Question

a.     What are the various ways that the American working class coped with the stagnation of real wages during the 1970's - 2007?

b.     What were the various ways that the American business community responded to the growth in productivity during the 1970's - 2007?

Answer 1

Ok. Let me share certain valuable insight basis which you can comprehend the subject and also the intricacies involved in it.

For Part a:

• During the mention preriod (1970s to 2007), the industrial productivity improved a lot, however the hourly wages of majority of workers did not increase in the reasonable proportion.
• Stagnation of real wages resulted in to the stagnation of family income of large chunk of middle class households.
• Income inequality grew in American economy.
• The effort for eliminating the 'gender wage gaps' and 'racial wage gaps' were either non-existent or terribly ineffective and slow.
• Low wage Americans and middle class American households, both were the victims of stagnation of real wages during the said period.
• Macroeconomic policies of America, during the said period, stopping focussing upon achieving 'Full Employment'. It lead to the problem of unemployment to the tune of unpleasant proportions.
• Intentional political agenda of weakening the unionization in the industry actually made th workers lose their negotiating power to the corporate owners. It was one of the prime reasons behind stagnation of real wages.
• Wage earners also had to deal with employers’ ability to exploit the undocumented workers which would lower the wages of these workers and also the ones who are in the similar fields of work.
• However, surprisingly, the salaries and compensation for CEOs, CXOs and top managers saw the unprecedented growth during this time. This was another reason of inequality amongst the working-class itself.

For part b:

• Between 1979 and 2018, the productivity grew by 69.6% whereas the wages grew only by 11.6%.
• Rising productity enables an economy to provide for substantial growth in the pay for vast majority of people, but in America, during the said period, it was not the case.
• The income and wealth generated during this time actually failed to 'trickle - down' to the vast majority.
• Those who enjoyed the most income and wealth greatly influenced the process of government policy making, which kept on favoring themselves at the cost of welfare of the mass of working class.
• With impressive growth in productivity during the said period, the domestic industry of Amecial became more competitive in the international market. It not only influenced the international trade terms greatly, but also set new benchmarks in the area of new capital and investment.
• US dollar beame more powerful influencer in the international foreign exchange market.
• Consumerism defined new USA and the business community made itself stronger like never before.