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Is your economy doing ‘very well’?

Posted: June 28, 2018 1:20 p.m.
Updated: June 29, 2018 1:00 a.m.

During the last two years, have you:

... been able to make your full rent or mortgage payment each month?

... received a pay raise that at least kept up with the cost of living?

... paid off or, at least, are keeping up with outstanding loans (including student loans), credit cards and other debt?

... been able to buy whatever medications you need without having to weigh that against groceries to feed you and/or your family?

... had any money in a savings account, and, if so, is it enough to cover your expenses for at least three months?

... been able to hold any investments?

If you answered yes to all of these questions, then there’s a chance you’re not going to understand what I’m going to say here.

If you answered yes to at least one, but especially two or more of these questions, you’ll know what of I plan to speak (or write, in this case).

Recently, U.S. Federal Reserve Chairman Jerome Powell declared, “The economy is doing very well.” And, CBS News said in a story I read on its website, it’s true. According to CBS -- nationally speaking -- “Steady hiring has shrunk unemployment to 3.8 percent -- the lowest since the 1960s. Consumers are spending. Taxes are down. Inflation is tame. Factories are busy. Demand for homes is strong. Household wealth is up.”

But, CBS also said, this doesn’t “reflect reality for a range of American who still feel far from financially secure even nine years into an economic expansion.” Folks are paying more for gas, child care costs are up, many workers haven’t had decent pay raises in years, and couples still struggle to afford a home. In other words, as CBS put it, “...people throughout the economy are straining to succeed despite the economy’s gains.”

“Many people are still living on a paycheck-to-paycheck basis,” Gegory Daco, head of U.S. economics at Oxford told CBS.

Have you noticed the higher prices at the gas pumps? While they’ve eased a little bit during the last week or so, overall, analysts at Morgan Stanley told CBS, those gas price increases will likely take away about one-third of any savings you saw from a recent tax break.

Some of this may be dependent on where you live.

Take San Francisco, for example, where, The Huffington Post points out, two-bedroom apartments “regularly go for $3,000 or $4,000 a month.” The Mercury News estimated it would take someone earning four times the minimum wage to afford an apartment there. CBS said “home ownership is largely unobtainable in San Francisco and Seattle.”

When I posted a link to the CBS story on Facebook, a cousin of mine in Arizona commented that the state is “rolling. Construction (is) going on all over the place. New businesses popping up everywhere. We are a red state and we are pro-business. It is the same with Texas.”

He went on to tell me that he and his fellow teachers (he teaches American history, among other things, at a high school) “finally received a 9 percent increase for this coming school year. Over the past 10 years, we only received 6 percent in total. Also, under Trump’s tax break, an additional $900 is added to my bottom line.”

I suspect teachers here in South Carolina would be envious. The Kershaw County School District’s proposed Fiscal Year 2019 budget calls for a 1 percent salary increase for all employees “plus step.” As I understand it, a step -- on average -- is equivalent to an additional 1.5 percent increase for those employees who have not “topped out” on their salary schedule.

That’s essentially, a 2.5 percent increase. Arizona is a different world if teachers got a 9 percent salary bump. At least his note about 6 percent during the entire last decade about matches up, I guess.

Note that he made mention of Arizona being a “red, pro-business state.” By that, he means Trump country. I couldn’t care less. South Carolina is a red state and -- for the most part -- pro-business.

But, remember this: At least one of the government officials we interviewed for our economic development package back in March pointed out that South Carolina is slower to recover from economic downturns.

CBS reported that, according to the World Inequality Database, the top 10 percent of the country holds 73 percent of its wealth.

“Contrast that with the middle 40 percent of the country, a group that would historically be considered middle class. In 1986, they held 36 percent of the country’s wealth; now it’s just 27 percent,” CBS wrote. The bottom 40 percent have a negative net worth.

The network reported that Americans’ average hourly earnings haven’t increased during the last 12 months.

Sure, the U.S. economy’s booming when you look at the country as a whole. Look deeper, though, and people’s individual economies aren’t really any better. In fact, they may be worse.

The question is what to do about it.


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