Back to my points (AB), we have survived a pandemic, provided for the welfare of the citizenry, and the nation is on its way to better times. The only sticking point being the 2017 tax cut which is leaving the nation with another reoccurring deficit.
How quick the influential 1-percenters were to move away from Biden as this was on his list of things to fix. Will a President Kamala make it a priority too?
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Back in the 1990s, when Republicans and even many Democrats were looking to cut and/or privatize Social Security. The standard wisdom being to be taken seriously, you acknowledge Social Security was facing a crisis. Even many progressives who supported the program repeated that line.
Social Security, of course, was not in a crisis, and it was important to say that to beat back the privatizers. We are seeing much the same story today, as when The Washington Post lectured us in a recent editorial headlined “Telling Americans the Economy Is Good Won’t Work.”
Well, the economy is good, and we should not be shy about saying that. To be clear, we still have tens of millions of people who are struggling to make ends meet and who sometimes can’t. This, however, is a structural issue that will take time to overcome and is a near-impossible task with a divided Congress.
Like many progressive economists, I view the unemployment rate as the single most important measure of the health of the economy. By this measure, the economy is doing great. We have seen 28 consecutive months of below 4 percent unemployment, beating the streak in the late 1960s boom. This is extraordinary — and something almost no one would have considered possible when Joe Biden took office.
Unemployment is a big deal. Not least. because in an economy where most people depend on their wages for the bulk of their income, those who don’t have a job are screwed. But the benefits of low unemployment go well beyond simply putting more people on a payroll.
In a tight labor market, workers have more bargaining power, especially those at the bottom end of the wage distribution. We have seen that during this recovery. The real wage (inflation-adjusted) for workers in the bottom decile of the wage distribution rose by 12.1 percent from 2019 to 2023—and this was following decades of stagnation.
Low unemployment allows workers from groups that face discrimination in the labor market to get opportunities they otherwise never would have had. In this recovery, we have seen the lowest unemployment rates ever for Black Americans and Hispanic Americans. The wage gap between Black and white workers has also fallen to a record low.
A strong labor market also means that people can escape bad jobs. In late 2021, tens of millions of workers left their jobs for better ones, and by 2022, workers reported the highest rate of job satisfaction ever.
This good news has barely been a blip in the media’s reporting on the economy. Instead, there have been endless stories about people being hit hard by inflation. It is often highlighting situations where the size of the hit is implausibly large. The reporting rarely points out that much of the inflation was a result of the pandemic and that nearly every other wealthy country took a comparable hit. This is like reporting on a housing shortage in the aftermath of a hurricane and not mentioning what destroyed the housing stock.
Now that inflation has fallen back to its pre-pandemic pace by some measures, much of the media has chosen to highlight the absurd expectation that prices will go back down. Prices will not fall back to where they were four years ago, because nominal wages have risen by 22 percent. Anyone expecting prices to fall following the high inflation of the 1970s would have been rightly treated as a kook, not featured prominently in news stories on the state of the economy.
We also keep hearing about invented crises. CNN decided to spotlight the retirement crisis at a time when most near-retirees have never been better prepared for retirement. And there is the perceived tragedy of young people never being able to own a home, even though their ownership rates are above pre-pandemic levels. And The New York Times just told us that recent college grads can’t find jobs, when their unemployment rate has returned to pre-pandemic levels.
We rarely hear about the 14 million homeowners who refinanced their mortgages between 2020 and 2022, most of whom are now saving thousands of dollars in annual interest.
One final point: No one is telling people that they are wrong about their own financial situation. People have negative views on the economy in general, but surveys find that people say they are doing pretty well themselves. Their negative views of the economy stem from the fact that they believe others are doing poorly. When we tell these people that the economy is good, we are just telling them that everyone else is doing as well as they are.
In short, we should stick with the data, not the pundits. Given the political and practical constraints that President Biden has faced, the economy is good—even excellent. We should be repeating that over and over again.
Do People Think the Economy Is Bad Because the Media Failed, or Because the Economy Is Actually Bad? The Nation
