I read Cafe Hayek every day, where Russ Roberts and Don Boudreaux, two professors at George Mason University, write on the intersection of economics and politics. Today, Professor Boudreaux points to a marvelous post by Steve Horwitz at the Austrian Economist. Professor Horwitz keeps track of the lifestyle of the poor over the years, and helpfully compares it to the average lifestyle of all Americans in 1971. Here is part of his table from the post:
Notice how much better off the poor are in 2005 (most recent census data available) compared to the average of all Americans in 1971. He writes of the data:
The overall lesson is clear: lives for Americans below the poverty line continue to get better in terms of what they are able to put in their households and have to make use of everyday. And do note that the average American household in 2005 was doing much better than its 1971 counterpart. MUCH better – and this doesn’t even count medical advances and the like. So whatever one hears about stagnating wages and the like, the bottom line is ultimately what we can afford to buy and have in our households to improve our lives. By those measures, life for the average American is better today than 35 years ago, life for poor Americans is much better than it was 35 years ago, and poor Americans today largely live better than the average American did 35 years ago. Hard to square with a narrative of economic stagnation or decline.
What the current policy regime holds for the future remains, of course, to be seen. But to use Pete’s terms: as long as the Schumpeterian horse of innovation and the Smithian horse of the gains from trade outrun the Government horse of stupidity, the winners will continue to be you, me and our children and grandchildren, even if the stupid horse is running a bit faster than it used to.
Remember this when you hear someone in the media or the Democrat party say that we are not making progress in improving the lives of ordinary citizens, and need some new government program to fix society. American will do that if we just leave people alone to take advantage of the the freedom to innovate.