Not sure what to make of this Gallup piece:
Upper-income Americans’ self-reported spending rose 33% to an average of $145 per day in May — up from $109 per day in April 2010 and May 2009, and the highest monthly average since November 2008.
Spending for middle and lower income folks largely stayed the same, which should surprise no one, because they haven’t made any economic progress in the last decade.
Obligatory “I am not an economist and may not have the first damn clue what I am talking about” warning.
Jon H
Going Galt don’t come cheap, you know.
sukabi
as for the middle and lower brackets spending staying level… when you’re down to the bare necessities, it’s not surprising… and the flatness tells me that the mid – lower brackets are actually doing worse than flat, as prices for the basics have gone up…
Emma
I think your title says all that needs to be said!
Socratic_me
That means that in one month they spend more than my yearly take-home. Incidentally, my pay is above median.
General Egali Tarian Stuck
Murrikans can only go so long afore they must buy something, anything, even if it’s with plastic. If not, they start getting the shaky tremblies and seeing spiders crawling up their legs, to where their self esteem plummets and they start feeling just like every other poor schlub in the world. ewwww!
When the soup lines come, there will still be a market for gold plated tin pots and fancy rubber chickens to go in them.
AhabTRuler
John, why do you hate America?
Downpuppy
I chased it all the way to Gallup’s footnotes & still don’t get it. Is this household or individual? What are “normal household bills”? How can people spend 3x their discretionary income?
Gallup’s Consumer Spending measure is calculated from responses to a basic question asking Americans each day to estimate the amount of money they spent “yesterday,” excluding the purchase of a home or an automobile, or normal household bills. The result is a real-time indicator of discretionary retail spending, fluctuations in which are sensitive to shifts in the economic environment. Gallup’s average monthly estimate of spending is correlated at the .65 level with the U.S. government’s report of total U.S. retail sales (not seasonally adjusted), and exhibits similarly positive and substantial correlations to other government measures of retail sales. .
MattR
As opposed to all the economists who don’t have the first damn clue about what they are talking about?
beltane
But if they paid an extra $.05 a day it would kill the economy and destroy the country.
El Cid
The biggest problem with the country is inflation. The fact that there isn’t any and no one is really predicting any is irrelevant. This is important.
Daddy-O
And that’s the beauty of the free market!
Punchy
Come on, John. We need a open thread! Check this out:
Colly moved to Pac10 today
Okie St. reported to be moving to Pac10
Texas now begging to be moved to Big10
Nebraska all set to take B10 offer, but they HATE HATE HATE TX, so if Texas gets a B10 invite, does Nebraska spike the offer?
TX A&M asking to join SEC, but needs a second team to go with…..rumors are that VaTech could be it
So much to discuss….rumors flying/changing by the minute!
licensed to kill time
@El Cid:
My 85 year old landlord has been telling me this for the last 2 & 1/2 years. I can’t refute him because he gets kinda cranky and I like this house.
Howlin Wolfe
Buh-buh-but according to the deficit hawks and bond markets and Randroids, the reason the economy is in the tank is because the poor people gots all the rich peeples munny. That’s why we have to cut back on entitlements, not raise taxes. NOTHING to do with shady deals done by lenders big and small, or by the whip-smart Wall Street Boyz.
I iz not a eekonimest either. Could you tell?
Ruckus
The link seems to be empty.
Here is the Gallup Poll
john b
145*31 = 4495.
I’m pretty sure that’s below the median.
jwb
@El Cid: Yes, because if people even starting thinking about thinking about thinking about inflation, then clearly economic hell will break loose.
LikeableInMyOwnWay
@General Egali Tarian Stuck:
Is this what people think out there in the middle of nowhere, where the big headline on the local paper is likely to be “CAR STOLEN?”
Mike Kay
The stock market rose approx 50% during Obama’s first full year in office. Naturally you’ll seeupper incomers spending some house money (what greenspan called “the wealth effect”).
Bill E Pilgrim
@General Egali Tarian Stuck:
Well yeah because people will still need to pay medical bills.
dadanarchist
Fixed.
ruemara
As a skilled professional, with decades of experience, I aspire to one day have median income, again. It seems like a dream to have had $3k to spend in a month.
I hate these people and America right now. & I’d really like to go to the dentist so my fabulous insurance can be put to use, but I just spent the extra monies on food for the week and gas.
HATE.
–it’s like an angry, bitter, broke stream of conscious poem.
jl
What is with Cole and his self-loathing?
In other words, what is with this?
“Obligatory “I am not an economist and may not have the first damn clue what I am talking about” warning.”
Most economists don’t have the first damn clue what they are talking about either.
I am not a macroeconomic specialist, but will keep an eye out for informed economic analysis of this stat, and see what is up.
Concerning the earlier thread: TPM is following the GOP, and specifically Johnny Bones gyrations concerning who should pay for all the BP spill damages. Very difficult to follow what these crooks (GOP and Bones, not TPM) are saying.
As far as I can tell, their line right now is the economic damages cap should not be removed and the feds should not pay. So, seems to me that by default that would leave state and local governments and hapless Gulf Coast citizens to swallow any uncompensated economic damages.
Which sounds like a typical GOP strategy: bafflegab and confuse until it is too difficult for the media to add up a one and one by themselves to get two, and then let random people who are not one of their BFFs suffer random bad consequences.
And that my friends, is good governance, GOP style.
The series of posts at TPM today makes entertaining reading. And the Democrats will do what with this little drama that should be explained and shared with the population? Especially with the many Gulf Coast GOP voters who are going to get screwed with the current GOP position on the issue?
LikeableInMyOwnWay
Me too. If only I could live in Ethiopia.
But, nope. Stuck here.
Zifnab
Maybe you poor and middle income folks should learn a little AUSTERITY and stop spending all your money on flat screen TVs, alcohol, rap music, and hookers!
jl
My original comment in moderation due to random b * n * r p * l l coinikidinkal spelling and perhaps off color language in original.
What is with Cole and his self-loathing?
In other words, what is with this?
“Obligatory “I am not an economist and may not have the first dang clue what I am talking about” warning.”
Most economists don’t have the first dang clue what they are talking about either.
I am not a macroeconomic s p e s h u l i s t, but will keep an eye out for informed economic analysis of this stat, and see what is up.
Concerning an earlier thread today on GOP position on BP spill economic damages: TPM is following the GOP, and specifically Johnny ‘B o n e s’ Boehner’s gyrations concerning who should pay for all the BP spill damages. Very difficult to follow what these crooks (GOP and Boehner, not TPM) are saying.
As far as I can tell, their line right now is the economic damages cap should not be removed and the feds should not pay. So, seems to me that by default that would leave state and local governments and hapless Gulf Coast citizens to swallow any uncompensated economic damages.
Which sounds like a typical GOP strategy: bafflegab and confuse until it is too difficult for the media to add up one one and another one by themselves to get two, and then let random people who are not one of the GOP’s or the media’s BFF suffer random bad consequences.
And that my friends, is good governance, GOP style.
The series of posts at TPM today makes entertaining reading. And the Democrats will do what with this little drama that should be explained and shared with the population? Especially with the many Gulf Coast GOP voters who are going to get the shive with the current GOP position on the issue?
jl
Sorry for duplicate posts. I assume comments in moderation will stay there forever. But I was wrong.
Ruckus
@Zifnab:
Can’t afford to drink, my TV is 15 yrs old, music I listen to is mostly older than that and if you think I can afford a hooker..
asiangrrlMN
@jl: Might I just say that I really dig the flow of your posts? They have a stream of consciousness quality to them that make them almost poetic. Plus, they are substantive. That is important as well.
Rich people are spending more money, while the middle class and the lower class are spending the same (or, probably, less). Same old, same old, in other words.
HE Pennypacker, Wealthy Industrialist
$90K is the cutoff between middle- and upper-income? I don’t think these people live in the SF Bay Area.
jl
@asiangrrlMN:
We Tunchfans know that the secret is to follow TunchThought always!
And I am hungry again! Food.
David Hunt
@Ruckus:
Heh. I wish my tv was that new.
BombIranForChrist
Obviously, they are spending all this extra money on charity.
Remember: this is how it works:
1. The government ends all “entitlement” programs.
2. As a result, the government massively cuts taxes.
3. The upper classes, now FLUSH WITH CASH, spend a lot of money on charities that are run by CEO’s who are masters of innovation. They do not spend this money on things like gold plated toilet tissue or psychotherapy for their purse pets. No, no, no. They spend it on charity. Yes indeed.
4. POVERTY ENDS!
Linda Featheringill
@El Cid:
No inflation and none forseeable:
Considering how many inflationary forces the government and Finance and etc. are producing, the lack of resulting inflation causes me to fear that the basic underlying trend in the US economy is deflationary.
Inflationary forces include any time we spend money we don’t have: Deficit spending, personal debt, buying things on margin, buying things on time. These activities are the modern-day equivalent of printing a bunch of money without having anything to back it up.
In other words, we may be running out of steam. Scary.
Zifnab
@Ruckus: Why are you people killing our economy? Get out there and spend, spend, spend! Stupid poor people, always hording their incomes and leaving the hard working rich to take up the burden of invigorating the marketplace with derivatives, self-help books, and sham-wows.
DFH no. 6
I’m very fortunate enough in my socio-economic situation that this number is right on my (household) monthly budget. Doing our part for the economy, I suppose.
I’m a senior construction/engineering manager for a commercial/industrial energy management company with plenty of work (lucky us), and my lovely wife of lo these many years is an RN clinical manager at a large downtown hospital (been working as an RN since graduating in ’77).
Like I said, very fortunate socio-economic position, for which I am grateful to the greater society around me. My wife and I have done our part, sure (schooling, reliably showing up for work every day, becoming skilled at things our civilization values, etc.) but we were both raised in working class families and we also both realize that the Randian worldview is childish crackpot nonsense — no one “does it on their own”.
That last part is why, even though our current household income puts us in spitting distance of the dreaded “OMG! we might have to pay an extra couple pennies in tax on every dollar above this limit when W’s tax cuts sunset” line, we understand and acknowledge full well that our financial success is primarily due to our incredible luck in having been born in the richest country the world has ever known.
Being white and in good health helps tremendously, too.
We just had to take advantage of the opportunity.
What happened to some of our siblings (wife’s and mine both) who’ve also become financially successful but morphed into “fuck you! I’ve got mine! Devil take the hindmost!” conservatives I, sadly, don’t know.
Socratic_me at #4: I believe you are off by a decimal point in your calculations.
Linda Featheringill
@Zifnab:
Poor and middle class should practice a little Austerity:
This is a joke, right? You’re being sarcastic?
Alex S.
In the end, the financial crisis turns out to be a redistribution of wealth by other means. The “game” is rigged.
Ruckus
@David Hunt:
I’d still have the one that would be 25 years old but I lost that in a roommate relocation situation.
Ruckus
@Zifnab:
Been trying to do my part but jeezz there’s only so many days a week I can eat cup o’ soup 2 meals a day to have some discretionary spending money.
@Linda Featheringill:
Zifnab is a pretty regular commentator and from the flavor of his/her previous posts I’m taking it as snark. Especially after the answer to a previous post.
Zifnab
@Linda Featheringill: It’s running out of steam because we’re not pumping much steam into it.
The TARP loans that were supposed to go into propping up the housing market just turned into banker bonuses. Large chunks of the stimulus money were funneled into tax cuts. And government spending has been weighted heavily towards military spending, which is great if you’re a contractor working in Iraq or Afghanistan but not so hot if you’re in the States.
Remember that eight years ago the economy was booming while the government was running a record surplus. There’s no reason we can’t turn the economy around. We have the resources. The recession is bad, but not Great Depression bad. And the credit available through US Treasuries has rarely been this cheap.
We simply don’t have the political capital to do what is necessary. And the President continues to believe the best of the Senators and the CEOs – a terrible mistake when we’re in the thick of class warfare.
Zifnab
@Linda Featheringill: Yes.
Chris
@john b:
The figure quoted was “take-home”, not “gross”.
Also: It always amazes me how people making $300k/yr can gripe so much about raising their marginal taxes, when that comes out to less than a Starbacks coffee every day.
cleek
so, y’all are telling me that the link in JC’s post works for you ?
maus
@Zifnab: I recently found out that a few people I know have Facebook added some group like “THERE SHOULD BE A DRUG TEST FOR WELFARE”.
The comments posted there are wayyy too ignorant and revolting for me to read through.
Bill Murray
@john b: well that is $52925 per year ($145*365). The median income was $50233 in 2007. If inflation has been less than about 2% per year, the median income would still be less than $145/day.
Zifnab
@Chris: People making $300k / year usually didn’t hit that number by accident. Plenty of small business owners and lawyers and doctors make that income range. And they got that small business or that law degree / MD by being excessively frugal in their younger years. These are people used to pinching pennies. And, frankly, I do feel a little bad for the guy stepping into the 33% tax bracket. It’s no fun.
But I think these people would throw fewer fits if they could see where the money actually goes. If construction on your local highway cost $50 million, but you watched a congested two-laner become a free-flowing four-laner, and you could see the extra $2k you paid that year to make it happen, people might blanche at the tax bill less.
Of course, if people saw a quarter of the five figures they forked over to the IRS get pissed away in the desert, they might also be less gung-ho next time a Republican President wanted to get his war on.
There’s so much obscurity in the tax-and-spend process, myth and superstition dominate preconceptions on where all the money is going.
Quiddity
@Downpuppy: Thanks for presenting the definition of spending. I was wondering if utilities counted (they don’t).
DFH no.6
@Bill Murray:
Like I said, Socratic_me was off by a decimal point.
The statement was “in one month they spend more than my yearly take-home pay”, which would mean a yearly take-home pay of around $4400.
El Cid
@licensed to kill time:
After listening to a lot of coworkers and friends and neighbors complaining about inflation when there hasn’t been any significant inflation — and some economists are warning we’re still at a risk for deflation — I have decided that they’re using the term inflation not for its intended purpose (the price index of certain non-energy items, etc., is increasing at a certain rate) but to mean that ‘they have or feel like they have less money these days.’
PurpleGirl
I haven’t really kept track of food prices so I’m not sure about price increases, but I do know that some packages are smaller and holding less. I see that as inflation.
Geeno
@john b: that’s way above median for 1 month.
Bill Murray
@DFH no.6: that’s what I get for not reading all the comments.
Geeno
@Bill Murray: Likewise
Corner Stone
@MattR:
Why you ragging on Mmonides?
Corner Stone
@Zifnab:
I’ll stop with the hookers when you can pry me from her cold, dead fingers.
Ruckus
@Corner Stone:
I’ll stop with the hookers when you can pry me from her cold, dead fingers.
Maybe it’s just my sick sense of humor but that was almost keyboard time.
El Cid
From the Bureau of Labor Statistics on the main measure of inflation cited, the Consumer Price Index.
DFH no.6
@Geeno:
The innumeracy in here is killing me.
What john b. was referring to was Socratic_me’s initial-comment (way back at #4) decimal point error (as I also noted) which led Socratic_me to incorrectly compute the monthly expenditures by us richie-riches as being somewhere around (even above) his yearly (and also the median yearly) income.
No doubt Socratic_me’s calculation wrongly came up with $44,000 per month (thus comparable to the yearly incomes). Decimal point error.
I blame Obama (and the public schools too, of course).
someguy
$145 per day? Those bastards.
At that rate, they’re on pace to spend…
$145 * 365 = $52,925 per year.
This calls for pitchforks, tar, feathering and the gallows.
Um, y’know, unless you do the math and question how the fuck “upper income americans” is defined.
Shit, my wife had a bunch of dental work done and for a couple weeks there I was on pace to spend $1.4 million, based on the one-day bill of $4k. So sue me.
Figures lie, and liars figure…
Uriel
@ruemara: Pfffft. Dental insurance. Such luxuries you are forced to suffer.
(Tongue mostly in cheek, but still, after spending $3,000 on work this year, it does seem like such a thing would be nothing less than wonderful….)
Uriel
@someguy:
I believe they figure it as those making over $90,000 a year.
Admittedly, there’s a lot of difficult math and elaborate induction behind that figure, but just to share my thinking on the subject, I used as a jumping off point the caption for the graph in question:
Now my thinking on the subject may be a bit idiosyncratic, but if it will help, I can further elaborate on the winding route by which i came to this conclusion, as obtuse as it was…..