CBO report on income changes vs inflation

[pdq]

Yesterday, the officially non-partisan Congressional Budget Office offered an update on changes in income, prices and the share of income needed for consumer consumption.

The bottom line:

Specifically, using two measures of income, CBO found the following:

For households in every quintile (or fifth) of the income distribution, the share of income required to pay for their 2019 consumption bundle decreased, on average, because income grew faster than prices did over that four-year period.

In graph form:


In every quintile of income (measured in either of two different ways) the share of income needed to purchase a “consumption bundle” of goods and services (defined in 2019, before Biden) dropped.

Are you economically better off now (during the Bidenomics Apocalypse) than you were pre-pandemic (during The Greatest Economy the World Has Ever Seen)? The CBO seems to think that the answer for the average American in each income level is yes.

Must be Fake News.

(And individually, YMMV, of course.)

[Acer]

Yeah, but gas is $4.00*

* The same inflation-adjusted price as it was not only before the pandemic, but since 1978. Counterintuitive, I know, but there it is.

[kj]

Does that take housing prices into account? Does that weight all things sold equally (the most necessary items increased in price most, last I saw, whereas things people almost never buy went down in price). I was just in Monaco and elsewhere in the Mediterranean, and restaurants were noticeably cheaper than in Boise. That is weird. I know a lot of people struggling (some of it is drastically increased property taxes) and they aren't imagining that things are worse. Saying they are wrong is really counterproductive. Why are they now struggling when they weren't? There are good reasons, we just have to figure out what they are.

[pdq]

I'm not saying they are wrong; I'm pointing out the data is clear that, on average, buying/paying for stuff in the US uses less of your income than it did in 2019.

...and I did say YMMV.

[Ted King]

I wonder if some part of the dynamic is that young people tend to like to feel like they are "getting ahead" in life. I wonder if many of them feel the burden of extra costs they didn't have a few years ago more than the increase in wages. If they are getting more money maybe feel like they should be getting ahead, but it doesn't feel that way because a lot of them aren't getting ahead - though they may be staying about the same.

/armchair psychology

[pdq]

Ted King wrote:
I wonder if some part of the dynamic is that young people tend to like to feel like they are "getting ahead" in life. I wonder if many of them feel the burden of extra costs they didn't have a few years ago more than the increase in wages. If they are getting more money maybe feel like they should be getting ahead, but it doesn't feel that way because a lot of them aren't getting ahead - though they may be staying about the same (or on average, doing better (YMMV)).

FTFY

[Mr645]

yea, things are great

https://www.cnbc.com/2024/05/16/credit-c...-rise.html

https://www.statista.com/statistics/2462...ed-states/

[sekker]

Mr645 wrote:
yea, things are great

https://www.cnbc.com/2024/05/16/credit-c...-rise.html

https://www.statista.com/statistics/2462...ed-states/

'Those links do not mean what you think they mean'.

CC debt is at the expected recovery rates from pre-COVID times, and savings rates are bouncing back post COVID inflation bubble.