Our economy is not 'great,' in fact it is 'suffering'

To The Daily Sun,

As a political science student and a presidential campaign intern, I have a considerable number of conversations about the state of the nation each week. Something I have noticed in my efforts is that the electorate of Belknap County have been convinced that the economy is doing wonderfully right now. Whether this idea has been spread through rumor or systematically distributed by the media is unclear, but make no mistake about it: the consumer economy is suffering.

Our media and institutions measure the economy by examining a mere three metrics: gross domestic product, the unemployment rate, and the stock market. Despite the universal use case for these metrics, coming to a conclusion about the economy without looking into factors that go unaccounted for while using them will lead to falsehoods.

Gross domestic product (GDP) is a monetary calculation of the total market value of all goods produced and services provided by a nation’s workforce in a given year. This measurement does not account for whether or not people are being compensated for increased productivity. In fact, despite undergoing a steady rise in annual productivity, wages have been stagnant as of the early 1970s. This means that people are working longer and harder than ever, but they’re not being paid accordingly.

The unemployment rate is relatively self explanatory: it measures how much of the population is currently employed. Of course, since this method only records whether or not someone is employed or unemployed, the unemployment rate does not account for the percentage of Americans who are underemployed, meaning people who are earning less than their level of education or experience would suggest. Moreover, the unemployment rate does not indicate how many full-time workers rely on social services to stay afloat. In other words, unemployment means little when roughly half of Americans make $30,000 per year or less.

Why the stock market isn’t a good indication of the strength of the economy should be obvious. Individual stock rates indicate how well a given business is doing and the health of the stock market overall improves when more people buy stocks. Considering working families barely make enough money to live paycheck to paycheck, the growth of stock equity only truly represents the financial health of those who are wealthy enough to buy into this market. Therefore, if the stock market is doing well, the rich are getting richer. Middle and working class people don’t factor into this equation.

Ultimately, in order to achieve a strong and steady economy, the middle and working classes must be capable of purchasing the goods and services that our businesses provide. At the moment, over half of Americans barely make enough money to put food on the table, which means half of our country has too tight of a budget to buy new clothes or pay for medical bills even less room when it comes to investing in a new car or a house.

So, sure, the economy is climbing according to our three metrics. But the next time you hear of this through the news or through your peers, take a second to ask yourself an important question: what has this uptick in the economy done for me? For my family members, friends, neighbors, co-workers, etc.? That’s how we, the people, should be measuring the economy.

Julia Davis

Gilford