Edited by Edward N. Wolff
Chapter 3: Who has Benefited from Economic Growth in the United States since 1969? The Case of Children
3. Who has beneﬁted from economic growth in the United States since 1969? The case of children* Christopher Jencks, Susan E. Mayer and Joseph Swingle INTRODUCTION Aﬄuent Americans remember the 1990s as a period of remarkable prosperity, during which the stock market soared and real GDP rose 35 per cent.1 GDP grew partly because the working-age population grew, but real GDP per worker rose 18 per cent. Although this cheery picture is widely accepted, household surveys tell a less encouraging story. According to the Census Bureau’s Current Population Survey (CPS), households’ mean pretax money income rose only 11 per cent between 1989 and 1999, and the bulk of this increase went to the aﬄuent. The Census Bureau’s report on its March 1999 income survey suggested that the median household’s real money income had risen only 5.1 per cent since 1989 (US Bureau of the Census 2000a, Table B-2). Discrepancies of this kind have led to a longrunning war of words between optimists who see America’s economic system as a model for the rest of the world and pessimists who see the American system as proof that laissez-faire capitalism beneﬁts the few at the expense of the many. Those who want to demonstrate the harmful eﬀects of slow growth and rising inequality tend to concentrate on trends among children. Figure 3.1 displays what we shall call the pessimistic picture of income trends among American children over the past generation. The data come from the CPS and...
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