This meme from Snarky Pundit (recently shared by Occupy Democrats) pretends things used to be better before Reagan came along. This forgets the 1970s was a time of economic malaise, with stagflation and a lower standard of living. In fact, the data shows things are much better today.
-The median household income in 1980 was $49,406 in 2016 dollars. The median household income in 2016 was $57,617. This is more than a 16% increase.[1][2]
-If we break it down by quintiles, the increase is even more impressive. If we think of middle class, “breadwinner” working households, those would be the 2nd, 3rd and 4th quintiles (omitting the poorest and richest fifth of earners). In 1980, the 2nd quintile of households averaged $38,905 in inflation adjusted dollars, compared to $45,600 in 2016 (a 17% increase). The 3rd quintile went from $59,645 to $74,869 (a 25% increase) and the 4th quintile improved from $87,332 to $121,018 (a 39% increase).[3]
-This increase in income comes even as hours worked declined. In 1980, the average employee worked 34.9 hours a week, today it’s 34.5 hours. So, more money for less work.[4][5]
-The increase in median income also comes as labor force participation declined slightly, from about 64% in 1980 to 63% today. This belies the assertion that everyone, or more people in the household are now forced to work to earn what they used to.[6]
-The cost of most consumer goods has fallen dramatically since the 70s. Between 1979 and 2015, the inflation-adjusted prices of bicycles, blenders, coffeemakers, ovens, dishwashers, food processors, refrigerators, grills, stoves, microwaves, slow cookers, toasters, treadmills, TVs and vacuum cleaners fell by an average of 76%. For example, it took 33 hours of labor to buy a dishwasher in 1979 vs just 13 in 2015. For a vacuum cleaner the difference is 15 hours vs. 2.3, for a color TV it’s 70 hours vs. 4.3. Not to mention all the new inventions that were unavailable in the 70s.[7]
-While overall standard of living is up, some costs have risen faster than inflation, particularly housing, education and healthcare. Coincidentally, these are the areas of the economy government has been most involved in, and these costs have risen with every president since Reagan. It seems the bogeyman is not what this meme purports.[8]
[1]https://www.census.gov/content/dam/Census/library/publications/2017/acs/acsbr16-02.pdf
[2]https://www.census.gov/prod/2013pubs/p60-245.pdf
[3]https://www2.census.gov/programs-surveys/cps/tables/time-series/historical-income-households/h01ar.xls
[4]https://data.bls.gov/pdq/SurveyOutputServlet?request_action=wh&graph_name=CE_cesbref2
[5]https://fred.stlouisfed.org/series/USAAHWEP
[6] https://data.bls.gov/timeseries/LNS11300000
[7]http://humanprogress.org/blog/us-cost-of-living-and-wage-stagnation-1979-2015
[8]https://www.cato.org/projects/humanprogress/cost-of-living