If you know anyone from Europe, one fact that’s inescapable is that poor Americans live a lifestyle roughly equivalent to the “middle class” in Europe. High obesity rates caused by readily available large quantities of food combined with a sedentary lifestyle of video gaming is a problem one would associate with the children of the wealthy, but here it is those in poverty who are used by “nutrition activists” (food Nazis) as an example of unhealthy American habits.

I grew up poor in the 70’s, in a Black family which struggled to make ends meat, now there is no member of my extended family who doesn’t own a cell phone, most own computers and quite a few own homes. We are benefiting from strong economy in a free market system and it’s not just the poor, but the middle class as well. I’m not alone in my assessment:

THAT middle-class earnings have been stagnant or in decline for the past few decades has been so often repeated that it is commonly mistaken for a fact. Fortunately for the average Joe and Jane, it is a non-fact. As Terry J Fitzgerald, senior economist at the Minneapolis Fed, shows in this mandatory short paper, things have long been looking up for the middle.

Mr Fitzgerald points out that there is a prima facie conflict between different sets of data: on the one hand, the economy as a whole has boomed, but, on the other, the average worker hasn’t seen any gains. On its face, the latter idea, that average real income is stagnant, is simply absurd. Just compare the quality of the houses, cars, appliances, comestibles and entertainments of the average household in 1977 to that of 2007. Note, for example, all the drugs and life-saving medical treatments available today, but unavailable at any price in the swinging 70s. Average folks are buying these much improved goods somehow. And that would be because, well, they can afford it — because they in fact do take home more in real terms. This can be observed in the data once they are interpreted with adequate care. As Mr Fitzgerald writes:

Just two adjustments—using the same price index and including benefits—have greatly diminished the growth rate differences between the microeconomic and macroeconomic series. Rather than falling by 4 percent over the past 30 years, average hourly earnings have actually risen by 16 percent. Growth in the median hourly wage went from 12 percent to a more respectable 28 percent.

And thus Arnold Kling asks: “Doesn’t that [penultimate] sentence single-handedly refute Paul Krugman’s latest book?” I’d say, not exactly, but it sure doesn’t help him any.

Read the rest here.

h/t Hispanic Pundit