Why have neoliberal economics failed the developed world middle-class?

The minority you talk about is the majority of the developed world.

The graph doesn't take into account cost of living (which has risen 30-40% since the 1980's.)
The middle class has gotten almost 30% poorer.

Except only the bottom 5% and 70-80% have gotten poorer.

The vast majority of global poor have gotten vastly more real income.

Also this graph doesn't account for higher cost of living.

For why it is not even close to being the optimal economic/political system?

Yes.

>the majority of the developed world.

Looks like 78-85 percentile. 85 to 100, twice as many, got a lot richer. So no, it's not the majority of anything.

Huh?

This chart deals with real income.

Cost of living in America (which is representative of the developed world) has risen 30% since 1980. I don't necessarily know the numbers for 1988-2008, but that shows that at least a good portion of the 70-90 percentile have actually had decreases in real wealth.

So yes, the majority as I claimed here

search.proquest.com/openview/cb7556f7be46b8f0f0ad2d3beccfb1d6/1?pq-origsite=gscholar

It directly led to the 2008 crash.

>brush off a socialist boogeyman dredged up from Latin America
>declare it dead at the very moment you announce its existence to the world
>and pretend it's been around this entire time
this meme needs to die

>this meme needs to die
This meme needs to die.

this I believe that at certain income levels the population becomes lazy and relegates more and more things to social welfare instead of taking care of it themselves.

At the same time the top ~5% continue to gain income due to their culture and customs which stave off sloth.

This. If you're not in the top 10% of wealthiest individuals and you're voting for economically liberal policies, you're an utter retard or a wide-eyed idealist who likes to ignore statistics.

>neoliberal economics

Buzzwords

>Why have neoliberal economics failed the developed world middle-class?
They haven't.
>The average American was richer in 1996 than today.
Because the United States of America fought TWO WARS OFF THE BOOKS.

Moderator to Bush and Gore at the 2000 Presidential Debate

"What are you going to do with the budget SURPLUS we currently have?"
(paraphrased)

I love how Americans think they are the entire world

the middle class in 50s-60s was created due to highly socialistic policies implemented by FDR and protected by IKE. They began to revert them since 70s and especially after 80's. True state of capitalism is not a huge chunk of middle class, only in existence due to high gov spending. G.I bill, helping G.I.'s to buy houses, the inter-state highway etc etc all done by government funding I'm not even talking about social security. The true state of Capitalism is a huge lower class with a tiny rich class, that was the case in pre 1940's and that will be the case in the future.

Get use to it 50s-60s were an anomaly, not the norm.

Because capitalism is bound to see a shrinking middle-class.

Neoliberal economics, just like original liberal economics, is inevitably setting itself up for a communist revolution.

>It directly led to the 2008 crash

No it really didn't.

Real income means adjusted for inflation.

Yes. Income.

Not total income purchasing power.

Income = what you take in adjusted for inflation.

Total income purchasing power = what you can purchase with your income (total money).

So the average American earns about as much REAL INCOME as in 1988, but the average REAL COST OF LIVING has risen 30%.
Therefore, the average American has 30% less real purchasing power than in 1988.

Wow great argument

en.m.wikipedia.org/wiki/Causes_of_the_Great_Recession

Every fucking cause is directly linked to the neoliberal economic/political system of the Great Moderation.

>Income = what you take in adjusted for inflation.
No. You could argue how the inflation index is badly calculated/doesn't reflect reality, but "real income" already implies we're talking about the general purchasing power of that amount of money.

Real income is not real purchasing power.

Real income is simply nominal income adjusted for inflation such as the CPI. It is not necessarily reflective of TOTAL PURCHASING POWER.

Then again, my explanation was somewhat wrong

>any day now guys
>it's inevitable because some dead guy said so

>Real income is simply nominal income adjusted for inflation such as the CPI
You have a base year, so you're comparing one year with another and detracting the inflation, thus calculating how better or worse is the income in constant prices.

>TOTAL PURCHASING POWER
Yeah, but I thought you mean taking the real income, then dividing it by the average costs of living, which would be making the same operation twice.

To answer OP, it's necessary to understand the scenario behind those years. We've been through a big recession and I'm fairly sure 1996 was a much better year for the world's economy, unless you lived in Mexico I guess

Well right now exactly what Marx said would happen is happening. As it has previously and would generally lead to communist revolutions.

>exactly what Marx said would happen is happening

Which is what?

Lots of stuff. But the specific point discussed ITT is that the middle class will start shrinking.

So long as we're on the subject, what do you guys think about the idea of the 20/80 society?

>Nowadays the majority of the world's population lives in an advanced economy.
Turkroach/Brazilian/African City boy everybody

Real income simply isn't reflective of real wealth.

These terms are confusing and we are likely in a semantic argument.

What I'm saying is that expenses for the average American have risen faster than expenses for the rich and poorest Americans.

Also, this graph stops in mid-2008. It doesn't include the majority of the recession or the rebound in 2010-2011.

>These terms are confusing and we are likely in a semantic argument.
>What I'm saying is that expenses for the average American have risen faster than expenses for the rich and poorest Americans.
I understood that much, but this topic could be the subject of a book. Why have they risen so much? Was it due to a faulty government intervention, the free market? Is it possible that new expenses were added in this period that significantly altered the index's level? Was something similar verified in other countries across the globe, and why?

Oh yes. Surely there are some books, but this is the tip of current economic research.
This chart takes into account the entirety of the world. Specifically the middle class of the developed world have witnessed falling real incomes 1988-2008. Since 2008 it probably got a little worse for everyone on the chart since the world economy has been shitty since then.

>Was it due to a faulty government intervention,

Yes.

Because neoliberal economics only really benefit the top people and developing countries due to investment from those top people.

Neoliberalism needs to die

The chart in the OP shows that almost everyone had benefitted, in accordance with economic theory.

When?

>almost everyone benefited
>leaving out 14% of the world population

Have you ever heard the word almost before?

Almost is used by almost all people to describe from 90-99%.

86% is not almost. It is most.

Where are you getting 14%? Looks like half that.

The global middle class is rising at an unprecedented rate thanks to free trade and the spread of technology. More and more people have access to computers, automobiles, housing, modern medicine, etc.

Proletarianization has largely halted, and even where it does occur those workers still have access to new luxuries and conveniences. Marx was very bright but he was not a prophet. Quit thinking that he predicted every single hiccup with the modern economy.

>When?

In the U.S., rising expenses are mostly healthcare, housing, and education. All three are largely driven by shitty laws. e.g., artificially making it more attractive to lend to students, which makes more capital available and just encourages tuitions to rise. Of those three, only housing "naturally" (in a free market) would be rising, bit not add much as it has.

Notice the bottom 5%

>global middle class

AKA the poorest people in the developed world.

We are discussing as I, the OP, stated, the developed world middle class.

None of your post made sense in relation to the question of "Government Intervention when?"

I refer you toCauses of Great Recession.

>None of your post made sense in relation to the question of "Government Intervention when?"

You want specific laws?

>Notice the bottom 5%

The bottom 5% were subsistence farmers before and they are still. It makes no sense to blame globalization for the fact that not everyone has been affected by globalization yet.