Why Workers Hate Biden’s Economy: An Immiseration Index

Who you gonna trust--experts, or your lyin’ eyes?

A growing number of technocrats, liberals, and supply-side progressives are perplexed. They find a lot of good news about the American economy in “the data.” Real wages among the poorest Americans are up. The stock market is up. Unemployment is down.

Yet everyone who isn’t them is unhappy about the American economy. What gives?

In a CBS poll earlier this year, 59% of Americans felt “pessimistic about the stock market.” 70% were “pessimistic about the cost of goods and services.”

If you find yourself in the position of “The data on the economy looks good, but the people don’t get it,” please understand that this is the same species of commentary as Clinton’s “basket of deplorables” musing in 2016. Even if you believe you’re not punching down at the working class, you are at least paying attention to the wrong signs about America’s economic health as a whole.

Now, the problems that exist in the economy are not the fault of the Biden presidency. He inherited a shit show. And we can only expect one presidency to do so much amid a fairly broken political system. Moreover, emergency stimulus spending in 2020 and 2021 ensured the American economy weathered the pandemic better than almost any nation in the world (we also had one of the worst body counts in the world, but I digress). 

But the question is not “What problems did Bidenomics cause?” It’s why aren’t people celebrating the going concern when economists are able to find a handful of variables that suggest the economy is getting better?

We can see in the CBS poll that, while a lot of people do directly blame the Biden administration for the economy, it’s not a majority of people, and far fewer than the percentage of people who think the American economy is f*cked.

So what politicos, consultants, and pollsters need are the key indicators that reflect what people are actually experiencing in the economy. Questions about economic insecurity are way more important than questions about the health of an economy using macro indicators that smooth out the yawning chasm between the plutes and everybody else.

We need, in short, indicators of immiseration. Let me break down what I think they should be.

If what we want to capture is a picture of economic security in the nation, then we should be paying attention to indicators like:

• Wealth inequality 

• Income inequality 

• Unemployment rate 

• Debt accumulation (esp under 40) 

• Rates of home ownership (esp under 40) 

• Rental prices, esp in metro areas

• The ratio of rental prices to wages  

• % working two or more jobs 

• % w/out healthcare or retirement savings

Because of inflation, rising interest rates, income instability, and the prohibitively high cost of many basic necessities (including housing), technocrats are finding solace in the wrong indicators of a “good economy.” Absolute wage increases, the direction of the stock market, the number of people in poverty, and even the unemployment rate—those things are not great indicators of economic security. 

The poverty line, for example, is by now an arbitrary reference point well below what it takes to live as something more than a pure wage slave; it also obscures the mass of people who live just above the poverty line, which is hardly a comfortable life.

The unemployment rate matters, but it’s not revealing enough by itself because the high proportion of people living in the gig economy (or as 1099 contract workers) tend to have multiple “gigs”—not because they love working so much, but because no single gig pays enough to live.

So by indicators of immiseration, how’s America doing? Well, that picture isn’t great, but it explains why people think the Biden economy is shit.

Here’s the real situation in America that ruling-class economists refuse to acknowledge (I have some of this data handy because it forms part of The Rivalry Peril book I’m finishing with Mike Brenes):

• Social mobility has been steadily declining for more than a generation.

• Over 30% of Americans earn less than $15 dollars per hour.

• 87% of low-wage Americans are age 25 or older. The greatest proportion of low-wage workers are women. People of color are overrepresented in the ranks of the working class, in addition to women of color being the most overrepresented.

• And while the average American’s wages have stagnated since the 1970s, the cost of living—specifically housing—has also steadily increased.  

• The crisis in affordable housing is not primarily about the difficulty of getting on the property ladder but rather having any place to live. In 2022, “…nearly 7.8 million Americans said they were behind on their rent in October and 3 million felt they were likely to be evicted in the next two months.”

• The proportion of Americans “struggling to pay for usual expenses” increased from 80.8 million in 2020 to 90.3 million by 2023.

• 41% of adults in America—more than 100 million people—are being pushed into debt by healthcare costs. “18% [of Americans with healthcare debt] said they don’t expect to ever pay it off.” 

• Nearly half of Americans say they don’t have three months of emergency savings, and the percentage dropped from 59% amid pandemic stimulus to 54% in 2022. (thanks to @rubin_lyle for turning me onto this stat)

• And finally, the wage share of the national income remains close to a 75-year low. 

Meanwhile, since the Global Financial Crisis, after-tax corporate profits have been both steadily growing and at a 70-year high. And while the number of people who fell into poverty globally during the pandemic increased by 160 million people while the net worth of the ten richest men more than doubled, from $700 billion to $1.5 trillion.

What do Democrats and technocrats (I repeat myself) have to say about any of this?*

Do you think the people represented in these indicators give a shit about the stock market or the direction of income inequality on average?

Do you think these conditions gird American democracy against neofascism, or make it more vulnerable to far-right recruiting?

*It’s not lost on me that I’m arguably both a Democrat and a technocrat. But I’m a self-aware, self-critical one—as we all should be.