I like the brighter future. It does seem kind of weird to count increased income, lower debt, and higher savings as separate wins. Higher income makes sense, but the other two are caused by the first. People couldn’t really increase discretionary spending, so debt and savings would have to improve.
I’d expect all of these metrics to not improve post covid. No more help from the government to increase income, no extra money to decrease debt (lower income, higher ability to spend discretionary), and same for savings.
Well! Do more of the same! Obviously people are generally experiencing better lives, right? (No, actually they are not (US-focused).)
If the metrics are wrong or only partially focused, their meaning is less or non significant. There is ample recent evidence that only a narrow upper class is improving while the increasing lower class is dropping in terms of cost-of-living-adjusted income.
Median income perhaps, or GDP of the bottom 25% of the population? The current theory is that GDP increases trickle down, but it's not totally clear they do in the current system. Those metrics might lead to better overall outcomes on the key happiness metrics.
1) In 2023, 72% of Americans reported that they were “at least doing okay financially”, a marginal decrease from 73% in 2022, but notably below the recent peak of 78% in 2021.
2) Monthly incomes in 2023 saw an uptick for 34% of respondents compared to 2022, a trend that has continued to increase over the last four consecutive years.
3) Among retired individuals who constitute more than a quarter of the U.S. population, 80% said they were doing at least okay financially, surpassing the national average.
Income inequality is up and disposable income is down, but neither of these are measures of living standard. Access to information, quality of life, expected lifetime, food security, leisure time and spending, etc are all improved.
I'm not sure the underlying data really supports that inequality has improved, depending on how you slice the percentiles. They kind of give up the game halfway through in my opinion:
>While still better off overall than before the pandemic, the poorest fifth of households have been slowly bleeding cash since late 2020. The rest of the bottom 50% continued to stockpile savings even as inflation began climbing.
Another way to interpret that is the poorest 20% have gotten poorer and the next lowest 30-50% are economical stressed and responding by hording money in ways that could create a self fulfilling economic downturn.
That would be very interesting. I would expect the higher income side to remain practically unchanged while the lower income side would move up to 50% or so, but still be far below the higher income side.
Even here there is a definitive and deliberate bump right during the beginning of the COVID times. I don't believe that's an artifact. Somehow this analysis is saying people are vastly better in August than they were in February.
I think that "average" in most of the different versions is useless. The millionaire and billionaire classes can be so over-represented they can draw the rest up. It doesn't answer if all of society is actually becoming more well off or just the cream continuing to rise.
Thanks. So, it's assets less debt. This is a huge flaw in the study. Even if everyone in the country had exactly the same income and savings rate, you'd still expect a triangle distribution of wealth because of differences in age (graded by years of saving followed by years of retirement on the downward slope). In reality, you have a huge number of people living with a high quality of life with almost no savings (house fully mortgaged, some small equity in their car maybe). Any measurement that counts these people the same as homeless is deeply flawed.
And then we're going to compare that bogus metric with what random people think it might ought to be after a few moments of thought. How many of the respondents do you think asked for a paper and calculator before giving their answer? This whole article is terrible rhetorical slight of hand.
It would be a valid comparison if it was compared to the average person's wealth increase (e.g. the value of their house, 401k) vs. their income taxes.
Median is the right metric. Household vs. personal, I'm not sure if it matters.
Economic cycles run in decades, hence you need to look at terms longer than decades to see if there is sustained improvement or not. From 1986 to 2019, there was gain at the median. [2; Table H-6] shows that since 1975, the median household income has increased by an annualized 0.7%. Each of the dips in [1] correlates to macro-economic events such as the '89 recession, dot-com/Y2K thing, sub-prime mortgage crisis. When the 2020 number come out, we'll likely see another dip due to COVID.
None of those events were precipitated by wealthy persons somehow screwing the poor. The sub-prime crisis comes the closest, but many wealthy persons were also affected badly by that policy error. The entire workforce of Lehman Brothers, for example.
I’d expect all of these metrics to not improve post covid. No more help from the government to increase income, no extra money to decrease debt (lower income, higher ability to spend discretionary), and same for savings.
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