Matt Yglesias just wants to believe…
…that Census data showing real median household income is slightly below 1989 levels is wrong, so he went searching for another data source to support his hunch. (Real means adjusted for inflation; median means right at the middle of the income distribution, with half of all households above, and half below.)
In his first post on the topic, “Median family income since 1989: Is the stagnation real?,” Yglesias drew on an assortment of feelings to make his Slate-ish contrary case: bigger better cars, bigger better TVs, MP3 players, and, of course, the Internet. Therefore, the Census report is fishy. But the Census figures come from a survey of over 50,000 households (technical details here), which sounds like a more reliable source than Matt’s gut. And they’ve been at it for decades—family data begins in 1947, and household data in 1967.
But, perhaps realizing that anecdata doesn’t really cut the mustard, Yglesias found himself an actual data source, the Consumer Expenditure Survey (CEX) from the Bureau of Labor Statistics (BLS) to support his hunch. (It’s abbreviated CEX so as not to confuse it with the Current Employment Statistics [CES], the source of the monthly payroll data.) So he rolled out his discovery in a piece posted on Friday, “BLS incomes have risen since 1989.” Anyone familiar with U.S. income stats knows that this is ill-advised. But you need not have read deeply in the income literature—all you need do is read the BLS’s FAQ, which advises against relying on CEX income data:
If you want to relate the expenditures of consumers to their income and characteristics, the Consumer Expenditure Survey is the primary source of data. However, for users interested only in income information, data published by the Census Bureau of the U.S. Department of Commerce may be a better source of information. Data from the Current Population Survey are based on a much larger sample size. For income information, visit the Web site www.census.gov/hhes/www/income.html….
So the BLS itself recommends using the very Census data that Yglesias wants to dismiss.
More on income and poverty figures in the next issue of Left Business Observer, now in preparation.