Two Takes on Whether American Living Standards Are Falling

At a recent Soho Forum debate, The New York Times’ David Leonhardt and the Cato Institute’s John Early took opposing sides on the question of whether American living standards are falling. (Reason)

Standards are falling: Leonhardt’s argument was based on rising economic inequality, falling U.S. birth rates, stagnating life expectancy and surveys showing citizens are growing disillusioned with the American Dream.

• Leonhardt also cited data showing it’s getting harder for Americans to get ahead.

• Per a 2017 study, 92% of Americans born in 1940 out-earned their parents, while only 50% of those born in 1980 did.

The counter argument: Early disputed the idea that inequality is rising, arguing that official statistics overlook factors like in-kind benefits, tax credits, and transfer payments, which reduce inequality.

• According to Early, if you include all income sources, around 77% of today’s Americans earn what the top 20% earned in 1967.

• Early also noted that many people today have access to goods and services that were once only available to the wealthy, such as advanced healthcare, technology, and consumer electronics.'

• Also, living conditions in general—like access to electricity, indoor plumbing, and air conditioning—have improved significantly since past generations, contributing to an overall better standard of living.