Wealth Destruction, 2007-2010
The Fed has published its survey of family finances from 2007 to 2010. The data are as depressing as you would expect, as they measure some aspects of the economic collapse that began in 2008. The period covered is that during which the Democrats had full control over Congress (January 2007 through January 2011), but that is mostly coincidental; the Democrats’ dominance was only one of many factors at work.
At a high level, the Fed survey reveals that both income and wealth were hit hard during the time covered by study. Median real income fell by 7.7%, with the decline affecting all income groups except “retirees and other nonworking families.” Some would say that is because the public sector–its entitlement arm, anyway–is doing fine. The story with respect to wealth is even worse. Median net worth declined by 40%, erasing 18 years of savings and investment for the average family. Much of that decline, but by no means all, related to home prices.
If you follow the link, you can peruse the data at your leisure–there is a lot there to see. Unfortunately, published data always lag behind current events, so the Fed’s survey doesn’t shed as much light as it might on the real problem: not the recession, but the pathetic recovery from the recession. Have things gotten better since 2010? Slightly, perhaps, but nowhere near enough. That is a story that remains to be told another day.
JOE adds: The Journal today reports on yet another aspect–private family wealth is being vacuumed up as inheritances slacken, baby boomers’ parents live longer on government health care, boomers’ savings accounts fail to realize the inheritances they once loosely planned around. This business of destroying private wealth and recycling cash into the federal system is deadly, deadly business. A twitch upon the thread…
John Hinderaker at PowerLine
(I wonder who Joe is. But the article tells alot anyway.