In this Substack, it was shown that the purchasing power of blue collar workers in the US has been dropping. The middle class is being gutted out. To better explore it, an idealized market basket consisting of 4 items was created. One year of purchase of this market basket gets you this much:
—1/30th of a house
—450 gallons of gasoline
—422 eggs
—4,437 kiloWatt-hours of electricity
Weights
A 30-year home mortgage was used in order to weight the house prices. A per capita gasoline use of 450 gallons/yr comes from 2017 data (eia.gov). A per capita consumption of 422 eggs/yr comes from 2020 data in Mexico (https://ourworldindata.org/grapher/per-capita-egg-consumption-kilograms-per-year). A per capita electricity use of 4,437 kiloWatt-hours comes from 2020 data (eia.gov).
Using this rough measure of purchasing power (a 4-item market basket), compared to the first quarter of 2023, blue collar workers in the last quarter of 1984 were 48% more rich:
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