One of the things that bugs me about the all too sterile political debate at times is when we're told that inequality is returing to levels not seen since the 1920s. No, not just that this point is marched out with the rhetorical equivalent of pursed lips and a "Well, what are you going to do about it?" look, but the way in which the other half of the point is never made, not even mentioned: what's happened to the absolute numbers, not just the relative ones?
As an example of the way in which life has become vastly better for all, have a look at Mark Perry's figures for food as a percentage of household disposable incomes over the decades. Since the 1920s the number has fallen from 25% to just under 10%: seriously, housholds used to spend a quarter of their net income on food, now they spend under a tenth. Yes, the food is better, choice is greater and incomes are vastly higher as well, but isn't that a stunning advance in human welfare?
That in less than a century the food needed to keep body and soul together declined in price, as a portion of income, so much?
There's also a technical point that needs to be made about US poverty figures. To remind you, the US measures poverty entirely differently from every other nation: they took the necessary food budget in the early 1960s, tripled it and said that this was the poverty level (everyone else is using 60% of median houshold income) and they've simply updated it for inflation ever since.
What they haven't done is update it for the changes in portions of spending on different goods and services. We can thus say that the position of the US poor, those on or below this poverty level (which, just to remind everyone again, is before the impact of poverty alleviation measures, everyone else counts after whatever we do to reduce poverty), is rather better than the simple stated figures suggest. For food has declined massively in price and thus that inflation adjusted standard goes further than it used to.