The Inflection Point of 2000

Fight disinformation: Sign up for the free Mother Jones Daily newsletter and follow the news that matters.

Matt Yglesias likes this chart from USA Today that illustrates what has happened to household incomes over the past decade:

In fairness, you really do need to account for rising health insurance premiums before you conclude that average incomes have dropped. I’ll spare you the details, but the census data shows that overall median incomes, adjusted for inflation, have dropped $3,719 over the past decade. However, the employer share of healthcare premiums has gone up almost exactly the same amount. Toss that back in, and total household compensation (cash plus health insurance) has been pretty much flat.

Still, that’s pretty bad:

This, I think, does a great job of illustrating the fact that the asset price collapse –> recession –> lost decade cycle is really something that started 10 years ago rather than a forward-looking risk. It’s often said that the 2001 recession was “brief” and “mild,” but the employment and income situation kept deteriorating for years and neither the employment-population ratio nor wages ever re-obtained their previous peak. The longer we go on not effectively addressing the additional labor market trauma of 2008-2009, the more this all merges into one giant pool of long-run economic dysfunction.

I keep meaning to write more about this, and I promise that someday I will. But there’s a real phenomenon here that hasn’t gotten enough attention. We often point to 1973 as an inflection point for workers: Before that, median incomes rose right along with economic growth, but starting that year income growth suddenly slowed dramatically. Instead of rising 2 to 3 percent a year, household income rose less than 1 percent per year.

It now looks to me like 2000 was another inflection point. Household incomes went from 1 percent growth to zero growth, and they’ve been stuck there ever since. Even researchers who are skeptical that income inequality rose dramatically after 1973 mostly accept that it’s definitely risen since 2000. The entire past decade has been an economic disaster on multiple fronts, and that’s one of the reasons the financial collapse of 2008 has been so terrible. We had a decade’s worth of labor market weakness that was partly masked by a housing bubble, and it all came crashing down within a year or two. Instead of a long, slow slide, we got ten years worth of drops compressed into 24 months. For more on this, see Scott Winship here.

And I really will try to write more about this eventually. It’s important. Unfortunately, the reasons are still hazy and there are dozens of theories about what’s happening. But something sure is.

THE FACTS SPEAK FOR THEMSELVES.

At least we hope they will, because that’s our approach to raising the $350,000 in online donations we need right now—during our high-stakes December fundraising push.

It’s the most important month of the year for our fundraising, with upward of 15 percent of our annual online total coming in during the final week—and there’s a lot to say about why Mother Jones’ journalism, and thus hitting that big number, matters tremendously right now.

But you told us fundraising is annoying—with the gimmicks, overwrought tone, manipulative language, and sheer volume of urgent URGENT URGENT!!! content we’re all bombarded with. It sure can be.

So we’re going to try making this as un-annoying as possible. In “Let the Facts Speak for Themselves” we give it our best shot, answering three questions that most any fundraising should try to speak to: Why us, why now, why does it matter?

The upshot? Mother Jones does journalism you don’t find elsewhere: in-depth, time-intensive, ahead-of-the-curve reporting on underreported beats. We operate on razor-thin margins in an unfathomably hard news business, and can’t afford to come up short on these online goals. And given everything, reporting like ours is vital right now.

If you can afford to part with a few bucks, please support the reporting you get from Mother Jones with a much-needed year-end donation. And please do it now, while you’re thinking about it—with fewer people paying attention to the news like you are, we need everyone with us to get there.

payment methods

THE FACTS SPEAK FOR THEMSELVES.

At least we hope they will, because that’s our approach to raising the $350,000 in online donations we need right now—during our high-stakes December fundraising push.

It’s the most important month of the year for our fundraising, with upward of 15 percent of our annual online total coming in during the final week—and there’s a lot to say about why Mother Jones’ journalism, and thus hitting that big number, matters tremendously right now.

But you told us fundraising is annoying—with the gimmicks, overwrought tone, manipulative language, and sheer volume of urgent URGENT URGENT!!! content we’re all bombarded with. It sure can be.

So we’re going to try making this as un-annoying as possible. In “Let the Facts Speak for Themselves” we give it our best shot, answering three questions that most any fundraising should try to speak to: Why us, why now, why does it matter?

The upshot? Mother Jones does journalism you don’t find elsewhere: in-depth, time-intensive, ahead-of-the-curve reporting on underreported beats. We operate on razor-thin margins in an unfathomably hard news business, and can’t afford to come up short on these online goals. And given everything, reporting like ours is vital right now.

If you can afford to part with a few bucks, please support the reporting you get from Mother Jones with a much-needed year-end donation. And please do it now, while you’re thinking about it—with fewer people paying attention to the news like you are, we need everyone with us to get there.

payment methods

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate