Sep 21, 2015
Government Grows. Incomes Decline.
Post by Freedom Partners
Despite massive government spending, household income is still 6.5 percent below pre-recession levels.
Last week, the U.S. Census Bureau announced that in 2014, real median household income fell to $53,657, 1.5 percent below the 2013 level of $54,462.
That means, even though we are supposedly in the midst of an economic recovery, average family incomes actually fell by $805 last year. According to the report, “There was no statistically significant change from 2013 in either real median household income or the official poverty rate.”
This marks the third consecutive year in which annual incomes were essentially stagnant.
More importantly, 2014 real median household income represented a 6.5 percent drop below the pre-recession 2007 level of $57,357 and 2.3 percent below the 2009 post-recession level of $54,925. This post-recession decline represents a sharp contrast to the 13 percent expansion seen from 1991-2000. The Wall Street Journal attributed this year’s decline to a massive 1.2 million increase in individual households generating lower incomes.
In addition, the Census survey showed 14.8 percent of Americans were living in poverty in 2014.
Valerie Wilson of the Economic Policy Institute explained to NPR that this translates into 1 in 7 Americans, or roughly 47 million people, being poor in 2014.
What fiscal policies led us to this sluggish recovery?
Spurred by this runaway spending, the government grew along with our debt. From 2008 to 2009, federal spending grew by 18 percent in one year.
Since January 1, 2008, our debt has risen by $7.4 trillion or 70 percent. The result has been slow growth and low pay. And yet the president is still demanding that Congress increase current spending levels.
Though politicians promised that big government borrowing and spending would lift Americans out of an economic hole, the facts tell a different story.
As Washington has gotten bigger, family incomes are getting smaller.