Harvard historian Niall Ferguson uses this chart to explain why Americans are unhappy with their nation’s economy.
Last week Clinton’s supporters seized on new economic data showing that median household income rose by more than 5 percent in real terms last year. Poverty is down. So is the number of Americans without health insurance. So is unemployment. Yes, Hillary Clinton has had a few bad weeks. But don’t worry.
All this seems like grist to the mill of a campaign that essentially promises continuity. Yet there is a problem. Take another look at those figures for inflation-adjusted median household income. Yes, it was $56,500 last year, up from $53,700 the year before. But back in 1999 it was $57,909. In other words, it’s been a round trip — and a very bumpy one indeed — since Clinton’s husband was in the White House.
Telling Americans that they are nearly back to where they were 17 years ago and then expecting them to be grateful looks like a losing strategy. When two thirds of Americans — and even higher percentage of older white voters — say the country is on the wrong track, they are not (as Democrats claim) in denial about the Obama administration’s achievements.
They are saying that the country is on a circular track, and has been since this century began.
Hat tip to occasional links & commentary.
I think anybody who criticizes President Obama for wage stagnation ought to say what should be done instead. Not that Obama controls the economy all by himself. He has to deal with two other branches of government, Congress and the Supreme Court. And, in a free-market capitalist economy, the national government can only influence the direction of the economy, not determine it.
Donald Trump most certainly does not have the answer. His basic ideas are tax cuts for corporations and wealthy individuals, and curtailment of government regulation—basically the ideas of Ronald Reagan and George W. Bush. They haven’t worked.
I think the ultimate answer is something equivalent to Jill Stein’s Green New Deal. Short of that the U.S. government can put Americans to work on necessary public works projects to restore the nation’s physical infrastructure, and on programs to provide good education and health care for all.
Raising the minimum wage would help. Strengthening labor unions would help. Anything that raises the incomes of poor people, workers and the middle class would be good in and of itself, and would help create a consumer market consisting of the majority of the public and not just the top 1 percent. This would be a virtuous circle.
Reducing the power of the financial sector would help. The purpose of financial markets is to turn wealth into capital in order to serve the needs of the real economy. We lose when the real economy becomes an arena for financial speculation.