We find that the average income for the middle 20% of households will likely decline by $2,456 in 2009, and by an additional $601 in 2010, for a total decline of $4,813 from 2007 to 2010. This is a decline in income of 9.3% for the typical household over these three years. Given the decline in income over the weak business cycle from 2000 to 2007, this means that after reaching an all-time peak in 2000, by 2010 real incomes for the typical household will likely have declined by $5,729, or 10.8% - truly a lost decade.
And here's one of her charts that Meteor Blades reproduced:
I advice everyone to go read her presentation. This are really going to get ugly before they get better. But I want to take a somewhat different focus for this diary, extending an analysis I did a couple of weeks ago, "Forget The Recession--Bush Economy Sucked BEFORE Then". I want to compare the 7-year and 8-year records with a view toward arguing that things have been economically lousy throughout the Bush years, and the media have been doing a terrible job of informing the American public all along. More charts, and very little text need to tell the story on the flip.
We start with a chart of income by qunitiles and the top 5% under Clinton and Bush. While the downturn of the last year is quite visible, it is not the most notable feature of the chart. What's most notable is that all the lines were going up under Clinton, and they flattened out under Bush. While the recession is certainly hitting all of us hard, it's particularly devastating because it comes after the preceeding 7 years of virtually no growth for anyone:
Here are the underlying figures in table form. At the bottom are 7-year and 8-year cumulative totals. As you can see, the 8-year totals for Bush are definitely worse--but the decline is trivial in comparison to the difference between the Clinton record and Bush record:
Bad as the past year was, the cumulative income change of a few thousand dollars barely registers in terms of total percentage of 2000 income. In contrast, Clinton delivered over 13-21% growth for people from 1992 to when he left office.
Just to make that point "perfectly clear", here's a table that tracks the gap between the Bush record, and where the economy would have been if the Clinton growth record had been repeated, year-for-year:
And here's what it looks like as a chart:
Clinton's economy was not the greatest in history--in fact, it pales compared to the post-WWII years through 1968 and even on into the early 70s. But it's so dramatically better than the Bush economy that the drastic downturn of last year barely changes the comparison.
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