Are You Better Off?

In his 1980 presidential debate with Jimmy Carter, Ronald Reagan famously asked the American people whether they were better off than they had been four years ago. Enough voters answered "no" to give Reagan a decisive victory in the election.

Senator Obama is posing the same question today, since Senator McCain promises to continue the economic policies of the Bush administration. One of us (John Schmitt) recently compared all the major indicators of economic well-being in 2008 and 2000.

On 23 of the 25 measures selected, the economy was doing better in 2000 than 2008. The deterioration was sharpest in the measures that concern us most. For example, the unemployment was just 4.0 percent in 2000. The most recent data show the unemployment rate at 6.1 percent. While family income was higher in 2008 than 2000, the gain over these 8 years was a pathetic 0.4 percent, compared to 14.7 percent growth in the Clinton years. Real wages actually fell in the last 8 years, after rising 8.2 percent in the Clinton years.