Thursday, December 18, 2014

An Alternate View

Just about everybody says the middle class is hurting, incomes frozen or shrinking and in a funk. The Washington Post has found an economist who disagrees, Stephen J. Rose of George Washington University.
Rose (snip) argues that researchers would reach a far different conclusion if only they used different--he argues, more comprehensive--data. He noted that the Congressional Budget Office found that the inflation-adjusted incomes of middle-income households went up 50 percent percent (from 1979 to 2007).

CBO saw a dramatic difference in middle class income gains because it captures information that tax records miss, such as income from transfer programs such as Social Security and Medicare, Rose said. CBO also takes into consideration changes in household composition, which makes a difference as the nation grows older and more Americans are apt to live alone, or at least in smaller households, than than they did decades ago.
I imagine the non-partisan CBO has the right view of this.