Over at Equitable Growth: I find the very sharp Marty Felstein engaging in a goalpost-moving effort that I cannot endorse:
There may be some powerful argument that the true consumer price index has risen more for the rich than for the middle class and the poor. But if there is, I am not aware off it. And so I think: The existence of downward bias from failure to measure the value of new good and new kinds of goods in official statistics of real income growth does not reduce the rise in inequality over the past generation--although it does mean that we collectively are richer now relative to our predecessors than we would be if official statistics were gospel.
Here I think we need to draw some distinctions. If you are not tech-savvy--if you are not a relatively intensive user of modern information, entertainment, and communication technologies--then you do not benefit from them. Then the official statistics showing declining median incomes over the past generation apply to you. And you are certainly much poorer now than you reasonably expected back then to be now. And it is wholly reasonable for you to believe that, while the economy has worked for the rich, it has not worked for you and somebody should be held accountable. READ MOAR