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Sunday, February 09, 2014

The 30-Hour Work Week

I read several interesting articles this weekend.

One was not my find. It came from Chris Cain, and it affirmed everything Catholic (and non-Catholic) demographers have been saying for a long time.

The next two were the story of where Obamacare got the idea for the 30-hour work week. Notice why it was originally desired. The point was to avoid layoffs. Hmmm... the fact that it was resurrected tells you something right there, doesn't it? But good Catholics should be interested in getting more time off. We want to return to medieval practice, don't we? Well, that story may not be entirely true.

This is the last one, and it ties up a lot of different things I've talked about on this blog: the aging population, the growth of government, etc.
Those with a keen eye will note that between 1800 and the 1920s, although there are clear periods of faster and slower growth, the rate of growth is consistent and undiminishing (i.e., an approximately straight line on a log-linear plot such as this).  But once the WWII boom wore off, we find a substantial downward curvature in the growth rate after 1960, coinciding with the era of sustained big government without a major war.
Plotting annual growth in real per-capita GDP over time reinforces the case.


To reiterate, between 1800 and 1929, the USA was a small-government nation.  While periods of wartime government expansion took place during the War of 1812, the Civil War, and WWI, in each case the pre-war spending levels were re-established in relatively rapid timeframes.  The period between 1930 and 1959 represents a complex transition period for government expenditures.  The rise of big government began, and was coupled with the extreme economic influence of a truly global war and its geopolitical aftershocks.  After 1960, the USA settled into big government and did not participate in any genuinely major international conflicts that exerted anomalously large effects on government spending patterns.
From 1800 to 1929, there is no significant trend in annual real per-capita GDP (p=0.77).  But between 1960 and 2012, there is a significant negative trend... If we consider the running 20-year growth in real per-capita GDP, and exclude any 20-year periods that include a major war (e.g., the War of 1812, the Civil War, WWI , WWII, and the Korean War), the dismal nature of the American economy during the last 50 years is even more evident.  The 22 worst periods of 20-year growth in real per-capita GDP have all occurred since 1985; 31 of the 32 worst periods of 20-year growth have taken place since 1982.  Of note, in 23rd-worst place is the period from 1866 to 1885, which includes a significant part of the Civil War Reconstruction era.  If we remove this 1866-1885 point based on its major war influence, then all of the 31 worst periods of 20-year growth have occurred since 1982. As generally prosperous as the 20-year period from 1981 through 2000 seemed (incorporating  both the Reagan and Clinton booms), this ranks only in the 33rd percentile over American economic history.  The USA is in economic decline, and has been declining for over a half-century.  This same 50-year period of decline corresponds to the period of largest sustained government expenditures as a percentage of the economy in American history.  Coincidence?  Not likely.
Of course, it is not coincidence, but the growth of government is not the only explanation. The American fertility rate has been dropping for close to 200 years. It went below replacement rate for the very first time in 1972. Within ten years, America's GDP also began to decline. As government grows, the family shrinks.

1 comment:

Palmetto Papist said...

The University of Texas at Dallas (UTD) is not the University of Dallas (UD)