When the internet is composed of hilarious memes, message boards to fling insults around, and nearly 1,500 episodes of The Tom Woods Show, who wants to spend any time reading economic data? If we need to discuss data, then it had better be summarized, fit into a tweet, and “own” our political adversaries. At least, that is how it seems the mainstream media is reporting on US government information that examined last year’s income trends for Americans.
Let’s just say, when it comes to the latest figures, the press had a buffet of options to choose from, but it decided to pick the stale and flavorless cucumber sushi over the fresh and delicious dynamite roll.
Coming to Your Census
The Census Bureau recently published its annual “Income and Poverty in the United States” report, which analyzes the incomes of Americans. A salivating media are homing in on one statistic in the 2018 study like a guided missile, attempting to prove that Trumponomics is failing Main Street.
According to the report, the median household had an annual income of $63,179 last year, a statistically insignificant uptick of just 0.9%. This is the first time in three years that median household incomes did not record a steep increase. Overall, when adjusted for inflation, households are earning less than 3% more than they did 20 years ago. Justin Wolfers, an economics professor at the University of Michigan, told the Counterfeit News Network that this study “tells a pretty darn depressing story” because there have been “two decades with no progress for the middle class.”
But was that everything published in the 88-page report? If so, All Work and No Play Makes Jack a Dull Boy because the researchers must have been bored to come up with unique ways to get to 40,000 words.
If reporters had taken the time to go through the entire report or even the CB’s bullet points, then an entirely different news story would have been promoted. Indeed, here are some findings that the mainstream media left out of their headlines and opening paragraphs:
- 1.2% income gain for family households.
- 2.4% boost for non-family households.
- 3.4% increase for full-time male workers.
- 3.3% jump for full-time female workers.
- 3.4% for all workers.
These are all statistically significant and suggest that incomes are actually growing at a healthy rate. But what about median household incomes flatlining in 2018? Shouldn’t we be pearl-clutching as much as the press? Mark Perry of the American Enterprise Institute has a reasonable explanation: declining size and changing demographics of US households.
“Because of the declining size and changing composition of US households over time, comparisons of median household income in two different years (like 1999 and 2018) is an apples-to-oranges comparison and will understate the household income gains on a per-person basis over time, and significantly understate the income gains for a households that have a constant number of earners over time (e.g., one-earner and two-earner households).”
Put simply, the statistically insignificant datum was due to societal trends, not economic policy.
It’s All About the Data
When it comes to this administration and media coverage, it is important to question deductions and conclusions. If you comb through the original source, even just its summary highlights, you find a whole host of positive data, from the increase in full-time year-round workers to an across-the-board decline in poverty rates. Yet, the press will only concentrate on that one blemish ahead of the 2020 election, which is not even something to be that concerned about, because, as Perry argued, it is an apples-to-oranges comparison.