I began writing this post the morning of Wednesday November 6th 2024 — the morning after the US election, where Donald Trump won a reasonably close yet nonetheless resounding victory over Kamala Harris.
Why is the pandemic stimulus "less the fault of Biden" than other things? There were two stimuluses. One passed under Trump, which was arguably defensible, and one completely unnecessarily stimulus once Biden took office. That was passed just to show he was "doing something" about the pandemic too. If anything, this analysis shows Biden deserves a lot of blame.
Great post. Thanks! I suppose one further consideration is the distribution of inflation by income. My impression is that there isn't much data on the inflation distribution. But it is plausible that different income percentiles are experiencing different inflation rates due to the different mix of goods and services consumed.
Great post. Very informative and eye opening about how people are afffected by inflation.
However I must admit my confusion about section 1 in particular. The data just seems a bit weird to me. I struggle to see how the wage increases seen in the real hour wage change per presidential term graph are comaptible with the Tesdechi real weekly wages growth graph. Did the hours worked per week really fall enough so that the increase in real wages was so offset for the higher percentile earners? A similar question can be asked about how the tasdechi graph is comaptible with the 0.6% median change in weekly earnings obseved during bidens term seen in he first graph of section 2. If the median change in weekly wages was positive over the term, would'nt it be expected for real weekly incomes to have grown over bidens presidency?
Im also confused by the real pre tax income graph for similar reasons. Real hourly wages grew, so how is it possible that real pre tax incomes (whcih as you said are primarily from wages) increased so little. And on a separate note, how is it possible real household incomes grew while male incomes collapsed? especially considering female household incomes do not appear to have compensated. In my mind this can only really be explained if there were a lot of female only households
Hello! I think this is a terrific article, although I need to go through it again to fully wrap my mind around it. I would be interested in your thoughts on my recent Substack post titled "Why Kamala Lost. A Study in 9 Simple Charts."
I am very pleased and mentally stimulated to have discovered this and your previous posts! Hardly my field of expertise, so I just nod at the data detail--but deeply appreciate the main arguments and clearly formulated conclusions.
Something, or many things, have been rotten in Denmark for some time; your analyses do help to clarify.
To really get at whether people's living conditions got better or worse, especially when we're talking in the range of a couple of percent, you'd need a price index for every individual/household.
Really excellent analysis, thank you. Now curiously, the Obama 2 administration looks really strong in these analyses, or am I reading that wrong? So that makes Trump 1 look like a genuine surprise.
you want to look at change in median wages not median change in wages. The reason is pretty obvious. consumption has decreasing marginal utility and so we care more about the change in wages of the bottom half than the top half. Of course, from a political standpoint, people in the top half getting poorer matters, but in terms of human welfare it's not what we're trying to optimize. median real wages have been up like a rocket for decades.
Why is the pandemic stimulus "less the fault of Biden" than other things? There were two stimuluses. One passed under Trump, which was arguably defensible, and one completely unnecessarily stimulus once Biden took office. That was passed just to show he was "doing something" about the pandemic too. If anything, this analysis shows Biden deserves a lot of blame.
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Great post. Thanks! I suppose one further consideration is the distribution of inflation by income. My impression is that there isn't much data on the inflation distribution. But it is plausible that different income percentiles are experiencing different inflation rates due to the different mix of goods and services consumed.
Great post. Very informative and eye opening about how people are afffected by inflation.
However I must admit my confusion about section 1 in particular. The data just seems a bit weird to me. I struggle to see how the wage increases seen in the real hour wage change per presidential term graph are comaptible with the Tesdechi real weekly wages growth graph. Did the hours worked per week really fall enough so that the increase in real wages was so offset for the higher percentile earners? A similar question can be asked about how the tasdechi graph is comaptible with the 0.6% median change in weekly earnings obseved during bidens term seen in he first graph of section 2. If the median change in weekly wages was positive over the term, would'nt it be expected for real weekly incomes to have grown over bidens presidency?
Im also confused by the real pre tax income graph for similar reasons. Real hourly wages grew, so how is it possible that real pre tax incomes (whcih as you said are primarily from wages) increased so little. And on a separate note, how is it possible real household incomes grew while male incomes collapsed? especially considering female household incomes do not appear to have compensated. In my mind this can only really be explained if there were a lot of female only households
Regardless appreciate the post
Hello! I think this is a terrific article, although I need to go through it again to fully wrap my mind around it. I would be interested in your thoughts on my recent Substack post titled "Why Kamala Lost. A Study in 9 Simple Charts."
https://charles72f.substack.com/p/why-kamela-lost-in-nine-simple-charts
I think it comes to pretty much the same conclusions as you, although I don't go into the numbers in nearly as much depth.
I am very pleased and mentally stimulated to have discovered this and your previous posts! Hardly my field of expertise, so I just nod at the data detail--but deeply appreciate the main arguments and clearly formulated conclusions.
Something, or many things, have been rotten in Denmark for some time; your analyses do help to clarify.
Very thorough piece summarizing a lot of debates I have only seen parts of. A good companion piece here:
https://www.employamerica.org/researchreports/real-wages-and-aggregation/
To really get at whether people's living conditions got better or worse, especially when we're talking in the range of a couple of percent, you'd need a price index for every individual/household.
Really excellent analysis, thank you. Now curiously, the Obama 2 administration looks really strong in these analyses, or am I reading that wrong? So that makes Trump 1 look like a genuine surprise.
you want to look at change in median wages not median change in wages. The reason is pretty obvious. consumption has decreasing marginal utility and so we care more about the change in wages of the bottom half than the top half. Of course, from a political standpoint, people in the top half getting poorer matters, but in terms of human welfare it's not what we're trying to optimize. median real wages have been up like a rocket for decades.
https://fred.stlouisfed.org/series/LES1252881600Q
Median change in wages still matters when it comes to elections! And surely you mean for *a* decade? Real wages were basically flat from 1979 to 2014.
Really useful post, thank you!