The Household Income Lie

Household income statistics are largely useless, but very popular with the Left, since they reinforce the Left’s fairness hobby horse, thus justifying (at least in the minds of Leftists, although it flies in the face of historical fact) ever-increasing Federal economic micromanagement of our lives.

Unfortunately, conservatives are not averse to throwing around household income statistics themselves. Please stop. At best, it makes us look stupid; at worst, it reinforces Leftist narratives.

President Obama, earlier this week:

[I’ll] just give you a few statistics: Since 1979, when I graduated from high school, our productivity is up by more than 90 percent, but the income of the typical family has increased by less than 8 percent. Since 1979, our economy has more than doubled in size, but most of that growth has flowed to a fortunate few. The top 10 percent no longer takes in one-third of our income; it now takes half.

Thomas Sowell, from 2011:

All I have to hear is the [phrase] household income, and I know we’re not serious, because households differ over time, in size; they differ from one group to another, in size; and they differ from one income level to another, in size.

Over time…households have been declining in size. So if you had a household in which, at some point in the past, there were three working adults; and now the household has only two working adults; and the family is making the same money they always made; that is not stagnation, that is a 50% increase in per capita income–which may be why one of the adults goes off and establishes his own household. He can afford to.

So household income [is] utter nonsense. If you’re serious, you look at per capita income, because per capita means one person. And it always means one person. It doesn’t mean one person in 1980, and one-and-a-half persons in 1930, and so on. It always means one person.

So if you’re looking for a legitimate comparison, that’s what you do. If you’re looking to score political points, you go to household income and family income, and wallah! you have your political points.


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Audio (MP3) version of video above.

Charts via MarketingCharts.com:

census-bureau-households-by-type-1970-2007

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One Response to The Household Income Lie

  1. Dan Draney says:

    Thanks for this. I learned something today. 🙂

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