I love how some stories get passed down through the generations. My mom used to tell my sister and me about how when she was a kid, she could walk to a shop and buy candy bars for a nickel (a full-sized candy bar, none of this “fun size” nonsense). I have told my kids that my sister and I used to walk to the Landhope Farms store just outside the borough of West Chester and get candy bars for 25 cents. My kids walk to that same store now (although it is no longer a Landhope) and the candy bars are $1.
(My oldest son, by the way, had a bus route that picked him up at the top of our hill-side neighborhood, but dropped him off at the bottom of the neighborhood. And so, he will be able to tell his children truthfully that he walked uphill both ways. Sometimes in the snow.)
The candy bar stories are background context to illustrate something that has been staring us right in the face: By any measure, the economy is doing great.
It would have been hard to ignore the rampant inflation that was the feature of almost every news story and shopping trip in 2021 and 2022. That inflation had a real impact on our ability to make purchases. Even while wages were growing at a sharp rate, inflation was outpacing that growth, reducing our actual purchasing power, or “real wages”.
Then, in the second half of 2022, inflation cooled but wages continued to grow. Real wages are now higher than they were before the pandemic.
This has not stopped us from suffering from some kind of collective myopia. Even while polls show that most people feel that they are personally doing well, these same people believe that the economy as a whole is doing poorly.
But the thing is: We are the economy. Each of us.
For some reason, we believe that bad things are happening elsewhere. For instance, very few voters believed that there were problems with their local elections in 2020, but a lot of people believed that something was wrong with the 2020 election somewhere else in spite of all the unsuccessful court cases, recounts, and “forensic audits”.
Let’s look at some economic data.
As of September, the unemployment rate in Chester County was 2.3%. That’s the lowest it has been since Bill Clinton was president. That’s the fourth lowest it has been since before Reagan. The story is pretty much the same in Mongomery County (2.6%), Delaware County (2.9%), Bucks (2.7%), Berks (3.2%), and while the 4.1% rate in Philadelphia is higher than the collar counties, that is the second lowest it has been in Philly since 1990.
It is tempting to think that we live in a special area — because, let’s be honest, we do — but in terms of this data, we are not alone. The Pennsylvania unemployment rate (3.5%) is the lowest it has been since before the 1980s. At a national level, the rate is 3.9%, which is higher than it was right before the pandemic (3.5%) but still the third lowest it has been since 1969.
Real wage growth is not only up, nationally, but it is up most among lower- and middle-income earners.
The 2023 Christmas shopping season is off to a tremendous start, with retailers posting record sales. Spending more than ever on Christmas is not the typical behavior of a country with a struggling economy.
Inflation is down to 3.5% and falling, which is still higher than the Federal Reserve’s goal of 2%, but lower than it was during most of the Reagan and G.H.W. Bush administrations.
So I think back to my mom telling us about nickel candy bars, and me telling my kids about 25-cent candy bars. Inflation has always been there. Sure, in the last couple of years, we took a real pounding. But when inflation cools, prices don’t go down. That is part of how our economy has always worked. That is why old people can tell stories like these.
The economy that Obama and Trump were so proud of has, in fact, returned. Just as before, it is not perfect, but the real failure of Bidenomics is not in the data. The real failure is our collective inability to believe that things are going well.
Will Wood is a small business owner, veteran, and half-decent runner. He lives, works, and writes in West Chester.
Source: Berkshire mont