Arment Dietrich

Spinning Out of Control: Was it Really a Boom?

By: Arment Dietrich | April 16, 2008 | 

Blog written by Brigitte Lyons

Politicians, economists, and business leaders are spending a lot of time debating our current economic state. Are we in a recession or a slowdown?

The New York Times, however, is asking whether our economy was really ever booming at all.

I recommend you check out the article, but if you want the cliff notes, I’ll copy the a few passages here:

“…The now-finished boom was, for most Americans, nothing of the sort. In 2000, at the end of the previous economic expansion, the median American family made about $61,000, according to the Census Bureau’s inflation-adjusted numbers. In 2007, in what looks to have been the final year of the most recent expansion, the median family, amazingly, seems to have made less — about $60,500.

This has never happened before, at least not for as long as the government has been keeping records. In every other expansion since World War II, the buying power of most American families grew while the economy did…”

Take a second to let that sink in: While the economy grew, the American median wage decreased.

So why aren’t the American middle class seeing the fruits of their labor? Is it because we’re lazy?

No. Productivity is still rising and beating estimates, while labor costs rose less than forecasted, according to a recent Labor Department report.

Not only are we more productive, but also we’re working longer hours and losing vacation time.

I may not have a degree in economics, but it seems to me that, for the average American, the recent boom was a bust.