Economy

Personal Incomes Are Falling Again

JM Ashby
Written by JM Ashby

Americans saw their personal income drop in January according to a new report from the Commerce Department and while a drop of 0.1 percent is not necessarily earth-shattering, it's still significant.

It's significant because January also marked the one year anniversary of the GOP's tax cuts for corporations and the rich.

From Bloomberg:

Personal income in January fell 0.1 percent from the prior month, compared with projections for a gain, following a 1 percent increase in December that was the largest in six years, according to a Commerce Department report Friday. Figures for purchases were available for December only and delayed due to the government shutdown, showing a 0.5 percent drop during the month, while the Fed’s preferred core price gauge rose 1.9 percent in December from a year earlier, unchanged from November.

The 1 percent increase in December, which was the "largest in six years," and January's modest decline are both related to the GOP's tax cuts.

According to the Commerce Department, the 1 percent increase in personal income that we saw in December can attributed to $83.4 billion in dividend payments; dividend payments that were at least partially enabled by the GOP's tax cuts. Incomes fell the following month because inflation is rising and holiday sales were extraordinarily weak.

This is another data point that Democrats can and should use to support a campaign to either roll back the GOP's tax cuts or impose new taxes on the rich to pay for necessary programs.

  • katanahamon

    Yes..I posted this elsewhere..I have gotten a substantial refund every year for twenty years..this year, I just had my tax guy finish..my refund is reduced by 2/3-3/4 of what it was. It’s..depressing.

  • Draxiar

    Add to this that pay has barely kept up with inflation (if at all) and we’ve got a winning formula for the continuous erosion of the middle class.

  • muselet

    Those tax cuts sure are supercharging the economy, aren’t they?

    –alopecia