shocked that only one half of Americans say a week long vacation or a brand new car is now unaffordable! Average price of a new car now is $45k, and the cheapest hotel rooms in safe areas cost over $200/night in places worth visiting.
Yeah, I'm a fairly high income earner (top 10%) and new car prices are absolutely insane to me. I'll keep driving my paid off 2020 model until it dies.
I'm a top 10% earner too, and I probably technically can afford a brand new car, but wouldn't spend that kind of money. We will save up and pay cash for a used car when we need another vehicle.
If you’re looking at brands that hold their resale value well…it’s better value to buy something new with promotional financing than to save and spend $25k+ in cash.
A 2-3 year old used Subaru Outback with 20-50k miles is going for almost $30k. New Subaru Outbacks are like $36-38k and have 0% financing.
Exactly what happened with us. Considered some used third-row SUVs in the $30k range, which we would have likely financed (after paying as much cash as possible).
Or we financed a new Subaru Ascent at 0.9 percent for four years at $40k. I believe total interest was just north of $700 as opposed to four percent or so on a $30k+ note which would have been double the interest (roughly $1,400 at $35k).
That can be better, but one downside is that by getting promotional financing you're often in a worse position to negotiate a lower car price. The low rate financing is the bonus they offer instead of reducing the price.
Basically what happened to me back in 2023. Pervious car kicked the bucket and decided to look around. Honda Civics and Accords with 80K+ miles were selling at the same price as brand new ones. Ended up just biting the bullet and went for a brand new Accord, there was no world I could justify going for a used at at near or exact prices as new.
I'm sure the situation isn't nearly as bad as it was then, but doubt the used market is priced in line as precovid.
You can buy a Toyota Corolla brand new for 25k and has the best durability out of any car on the market. The average price of a new car is only 45k because Americans choose to be irresponsible.
The average price of a new car is that high, not because of irresponsible consumers, but because only those who can afford it are buying brand new. And guess what, it's no longer the middle class, which continues to shrink. It's upper middle and above (see k-shaped economy). People looking for a budget friendly car are not buying new anymore, rather they are holding on to their cars longer or looking for used deals.
Yea. I was curious about car sales. People buy used cars a lot more than new cars (like 3X). So most consumers actually do act like new cars are not affordable, or not worth purchasing. But vacations are relatively cheap compared to other costs like rent, vehicles, healthcare...
Most hotels are shifting from higher quantity of bookings at low rates to lower quantity of bookings at higher rates since less people paying more at certain properties is easier to staff and it’s the same revenue and same profit with less of an impact on payroll. Most of the lowball rates have shifted to Airbnb or VRBO or other short term stay options, this isn’t recent news but the more hotels that continue to do this will continue to drive travelers away. Talk to any bar or restaurant staff off the record, off the clock and most of them will confirm this or that people at certain properties are spending far less on higher ticket items at hotels like they used to at lower rates. To some extent this is good because post-pandemic everyone wanted to travel vlog the world 10x over and there’s still a bit of content creation demand from people that have pursued this lane of work or are left no choice to do something like this after being laid off. All that to say, going anywhere anymore is a slog with air travel delays and the quality of doing anything anywhere has really declined as well. You’re better served to save your money, establish a solid health or fitness routine and find simple, common joys of life without feeling like you have to seek global arbitrage as your peak personality.
A weeklong vacation abroad is quite inexpensive for Americans. Like, there are so many ways to have very cheap vacations as Americans relative to the rest of the world, so I actually don’t think that one should be considered the same.
A lot of really fun vacations don't require a hotel room at all. If you live within driving distance of a national or state park camping is a ton of fun. When I was a kid my family drove from Nebraska to yellowstone and slept in campgrounds on the way, then camped there for a week. The food was by far the most expensive part of the trip, and we would have been spending almost as much on it at home anyway
It's cheaper then a week at the 200 dollar a night hotel mentioned earlier. It is pretty easy to find a 4 person tent for less then 300 bucks, a 2 person tent for less then 200.
How cheap do people want a vacation to be? A week of camping for two could be less then 500 bucks, including all the equipment. Then you can go camping for even cheaper in the future.
They're called blankets. Put like 3 on the floor and you are good to go. Without a sleeping bag you camp when the weather is warm, so another blanket on top. You wanna get real cheap with it, skip the tent and sleep in a hammock. I don't like that because rain will suck, but I know people that do it.
Even if you are too soft to sleep on blankets, a camping pad is less then 20 bucks.
>I now have to bring blankets that aren't meant for outdoor use to go on vacations?
Do you think the inside of a tent is outdoors? Have you ever been camping before? The most common bougee solution I have seen is an air mattress with sheets, blankets, and pillows.
>Sheeeeesh, this cheap "vacation" sucks! Let me just work for the week. LMAO
If you don't like camping just say so. Yes, sleeping in a tent is less comfortable then sleeping in bed. You might even get dirty and tired by the end of the day from all the walking around! God forbid, you might even get bitten by some insects.
You have to travel out of the U.S. to get decent prices on hotels. Half the fun of traveling now is just getting to save money… So dystopian and can’t imagine how people with kids are getting by
Would just like to point out that, as early as the 2000’s, there has been a noticeable decoupling of the link between consumer confidence and consumer spending (https://fraser.stlouisfed.org/files/docs/historical/frbsf/frbsf_let/frbsf_let_20080627.pdf). I believe a paper in JEP labeled the relationship as modest in 2004 (https://fraser.stlouisfed.org/files/docs/historical/frbsf/frbsf_let/frbsf_let_20080627.pdf).
Post-COVID, there are some noticeable trends that suggest that this link is weakening even further (https://www.federalreserve.gov/econres/notes/feds-notes/tracking-consumer-sentiment-versus-how-consumers-are-doing-based-on-verified-retail-purchases-20250424.html). And, in fact, REAL retail sales are up between 2019 and 2024 (https://www.federalreserve.gov/econres/notes/feds-notes/a-better-way-of-understanding-the-u-s-consumer-decomposing-retail-spending-by-household-income-20241011.html).
This doesn’t suggest that the consumer feelings on the economy are wrong, or out of touch. It does suggest, however, that even if people feel things are worse, they are buying more. Both low income real wages and spending are higher.
I've read around about it and I've not seen any super credible studies of why it's happening. But it's being discussed a lot.
"Boomcession", etc.
It's very clear that, despite the American economy generally faring better over the last 20 years than our peers' economies, Americans are more cynical than they've been since Black Monday in 1987.
Case in point that this is possibly partisan and likely news-cycle/social-media driven: In Biden's final months, Democrats were extremely cynical about the economy despite Biden's strong recovery and righting-of-the-ship. We achieved a soft landing, we prevented a bottoming out, we stabilized prices and inflation...and yet very few Democrats were ready to give their administration credit.
Come Trump, now, and Dems are decrying his economic failures and pointing to Biden's stabilization with praise.
I think people are bought into a general social media-driven and news-driven malaise. There are absolutely people suffering right now and there are economic problems we face (many of which Trump is worsening), but it is well-known that there is a big disconnect between sentiment and reality, and it's hard to scientifically place blame.
Americans aren't wrong in their feelings tho. There's clear evidence and data that shows since the 80s, almost all of the extra value generated since then has been captured by the capital owning class.
For 40 years, Americans have watched as every essential became ridiculously expensive while the wages slowly crept up. From housing to healthcare, education, transportation, etc all the necessities for modern-day life have all skyrocketed to the point that we've killed younger generations' ability to move out and start their own life.
Of course spending is up, prices have gone up for everything. Very few people gave bidens admin credit because their entire term they gaslighted the public like trump did about the economy doing well.
I agree and I criticized both administrations for their unrealistic assessments and lack of common sense problem solving.
It is clear to me having lived through the 70’s and early-mid 80’s struggling with stagflation that we have and are continuing to experience mild stagflation, generating similar emotional consumer attitudes.
What worked last time was a Federal Reserve chairman with a backbone. Now we have none such person.
Reagan broke Unions in the states. Unions had, for their part, gotten too complacent and kind of forgot their purpose to begin with.
Both sides(liberal and conservative,not leftists) abandoned Unions in the 80s. Its not really a surprise that some Unions have chosen to support MAGA, as they have promised a golden age for manufacturing(that they can't deliver on) while Democrats have......been apathetic at best in terms of real action.
This really isn't a "both sides" thing. Democrats supported labor well past the 80s, but labor started abandoning Democrats in the early 90s when teamsters tuned their AM truck radios to Rush Limbaugh.
Propaganda is a helluva drug.
Recently Democrats haven't pushed support for labor as much as they used to, but it's circular at this point. Supporting unions doesn't get the union vote, because "socialism bad."
It’s possible. We’ve managed to turn every economic shock into a purely partisan thing (Bidenflation happened during Biden, and was partially caused by Biden, but politicians since 2000 had contributed).
I’m not an economist so apologies in advance if this is a basic bitch question: when these studies show low income people’s spending is higher, does that reflect that their spending is up due to the cost of goods they buy going up, or is that saying the quantity of goods sold is going up? Guess I’m asking if they’re spending more, but ultimately for less stuff.
Thank you for sharing this. I feel like it is also profoundly felt by anyone who keeps up with economic news: Americans have been crying uncle and wailing about crashes, failing sectors, personal bankruptcy, and more for almost 20 years now. It's like 2008 bore a certain cynicism in this country and it's lingered in our culture and our narrative.... Yet more have been lifted into the middle class than before, and people continue to spend like it's nobody's business on hyper-niche and non-essential goods markets (like entertainment).
How many times since COVID have we been told we are 1 quarter away from a recession? How many times has the media suggested Americans all going broke? And yet those same economic brackets continue to spend like crazy. Target warns of sales drops, everyone braces for the recession, and then spending picks back up again and we trot along. Eggs hit $12 a dozen in some places and people still dined out and got eggs for breakfast.
Clearly we are still in jeopardy with tariffs, uncertainty, automation, and growing income disparity. But I have seriously come to question the legitimacy of consumer confidence. Are we being overwhelmed by the cynicism and permission of the Internet and of news media?
People never used to buy so much optional shit and now we have people feverishly taking out staggered payment plans on mobile apps to purchase quirky home goods on Etsy or hobby goods and consumer technology. It's feverish spending and people can somehow continue to afford that kind of hyper-consumerism. That suggests to me that the middle class and proximal majority of Americans are not as desperate and destitute and razor-margin as suggested.
I’ll loop u/RIP_Soulja_Slim in on this, since I found at least one of the Fed notes from his link, but some explanations I’ve seen floated include:
Social media influencers further distorting the “Keeping up with the Joneses” phenomenon.
The behavioral ECON notion that costs (inflation) have more impact than benefits (wage growth).
Poor, and decreasing, economic literacy.
Living through multiple negative supply shocks. Even though many of these probably had limited to no impact on most individuals. And the awareness of these shocks.
> The behavioral ECON notion that costs (inflation) have more impact than benefits (wage growth).
This is the one I'm seeing most, basically the thesis (being supported by observed data and behaviors) is that people are fixating on prices and not incomes, generally sentiment is driven by incomes - your income goes up, you feel good. And despite most people's incomes going up quite a bit in real terms (inflation adjusted), the price shocks caused us to focus on prices, which impacted sentiment negatively.
The household savings rate in the US is very low and decreasing. People live at the edge of their fiscal capacity, and any increase in mandatory expenses like food, energy, healthcare or housing translates into immediate pressure because they don't have any slack. Whereas an increase in income simply leads to a lifestyle expansion rather than increased savings, so the baseline pressure never decreases.
Someone also mentioned something else that is impacted by social media:
People think crime rates are going up because a friend of a friend had something happen to them and because of social media they can see that happening everywhere all day long. Even though every metric we have except automobile fatalities has been going down for two decades aside from the COVID bump, people see the negative impact of crime just as much as when crime rates were nearly double in the 80's due to social media algorithms pushing negative stories to increase engagement.
This goes back to the whole "the statistics are fake" discussion from earlier, people don't see the 5% income increase, because they see a 1% price increase blasted at them every day, 12 hours a day.
I'm really glad you brought up those points--I think about them a lot.
Social media "keeping up with the Joneses"
Broader behavioral trends like shortening attention spans, less delayed gratification, more dopamine-chasing and trend-chasing (means faster flickering between hobbies and purchase inclinations, and it means more frequent purchasing activity/trend FOMO/etc)
Decreasing economic literacy
It means people are forgetting age-old philosophies "buy for life" (instead just blaming trendy scapegoats like planned obsolescence and enshittification...even in industries/products where that isn't happening), forgetting how we used to learn to repair our own things, to not own matched-sets of everything, to not seek to buy/own numerous things (rather just buying what you NEED or truly truly love).
The issue is...wealth gaps are widening. Income gaps are widening. The Joneses are getting further and further away, and so chasing them is definitely going to feel impossible and definitely will make people think they're comparatively on the brink.
I'm not about to argue that we're a booming Economy--Trump is talking out of his ass with "Golden Age". But it's very likely that America has had one of, if not the strongest economy for the last 20 years DESPITE cries that we're a failing 'late stage capitalist' hellhole.
...To get political for a second...I swear that if we could figure out our healthcare crisis, so many of the public's concerns about affordability and QoL would go away. Because personal purchasing power is so much higher. I've lived in Europe and spent great time around there...and their people have much less economic mobility (even in upper brackets) and they have far fewer opportunities to own things as Americans do. The main difference in the living experience is healthcare. We need to figure that out, and perhaps much of the anxiety/strain goes away. That, and we need to stop this social media-inspired purchasing craze.
That part is no better in Europe. In most cities there it's actually worse than it is here. 900 sqft fart closets that cost half your monthly take-home, and you don't have central air/heating or in-unit dishwashers/garbage disposals/laundry. Most of America doesn't deal with that.
Healthcare is really the one that they seem to get so right--though our critical care is better.
I have no sympathy for these car companies and dealerships. They made a killing during covid and now their lots are full and not moving any product. I hope they saved some of those profits
As a non-American, I just want to say how insane it is to put healthcare in the same category as luxuries like week-long vacations and new cars. I think a lot of Americans have grown so used to thinking of fucking healthcare as a luxury that they don’t even realize how twisted that mindset is.
Sometimes helpful to recognize the damage still felt in employment markets tied to the 2008-2009 recession. The average length of unemployment shot up to 40 weeks then, and has remained above 20 weeks ever since. In the fifty years prior to 2008, it might occasionally max out at 20 weeks, ranging between 10 and 20 weeks. This is a key factor in assessing family stress tied to layoffs.
I was going to fly to Salt Lake City this June for a family visit. I’m in Phoenix for context. After choosing my flight and paying to choose my seat and have luggage, it was going to be over $400 round trip. For an hour and a half flight. I chose to rent a KOA cabin and I’ll drive there. With gas it may be even but at least I’ll avoid the stress of the airport.
I’m well educated and a decent paying job, wife, 2 kids. Modest lifestyle, no extravagances. Lost my meager savings during a 3-month job search. Scraping by month to month. Winter break plans this year was: spend 1 day in the city 45 mins from us. My retirement plan is a bullet to the head once I’m unable to work anymore. My kids are super smart and I have exactly $0 to put toward their college tuition when they get there. Life is bleak, I’m falling into depression, and there is no relief in sight.
Is life easier anywhere else? The rent and home values and Canada are well documented, the European social safety net is amazing but unemployment is horrendous. Is there anywhere on Earth where standards of living are getting better for working people?
liverpoolFCnut | 4 hours ago
shocked that only one half of Americans say a week long vacation or a brand new car is now unaffordable! Average price of a new car now is $45k, and the cheapest hotel rooms in safe areas cost over $200/night in places worth visiting.
Educational_Report_9 | 4 hours ago
Yeah, I'm a fairly high income earner (top 10%) and new car prices are absolutely insane to me. I'll keep driving my paid off 2020 model until it dies.
AlarmedWillow4515 | 4 hours ago
I'm a top 10% earner too, and I probably technically can afford a brand new car, but wouldn't spend that kind of money. We will save up and pay cash for a used car when we need another vehicle.
kindofnotlistening | 3 hours ago
If you think new car prices are bad…I’ve got horrible news for you regarding the used car market.
AlarmedWillow4515 | 3 hours ago
Used car prices are terrible too, but slightly less so. Mostly, we just use our cars until we can't.
kindofnotlistening | 2 hours ago
If you’re looking at brands that hold their resale value well…it’s better value to buy something new with promotional financing than to save and spend $25k+ in cash.
A 2-3 year old used Subaru Outback with 20-50k miles is going for almost $30k. New Subaru Outbacks are like $36-38k and have 0% financing.
Pay-Homage | 2 hours ago
Exactly what happened with us. Considered some used third-row SUVs in the $30k range, which we would have likely financed (after paying as much cash as possible).
Or we financed a new Subaru Ascent at 0.9 percent for four years at $40k. I believe total interest was just north of $700 as opposed to four percent or so on a $30k+ note which would have been double the interest (roughly $1,400 at $35k).
Educational_Report_9 | 2 hours ago
Both are wildly expensive. It just emphasizes the affordability issues most people are facing.
kindofnotlistening | 2 hours ago
I am in the exact same spot right now and used financing rates are just astronomical compared to manufacturer incentive rates.
AlarmedWillow4515 | 2 hours ago
That can be better, but one downside is that by getting promotional financing you're often in a worse position to negotiate a lower car price. The low rate financing is the bonus they offer instead of reducing the price.
kindofnotlistening | 2 hours ago
Oh man…you haven’t been car shopping in a while. No one is reducing prices on used cars, even for cash.
You aren’t negotiating much of anything, especially on a used car.
AlarmedWillow4515 | an hour ago
I haven't bought a car for a few years, and reading this I'm going to hold on to the cars we have as long as I can.
kindofnotlistening | an hour ago
Absolutely do that. I am in hell right now.
2015 with a busted sensor that was discontinued. The aftermarket part starts at $1500 + labor, but no one can source it.
So my options are try to source an impossible part and put $2k+ into a car worth $4k or deal with the car market right now.
TrashTierUser | an hour ago
Basically what happened to me back in 2023. Pervious car kicked the bucket and decided to look around. Honda Civics and Accords with 80K+ miles were selling at the same price as brand new ones. Ended up just biting the bullet and went for a brand new Accord, there was no world I could justify going for a used at at near or exact prices as new.
I'm sure the situation isn't nearly as bad as it was then, but doubt the used market is priced in line as precovid.
Sideshift1427 | 2 hours ago
The automobile industry is forecasting lower new car sales in 2026 compared to 2025.
Crazy_Reporter_7516 | 4 hours ago
You can buy a Toyota Corolla brand new for 25k and has the best durability out of any car on the market. The average price of a new car is only 45k because Americans choose to be irresponsible.
kindofnotlistening | 3 hours ago
No obviously everyone needs a giant truck or 8 seat SUV.
skateboardnaked | 3 hours ago
Thats exactly what I bought 2 years ago. I'm driving it until it falls apart!
akc250 | an hour ago
The average price of a new car is that high, not because of irresponsible consumers, but because only those who can afford it are buying brand new. And guess what, it's no longer the middle class, which continues to shrink. It's upper middle and above (see k-shaped economy). People looking for a budget friendly car are not buying new anymore, rather they are holding on to their cars longer or looking for used deals.
Matt2_ASC | 4 hours ago
Yea. I was curious about car sales. People buy used cars a lot more than new cars (like 3X). So most consumers actually do act like new cars are not affordable, or not worth purchasing. But vacations are relatively cheap compared to other costs like rent, vehicles, healthcare...
AgileDrag1469 | 2 hours ago
Most hotels are shifting from higher quantity of bookings at low rates to lower quantity of bookings at higher rates since less people paying more at certain properties is easier to staff and it’s the same revenue and same profit with less of an impact on payroll. Most of the lowball rates have shifted to Airbnb or VRBO or other short term stay options, this isn’t recent news but the more hotels that continue to do this will continue to drive travelers away. Talk to any bar or restaurant staff off the record, off the clock and most of them will confirm this or that people at certain properties are spending far less on higher ticket items at hotels like they used to at lower rates. To some extent this is good because post-pandemic everyone wanted to travel vlog the world 10x over and there’s still a bit of content creation demand from people that have pursued this lane of work or are left no choice to do something like this after being laid off. All that to say, going anywhere anymore is a slog with air travel delays and the quality of doing anything anywhere has really declined as well. You’re better served to save your money, establish a solid health or fitness routine and find simple, common joys of life without feeling like you have to seek global arbitrage as your peak personality.
HedoniumVoter | 2 hours ago
A weeklong vacation abroad is quite inexpensive for Americans. Like, there are so many ways to have very cheap vacations as Americans relative to the rest of the world, so I actually don’t think that one should be considered the same.
besselfunctions | an hour ago
> Average price of a new car now is $45k
more like $50k, if you include pickup trucks, which are usually used like passenger cars anyway
https://www.coxautoinc.com/insights-hub/jan-2026-atp-report/
zephalephadingong | 3 hours ago
A lot of really fun vacations don't require a hotel room at all. If you live within driving distance of a national or state park camping is a ton of fun. When I was a kid my family drove from Nebraska to yellowstone and slept in campgrounds on the way, then camped there for a week. The food was by far the most expensive part of the trip, and we would have been spending almost as much on it at home anyway
Educational_Report_9 | 3 hours ago
The initial purchase of camping equipment can be quite expensive.
zephalephadingong | 2 hours ago
It's cheaper then a week at the 200 dollar a night hotel mentioned earlier. It is pretty easy to find a 4 person tent for less then 300 bucks, a 2 person tent for less then 200.
How cheap do people want a vacation to be? A week of camping for two could be less then 500 bucks, including all the equipment. Then you can go camping for even cheaper in the future.
Educational_Report_9 | 2 hours ago
A tent is all you need?
zephalephadingong | an hour ago
A tent and a cooler. If you want to fancy it up, it will cost more. Everything else is consumables or something you already own.
Educational_Report_9 | an hour ago
Sleeping on the hard ground with no sleeping bag....."vacation." 😂
ferocious_swain | 33 minutes ago
Homeless Cosplay
Educational_Report_9 | 26 minutes ago
😂
zephalephadingong | an hour ago
They're called blankets. Put like 3 on the floor and you are good to go. Without a sleeping bag you camp when the weather is warm, so another blanket on top. You wanna get real cheap with it, skip the tent and sleep in a hammock. I don't like that because rain will suck, but I know people that do it.
Even if you are too soft to sleep on blankets, a camping pad is less then 20 bucks.
Educational_Report_9 | 59 minutes ago
I now have to bring blankets that aren't meant for outdoor use to go on vacations?
Sheeeeesh, this cheap "vacation" sucks! Let me just work for the week. LMAO
zephalephadingong | 54 minutes ago
>I now have to bring blankets that aren't meant for outdoor use to go on vacations?
Do you think the inside of a tent is outdoors? Have you ever been camping before? The most common bougee solution I have seen is an air mattress with sheets, blankets, and pillows.
>Sheeeeesh, this cheap "vacation" sucks! Let me just work for the week. LMAO
If you don't like camping just say so. Yes, sleeping in a tent is less comfortable then sleeping in bed. You might even get dirty and tired by the end of the day from all the walking around! God forbid, you might even get bitten by some insects.
Powderkeg314 | 2 hours ago
You have to travel out of the U.S. to get decent prices on hotels. Half the fun of traveling now is just getting to save money… So dystopian and can’t imagine how people with kids are getting by
EconomistWithaD | 6 hours ago
Would just like to point out that, as early as the 2000’s, there has been a noticeable decoupling of the link between consumer confidence and consumer spending (https://fraser.stlouisfed.org/files/docs/historical/frbsf/frbsf_let/frbsf_let_20080627.pdf). I believe a paper in JEP labeled the relationship as modest in 2004 (https://fraser.stlouisfed.org/files/docs/historical/frbsf/frbsf_let/frbsf_let_20080627.pdf).
Post-COVID, there are some noticeable trends that suggest that this link is weakening even further (https://www.federalreserve.gov/econres/notes/feds-notes/tracking-consumer-sentiment-versus-how-consumers-are-doing-based-on-verified-retail-purchases-20250424.html). And, in fact, REAL retail sales are up between 2019 and 2024 (https://www.federalreserve.gov/econres/notes/feds-notes/a-better-way-of-understanding-the-u-s-consumer-decomposing-retail-spending-by-household-income-20241011.html).
This doesn’t suggest that the consumer feelings on the economy are wrong, or out of touch. It does suggest, however, that even if people feel things are worse, they are buying more. Both low income real wages and spending are higher.
ImperiumRome | 5 hours ago
Can we explain the decoupling due to partisanship or is there a more "scientific" reason ?
S-192 | 5 hours ago
I've read around about it and I've not seen any super credible studies of why it's happening. But it's being discussed a lot.
"Boomcession", etc.
It's very clear that, despite the American economy generally faring better over the last 20 years than our peers' economies, Americans are more cynical than they've been since Black Monday in 1987.
Case in point that this is possibly partisan and likely news-cycle/social-media driven: In Biden's final months, Democrats were extremely cynical about the economy despite Biden's strong recovery and righting-of-the-ship. We achieved a soft landing, we prevented a bottoming out, we stabilized prices and inflation...and yet very few Democrats were ready to give their administration credit.
Come Trump, now, and Dems are decrying his economic failures and pointing to Biden's stabilization with praise.
I think people are bought into a general social media-driven and news-driven malaise. There are absolutely people suffering right now and there are economic problems we face (many of which Trump is worsening), but it is well-known that there is a big disconnect between sentiment and reality, and it's hard to scientifically place blame.
teshh | 4 hours ago
Americans aren't wrong in their feelings tho. There's clear evidence and data that shows since the 80s, almost all of the extra value generated since then has been captured by the capital owning class.
For 40 years, Americans have watched as every essential became ridiculously expensive while the wages slowly crept up. From housing to healthcare, education, transportation, etc all the necessities for modern-day life have all skyrocketed to the point that we've killed younger generations' ability to move out and start their own life.
Of course spending is up, prices have gone up for everything. Very few people gave bidens admin credit because their entire term they gaslighted the public like trump did about the economy doing well.
PlanetCosmoX | 4 hours ago
I find it ironic that Trump is repeating the error the Dems made that lost them the election.
21plankton | 3 hours ago
I agree and I criticized both administrations for their unrealistic assessments and lack of common sense problem solving.
It is clear to me having lived through the 70’s and early-mid 80’s struggling with stagflation that we have and are continuing to experience mild stagflation, generating similar emotional consumer attitudes.
What worked last time was a Federal Reserve chairman with a backbone. Now we have none such person.
Own-Chemist2228 | 3 hours ago
>almost all of the extra value generated since then has been captured by the capital owning class.
And yet we have union leaders endorsing the political party that is openly anti labor.
AddanDeith | 3 hours ago
Reagan broke Unions in the states. Unions had, for their part, gotten too complacent and kind of forgot their purpose to begin with.
Both sides(liberal and conservative,not leftists) abandoned Unions in the 80s. Its not really a surprise that some Unions have chosen to support MAGA, as they have promised a golden age for manufacturing(that they can't deliver on) while Democrats have......been apathetic at best in terms of real action.
Own-Chemist2228 | 2 hours ago
This really isn't a "both sides" thing. Democrats supported labor well past the 80s, but labor started abandoning Democrats in the early 90s when teamsters tuned their AM truck radios to Rush Limbaugh.
Propaganda is a helluva drug.
Recently Democrats haven't pushed support for labor as much as they used to, but it's circular at this point. Supporting unions doesn't get the union vote, because "socialism bad."
EconomistWithaD | 4 hours ago
Since the 1980's, at least 50% of Americans are better off. Substantially, too.
Real Median Personal Income in the United States (MEPAINUSA672N) | FRED | St. Louis Fed
EconomistWithaD | 5 hours ago
It’s possible. We’ve managed to turn every economic shock into a purely partisan thing (Bidenflation happened during Biden, and was partially caused by Biden, but politicians since 2000 had contributed).
armand11 | an hour ago
I’m not an economist so apologies in advance if this is a basic bitch question: when these studies show low income people’s spending is higher, does that reflect that their spending is up due to the cost of goods they buy going up, or is that saying the quantity of goods sold is going up? Guess I’m asking if they’re spending more, but ultimately for less stuff.
EconomistWithaD | 11 minutes ago
Look for a few words.
The first is real; any value in economics that is “real” has been adjusted for cost of living/inflation. The second is nominal; when they are not.
Since these are real. These are inflation adjusted
S-192 | 5 hours ago
Thank you for sharing this. I feel like it is also profoundly felt by anyone who keeps up with economic news: Americans have been crying uncle and wailing about crashes, failing sectors, personal bankruptcy, and more for almost 20 years now. It's like 2008 bore a certain cynicism in this country and it's lingered in our culture and our narrative.... Yet more have been lifted into the middle class than before, and people continue to spend like it's nobody's business on hyper-niche and non-essential goods markets (like entertainment).
How many times since COVID have we been told we are 1 quarter away from a recession? How many times has the media suggested Americans all going broke? And yet those same economic brackets continue to spend like crazy. Target warns of sales drops, everyone braces for the recession, and then spending picks back up again and we trot along. Eggs hit $12 a dozen in some places and people still dined out and got eggs for breakfast.
Clearly we are still in jeopardy with tariffs, uncertainty, automation, and growing income disparity. But I have seriously come to question the legitimacy of consumer confidence. Are we being overwhelmed by the cynicism and permission of the Internet and of news media?
People never used to buy so much optional shit and now we have people feverishly taking out staggered payment plans on mobile apps to purchase quirky home goods on Etsy or hobby goods and consumer technology. It's feverish spending and people can somehow continue to afford that kind of hyper-consumerism. That suggests to me that the middle class and proximal majority of Americans are not as desperate and destitute and razor-margin as suggested.
EconomistWithaD | 5 hours ago
I’ll loop u/RIP_Soulja_Slim in on this, since I found at least one of the Fed notes from his link, but some explanations I’ve seen floated include:
Social media influencers further distorting the “Keeping up with the Joneses” phenomenon.
The behavioral ECON notion that costs (inflation) have more impact than benefits (wage growth).
Poor, and decreasing, economic literacy.
Living through multiple negative supply shocks. Even though many of these probably had limited to no impact on most individuals. And the awareness of these shocks.
RIP_Soulja_Slim | 5 hours ago
> The behavioral ECON notion that costs (inflation) have more impact than benefits (wage growth).
This is the one I'm seeing most, basically the thesis (being supported by observed data and behaviors) is that people are fixating on prices and not incomes, generally sentiment is driven by incomes - your income goes up, you feel good. And despite most people's incomes going up quite a bit in real terms (inflation adjusted), the price shocks caused us to focus on prices, which impacted sentiment negatively.
DeliciousPangolin | 4 hours ago
The household savings rate in the US is very low and decreasing. People live at the edge of their fiscal capacity, and any increase in mandatory expenses like food, energy, healthcare or housing translates into immediate pressure because they don't have any slack. Whereas an increase in income simply leads to a lifestyle expansion rather than increased savings, so the baseline pressure never decreases.
OrangeJr36 | 3 hours ago
Someone also mentioned something else that is impacted by social media:
People think crime rates are going up because a friend of a friend had something happen to them and because of social media they can see that happening everywhere all day long. Even though every metric we have except automobile fatalities has been going down for two decades aside from the COVID bump, people see the negative impact of crime just as much as when crime rates were nearly double in the 80's due to social media algorithms pushing negative stories to increase engagement.
This goes back to the whole "the statistics are fake" discussion from earlier, people don't see the 5% income increase, because they see a 1% price increase blasted at them every day, 12 hours a day.
EconomistWithaD | 5 hours ago
I did have someone say that $600 real wage gains ($1,500 nominal) per year, for someone making $20,000, was nothing.
So, even beyond that, they may just be ignoring the wage gains.
S-192 | 5 hours ago
I'm really glad you brought up those points--I think about them a lot.
It means people are forgetting age-old philosophies "buy for life" (instead just blaming trendy scapegoats like planned obsolescence and enshittification...even in industries/products where that isn't happening), forgetting how we used to learn to repair our own things, to not own matched-sets of everything, to not seek to buy/own numerous things (rather just buying what you NEED or truly truly love).
The issue is...wealth gaps are widening. Income gaps are widening. The Joneses are getting further and further away, and so chasing them is definitely going to feel impossible and definitely will make people think they're comparatively on the brink.
I'm not about to argue that we're a booming Economy--Trump is talking out of his ass with "Golden Age". But it's very likely that America has had one of, if not the strongest economy for the last 20 years DESPITE cries that we're a failing 'late stage capitalist' hellhole.
...To get political for a second...I swear that if we could figure out our healthcare crisis, so many of the public's concerns about affordability and QoL would go away. Because personal purchasing power is so much higher. I've lived in Europe and spent great time around there...and their people have much less economic mobility (even in upper brackets) and they have far fewer opportunities to own things as Americans do. The main difference in the living experience is healthcare. We need to figure that out, and perhaps much of the anxiety/strain goes away. That, and we need to stop this social media-inspired purchasing craze.
ShockinglyAccurate | 4 hours ago
Housing goes right along with healthcare. Renters got absolutely pummeled in the last decade.
oooshi | 3 hours ago
Everwhere, too. People complain about spending too much on housing in countries with universal healthcare, too.
S-192 | 3 hours ago
That part is no better in Europe. In most cities there it's actually worse than it is here. 900 sqft fart closets that cost half your monthly take-home, and you don't have central air/heating or in-unit dishwashers/garbage disposals/laundry. Most of America doesn't deal with that.
Healthcare is really the one that they seem to get so right--though our critical care is better.
immaculatephotos | 2 hours ago
I have no sympathy for these car companies and dealerships. They made a killing during covid and now their lots are full and not moving any product. I hope they saved some of those profits
IWantedAPeanutToo | 2 hours ago
As a non-American, I just want to say how insane it is to put healthcare in the same category as luxuries like week-long vacations and new cars. I think a lot of Americans have grown so used to thinking of fucking healthcare as a luxury that they don’t even realize how twisted that mindset is.
Leather-Map-8138 | 4 hours ago
Sometimes helpful to recognize the damage still felt in employment markets tied to the 2008-2009 recession. The average length of unemployment shot up to 40 weeks then, and has remained above 20 weeks ever since. In the fifty years prior to 2008, it might occasionally max out at 20 weeks, ranging between 10 and 20 weeks. This is a key factor in assessing family stress tied to layoffs.
Partridge_Pear_Tree | 2 hours ago
I was going to fly to Salt Lake City this June for a family visit. I’m in Phoenix for context. After choosing my flight and paying to choose my seat and have luggage, it was going to be over $400 round trip. For an hour and a half flight. I chose to rent a KOA cabin and I’ll drive there. With gas it may be even but at least I’ll avoid the stress of the airport.
Cantaloupe3000 | 2 hours ago
Flights are so expensive, and they nickle and dime you for everything.
Want to check a bag? more money
Want to carry on a bag? more money
Want WIFI? more money
Want food? more money
Want a seat closer to the front? more money
etc, etc, etc
throwaway00119 | 2 hours ago
So, don't pay for those things? Flying has been commoditized and is cheaper and safer today than any time in history.
Feel free to go look up those statistics.
Boeing - Statistical Summary of Commercial Jet Airplane Accidents
The real problem is people have no respect or understanding of what life was like 30 years ago. We have the collective memory of a goldfish.
NonchalantR | 2 hours ago
This is why you pack light and get stoned before your flight so you can just sleep and spend as little as possible. Greyhound in the sky baby
whitelowtis | 2 hours ago
But a lot of the world is a lot better off than the USA, I don't understand why people say it's wealthy when nothing is affordable? What am I missing?
RightIzWrong | an hour ago
I’m well educated and a decent paying job, wife, 2 kids. Modest lifestyle, no extravagances. Lost my meager savings during a 3-month job search. Scraping by month to month. Winter break plans this year was: spend 1 day in the city 45 mins from us. My retirement plan is a bullet to the head once I’m unable to work anymore. My kids are super smart and I have exactly $0 to put toward their college tuition when they get there. Life is bleak, I’m falling into depression, and there is no relief in sight.
Optimal-Bass3142 | 2 hours ago
Is life easier anywhere else? The rent and home values and Canada are well documented, the European social safety net is amazing but unemployment is horrendous. Is there anywhere on Earth where standards of living are getting better for working people?