Monday, November 30, 2009

The Economic Condition of Poor Americans (and the rest of us) Continues to Improve

Some fascinating data compiled by economist, Steve Horwitz, on how poor people compare to the average person in 1971 and to the average person in 2005:


I think these data largely speak for themselves. The only categories where the poor have become "worse off" are in freezers (likely due to more being built into fridges) and now telephones, which is, of course, explained by the gains in cell phones. Stoves are down slightly, but that too could be due to swapping regular stoves for microwaves or even toaster ovens. In any case, it's a pretty small decline.

The overall lesson is clear: lives for Americans below the poverty line continue to get better in terms of what they are able to put in their households and have to make use of everyday. And do note that the average American household in 2005 was doing much better than its 1971 counterpart. MUCH better - and this doesn't even count medical advances and the like. So whatever one hears about stagnating wages and the like, the bottom line is ultimately what we can afford to buy and have in our households to improve our lives. By those measures, life for the average American is better today than 35 years ago, life for poor Americans is much better than it was 35 years ago, and poor Americans today largely live better than the average American did 35 years ago. Hard to square with a narrative of economic stagnation or decline.

I'd challenge any naysayer to look at this data and try to claim the poor are getting poorer, that incomes haven't risen over the last 35 years, or that we are becoming worse off (materially) than our parents'/grandparents' generation.

Exciting stuff!

More on this here and here.

No comments: