Stock market doesn’t indicate true economic situations of most

Everyone likes to point to a roaring stock market as a sign of a great economy. It’s one of the easiest measures to look at and say, “See, these companies are doing great.”

Unfortunately, when it comes to the economy for everyday Idahoans, the story is a little bit different. Sure, there are people that are doing just fine right now. I’m one of them.

But let’s get real. When we think of the stock market, most of us mean the companies measured by the Dow Jones Industrial Average. When we get all excited about the Dow, it means we’re basing the idea of an awesome economy on the performance of 30 companies.

A paper by New York University professor and economist Edward Wolff estimates that 84 percent of stocks are owned by the wealthiest 10 percent of Americans. The United Way reports that 44 percent of southeast Idaho residents are designated as ALICE, which means that they’re asset-limited and income-constrained — even though they’re working. Idaho Falls residents are far from the top 10 percent and far from sharing in the gains posted by the Dow.

Indeed, the bulk of wealth gains from the latest bull market run have gone to the wealthiest in the country, not the ordinary folks.

We pretend that hard work automatically equals wealth, but while the Economic Policy Institute reports that productivity increased by 69.6 percent between 1979 and 2018, hourly pay only increased by 11.6 percent. That doesn’t seem quite right, especially when you consider that CEO compensation has grown by 940 percent since 1978. Someone’s benefitting from the current economic conditions, but it’s not most ordinary Americans.

Here in Idaho, the median hourly wage is $15.70 per hour, according to the Bureau of Labor Statistics. However, the Massachusetts Institute of Technology’s living wage calculator points out that for a family of four, with one adult working, it takes $25.07 to meet the necessities of life. The actual experience for a large swath of our families is that it requires both adults in a two-adult family with two children to make ends meet in Bonneville County.

Maybe, instead of looking at the stock market and assuming everything is fine, it’s time to look around at what’s really happening to those who don’t live at the top of the economic ladder. The New York Fed reports that household debt is at levels above what we saw just before the 2008 financial crisis. Car loan delinquencies hit a record earlier this year. And, according to credit agency Experian, almost one-quarter of Americans use debt to cover their necessities. Those are the true measures of how our economy impacts regular working folks.

So, maybe, instead of giving tax cuts to the top and wringing their hands over a lack of revenue created by their own policies, it’s time for our Idaho “representatives” to adopt policies designed to actually invest in our people and our communities.

Miranda Marquit is a nationally recognized financial writer and speaker. She is the chairwoman of the Bonneville County Democratic Central Committee.