« Implicit Bias | Main | If At First You Don't Succeed, Try Again With Bigger Countries » Pew on the Middle Class09 Apr 2008 06:22 pm
This is a pretty striking trend. Politically, it's a bit tricky since the salient trend is the dramatic narrowing of the better/worse gap, but the betters still outnumber the worses. You want to tap into the sentiments of the growing "worse" bloc, but still can't let that kind of sentiment dominate what you're saying since there are all these "betters" out there still. Comments (40)
Perhaps people's recollections of how they were doing 5 years ago aren't the best gauge of how they were actually doing five years ago vs. today. 
The bit about all the betters out there is true...but a lot of those people might be worried that in five years they too will be in the worse column. One can be worried about conditions today and their potential impact yet still be better off now than five years ago. I bet a lot of people in the better column are nervously eyeing that rising "worse off" trendline, and may feel that they are only marginally on the "better" side.
Well, when Reagan used that line to such (apparent) great effect, the split was 52-25. With 31% saying they're worse off, many more than that will have friends or family who are part of the 31%. I don't think it's tricky politically at all.
Keep in mind that the income of individuals generally tends to go up as they get older. Thus, even when things are getting worse overall, you may have a plurality of individuals saying that they are personally better off (at least in terms of income).
are you more impressionable now? more illiterate? a greater sense of entitlement?
too many steves, however accurate people are about 5 years ago (who knows what "better" means, anyhow?), there is no reason to think that they are somehow more inaccurate in 2008 than at any time in the past 44 years. so when you have the "worses" at an all time high and the "betters" at an all time low, that does actually have some meaning in 44 years of data sets.... i'd suggest that the political way to play it is to ignore the whole better/worse question and instead play on what is causing insecurities: the end of the house price bubble; the weak job growth of the bush years; the stagnation of real take-home pay (associated with rising prices); the endless waste of iraq.
are you more impressionable now? more illiterate? a greater sense of entitlement?
Was the post title intended? Cause if it was it was pure genius.
interesting - the Ford/Carter years created a steep increase in malcontents, but the level stayed that bad throughout Reagan/Bush I. Clinton cheered us up, Bush II bummed us out again. Yet another example of 'the matter with Kansas?'
Mission Accomplished!!!
Note that "better off" is now well below 50% for the first time -- so if you ask the question "are you better off?" a substantial majority is likely to say "No!" A separate question to N -- What about those who get old enough to retire? If someone has retired in the past five years, and their income has (consequently) dropped, are they supposed to say they're worse off even if they're happier and have all the money they need?
BarryG, I have no way of knowing how a retired person would answer the question. My guess is that (as you imply) it would be less related to income and to the overall economy, since they're no longer subject to trends in the labor market, have Medicare, etc. The effect of the individual income tendency I described would be confined to working-age people who base their better off/worse off evaluation on their personal financial situation.
Seems like an excellent time for a Democrat to ask the question. Looking more carefully at the chart, we now have the smallest percentage (41%) who believe they are better off in the past 44 years, 28% believe there is no or little change, & the highest percentage who believe they are worse off. It worked for both Reagan & Clinton when confidence was higher than it is today.
Hey joejoejoe, Where can I get some of those magic scissors? They could really come in handy!
In general, I don't think questions of individual well-being are as relevant as questions regarding the well-being of the country. I think right track/wrong track questions are more salient when it comes to shaping a campaign's message, and those numbers clearly show a need to aggressively attack the President and the direction he has taken the country.
According to NPR's Marketplace tonight, compared to 4 years ago the median family income has gone down, even while the pie is growing. Normally economic prosperity is shared (in whatever proportions; see that old graphic about how every income level does under R and D)--this time, the wealth is not just concentrating at the top but actually leaving the middle and bottom. When people say they're worse off than they were 4 years ago, they're reflecting the truth.
well 5 years ago, the economy was really, really in the crapper, and didn't get any better until (ironically) it appeared that swift victory was at hand in iraq. i know i'm a lot better off than i was 5 years ago. i love this title... i'm pretty sure it was on purpose : )
There's not really much of a trend for either response. A linear regression of "Better Off" against "Year" suggests a decline in "Better Off" of about three percentage points over 44 years. (2008 is way below trend, as is 1988; 1998, 1999, and 2000 are way above trend.) In fact the coefficient on "Year" is not statistically significant. The data seem to suggest that the percentage of respondents saying they are better off fluctuates randomly around 50%. A linear regression of "Worse Off" against "Year" also shows a slight *downward* trend, with a decline of about 2 percentage points over 44 years. This is also not significant, suggesting the percentage of respondents saying they are worse off fluctuates randomly around 23%. (2008 is well above trend, as are the late-1980s years; the late 1990s are well below trend). We can't even say that people say they're worse off than 5 years age when the economy is in a recession--the only recession year for which we have data is 2008; it's apparently missing for 1974-75, 1979, 1981-82, 1991, and 2001. What I have to say is I don't think we can learn much from this. Much as I'd love to be able to use it to bash (honestly) Bush and the Republicans. If 2008 is something other than random fluctuation, we'll know in a few years--if the Gallup people keep asking the same question.
The question isn't are you worse off, it's are you better off. So "the same" isn't data to be ignored, it's people who aren't better off. This is America. If you work hard and play by the rules, things are supposed to get better. If our country's GDP goes up you're supposed to get a fair share of it. People know this has supposedly been a boom, and they know other folks got rich, but most of them aren't better off. Someone should be asking Reagan's question. Are you better off than youbwere 5 years ago? And then they should follow it up with the Democratic finish: Are we better off than we were 5 years ago? Is our nation on the right track, or 5 years from now will we still be shaking our asking ourselves this same question? And the nswer, of course, is our nation needs to return to its central values. Because the failed Republicn leadership has led us all astray.
The question isn't are you worse off, it's are you better off. So "the same" isn't data to be ignored, it's people who aren't better off. This is America. If you work hard and play by the rules, things are supposed to get better. If our country's GDP goes up you're supposed to get a fair share of it. People know this has supposedly been a boom, and they know other folks got rich, but most of them aren't better off. Someone should be asking Reagan's question. Are you better off than youbwere 5 years ago? And then they should follow it up with the Democratic finish: Are we better off than we were 5 years ago? Is our nation on the right track, or 5 years from now will we still be shaking our asking ourselves this same question? And the nswer, of course, is our nation needs to return to its central values. Because the failed Republicn leadership has led us all astray.
"This is America. If you work hard and play by the rules, things are supposed to get better. If our country's GDP goes up you're supposed to get a fair share of it. People know this has supposedly been a boom, and they know other folks got rich, but most of them aren't better off." Bingo. Right-wing policies have put the American dream in the crapper. We need globalization with a big net to deal with economic insecurity (disease, plant closings, etc.). It's funny how sentiments like "united we stand, divided we fall" are only embraced by the right when it comes to killing random brown people.
Pew On The Middle Class, Or, How I Learned Not To Worry And Love Trickle Down Economics. Pewned!!
I'm pretty shocked to see the numbers looking so much worse than they did at some other bad times in the past 40 years, namely the mid-70s. It was mentioned above that demographic factors may be involved. There are a lot more retired people now than there were then, and it seems that retired people's economic situation stays level or gets worse compared to working people and people getting an education, whose prospects tend to improve over a five year period. I also agree that the political approach to talking about the problem is not that difficult. A lot of the people who are doing better are not going to give the government and the economy much credit. They saved, worked two jobs, got out of debt through a lot of frugality, finished school. etc. Others who did well in stocks, who got a new, better job, or got a promotion, may give credit to the health of the economy. So even when 41% say they're better off, that doesn't mean they all think economic conditions are good. The situation really stinks right now and most people know it.
"According to NPR's Marketplace tonight, compared to 4 years ago the median family income has gone down" Inflation adjusted average hourly wages have been stagnant from 2003-2007, with those only with high school degrees losing 0.8% per hour, those with college degrees gaining 0.4%, and those with advanced degrees earning 0.6% more. One of the challenges of an information society is that we do expect to see dramatic returns to education. One would hope that higher levels of technology would enhance productivity and wages of the less educated, but it might also just make things cheaper in a way that is not well represented by a single inflation number. For example, a $500 computer you can buy today simply did not exist at any price in 2000. Moreover you can buy a heck of a lot of cheap stuff at Walmart now, although gasoline and food prices are up. But one has to admit that the last four years are not what you'd call a great economic time. I'd look for ways to enhance commerce, such as ending agriculture supports, de-regulating health insurance, opening up trade with Cuba, simplyfing taxes, and ending pointless wars (like Iraq and the War on Drugs). One data point, however - my family is making 100% more now than we did four years ago...
One addition, real after-tax income is up from 2004 to 2005 (this data takes a few years to digest). http://www.cbpp.org/12-14-07inc.htm The middle fifth saw a 0.8% increase in after-tax income, while the top fifth saw a 7.4% increase.
There's not really much of a trend for either response. ... the coefficient on "Year" is not statistically significant. Sorry, Donald Coffin, but you don't understand how statistics work. You are treating this as 15 observations. But it's 15 x N observations, where N is the average number of respondents in each year. Assuming N is reasonably large, any difference between years of more than a couple percentage points will be statistically significant.
Are "Petraeus scissors" found on the same aisle as "Damocles swords"?
As others have pointed out, the baseline expectation is that things should be getting better for individuals during most of their lives. So, the upshot politically is that anyone not in the better off category--and indeed potentially at least some of the people in the better off category who aren't as better off as they hoped to be--are likely to be receptive to a "change of course" message.
The worse off crowd is the reality based community. The better off group is the magic pony seeking contingent. Those who think the financial system has been saved by the Fed. The Fed who yesterday said it was game to being bailed out by the Treasury. That's you and me folks. The same Treasury who has had to borrow and extra $175 more than expected over the last month because tax receipts are imploding. Luckily for them there is a panic into Treasury paper as so much other paper is too risky. Someday soon it will occur to them the Treasury paper is the biggest risk of all. Treasury paper is the most overvalued asset in the entire world.
Edit.
How would this compare to "do you think the country is better off than five years ago?" My personal situation is better, but the country is worse off. Are there any data to what extent each of these questions matters?
I'll just reiterate what N and bob in fla said. N made the point that one's circumstances improving with age is the norm, and even if most people are better off than they were five years ago, people can still be worse off on the whole. People who were enjoying a comfortable retirement five years ago are now dead, and people who were still in school five years ago are in a crappy job market, trying to make ends meet, perhaps with a kid or two. And bob in fla emphasized that the "are you better off than you were four years ago?" worked well for Reagan and Clinton when the numbers were much better than they are right now. Given that the answers to this question are the poorest by far that they've been in the past 44 years, it's got to be the right time to hit hard on that question.
I don't think it's hard to make the point. In 44 years of polling, the highest number of Americans thought they were better off in 1998. 57% thought so, versus 16% who indicated they were worse off. In the last 10 years, the better off Americans have fallen 16%, double the steepest decline previously seen in that 44 years. At the same time, the group of Americans claiming to be worse off more than doubled from the alltime low of 15% in 2000 to 31% today. The smallest previous margin between the upbeat and downbeat was 21%. Now a mere 10% margin remains, with most of that record pessimism occurring in the past year. Though the polling doesn't go back far enough to be certain, many believe this is the most pessimistic Americans have been about their financial security since the Great Depression. Political experts indicate this creates a high probability of voters rejecting incumbents and rejecting the party controlling the White House. Further, with this level of record-breaking pessimism, some predict the presidential race won't even be close as voters send the clear mandate: "we're mad as hell and we demand change!" (See how easy it is to convey the message that a groundswell's afoot that everyone who's feeling any pinch wants to be on board with? And despite the 41%, it means for some in the smaller group, economics will transcend race for the first time since 1964. Remember, reversing the minds of 4% of the voters - compared to 2004 - will provide the largest margin of victory for EITHER party since 1984).
I'd take that graph with a pinch of salt, for two reasons. First, since asset values have an obvious affect on these sorts of opinions, it would make sense for folks to feel that they are worse off today than they were, say, two years ago: their house is probably worth less than it was at the peak of the market, and their investments are probably worth less. But are they worth less than they were worth five years ago (this time in 2003)? Highly doubtful. The stock market bottomed in October of 2002, and that was the beginning of a 4 year+ bull market. Similarly, housing prices haven't fallen back to 2003 levels. The second reason this seems dubious is portion of the graph that covers the 1970s and early 80s: the 70s were a period of economic stagnation, high inflation, high gas prices (and shortages), anemic stock market returns, great American cities like New York in decay and despair, etc. The early 80s featured the sort of recession that most of you whippersnappers have never experienced, as Paul Volcker jacked up interest rates to double digits to wring the inflation out of the economy. Either Americans aren't answering the question honestly or the biased media has had a profound effect on their perceptions (i.e., by the paucity of reporting on the economic expansion followed by the sky-is-falling reporting now).
Either Americans aren't answering the question honestly or the biased media has had a profound effect on their perceptions (i.e., by the paucity of reporting on the economic expansion followed by the sky-is-falling reporting now). Whistling past the graveyard? Suggesting Americans are too stupid to count or too dishonest has never been a successful political strategy.
"Suggesting Americans are too stupid to count or too dishonest has never been a successful political strategy." Who said that should be a political strategy? I was just explaining why this seems dubious to me.
Fred, I'm not sure what you are trying to explain with your discussion of asset prices, since a plurality did in fact report they were better off than they were five years ago. Also, you might want to take a look at the distribution of wealth in the form of marketable assets in the United States: it is highly concentrated, and thus for most Americans asset appreciation is only a small component of their overall financial picture.
I think Fred has a point in this regard - the freshness/recency of economic downturn probably has a big bearing on how people feel they are doing. Also, the downturn doesn't have to have hit people's incomes (yet). The widely reported decline in home prices is enough to make most homeowners, and particularly highly leveraged ones, get a strong sinking feeling. So in sum, if unemployment stays stable and home prices bottom out and stabilize this year instead of continuing to spiral downward, people's economic situations may not improve, but some of the pain will subside. And that's before any actual economic recovery as such. A counterpoint, though. There are subsets of the population for whom current trends, even without further decline, will become less and less tolerable. Think parents of college students or the recently graduated, who are at the wrong end of 50 years of double-inflation tuition increases; or the employed but uninsured, who number much greater than even 10 years ago and who are feeling the geometric rise in premiums and other costs; or former $16/hour factory workers for whom larger unemployment trends are irrelevant - their highest earning days may be over. In doing some back of the envelope parsing of the demographics, it is hard to think that Fred's purported underreporting of the good economic times is a real factor distorting perceptions, even if there is a slight premium on pain right now due to immediacy and, to some degree, media exposure.
Also, the downturn doesn't have to have hit people's incomes (yet). But more importantly, the supposed upturn we were in before this didn't hit their incomes either. Since 2000, median income has declined, and during this expansion, employment didn't boom. It didn't feel like a good time, and now we're being told the good times are ending? Terrifying. Between 1976 and 1980, the "worse off" stat went from 20 percent to 24, and the "better off" went from about 55 to 52. Reagan successfully campaigned on a message of "are you better off now than before" and a blame-the-liberals-and-blacks, we're returning to Traditional Values and everything will get better. Between 2000 and 2008, the number of people worse off has LEAPED from 15-31 percent, an all-time lw to an all-time high. "Better off" numbers have likewise dropped from an all-time high to an all-time low. Put this together with a record 81% wrong-track number? Whichever presidential candidate, whichever party best articulates a message of change will win. And you need to explain to people whose fault it is. So far, no one has mamaged to construct a compelling narrative, and it's scary becuase the Republicans are much, much better at these kinds of "here's how we got here" stories than Democrats.
Comments closed April 23, 2008. |
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Heads in the Sand
Just add some Petraeus scissors* to the chart and things are looking up!
* Petraeus scissors - suggested future results that are the opposite of past trends
Posted by joejoejoe | April 9, 2008 6:38 PM