You're right on all counts. I tend to run towards long posts, and I tried not to go too far with my analysis. I'm sure that I left out other things as well. A part of the rising cost of healthcare and every other rising cost is lawsuits. A hundred or so years ago, when you bought a product, you were pretty much buying just the product. Today, you are buying the product plus the cost of the lawyers for the retailer, the wholesaler, various transportation companies, and the manufacturer. Each of these companies in the chain must have more lawyers than it needed in the past. The costs for those lawyers are passed to the consumer. Again, if you are in the law industry, you are doing better than you were forty years ago. If you are in any of the productive businesses that are being bled by the law industry, you could be doing worse.
Bill
Bill, just to emphasize your point -- check out the David Wessel column today in the Wall Street Journal. He writes what we already know -- even a college degree now is not enough to stay ahead of inflation. It takes a graduate degree/doctorate:
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CAPITAL
By DAVID WESSEL
Why It Takes a Doctorate
To Beat Inflation
October 19, 2006
The typical American worker with a four-year college degree earns a lot more money than a similar worker who didn't go beyond high school -- 45% more.
Education does pay. But in today's economy, getting a bachelor's degree is no longer a guarantee of raises big enough to beat inflation.
WALL STREET JOURNAL VIDEO
[Video Report]
David Wessel discusses a growing disparity in the salaries of workers in America.
CAPITAL EXCHANGE
[Capital Exchange]
Send comments on this week's column to capital@wsj.com.
Although the best-paid college grads are doing well, wages of college grads have fallen on average, after adjusting for inflation, in the past five years. The only group that enjoyed rising wages between 2000 (just before the onset of the last recession) and 2005 (the most-recent data available) were the small slice with graduate degrees.
Think about that: Even though the economy and productivity have been growing smartly, lots of workers who played by the rules and went the distance to get a four-year college degree aren't getting ahead.
[...excerpt...]
" You're right on all counts. I tend to run towards long posts, and I tried not to go too far with my analysis. I'm sure that I left out other things as well. A part of the rising cost of healthcare and every other rising cost is lawsuits. A hundred or so years ago, when you bought a product, you were pretty much buying just the product. Today, you are buying the product plus the cost of the lawyers for the retailer, the wholesaler, various transportation companies, and the manufacturer. Each of these companies in the chain must have more lawyers than it needed in the past. The costs for those lawyers are passed to the consumer. Again, if you are in the law industry, you are doing better than you were forty years ago. If you are in any of the productive businesses that are being bled by the law industry, you could be doing worse."
Which gets to an implicit point underlying my earlier posts: The US has become overregulated and sclerotic. Other countries offer an increasingly more competitive climate not only in which to do business but to simply live. It's no surprise a growing amount of our productive activity is being outsourced, so to the point where growing numbers of Americans are even seeking healtcare, adoptions and surrogate mothers abroad. We've overregulated and over-lawyered ourselves out of an increasing share of economic activity and other countries are not standing still.