immmigrants are either men or women. In that case, outsourcing would account for a putative 41 percent of the change in American wages, roughly equal to the expected effect of 34 million women entering the work force.

Miraclewhip also fails to note that for a household, a second income inherently involves a tax increase thanks to the progressive taxation system. Neither the swelling of federal programs nor the attendant tax increases are completely unrelated to women entering the workforce, indeed, working women heavily supported both.

I would hesitate to describe Miraclewhip’s economic argument as “cockamamy”, however, as she simply hasn’t made one.