Random Charts - U.S. life

Source: Life Experiences and Income Inequality in the United States (26-pg PDF)

Random charts - racial wealth gap

Source: The economic impact of closing the racial wealth gap 19-pg PDF)

Random charts - hospital closures

Source: ‘Leaving billions of dollars on the table‘ Rural hospitals foundering in states that declined Obamacare

Random charts - U.S. budget

 

 

Source: The Federal Budget: Overview and Issues for FY2019 and Beyond (24-pg CRS PDF)

Random chart - CEO compensation

Source: Does tax deductibility affect CEO pay? The case of the health insurance industry

"The policy of limiting the deductibility of even performance-based pay for CEOs has much to make it worthy of recommendation. Evidence strongly indicates that performance-based pay is not an efficiency enhancing institution that should be given preferential treatment in the tax code, so ending this preferential treatment is the rare provision in the TCJA that seems to make some economic sense. Further, ending the performance-based pay deductibility will raise a modest amount of revenue to roughly $9 billion per year (Balsam 2012). 

However, this analysis finds little evidence that ending the deductibility of performance-based pay will significantly affect the trajectory of CEO pay. We find no evidence that the provision of the ACA limiting the deductibility of CEO pay for insurers had any effect in reducing CEO compensation. This would tend to support the view that CEO pay is determined much more by the power of CEOs in corporate decision-making than the returns they generate for shareholders since the change in tax treatment unambiguously raised the cost of CEO pay to the companies that employ them. This also suggests that efforts to rein in CEO pay by limiting deductibility more generally, as was done in the Tax Cut and Jobs Act of 2017, will not be effective. In order to limit CEO pay it may be necessary to alter the rules of corporate governance in ways that increase the power of shareholders over the CEO. This assessment must be qualified by the fact that our sample included a relatively small number of firms over a span of just four years"

Random charts - financial security

Source: The Role of Emergency Savings in Family Financial Security: What Resources Do Families Have for Financial Emergencies (14-pgPDF)

The conclusion of the report? "...No matter how household well-being is measured, most Americans today do not have enough savings to weather a financial shock, and they feel this vulnerability acutely: Respondents expressed a clear desire to save, but the reality for many households is that they have far less of a financial cushion than they want or need. Many forces combined to produce the low levels of saving in U.S. households, including choices that families make about their finances—such as when and how much to spend—the resources they have, and needs that can drain their accumulated savings.

 

The challenges that Americans face in building savings are made steeper by the fact that, as households use their savings to address unexpected expenses and losses of income, they then need to replenish those reserves. In fact, the first brief in this series found that, although it could not demonstrate that shocks caused financial hardship, households that have had a financial shock have median liquid savings that are almost $4,000 below those that have not.

 

These findings reveal that significant parts of the population are at financial risk, but they also present an opportunity for broad-based efforts to enable and support family saving. Strategic policy changes have the potential to enhance households’ opportunity and incentives to build financial security. The next brief in this series will explore how Americans think about their savings and how insights into family finances can shape the creation of public policies and programs that can help households close their savings gaps."

Random chart - profitability

Source: Health care profits concentrated at drug companies

"Ninety-nine of the largest publicly traded health care companies cumulatively collected $33 billion of profit and $577 billion of revenue worldwide in the third quarter this year, according to earnings reports we tracked. Pharmaceutical companies collected more than 60% of those profits, but only 22% of the revenu."

Random charts - hospitals

 

 

Source: The uncertain road ahead: Could technology offer hospitals relief from increasing margin pressures? (18-pg PDF)

Random charts - income mobility

 

Source: The fading American dream: Trends in absolute income mobility since 1940

"... We estimated rates of “absolute income mobility”—the fraction of children who earn more than their parents—by combining data from U.S. Census and Current Population Survey cross sections with panel data from de-identified tax records. We found that rates of absolute mobility have fallen from approximately 90% for children born in 1940 to 50% for children born in the 1980s. Increasing Gross Domestic Product (GDP) growth rates alone cannot restore absolute mobility to the rates experienced by children born in the 1940s. However, distributing current GDP growth more equally across income groups as in the 1940 birth cohort would reverse more than 70% of the decline in mobility. These results imply that reviving the “American dream” of high rates of absolute mobility would require economic growth that is shared more broadly across the income distribution..."

Random chart - retail

Source: Amazon is actually the weakest of the big U.S. retailers, Moody’s says

Random charts - wage inequality

 

 

Source: Wage inequality continued its 35-year rise in 2015

"Key findings include:

• While real hourly wages (i.e., wages adjusted for inflation) grew across the board in 2015, this is largely due to a sharp dip in inflation; growth in nominal wages (i.e., wages unadjusted for inflation) has not accelerated. This dip in inflation is unlikely to be a durable source of future real wage gains.
  • Nominal wage growth of 2.2 percent remains below a level where workers would reap the benefits of economic growth.
  • There is no evidence of substantial acceleration of wages that would signal that the Federal Reserve Board should worry about incipient inflation and raise interest rates in an effort to slow the economy.

• Real hourly wage growth in 2015 was fastest at the top of the wage distribution, illustrating that wage inequality continued its 35-year rise last year.
  • The gap between the middle and bottom has remained stable since 2000.
  • The gap between the top and everyone else has grown.

• Looking at men and women separately, from 2014 to 2015, the strongest wage growth was at the top of the men’s wage distribution and at the bottom of the women’s wage distribution.
  • For men, wages at the 95th and 90th percentiles grew by 9.9 percent and 6.2 percent, respectively, compared with only 2.6 percent at the median.
  • While significant gender wage gaps remain across the wage distribution, there has been significant narrowing of the gap at the bottom and middle of the wage distribution since 2000.

• In 2015, faster low-wage wage growth occurred in states that increased their minimum wage.
  • The 10th percentile women’s wage grew 5.2 percent in states with legislated minimum-wage increases, compared with only 3.1 percent growth in states without any minimum-wage increase.

• Racial and ethnic wage gaps are on the rise at the top of the wage distribution.
  • Between 2014 and 2015, white wage growth was at least as fast as black wage growth at all deciles, and was far stronger at the top than at the middle or bottom.
  • Wage growth at the bottom of the Hispanic wage distribution since 2000 greatly exceeded that of low-wage black workers, who actually experienced losses over that period.
  • Regardless of race or ethnicity, within-group inequality has risen since 2000, with stronger growth at the top than at the bottom.

• Over 2000–2015, wage growth was faster among the more educated, but not fast enough to explain growing wage inequality.
  • For both men and women, those with less than a college degree had lower wages in 2015 than in 2007.
  • While there has been a slow narrowing of gender wage gaps for those with less than a college degree since 2000, gender wage gaps continued to grow among those with an advanced degree..."

Random chart - "frictionless commerce"

Source: The Digital Future of Retail Financial Services

"The rise of “frictionless commerce,” in which consumer purchases are automatically initiated without an explicit purchase decision, instead made with the consumer’s advance consent, using real-time, integrated data from preferences, past behaviors, sensors, and other sources of contextual data..."

Random chart - wealth

Source: You might be among the world’s richest people and not realize it

Random charts - debt

 

 

Source: Debt and (not much) deleveraging

Random charts - Insecurity

 

 

Source: The Politics of Financial Insecurity: A Democratic Tilt, Undercut by Low Participation 

"When it comes to choosing a party’s candidate in the voting booth, one pattern in modern American politics is so familiar it has become a truism: the rich vote Republican, the poor vote Democratic. And while the reality of the situation is much more nuanced, in broad strokes it has been the case that Republicans have consistently garnered disproportionate levels of support from the financially well-off, while the least financially secure Americans have been significantly more likely to back Democrats. Least Financial Secure Less Likely to Vote or to Otherwise Engage With Politics

But a new analysis of Pew Research Center survey data collected in the fall lead-up to the 2014 midterm elections finds that at least as striking is the degree to which those who are financially insecure opt out of the political system altogether, and how that opting out disproportionately affects Democratic support. 

Financial security is strongly correlated with nearly every measure of political engagement..."

Random charts - optimism

 

Source: Americans' Personal Financial Assessments Up Sharply

Random charts - inequality

 

 

 

Source: What We Know About Inequality (in 14 Charts)

Random chart - relative pay

Source: CEOs Get Paid Too Much, According to Pretty Much Everyone in the World

Additional OCO update

Earlier this month Update VI - OCO update discussed the OCO. Back in In June 2011 this blogger had noted that "...the CBO Baseline of March 2011, against which all proposals are scored to determine their effect, included $1.7 Trillion of overseas contingency operations funds (i.e. funds for the operations in Afghanistan and Iraq) over the next ten years..." and that this would leave 'magical money' available for the Pentagon (which at the time was predicting that sequestration would result in doom!).

Now, finally, it appears that lawmakers "from both parties" have woken up to this, expressing "...concern that the funding request is setting a dangerous precedent of maintaining a “slush fund” for the Pentagon to use without any congressional oversight..." Apparently sometimes it takes a while...

Update VI - OCO update

 Source: CBO letter to Harry Reid

Previous blog entry on the OCO:

The Magical $1 Trillion - Aug 4th, 2011

A Step Backward, or More to Go? provides information on the 'slush fund' that is the OCO (the 'Overseas Contingency Operations') and the funding request for the upcoming fiscal year:

"The FY15 OCO request for DoD is $58.6 billion, 31% less than the FY14 enacted amount. As part of two newly requested funds for counterterrorism and reassuring European allies given the Ukraine crisis, the request also includes an additional $1.4 billion in OCO funding for State, which adds to State’s previously submitted $5.9 billion OCO request for a total of $7.3 billion in FY15.

The 31% drop puts the decline in OCO funding back on the pace of the FY13 and FY12 OCO budgets, which dropped by 29% and 28% from the prior year, respectively, after only a 2% drop from FY13 to FY14..."

And, as surmised/predicted back in 2011, the OCO has turned out to be a major 'slush fund' that keeps on giving: "...Although OCO funding is dropping significantly again, it is still not declining as quickly as troop levels in Afghanistan are being reduced. In FY15, troop strength in Afghanistan will drop by 56% from this year’s levels, or a rate almost twice the drop in OCO funding. As a result, troop strength will be less than a tenth of what it was six years ago, but OCO funding will still be more than a third of what it was..."