Median Household Income
Real median income fell, for the fifth straight year. Why are voters negative on the economy? Simple. Even though the GDP grew at a healthy clip, the benefits of that growth only accrued to upper-end earners. In simple terms, the rich are getting richer—and the non-rich, who aren’t getting richer, say the economy stinks.
Well, maybe. But as of August, the Census Bureau at http://www.census.gov/hhes/www/income/income04/prs05asc.html seems to have said that wasn't true:
Income, Poverty, and Health Insurance 2004 - Press Briefing As already noted, the 2004 median money income for all households was unchanged from the year before, at $44,400. This is the second consecutive year that households did not experience an annual change in real median income, after declining in real terms for two years (in 2001 and 2002).
Their supporting figure is http://www.census.gov/hhes/www/img/incpov04/fig05.jpg which goes back to 1967; you could argue it makes Reagan and Clinton look good and Bush look bad, or not, but it does not seem to support the DailyHowler echo or Prof Krugman's statement. If they've changed their report, or if he explains why their report should not be believed (e.g., households are larger, so that for each household size median money income is smaller but the average has not changed? Or money income is not the only income, and doesn't count employee benefits which have fallen? [But I thought they'd risen] Or other factors like household wealth, mainly values of housing, have fallen? [But I thought they'd mostly risen. Clarification here would really help.]) then I'd like to know.
As a separate issue, the DailyHowler explains negative views as due to the fact that
the rich are getting richer—and the non-rich ... aren’t getting richer
But the Census Bureau also said that
According to the most widely used measure, the Gini index, household money income inequality did not change from 2003 to 2004. Another measure is based on the share of total income that each 20 percent of households received. None of the shares changed between 2003 and 2004.
That's not to say that the problem isn't real: the Bureau continues, saying that
Over the last decade, however, the Gini index has increased, indicating a higher level of income inequality than in 1995.
In fact http://www.census.gov/hhes/www/income/histinc/h04.html seems to indicate that the Gini rose pretty steadily through the 80s and 90s, peaked in 2001, fell (presumably from bubble-popping, but maybe GWB did some invisible-to-me actions against inequality--that's what the numbers say, right?) and is now back up to its 2001 value.
Now, I'm suspicious of all these figures. If people are spending more on Christmas, as suggested by the December 7th Chicago Tribune's rather depressed "slower sales growth" report that
Retail sales rose 3.5 percent for the week compared with a year earlierthen I suspect that in fact they're feeling better off. Moderately.
That doesn't mean I want to support our President on economic policy: I don't; my economic policies would have been totally different. (Free Trade! Fiscal Responsibility! ... and so on.) But I think that the Daily Howler needs to cite sources, or at least I wish Bob Somerby would explain why I'm misreading these.
[Update: I see Angry Bear on earnings, giving graphs showing that wage income is stagnant but compensation (including benefits) rising startlingly, and saying
nearly all of our real compensation gains today (and I do think we're seeing them) are being eaten up by the monster that we call a health care system.That looks plausible to me. It doesn't much support the Howler's take, but it is not reason for great rejoicing. I think people don't feel much better off when their health care costs rise, even if it's because they're getting expensively better health care.]