This video from The Fund for American Studies has been making its way all around the free market blogosphere this past week. Stossel blogged about it, as did Peter Robinson, Dan Mitchell, and others.
In a popular video released last month, Robert Reich of MoveOn.org used a statistic that has been very popular as proof that we need more economic regulation. “Since 1980,” he says, “the American economy has doubled in size. But, adjusting for inflation, most people’s wages have barely increased.”
Lee Doren of the Competitive Enterprise Institute has done a great rebuttal of the Reich video, and makes the case that wages have in fact been increasing when you factor in transfer payments and healthcare benefits.
But suppose Reich was right, and real wages have been stagnant. Workers in 1980 had no internet access — virtually no one did. Now 78% of Americans have access to the internet, and most wouldn’t give it up for $1 million. Even if wages have been stagnant, wealth has exploded, and continues to explode.
