The Economy Isn’t Broken, We Are

The University of Michigan’s index of consumer sentiment hit its lowest point since 1952, but this doesn’t necessarily mean the economy is in shambles. A closer look at the numbers reveals a more nuanced picture – one that challenges our collective gloominess.

Families across income spectrums are struggling to afford basic necessities like childcare and healthcare, and the soaring cost of living is taking its toll. However, beneath these surface-level concerns lies a complex web of factors contributing to this pervasive pessimism. We’re quick to blame economic indicators for our woes, but perhaps we should be looking inward instead.

Years of belt-tightening and uncertainty have tempered Americans’ expectations. The prolonged COVID-19 pandemic and the looming specter of inflation have conditioned us to anticipate financial hardship – even when it’s not necessarily there. Our media landscape amplifies negative narratives, reinforcing a collective sense of dread.

Economic data tells a different story: 96 out of every 100 Americans who want a job have one, and real disposable personal income is at an all-time high. Even low-income households are seeing improvements in living standards, thanks to the tight labor market’s fueling wage gains that have swelled family budgets.

We refuse to acknowledge this progress partly because we’re beholden to a prevailing narrative of economic doom – one that conveniently ignores our own agency. We’ve become accustomed to bemoaning our fate rather than taking responsibility for shaping it. The truth is, most Americans are doing okay; they just won’t admit it.

Historical context also plays a role: we tend to forget the past in times of relative prosperity. During periods of economic downturn, however, we’re quick to dredge up memories of better days – the 1950s and ’60s, for instance, when our economy was indeed robust. What we overlook is that those eras were also marked by structural inequalities and social injustices that continue to plague us today.

Looking abroad, America’s economic performance stands out in stark relief: Europe’s GDP per capita has shrunk to half of the United States’, and our middle class remains richer than its European counterparts. If France and Britain were states within the US, they’d be among the poorest.

Perhaps it’s time we revised our notion of what constitutes “good” economic times. Rather than fixating on ephemeral GDP growth or stock market fluctuations, let’s focus on the real metrics that matter: rising living standards for most Americans, a tight labor market driving wage gains, and record-high disposable income.

We’re stuck in a perpetual state of anxiety – one fueled by our own projections of doom rather than an objective assessment of reality. It’s time to reframe our understanding of economic progress and recognize the resilience that has characterized our post-COVID recovery.