Dear Pundits: The Economy Is Only Booming If You Ignore The Plights Of Millions

40 percent of American adults said that their families had trouble meeting a basic need last year.

Dear Pundits: The Economy Is Only Booming If You Ignore The Plights Of Millions

A Grain of Saul is a weekly column that digs into some of the biggest issues we face as a nation and as an international community in search of reliable data, realistic solutions, and — most importantly — hope.  

If you listen to the pundits, the economy is humming.

The S&P 500 is at an all-time high. Unemployment is lower than it's been in decades. Corporate profits have never been better. And last week, the United States got the tell-tale sign the economy is doing well: Gross Domestic Product was revised upwards to 4.2 percent growth in the last quarter.

And yet, if you look a little bit closer, you'll notice something odd: despite sky-high profits, the economy is failing millions of Americans.

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A report released this week by the Urban Institute, a nonpartisan policy group in Washington D.C., found that 40 percent of American adults said their families had trouble meeting a basic need last year. Those needs included food, health care, housing and utilities. 

That shocking statistic is no aberration. It just confirms the data we've had for years. In 2017, The New York Post reported that 1 in 4 Americans refuse medical care because they can't afford it. In 2016, the United States Department of Agriculture estimated that 42 million Americans, including 13 million children, had a lack of consistent access to enough food for an active, healthy life. In the last year, real hourly wages decreased by .2 percent. 44 million Americans currently hold student loan debt and 75 percent of millennials are in debt. Close to 600,000 Americans are homeless, and in 2017 the number increased for the first time in seven years.

How can all of these things be true? How can the economy be doing so well but millions of Americans can't eat? 

The truth is that the economy is only doing well by the measurements so many pundits and economists have chosen to gauge it by. It's doing well for the most privileged in the country— for corporations, for wealthy Americans invested in the stock market and for business owners. 

If America wants to more accurately measure economic health, it should start by changing the way it measures economic success to include more Americans. Unemployment and Gross Domestic Product should be the footnotes, not the headline. Even in President Barack Obama's tenure, which saw "unprecedented economic growth," far too much credence was given to lowering unemployment rates while people were actually picking up part-time jobs to make ends meet or labor participation rates were falling.

It turns out, I'm not the only one who thinks a change is needed: a day after pitching this idea to my editor, Democratic senators proposed The Measuring Real Income Growth Act, which would show how GDP growth differed across classes in the United States. It's not a great solution as it's still centered on GDP, but it'd be a more accurate way to view the health of the economy for all Americans than what we have now.

Instead of marrying ourselves to GDP and unemployment, we should start measuring economic health by asking questions like the researchers at the Urban Institute did. How many people are struggling to eat? What percentage of folks are unemployed? How many aren't buying health insurance because they can't afford it? How many Americans are in debt?

These benchmarks would do a much better job showing us how "real" Americans are thriving (or struggling) in today's economy.

New York Stock Exchange
New York, New York, USA - Sept. 22, 2011 - Busy trading floor of the New York Stock Exchange  Bart Sadowski

I'd feel a lot happier reading about how "food insecurity dropped below four percent today" than I currently feel reading that GDP has grown four percent. I'm more interested in knowing how many Americans couldn't afford health care last quarter than I am in knowing how much Apple's stock grew. I want to know whether more Americans have a roof over their head, not whether more chain restaurants have been opened across the country. 

And in each case, we'd learn a lot more about how things are going by judging our progress by this country's people, not its companies. 

As a country, we deserve to know how all Americans are faring. But the way we talk about our economy today has to change if we want a clear picture.  The hyperfocus on the GDP, unemployment and stock market numbers are sweeping the plights of millions of people under the rug. 

If economists and pundits really are interested in how America is doing, it's about time they started asking us how we're doing. 

Cover image via David McNew/Getty Images

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