Happy New Year: Already Depressed Median Household Income Has Gone Nowhere For Almost Almost Two Years
In an earlier post today (at NewsBusters; at BizzyBlog), I noted that reporters at Politico and CNNMoney.com seemed mystified at a CNN/Opinion Research Corporation poll showing that 68 percent of Americans believe the economy is in poor shape, and that over half believe it will still be that way a year from now.
One reason for their incredulity is that, perhaps deliberately, they haven’t been paying attention to household income data compiled monthly by ex-Census Bureau workers at Sentier Research. Sentier’s latest report covering November came out today. It shows that annualized inflation-adjusted median household income is still more than 7 percent below where it was when Barack Obama took office in Janaury 2009, and that it’s gone nowhere in the 23 months since December 2011. At an index value of 92.7, November’s figure is virtually the same as it was in December 2011 (92.8).
To its credit, the Washington Post’s Wonkblog found Sheila Bair, who “served as Chair of the Federal Deposit Insurance Corporation from June 2006 through June 2011.” Ms. Bair calls the following her favorite graph of the year:
This is why Ms. Bair chose the above graph (bolds are mine):
… for a large number of American households, there has been no economic recovery. Caught in a vice of chronic unemployment and falling wages, real median household income (excluding capital gains and losses but including cash government benefits) has declined 4.4% since the “recovery” began in 2009. For many households, the drop has been more severe. For African-American households, it is 10.9%. For those under 25 years old, it is 9.6%. For single females with children, it is 7.5%. Indeed, the only households to experience an increase in real income are those 65 to 74 years old.
So as the investor class celebrates the stock market’s bubbly 25% gain in 2013 courtesy of quantitative easing, let’s not forget the plight of those Americans who work for a living. And in 2014, let’s face up to the ineffectiveness of monetary policy to help them and the desperate need for fiscal leadership to generate real, sustainable growth.
Bair was appointed by George W. Bush in 2006. From the title of one of her her blog posts (e.g., “Time to abolish Fannie and Freddie who now account for 75% of the mortgage market, virtually all taxpayer backed” and ), it appears that she isn’t a slavish adherent to Keynesianism. On the other hand, she doesn’t fully appreciate the gravity of our financial situation. In January, she tried to explain “Why Republicans need to help Obama.” Obama is not interested in their help at all, Sheila.
Unfortunately, Bair’s guest post is only one of three items returned in a Google News search on Sentier Research’s firm name for the past week. The other two refer to older data.
It’s remarkable that the press, to the extent that it has noticed stagnant incomes at all, has rarely if ever assigned the blame to Obama administration economic and regulatory policies. That certainly was not the case during the George W. Bush administration, when median income was generally only flat and not stuck at the bottom of a crater.
Instead, the press has allowed itself to be co-opted by Obama’s speechifying about “income inequality,” which happens to have deepened on his watch, and arguably because of his administration’s policies.
Cross-posted at NewsBusters.org.