The first entry in the “that’s what we’ve been trying to tell you all along!” department of the year comes via WaPo:
The past decade was […], according to a wide range of data, a lost decade for American workers. A decade that began in a moment of triumphalism — there was a current of thought among economists in 1999 that recessions were a thing of the past — has included two of them — bookends to a debt-driven expansion that was neither robust nor sustainable.
There has been zero net job creation since December 1999. No previous decade going back to the 1940s had job growth of less than 20 percent. Economic output rose at its slowest rate of any decade since the 1930s as well.
Middle-income households made less in 2008, when adjusted for inflation, than they did in 1999 — and the number is sure to have declined further during a difficult 2009. The Aughts were the first decade of falling median incomes since figures were first compiled in the 1960s.[emphasis mine]
When the point of your position is to ignore these types of things, they end up shocks after the fact. For the rest of us, the endless bouts of “WTF, my check is gone already?!?” kept us away from that luxury.
The miserable economic track record is, in part, a quirk of timing. The 1990s ended near the top of a stock market and investment bubble. Three months after champagne corks popped to celebrate the dawn of the year 2000, the market turned south, a recession soon following. The decade finished near the trough of a severe recession.
But beyond these dramatic ups and downs lies an even more sobering reality: long-term economic stagnation. The trillions of dollars that poured into housing investment and consumer spending in the first part of the decade distorted economic activity. […]
The housing bubble both caused, and was enabled by, a boom in indebtedness. Total household debt rose 117 percent from 1999 to its peak in early 2008, according to Federal Reserve data, as Americans borrowed to buy ever more expensive homes and to support consumption more generally.
Income went stagnant, prices kept going. The politically endorsed response to this was treating debt as if it were savings, hence the resulting malinvestment. Learning from our errors sounds like a simple resolution to make for the new year, but will we actually approach it?