If you are comparing this depression to the 1930's you need to add social security and disability to unemployed stats

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docmims's picture
docmims
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If you are comparing this depression to the 1930's you need to add social security and disability to unemployed stats

Ok tell me why I'm wrong.

 

Since social security and disability (both with soaring numbers recently) were not around in the Lesser Great Depression(1930s).  My theory is that we should add the social security/disability rolls to our unemployment numbers.  If we did we would show that current unemployment is greater than in the 1930's.

Some of you smarter economic guys critique me on this premise.  Also women weren't included in the unemployment stats for the 1930's were they?  That fact may add to the unemployment rate now when compared to the 1930's also.

I was just in a amiable argument with a Democratic coworker who says things are getting better, I begged to differ.  I would like to know what you folks think.Undecided

Septimus's picture
Septimus
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Re: If you are comparing this depression to the 1930's you ...

Good points. Hmmm...

I'd agree that you would need to add back in a good proportion of the people on SS or disability. Not all because some amount of those were not in the work force back then either, especially the older people who, instead of relying on SS, relied on their families a lot more.

As for women, if they were not in the work force much today then all of those jobs would be available to men, thus the unemployment rate would actually go down by what ever the percentage of unemployed women today suddenly decided to stay at home. So, when you take both of these factors into account, I don't know how much the unemployment rate would channge.Of course, there is that issue that wages, overall, may be down in real terms now compared to then since trsaditionally a one earner family was able to provide a decent living and a one earner family today at the mdeian wage would not be able to provide a really decent living for a family of four (please comment if you disagree, I know standards of what is "decent" have changed a lot since then so maybe I am wrong here).

Another thing though is that the unemployment rate is calculated differently now than then, I am not sure of the differences though, perhaps someone else knows that and can add that.

Thomas Hedin's picture
Thomas Hedin
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Re: If you are comparing this depression to the 1930's you ...

I think we should focus on the cause of our current financial crisis and enact legislation to remidy the cause, and revoke and destroy whoever's ability to cause such economic harm for their own personal gain.

docmims's picture
docmims
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Re: If you are comparing this depression to the 1930's you ...
Thomas Hedin wrote:

I think we should focus on the cause of our current financial crisis and enact legislation to remidy the cause, and revoke and destroy whoever's ability to cause such economic harm for their own personal gain.

I like the legislation that any bank that is too big to fail should be broken up into banks that aren't too big to fail.

 

Also to the point that women weren't in the workforce in the 30s,  I don't know if that affects both the numerator and denominator equally for a net wash.  However I think a large percentage of current elderly  and disabled who could work should be included as unemployed to compare the data from now to the 30s.  My point is things are as bad now as then even though the "unemployment numbers" are doctored to show lower unemployment now.

BTW i do think the social security safety net is a good thing.

FinPro's picture
FinPro
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Re: If you are comparing this depression to the 1930's you ...

I think intuitively about it.  In the 30's you had almost no households with a second income.  When the job was lost, the impact was immediate and devistating.  Today, we have an overwhelming number of 2nd income households and that is why things are better today, even if the unemployment rate nickles up another ~5%.  The debate over how measures change over time is more open to me than whether we're better/worse off on employment rates.  Two cents.

Full Moon's picture
Full Moon
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Re: If you are comparing this depression to the 1930's you ...

   I also wondered if we did go back to one income households ....    if either the husband or wife stay home and cooked good meals and had regular meal times,  would our stress and  health be better ?  Would we possibly have more stable homes and would the  wages go up to off set the loss ?    I am assuming the food,daycare/nanny, clothes budget ,etc. would go down to cover some of the loss.

 Could be we are very  soon to find out .

plato1965's picture
plato1965
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Re: If you are comparing this depression to the 1930's you ...

Finpro: If you think two incomes adds resilience..

 

...  I'd highly recommend Elizabeth Warren's excellent lecture on the topic..

 

 

( skip to the 28 minute mark if you're in a hurry... )

 

Full Moon's picture
Full Moon
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Posts: 1258
Re: If you are comparing this depression to the 1930's you ...

Thank you Plato ,

      What have we done to ourselves !!!  It sure answered a lot of questions .

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