Why Americans Feel Poor (In 1 Simple 'Fiction-Peddling' Chart)

Tyler Durden's picture

Why do so many Americans feel dissatisfied about the economic state of their nation? None other than former Fed uberdove, Narayan Kocherlakota 'fiction peddles' one simple chart that makes it hard for any card-carrying Democrat to argue with...

As Bloomberg reports, the chart below shows the cumulative growth in per capita real GDP in the U.S. over the preceding ten years, for each year from 1957 to 2015. It does a great job of depicting the country's post-World War II macroeconomic experience.

Narayana sees 3 key points:

  1. Growth was unusually strong in the 1960s and early 1970s. In every year from 1966 through 1973, per-capita income was up between 30 percent and 40 percent from a decade earlier. Thus, it's not surprising that many Americans recall this as a great period for the nation’s economy.
  2. In every year from 1984 to 2007 -- a period that economists call the Great Moderation, because of the way both growth and interest rates stabilized -- per-person income was up between 20 percent and 30 percent from a decade earlier. That's ample reason for Americans to view this as a good period for the economy.
  3. Cumulative per-person growth from 2005 to 2015 was lower than in any prior decade in the sample. That certainly helps explain why many Americans are unhappy with the nation’s recent economic performance.

As he concludes: Americans are right to want better performance than they've seen in the past ten years.

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I Write Code's picture

Things are much, much worse than that.  Chart needs to be revised.  Many charts have shown that all the growth is in the top 1%.  For the 99%, real growth has been NEGATIVE for twenty years, increasingly so.

Creative_Destruct's picture

Would be interesting to see individual charts for each decile, plus one for the top 1%

Boris Alatovkrap's picture

Amerikansky, when #statist is lead citizenry to think everyone is happy prosperous, but you are just not feel it…

Wahooo's picture

How can we become more like the Russian people and resign ourselves to economic malaise?

Muddy1's picture


Easy, drink lots of vodka, then feast on bad cabbage anf fatty sausage, drink more vodka, smoke bad cigarettes, drink vodka, believe that everyone is being treated the same, drink vodka, drink more vodka.......

gatorengineer's picture

yeah but they got Russian Pussy, not many 200 lbers over there, they still look like women.

Government needs you to pay taxes's picture

So if that GDP stat is NOMINAL rather than inflation-adjusted, what does that say about REAL growth with the correlary read-thru on REAL household income?

Eventually, enough Americans are going to realize they'd do better economically by grabbing ropes and razors than by trudging slowly into darkness.

CNONC's picture

I agree.  I sure am tired of looking at fat women.  And we wonder why Viagra is such a big seller here.  You have to have some assistance to perform when you're with "grossen tieren"

NewHugh's picture

At least their leader isn't a corrupt pussy like ours.

new game's picture

obomb-ba is not my leader! and these fucks, putin included, are so removed from everyday lives that your statment means nothing. might as well be watching the voice. at least she is beautiful. see the retarded disconnect?

gatorengineer's picture

We have we elected Obozo twice and are about to get (elected or not) shitlery for 4 years.

Escrava Isaura's picture

Boris Alatovkrap: Amerikansky,(1) when #statist is lead citizenry to think everyone is happy prosperous (2), but you are just not feel it…(3)

Your number 1 statement tells us that you’re here as a propagandist/agitator, which became common practice here at Zero Hedge.

Number 2 you purposely forgot to mention why Americans can’t no longer be prosperous which would answer your number 3 incendiary statement.

And final, financial collapse followed by commercial collapse will be not an US phenomenon but a global phenomenon.

So, hold your horses there cowboy with your incendiary propaganda and misrepresentation of the facts.


Bill of Rights's picture

Americans are no longer prosperous cause they are lazy sit on the couch watching football fat asses. No one owes you a living you have to work for it and HARD.

CNONC's picture

If you are trying to do something, and it seems really hard, you are probably doing it wrong.  I used to think making a good living required hard work too.  I was doing it wrong.

toady's picture

Exactly. I mean, sure, hard work is required when you dig ditches, but eventually you learn how to run the excavator, and all you have to do is sit and push levers.

It's not saying anything bad about hard work, it's just that people learn to improve processes. The most successful people I know make things easier for themselves and others. 

CNONC's picture

That's right.  The definition of a "good living" matters a lot too.

Erek's picture

I not only "feel poor", I AM poor!

Thank you CBs, ObumfukCare, IRS, et al and all you other money/wealth-stealing bastards!

death2Tyrant-asauras's picture

but, but, but....we are amerika, we are number one. we are the best. etc. etc. and etc.



as someone said, the best slave is the slave that does not realize its a slave.





saveUSsavers's picture

right! GDP is a LIE  FOR 10 YEARS because of incr hedonic adjustments reducing inflation deflater used to compute the GDP

FrankDrakman's picture

The chart is complete BS. It starts in 1957, when the US was the undisputed manufacturing leader of the world, having emerged from WWII completely unscathed, unlike Britain and Germany, which had both been pounded by bombs for years. Why doesn't it show us the same figures from 1900-1920, for example, or from 1925-1935, for that matter? 

And how much of that GDP growth was stimulated by the US MIC, which provides jobs for some, but ultimately takes a great amount of wealth, and puts it into useless equipment, like nuclear subs and missiles? How much better off would we be if that money had been spent on homes or highways or subways or any number of things that normal people actually want and use, instead of guns and bombs that are used to enforce the wishes of a tiny neofascist minority?

HalinCA's picture

Look at it this way ... the chart shows how shipping jobs off shore, deregulating banks/investment houses, and replacing manufacturing with finance ruined the economy. Also note how all that magical silicon valley BS wasn't enough to keep things humming.

Swamp Yankee's picture

Could it be that everything is going up execept our incomes?

Archibald Buttle's picture

you need a bigger teevee. they've never been cheaper!

Tarzan's picture

We feel so poor because we "need" so many frivolous things to survive, bigger, brighter, shinier....to keep up with Mr Jones, more bread and circuses, FTW.

winnnnnnnnnnnnnnnnnnning is so fun...................


"Sheol from beneath is excited over you to meet you when you come; It arouses for you the spirits of the dead, all the leaders of the earth; It raises all the kings of the nations from their thrones. "They will all respond and say to you, 'Even you have been made weak as we, You have become like us. Your pomp and the music of your harps Have been brought down to Sheol; Maggots are spread out as your bed beneath you And worms are your covering.'…

Seek_Truth's picture

Because we get to benefit from the work we put in?

Tell me why the Highwayman (gubmint) should even survive.


Creative_Destruct's picture

"Americans are right to want better performance than they've seen in the past ten years"

I dunno though. Could be we've played out the string of the centuries-long industrial and post-industrial growth trend, especially with the rate of population growth starting to roll over and the planet approaching carrying capacity.

And idiot Keynseian stimulation policies will only serve to band-aid and bubble-gum together the system for a time.


cart00ner's picture

Got by ok as a kid 70-80's - crappy jobs, but didn't have an iphone, xbox, big tv, internet costs.

My kids bitch that it's sooooo hard today, and i agree... It's costing me a fortune!

The money they spend on that shit is what i saved for a deposit on a house. Peckerheads but i love em!

asteroids's picture

It's all about demographics and the printing press. Politicians and big biz seek to fleece the people with the most money at any period of time. Currently, that would be Baby Boomers in retirement and Millenials with student loans. I see these two generations in poverty eating cat food.

Wahooo's picture

Was just thinking the same. Wait until you start shopping around for colleges, $20,000 - 25,000 a year for a 4-year institution. Now THAT'S a mortgage payment!

Vonhoff5's picture

I wish it were that inexpensive!

saveUSsavers's picture

right! local Cal State 5 yrs ago cost us $28K for 4 yrs tuition, no books, which our son bought used online(national RIPOFF)

BetterRalph's picture

message to the next generation.

buy used books/tools/test equip and boycott college

hurry up and learn,(I mean listen)

Get a good FAN for ventilation,

watch your nutrition.

open a vintage repair shop

world needs moar HighVoltage 8uF's


GunnerySgtHartman's picture

Unless someone wants to go into a very specific career field, like medicine, college is increasingly a huge ripoff.

death2Tyrant-asauras's picture

you are correct that its a rip off. the ROI on it really sucks. I think that is true for doctors as well. they now only really have the option of working for large corporations. they will make a good living, but will never really accumulate significant wealth.


if I had a kid who was 18, I would send him to a tech/vocational school.  then set him up in a small business.  in another country. 


fixing cars or plumbing or such will make him a much better living that depending on some giant corporation that will fire him as soon as he is eligible for a pension. or when they decide that its cheaper to set up operations in India or some offshore country. or import some cheaper labor on a visa and set them up on a boat offshore.


(also, I would have home schooled him and not allowed him/her to be subjected to the marxist horseshit now going on in public education in america)


and I speak as a person with advanced degrees and who worked in the corporate world for 30 plus years.


at the end, I had built someone else a great business and all I had was some pay stubs, some savings, and some one else had all the equity.  not a good use of my time and energy.


Rickety Rekt's picture

Over priced and a crap education. If you live in Canada and head to USSA for post secondary they bump your grade average by about 10%. 

Erek's picture

Oh, boo hoo! That's your own stupid fault.

Quit whining and bitchin' and stop buying that shit for the little bundles of joy. Make them work for the money you give them so they might appreciate it a little more and not squander it like they were .gov.

Otherwise, say "good-bye" to your deposit for a new abode.

death2Tyrant-asauras's picture

the littel bastards are expensive. its why I never had any. but once you let them in the door, you really cant get rid of them. 

Dodgy Geezer's picture

We see the same boost in Britain during the Imperial period, followed by a decline over the post WW2 years.  So I think the same thing is happening to the US.


You just got a shorter period of world hegemony...


Archibald Buttle's picture

once al gore invented the internet, it all got kicked into overdrive.

BetterRalph's picture

When I get punched in the mouth I "feel" like I have a bloody lip.
Shit's in my mind, really what's happened is my lips have assaulted an honest fist.
Insert ticker-guy's "gdp to debt" color chart + math exponents 101 refresher

billwilson2's picture

Bush invades Iraq. From then on all down hill. You can only blow so much of your wealth on blowing things up before you start to run out of wealth.

DemandSider's picture

 The petrodollar scheme was begun by the parasitic banking sector to bloat the value of the dollar to mask the bachanal of spending during the Vietnam tragedy. History will show this was the start of our decline, not just because Communist China proved it was superior, militarily, in Vietnam, but because the petrodollar REQUIRED Communist China to run trade surpluses with the U.S. to get dollars to buy OPEC oil and grow their GDP. Of course, the Neoliberal/CCP/Wall Street Axis Powers all work together to crush democracy and free speech. Had this not been the case, Communist China would have failed, just as The USSR failed.

TheVoicesInYourHead's picture

Simple answer-

The 99% feel poor because real consumer inflation (for the things you cannot import from China: i.e. medical, education, house rent/buy costs) has been 7%-12% annualized for the last 20 years, but wages have moved little over that same period.

The fed likes to talk about fake "low inflation" because it helps to keep Les Misérables from taking the pitchforks out of the shed.

Raging Debate's picture

Voices - You and others nailed it about inflation yet stagnant wages. Plus food and energy also went parabolic 2005-2015. Energy has declined now and food is flat. Also other commentators like Geezer mentioned our short empire and compared it to Britain and its decline. Very apt comparison.

Trade snd tax policy has been awful, now causing more business deaths than birth. Every person knows the rule of law only applies to those that cant afford a good lawyer or if your immune like most politicians. 

Lets not forget Congress abdicating its monetary authority to a private Central Bank (the Fed) and warmaking to the executive. Being lazy while being bribed by big business lobbyist was fun and profitable, for them. That is rampant corrruption. 

The outlier issues are carrying capacity and automation.  Malthus has been proven wrong consistently. Christ, even Llyod Blankfien stated on Chsrlie Rose the economic problems are caused by bad distribution not automation or shortages. 

truthalwayswinsout's picture

What is really wrong is we have failed to bring forth the next "Industrial Revolution."  It started in the 60's and went into the 70's and then fell flat on its face.

The next revolution should have been the commercialization of space but it has been dead in the water since the mid-70's. We have lived off of those advances for a period of time and now have electronic gizmos and internet which were all invented during that time frame but those advances are slowing dramatically.

This failure is due to the cronyism of the Progressive National Socialists who have declared a race war on the White Race and are more concerned with correctness and control than capitalism.

It is easy to get things back on track. Just take NASA public and restart the commercialism of space. Within 10-15 years wealth and prosperity will return and a very funny side benefit will be to save the environment.