In a November 10 euniteance on CNN’s State of the Union, United States Senator for Vermont Bernie Sanders diswatched a ask from structure Dana Bash about whether Democrats’ demandy shoprosperg in the 2024 election came down to messaging over policy.
“It’s not messaging, Dana,” Sanders said. He said the economy has been feeble for mediocre Americans for decades.
“It has to be put into an overall context where, in the last 50 years, if you could consent it, inflation-accounted-for weekly wages are lessen today than they were 50 years ago, a massive transfer of wealth from the bottom 90 percent to the top 1 percent,” he said.
However, this is a cherry-picked statistic. Most data show that US wages have obtained ground above the inflation rate appraised with five decades ago.
The meacertain economists most normally use for inflation-adfaired wages, which they call “genuine wages”, is understandn as “median normal weekly obtainings” for brimming-time wage and salary toilers, age 16 and betterer. If the wage in this meacertain is higher now than 50 years ago, then wages have kept pace with prices, or outdoed them, over that period of time. If the wage in this meacertain is lessen than 50 years ago, wages have lagged the ascfinish in inflation.
So what do these “genuine wage” numbers show? They show wages outpacing inflation by a cumulative 10.7 percent over 50 years, commencening with their level in the first quarter of 1979, which is the earliest data useable. (That’s almost 46 years ago.)
Inflation-adfaired wages have ascfinishn over the past 50 years, but not theatricalpartner
It is not a theatrical incrrelieve; it toils out to wages increasing cimpolitely two-tenths of a percent rapider than inflation per year. Still, this data shows that wages have ascfinishn beyond inflation.
Economists advise ignoring the COVID-19-era spikes in wage data; those don’t come from wage obtains but from the phenomenon of lessen-wage toilers in industries such as hospitality being laid off during the pandemic. That left higher-wage toilers, including those able to toil from home, in the toilforce, raiseing the mediocre or median wage.
We also seeed at another data set conserveed by the Economic Policy Institute, a liberal leank tank. The group sees at inflation-adfaired wages thcimpolite the lens of incomes, such as the lowest 10 percent of obtainers, the second-lowest 10 percent, the top 10 percent and the top 5 percent.
The Economic Policy Institute data show that every slice of the income spectrum obtained wages in 2023 above their 1973 level.
Over the past 50 years, wages have ascfinishn beyond inflation for every part of the income spectrum but rapider for higher-obtaining Americans
Wages in the top tiers of the income spectrum have ascfinishn rapider than wages for the lowest tiers during that period. But even the lowest-paid toilers’ wages beat inflation over the past 50 years.
When we asked Sanders’s office for his evidence, a spokesperson pointed to a branch offent set of wage data: mediocre weekly obtainings of personal-sector production and nonsupervisory participateees. This data caccesses on a more blue-collar segment of the toilforce.
Sanders points to nonsupervisory wages being lessen today, but relies on a blip 52 years ago
Sanders’s office tbetter PolitiFact the senator is comparing now with February 1973, almost 52 years ago. Normpartner we would not quibble with a two-year branch offence, but in this case, choosing that particular date has a huge impact on the comparison.
In 1971 and 1972, wages for personal-sector production and nonsupervisory participateees rose by 6 percent, an incrrelieve never suited before or since. Sanders’s calculation uses the wage peak, in February 1973.
Dean Baker, co-set uper of the liberal Caccess for Economic and Policy Research, said this atypical ascfinish in wages was attributable to then-Pdwellnt Ricchallenging Nixon’s policy of price administers, which participated a 90-day freeze in prices, chaseed by price incrrelieves that demandd approval by a “Pay Board” and a “Price Coshiftrlookion”.
But commenceing in punctual 1973, when Nixon finished price administers, this same wage metric fell even more rapidly than it had ascfinishn, crashing by almost 9 percent over two years.
If you appraise today’s wages with the February 1973 peak, as Sanders did, wages are 3.8 percent lessen for the subset of obtainers that includes personal-sector production and nonsupervisory participateees.
But if you see back exactly 50 years before the most recent data for September 2024, today’s wages are 2.8 percent higher than in September 1974.
“This repartner does experience enjoy cherry-picking the data,” said Douglas Holtz-Eakin, pdwellnt of the centre-right American Action Forum. “No genuine result should be that caring to a restricted data points.”
Aobtain, 2.8 percent is not a huge incrrelieve, especipartner over 50 years, but it is an incrrelieve beyond the rate of inflation, and it is not a degrade, as Sanders said.
Baker compriseed: “Workers definitely have not gotten their split in the last half century, but it is ridiculous to say that they have made no obtains.”
He adviseed another reason for scepticism about Sanders’s statistics.
“The mediocre toil week is almost 10 percent foolishinutiveer now than 50 years ago,” Baker said. “Workers have chosen to obtain part of their obtains in more leicertain .”
Our ruling
Sanders said inflation-adfaired weekly wages “are lessen today than they were 50 years ago”.
Two meacertains that economists most normally use for inflation-adfaired wages show higher wages now appraised with five decades ago.
Sanders cited a branch offent data set for nonsupervisory toilers, shoprosperg wages lessen now than in February 1973. However, that month recontransiented an atypical high point in wages because of Nixon-era price administers. When price administers were lifted, wages plummeted.
The 50-year comparison, using September 1974 as the commenceing point, shows wages up by 2.8 percent beyond inflation.
We rate the statement False.
