Are you better off than you were four years ago?
On Saturday, October 20, The Boulder Daily Camera published my answer to this question:
Am I better off financially? No. My income is lower, while living expenses have increased.
I’m not alone. For each state, the Washington Post graphed trends of inflation-adjusted median household income between 2007 and 2011. During this time, Colorado’s median household income decreased by 7.3 percent. Nationally, median household income dropped by 8.0 percent. And yes, the number of income earners per household was constant during this period, which the Post should have mentioned.
But those of us actually earning an income should be grateful to be employed. Last month’s BLS “official” unemployment rate was 7.8 percent, same rate as in January 2009 when Obama took office. But this is misleading, as it does not include the unemployed who have given up looking for jobs. Including these people, the unemployment rate has yet to fall to the level it was at when Obama took office.
Given the decrease in income and employment rates, it’s not surprising that Americans’ net worth has also decreased since the financial crisis preceding the 2008 election. In June the Washington Post summarized a study by the Federal Reserve: “Median net worth of families plunged by 39 percent in just three years, from $126,400 in 2007 to $77,300 in 2010. That puts Americans roughly on par with where they were in 1992. … Over a span of three years, Americans watched progress that took almost a generation to accumulate evaporate.”
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See also this Reason magazine article:
The Recovery That Wasn’t: Three and a half years later, White House officials are still making wildly optimistic comments about the economy they mismanaged.