The Economic Reality of the Past Seven Years

The latest income and poverty figures from the Census Bureau show that, while there were some improvements during 2007, the typical family, after seven years of tepid economic “expansion,” has still not made up the ground it lost in the last recession—unprecedented by historical standards.

It’s therefore no wonder that a recent Pew Research Center poll found such large segments of the public reporting difficulty affording various essentials of daily life: Thirty-eight percent said it was difficult or very difficult to afford food; 46 percent said it was difficult or very difficult to afford health care; 49 percent reported problems affording home heating and electric bills; and 68 percent said the same about affording gasoline.

And the public is generally gloomy about their ability to keep up with the cost of living. In the same poll, just 6 percent said their income was going up faster than the cost of living, 28 percent said their income was staying even with the cost of living, and a whopping 64 percent said their income was falling behind the cost of living. These public sentiments are consistent with the story told by the Census income data. They reveal the truth behind the Bush administration’s attempt to put a happy face on its dismal economic record.