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Not so much, it turns out

The new Survey of Consumer Finances shows an increase in family net worth between 2004 and 2007 — but estimates, based on stock and housing prices, that all of that gain and more has been wiped out since then. Adjusted for inflation, families are poorer now than they were in 2001.

It’s worth pointing out that with this release, yet another pillar of the what-me-worry school of economics has fallen. You may remember that a few years ago there was a lot of talk about how only bubbleheads paid attention to our low, low savings rate, because the truth was that Americans were getting steadily wealthier thanks to rising asset values.

Not so much, it turns out.

My conservative friends often propose a thought experiment whereby we split the country in half and run one half with "Republican ideals" and the other half with "Democratic ideals" for 10 years and see who does better. They then explain that their half would have no taxes and people would be as rich as they put effort into it; and then they make up unbelievable Rush Limbaugh horror stories about how bad things would be on the Democratic side (all wages would be divided evenly among all citizens, taxed heavily, schools would force our young children to have homosexual sex, etc.). The fact that they always have the same examples makes me think that this might be something that Rush actually does talk about on his show.

Well, we basically had the Republican philosophy for 8 years and... ZOMG "families are poorer now than they were in 2001".

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