NYTimes: Wages fall to an historic low!

[J. J.]

"As a percentage of national income."

This is exceptionally misleading.  Let me give you an example.

From 1993-7 my personal income from wages decreased as a percentage of my gross personal income.  Now my wages increased a bit more quickly than inflation, so what caused this.

I put money into investments and savings that earned interest.  I had more interest, as a percentage of my income, in 1997 that I did in 1993.  My real income has increased, my wealth has increased, but the percentage of wages making up my personal income has decreased.

Let's say that I made $19,800 in wages and $200 in interest in 1993.  The percentage of income from wages is 99%.  In 1997, I'm making $22,500 in wages in 1993 dollars, and $2,500 in interest also in 1993 dollars.  My percentage of income form wages is 90%; it dropped.  My income, in real dollars, has increased by 25%, even after inflation.

[J. J.]

What the hell does this have to do with the matter under discussion, J.J.?  The working class recieves virtually its entire income from wages, while the owning class receives its entire income from investments, so the two different types of income go to two entirely separate classes of people. 

That's an incorrect statement.  The "working class" became very aware of investments since the 1980's.  About 50% of all households own some stock, for example. http://www.businessweek.com/the_thread/wellspent/archives/2005/11/stock_ownership.html

There are other methods of generating income from resources, including the more traditional, like interest from CD's and buying an renting out property.  Those aren't "wages."  As these increase, the precentage of total income from wages decreases, but the individual's income increases.  As a person's worth expands, his precentage of income from "wages" should decrease.

[J. J.]

What the hell does this have to do with the matter under discussion, J.J.?  The working class recieves virtually its entire income from wages, while the owning class receives its entire income from investments, so the two different types of income go to two entirely separate classes of people. 

That's an incorrect statement.  The "working class" became very aware of investments since the 1980's.  About 50% of all households own some stock, for example.

This is completely irrelevant, J.J.  'Some stock'?  It doesn't matter if they have a few meager shares in their IRAs and whatnot, these people derive nearly all their income from work.  They are working class.

There are other methods of generating income from resources, including the more traditional, like interest from CD's and buying an renting out property.  Those aren't "wages."

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As these increase, the precentage of total income from wages decreases, but the individual's income increases.  As a person's worth expands, his precentage of income from "wages" should decrease.

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Opebo, the American worker, a class that you know very little about, has bee accruing assets (in such things as retirement plans, not to mention traditional investments), for the last quarter century.  These generate interests.

Let's assume that there is a worker, A, who makes $19,800 and has no other income.  His percentage of income from wages is 100%. 

He saves a bit during the year and the next year gets $200 in interest.  He makes exactly the same the next year in wages.  How much has he made overall?  $20,000, more than he was.  What percentage of his income is from wages?  99%.  I case you cannot figure it out his percentage of wages has dropped; 99% is less than 100%.  His income has increased.  His income has has ground by more than 1%, even though his wages (adjusted for inflation) have not increased.

Multiply this by 120,000,000 and you have some idea of why wages are becoming a smaller proportion of income.