Setting the Record Straight on New York Daily News' Editorial Hit on President Obama's Economic Legacy
After interviewing both Bernie Sanders and Hillary Clinton, the New York Daily News concluded that Hillary Clinton was far and away the better candidate because of the realistic nature of both her perception of current challenges and her proposed solutions. On this, the Daily News and I agree.
But the editors of The Daily News also used the endorsement - which they knew would be widely read - to launch a professional hit on President Obama's legacy, calling the White House's optimism over America's economic progress of 14.5 million new jobs and the longest era of private sector job growth in history coming back from the brink of absolute catastrophe merely "let's-pretend rituals."
In fact, in flinging their attacks at the President, the Editorial Board of The Daily News sounded much more like Bernie Sanders than they did Hillary Clinton. And like Bernie Sanders, they did not bother to do their homework on the numbers they were throwing around to undermine the legacy of the man who has achieved what can only be described as a near-miracle in economic terms against the backdrop of economic calamity unknown in almost all of living memory.
The professionally prepared hack-line was ready: lament the decline of the American middle class and blame the president for not having achieved panacea from peril in the space of seven years. But they didn't even get their middle class decline storyline right.
That sounds bad indeed. The Daily News is describing a real-dollar drop of a full 7.2% in median household income.
Even if you disregard the fact that the editorial board found it fit to compare the height of an economic boom fueled in part by the dot-com bubble with recovery from economic abyss caused by the Republican administration sandwiched between the last two Democratic ones, the numbers are not nearly as bad when considered against two other trends that have taken place for US households between 1999 and 2014.
First, the size of the household keeps getting smaller. According to the Census Bureau, the average US household size in 1999 was 2.61, which had shrunk to 2.54 by 2014. That means for median household in that period, average per capita income dropped from $22,162 to $21,125 - a 4.7% drop, which is, while still substantial, considerably less than the 7.2% drop the raw numbers portray.
Another important mitigating factor is still missing, however. A much higher portion of the American household is now likely to be elderly than was the case in 1999. Again according to the Census Bureau records, the median age of the American householder has increased by almost five years between 1999 and 2014, from 46.6 to 51.2. The portion of householders who are elderly increased from 20.8% to 23.4% or an increase of 12.5%. Given that the elderly tend to have lower income than those in their peak earning years, the real per capital median income drop of less than five percent may well be explained by this factor.
The data used by the Daily News may also be a little outdated. More recent data shows that median household income in February of 2016 has hit $57,129, making the per capita household income $22,491, slightly above 1999 levels reported by the Daily News. (H/T to "derleider" in comments.)
The Daily News makes a similar blunder when it comes to income distribution. They recounted a "withering middle class" with Sanderesque charm.
Four decades ago, the backbone of the U.S.A. commanded almost two-thirds of the national income. Today, it clings to just 43% while the top tier has roared ahead to claiming almost half, along with wealth that is fully seven times larger than the holdings of the entire middle class.
The editors have taken the numbers from a Pew Research Center study showing that as of 2015, the middle class had lost its numerical majority - now only 49.9% of the US adult population while the lower and upper classes made up the other 50.1%, as well as that the share of the middle class' income had indeed dropped to 43% today from 62% in 1970.
A careful observer will note here that in 1970, when the middle class had 62% of the national income, the middle class also comprised a similar share (61%) of the US adult population (80 million out of a total adult population of 131.6 million). With the decline of the share of adults who are middle class to just below half, an income share of 43% is still a fall, but not one nearly as dire as the misleading measure of an almost 20-point reduction.
But wait a minute. Isn't the the fact that the middle class has gone from 61% of US adults to under 50% in and of itself bad news? It is, but not entirely.
What the Daily News editors fail to mention in their rush to bulldoze President Obama's record is the fact that at least part of this had happened because a greater share of the US adult population were in the upper class in 2015 than in 1970.
Challenges yet remain, and nobody should have any illusions about that. Productivity growth has not matched wage growth for decades, debt is burdening students, and far too much of our national income and wealth is taken up by the very few. According to Pew, the shares of Americans in both the lowest income and highest income tiers have gone up, creating more income disparity.
But the media does not do anyone any favors by presenting a simplistic and erroneous assessment of the problems we're facing.
In essence, the editors of the Daily News made the same mistake as the candidate they rejected. They rushed to use popularized top-line numbers to be critical of President Obama's hard-fought, sweat-earned legacy. It can be said that when it comes to Barack Obama's record on the middle class and his economic legacy, it's the New York Daily News editorial board that are comprised "fantasist[s] ... at passionate war with reality."
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