Heading into the November presidential election, one of the biggest issues on voters' minds is the economy. According to a new poll, 73% of Americans say strengthening it is their top concern.
Economic signs are improving, but many Americans don't feel the relief.
Inflation showed signs of cooling and both stock indexes and corporate profits are up. But many Americans aren't feeling any economic relief.
The US economy and one's personal financial situation are separate situations.
The economy is doing great, high dollar value, low unemployment, new job creation, small business subsidies, government investment, it's all greatly strengthening the dollar.
That's the strong economy.
Regulatory economic practices and corporate lobbying against fair pay and price limits on housing and living essentials has been increasing for the majority of Americans for decades.
No unions, no labor rights. No regulatory oversight, no mortgage caps.
The economy is doing great and it has nothing to do with grocery prices or something like gasoline which is largely imported and based on the whims of a single family thousands of miles away that wakes up and decides what the price will be.
The US economy and one's personal financial situation are separate situations.
I think the point no one is outright saying is that yes, you're correct. However, that shouldn't be the case.
Many Americans find it appalling that we measure the economy by stock prices which don't reflect the economic situation that is experienced by the vast majority of Americans. They believe that we should measure the economy based on things like housing and food affordability, with less emphasis on the economic situation of the wealthy few who don't need to worry about those day to day concerns.
When people rate the economy they are looking at their personal situation. The article is complaining that people aren't looking at all these economic indicators, but it's not clear why they would care about them if they personally are facing hardship.
When people write about "the economy", including the person who wrote this article, they generally focus on just two things:
Inflation
Unemployment.
Those are the two things mentioned in the subtitle of the article. It's no coincidence that those are also the two priorities of the Fed. And those are also the two macroeconomic indicators that are most likely to affect American personal finances. The first one relates directly to gas and grocery prices, BTW.
So there is good reason to be glad when the economy is doing great.
An 84-year-old incumbent party-line centrist was running against Hitler, and the left party at the time spent all its time attacking the centrists (they called the establishment left party “the main enemy”), and ran their own third-party candidate in the election, siphoning votes away from the center.
A few years later, Hitler had managed to seize power and most of the leftists were in the camps or dead. They were the first of his targets, even before he started working for real against the Jews.
I’m being a little bit selective about it to emphasize the similarity with today, and glossing over some important differences in the situations. But also, the situations are eerily similar, at the core.
Well, the ramp up to the "Machtergreifung" was, but the actual ascend to power was 1933. Again, just like in the US: Vote in November 2024, inauguration Januar 2025.
But also, the situations are eerily similar, at the core.
Which makes me shiver. I know that most Americans learn only a very limited subset of history in school, and they get even that wrong (How many people in the US still call the civil war the "War of Northern Aggression"?). If I were a history teacher in the US, I would see to add a thorough lecture about first half of 20th century Germany at the next avalable chance. And tell them why American soldiers gave their lives to fight it.
And maybe they should add "The Wave" by Morton Rhue to the literature curriculum, if they have not done that already.
Ask any historian what are the lessons of the 1932 German elections, and they'll tell you: If you're upset about the establishment incumbent, and specifically the state of the economy, it's okay to overlook serious warnings about the other guy
Despite a low unemployment rate and slowing inflation, many Americans believe the economy isn't doing well because food and gas prices are still high.
Well, the government isn't gonna induce deflation. Wages may rise, and a low unemployment rate contributes to that, so the price may fall relative to your purchasing power, but in absolute terms, the prices are where they are.
"The real wages are increasing much faster than the inflation rate, which is very steady," said Kishore Kulkarni, an economist with Metropolitan State University in Denver. "And therefore, the real wages are in fact increasing, but people are not feeling it because there is so much negativism outside."
So I spent some time looking into this wage increase stuff and I did find this fun chart with inflation adjusted wages growing 2% in the last 5 years, that’s pretty paltry compared to the corporate profit increases. I’d bet that power imbalance is a large factor in consumer sentiment falling against otherwise good looking economic data.
We’re in a weird economic time right now where the median is actually misleading.
Wages at the bottom are going up hugely (beating inflation by 12 percentage points). Wages at the middle (median) are pretty much unchanged as you noted. Wages at the top are falling behind inflation. I.e. inequality is going down for the first time in God knows how long.
I talk about it elsewhere in the thread and link to a couple articles, but the short answer is that you’re not wrong but median real wages aren’t the whole picture right now.
And yes corporate profits are a huge problem. There was a huge corporate tax increase in 2023 that funded some of the stuff the led to the 12% wage increase at the bottom end, but it’s nowhere near enough.
The problem with inflation is that the cat can never go back in the bag. Sure, the Fed says they have inflation "under control" at the moment, but it's still way higher than where pre-covid projections predicted it would be at this time, and real wages have not nearly caught up to the increased prices that literally everyone who earns a paycheck for a living is feeling right now. High cost of groceries and gas will never go back to the way they were, and no matter who ends up sitting in the Oval Office next January, they won't be able to change that fact.
Workers across the country need to wake up and realize that they outnumber the owner class 10,000 to 1. A general strike could grind the entire nation to a halt and then they'll start listening to what we have to say. The politicians in Washington have already signaled that they don't care if average people can't make ends meet and nobody is coming to save us, so we have to take matters into our own hands using the tools proven to work time and time again - worker organization.
So there's a pretty concerted effort to make "the economy is actually getting better" stories sound untrue with some particular talking points - it's actually really effective. Here are some of the big ones. You can see why they work.
Replying to "the economy is getting better" with "how DARE you say the economy is good and all the problems are fixed, clearly that's not the case" as a way of reframing away from the conversation of whether things are getting better, or worse, and why that is. Basically interfering with the effort to understand the policies that help or hurt by simply asserting that everything's bad, so nothing being talked about can possibly be a good thing.
Saying "well I'm not doing okay, how dare you say I'm not struggling" and getting all fucked up and angry about it, so that anyone that tells you that millions of low-income workers are making more now than they were a few years ago, like way more, and that's a good thing, looks like an asshole
Bringing up that the CPI excludes some categories, and implying that if it did include them, it would show more inflation than what it does (including the pretty significant spike in 2022). This one is actually a really clever subterfuge, because of how complicated it gets to explain why it is wrong (whereas if you just say "CPI doesn't include housing costs" or whatever, people can grasp that instantly and make the connection and assume that housing costs would change the value if they were included).
Saying "well who cares about the stock market, I just know I'm struggling" when no one said anything about the stock market or the rich-person economy metrics, and everyone's talking about inflation-adjusted wages and nothing about the stock market
They're all tricks. There are more but those are some of the main ones
And you see the same 4 or 5 of them, over and over again, if you start looking
You'll see some of them in comments nearby to this one, I guarantee it
Edit: More
Insisting that when cumulative inflation is 20%, and 10th percentile wages have gone up 32%, wages aren't keeping up with inflation, simply because you insist that they aren't. If anyone tries to say numbers, just say they don't count.
Focus on the 20% inflation, because it feels real. People can see it in grocery prices, it's tangible. It rings true. The wage growth is mostly at the low end (truck drivers, housekeepers, manufacturing) where most Lemmy users can't see it, and even when someone's wage has gone up, it's easy to decide it happened because of some other factor, whereas $7 for a carton of eggs is right there in your face and memorable. And universal.
What are these "tricks" for? Millions of us out here are struggling. "But you're earning more money!"... Ok, a dollar more? While everything else has gone up including rent with a near 40% increase in the last few years in some places.
To just be so dismissive of those barely surviving sounds like you're coming from a place of privilege.
Insisting that when cumulative inflation is 20%, and 10th percentile wages have gone up 32%, wages aren't keeping up with inflation, simply because you insist that they aren't. If anyone tries to say numbers, just say they don't count.
Focus on the 20% inflation, because it feels real. People can see it in grocery prices, it's tangible. It rings true. The wage growth is mostly at the low end (truck drivers, housekeepers, manufacturing) where most Lemmy users can't see it, and even when someone's wage has gone up, it's easy to decide it happened because of some other factor, whereas $7 for a carton of eggs is right there in your face and memorable. And universal.
This is also a little bit of the getting angry or fucked up tactic, too. See? I look like an asshole now, with all my numbers.
Just making up a number of 40% inflation I haven't seen before. I don't think that's common enough to warrant an entry of its own. Want to show me where you got 40% from?
I don't feel the economy is getting better but I blame inflation on trump not continuing obama slowly raising interest rates and so when covid hit we were already at zero. Covid actually saved trump from inflation on his watch as we reduce demand for about a year or so amount of resources which managed to shift it to just out of his term.