The Rich Still Aren’t Spending Like They Used To

Here’s a fascinating chart from the New York Times:

First of all, it’s interesting to see how fast spending plummeted: it declined by a third within the space of less than two weeks. That’s unreal.

Second, it shows how effective the UI bonus payments have been. These payments go to the unemployed, who are largely in the bottom half of the income spectrum, and those are the people whose spending rebounded most strongly.

Third, it suggests that the upper middle class is still spending way less than it used to. The article notes this, but finds it largely inexplicable. However, given that the top 25 percent are responsible for something like half of all spending, their reluctance to get back to normal is a big deal.

My own guess? Low-income workers cut back on necessities (rent, food, etc.) because that’s all they buy. When they got more money, they started buying that stuff again because they had to. Richer folks cut back mainly on luxuries (theater outings, expensive restaurant meals), and many of those things are still unavailable. More generally, their spending is still down because they mainly cut back on nonessential items in the first place and that means they can afford to wait a while before they get back to normal.

MOTHER JONES NEEDS YOUR HELP

We have about a $170,000 funding gap and less than a week to go in our hugely important First $500,000 fundraising campaign that ends Saturday. We urgently need your help, and a lot of help, so we can pay for the one-of-a-kind journalism you get from us.

Learn more in “Less Dreading, More Doing,” where we lay out this wild moment and how we can keep charging hard for you. And please help if you can: $5, $50, or $500—every gift from every person truly matters right now.

payment methods

MOTHER JONES NEEDS YOUR HELP

We have about a $170,000 funding gap and less than a week to go in our hugely important First $500,000 fundraising campaign that ends Saturday. We urgently need your help, and a lot of help, so we can pay for the one-of-a-kind journalism you get from us.

Learn more in “Less Dreading, More Doing,” where we lay out this wild moment and how we can keep charging hard for you. And please help if you can: $5, $50, or $500—every gift from every person truly matters right now.

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