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Through the entirety of the 1960s, employment rose while poverty fell sharply. It was a period of economic expansion that illustrated that shared economic prosperity was, indeed, a realistic goal. Flash forward to the 2020s, and we see a much different story.

As of July 2023, the Consumer Price Index — an array of goods that includes the costs of food, energy, new and used vehicles, apparel, shelter and medical care — was up 3.2% year-over-year. Core inflation, which excludes food and energy costs, yields a higher increase, at 4.7%. But Gene Ludwig worries that the Fed is looking at the wrong measurement.

In today’s economy there is a sharp dichotomy between “employed” and “gainfully employed.” While the headline unemployment rate is impressively low at 3.5%, if you dive deeper into the percentage of workers unable to secure living-wage jobs, you will find 22.9% of American workers are functionally unemployed.

The most recent U.S. Consumer Price Index rose by its lowest level since March 2021, which to the casual observer, is a sign that inflation is moderating. In an era where the cost of living continues to rise, accurately measuring inflation is not just essential but critical to safeguard Americans’ financial security and well-being.

The truth is the plight of the average low- and middle-income family has been so dismal for so long we welcome any hint of good news with unabashed optimism. This in itself should be a wakeup call and a signal to policymakers to maintain the momentum we have seen in recent months

It is possible that the lived experience is worse than official employment and inflation data imply.

Yes, the economy is better, but compared to what? Compared to an unprecedented pandemic that shut down the global economy. Sadly, if we look at the numbers — the real numbers — middle- and lower-income families have been losing ground for at least two decades.

As Americans look ahead to another Independence Day and a likely contentious 2024 presidential election, many are feeling fiscal pain as the prices of food, shelter, healthcare and transportation climb higher than their paychecks.

As the market ebbs in the wake of overlapping crises, how can a modern American Industrial strategy transform key economic sectors, strengthen supply chains, empower workers, and help build the American economy from the ground up?

It’s common knowledge that Buffalo Niagara has lagged the rest of the nation when it comes to job recovery after the pandemic. The most recent Buffalo News analysis in late April showed the region is still some 13,000 jobs short of pre-pandemic levels, making the local recovery the 10th slowest among the top 100 metropolitan areas.

How achievable is the American Dream? It’s an emotional question at the core of our national identity. To answer that, the Ludwig Institute for Shared Economic Prosperity has constructed a “Minimal Quality of Life Index.”

Some say that the GDP’s consumption, gross investment, and government components measure our well-being. Others, though, suggest alternatives. Over at the Ludwig Institute for Shared Economic Prosperity, they’ve been keeping an eye on the little things in life that make a big difference.

While the cost of living is up overall, the cost of living well has been falling, according to an innovative index that measures the cost of bare recreational necessities, like short vacations and money for gifts and holidays.

When inflation finally comes under control, everyone will rightfully celebrate. But even as Washington and Wall Street collectively exhale, policymakers will need to take some time to understand why 2021’s prevailing economic wisdom proved so wrong.

“Consumers who weren’t able to make ends meet are just digging themselves a deeper and deeper hole with the higher interest rates,” said Philip Cornell, economist at LISEP.

Instead of creating a new bureaucracy every time a new scam shows up, Congress should empower existing financial regulators.

How do the CPI and Unemployment Rate fall short of measuring our economic realities?

The dust has settled from the 2022 midterm elections, and there were many lessons to be learned. One of those lessons should be blatantly obvious, best stated by the infamous fictitious newscaster Howard Beale: folks are “mad as hell, and they’re not going to take it anymore.”

Middle- and low-income Americans are materially worse off over at least the last two decades than government headline statistics would have us believe.

The methods for measuring who is “working” or “not working” are based on a time in the 1930s when people either had a factory, technical or educational job, or didn't at all. “Today, it's a much more complex environment,” Gene Ludwig says.

Do we really understand what’s happening in the economic lives of regular Americans? Gene Ludwig, founder of the Ludwig Institute for Shared Economic Prosperity, discusses how and why we should pay attention to different economic indicators.

Prevailing economic analysis remains more problematic than the parable of the blind men and the elephant. Several of the government-produced indicators that make monthly headlines purportedly speak to one small aspect of present reality, but none describe our circumstances as a whole.

Several key government-reported headline statistics present a distorted view of reality for most Americans, with the impact extending far beyond Wall Street. And it can have dire consequences — particularly when those numbers drive economic policy. Look no further than the Federal Reserve's recent decision to hike interest rates.

Why Washington needs to wake up to the crisis that’s looming in the nonbank financial sector.

Former Comptroller of the Currency Gene Ludwig is urging federal regulators to use their authority under the Community Reinvestment Act to give banks more tools to extend credit to low- and moderate-income individuals during economic downturns.

The latest numbers for low- and middle-income families held some good news regarding living-wage job growth, as well as median weekly earnings. But the double punch of inflation, combined with interest rate increases by the Fed, will most likely portend a concerning economic landscape for LMI families in the months ahead.

Former Comptroller of the Currency Gene Ludwig believes the combination of high inflation and rising interest rates present unique risks to the banking industry. Ludwig expects that higher interest rates will lead to more expensive borrowing for many businesses while also increasing their operating costs.

Wednesday’s consumer-price index report showed a 9.1% year-over-year jump. Following similar news last month, the Federal Reserve increased interest rates by 0.75 percentage point. This spells double trouble for middle- and low-income Americans: increased expenses for the former and job losses from the latter.

“For the average, middle-to-low income Americans, life is getting more difficult,” said Gene Ludwig, founder of the Ludwig Institute for Shared Economic Prosperity, an economic research group. In recent months, “it’s been getting worse significantly above expectations.”

How do we know the real effect of inflation on the buying power of individuals in the United States? Unless we change the way we analyze data and evaluate key economic indicators, we will not have an accurate picture of the health of our economy, according to Eugene Ludwig, a leader in finance and former comptroller of the currency.

Mark Twain is often quoted to have said: “There are three types of lies: lies, damn lies, and statistics.” I would never dare to argue with the great bard, Mr. Twain. However, I would refine his view of statistics to say that so often it is not the numbers or the number collection that brings out such justifiable ire, but rather what the statistic is being used for and how it is defined.

America’s employers extended a hiring streak in May, adding 390,000 jobs amid skyrocketing inflation and mounting fears of a potential economic backslide.

New data released this morning by the Ludwig Institute, shared exclusively with Morning Money, show large labor market discrepancies among metro areas across the country, each grappling with their own challenges related to the pandemic, or in some cases economic upheaval from decades earlier.

Perhaps “fake” is too strong a term to describe the data-driven consumer price index (CPI), which serves as the U.S. government’s proxy for inflation. But the narrative the CPI has long burnished — namely that, since 2000, ordinary expenses have been fairly manageable amid rising wages — is entirely debunked by new research.

The focus should be on those who the Ludwig Institute for Shared Economic Prosperity described in a recent Time Magazine article. These folks need and should get help.

Gene Ludwig, founder of consulting firm Promontory Financial, went even further, saying, “most leaders in America don’t understand how bad things are for the poor and middle class .... If we don’t make changes we are headed for civil unrest.”

Economic dynamism and opportunity have enabled the United States to build the most innovative, resilient, and prosperous economy in the world. As we continue to confront pandemic-era economic challenges, our nation has an imperative to drive a widespread recovery that lifts individuals and communities across the country.

Each time the economy falters, a disproportionate number of Minority Depository Institutions find themselves in trouble through no fault of their own.

Eugene Ludwig, the former comptroller of the currency in the Clinton Administration, says the CPI distorts the real economic picture for lower- and middle-­income Americans because it counts the costs of discretionary items such as yachts, second homes, and hotel rooms. By his calculations, the cost of household minimal needs rose 64% from 2001 to 2020, 1.4 times inflation.

It was a good news, bad news situation at the end of the first quarter of 2022, when the Bureau of Labor Statistics (BLS) issued its Q1 wage data.

When Black businesses fail, are unable to get off the ground, or underperform, it doesn’t just add to the racial wealth gap — it costs all Americans money.

Inflation is now the dominating topic in economics news: with the Consumer Price Index (CPI) hitting a 40-year high at an annualized rate of 7.9%, and the Fed’s recent decision to increase interest rates by a quarter point, it is now a top-of-mind issue for every American household.

LISEP Chair Gene Ludwig spoke about the True Cost of Living (TLC) at a virtual Axios event on The Affordability Crisis on March 9. Esteemed speakers included Heather Boushey of the White House Council of Economic Advisers and UC Berkeley public policy professor Robert Reich.

When federal government largesse was being shown for larger institutions to mop up the mess of 2008, we didn’t save a legendary community development bank serving the South Side of Chicago – one that knew that community and catered to its families so well. An international icon of American community development lending, a pioneer, destroyed.

For decades, regulators have embraced a set of policies that, when recessions arise, force the closure of struggling lenders that serve poorer and marginalized communities. In practice, this has the effect of allowing investors to purchase the closed lenders’ assets (loans and properties) while they’re devalued. This vicious cycle has steadily worsened inequality.

During the course of the pandemic, Memphis lost a substantial number of jobs that pay a living wage, according to at least one Washington D.C.-based think tank that focuses on economic development for the lower and middle classes. LISEP defines “functional unemployment” as being employed but not at a livable wage, or working part time at a job due to unavailability of full-time jobs with benefits.

In November 2021, 23.6% of the labor force was functionally unemployed, meaning they are seeking, but unable to find, full-time employment paying above the poverty level, which we conservatively peg at $20,000 a year. By contrast, the headline number we all heard about was 4.2%.

Even before the pandemic, nearly one in three Californian households struggled to pay for basic necessities, according to the United Ways of California. During the pandemic, a report from the Ludwig Institute for Shared Economic Prosperity found that 4.8 million Californians were seeking, but unable to find, full-time work that paid a living wage.

Forget shipping delays. A deluge of truck traffic and abandoned containers at the Port of Los Angeles creates daily hazards for residents in the neighboring community of Wilmington.

Statewide, 85.7% of the jobs lost during COVID are back. Plus: Wages are up, unemployment rate falls again and another look at the true unemployed.

Despite all the buzz about the “Great Resignation,” labor shortages, and 10 million unfilled job openings, this is the underlying reality: Many tens of millions of Americans are jobless for lack of job opportunity.

Memphis lost more living-wage jobs during the pandemic than most metros around the country, according to a new analysis from a think tank focused on economic equity for the middle and lower class.

While the Twin Cities metro’s unemployment rate is technically a low 2.6%, the “true” number of people who are unemployed — by one analysis — is much higher than that.

While a 7.5% unemployment rate is dismal, it may also understate the true nature of the job situation in California.

California’s official unemployment rate is 7.5%. But a newer method of measuring unemployment reveals a far larger portion of the state is struggling to find full-time employment that pays enough to cover the cost of living.

For some, September’s headline figure is woefully misleading, as it is every month. What if the “true” unemployment rate is actually closer to 22%?

There is an enormous (but invisible) supply of labor that companies can hire to keep costs down.

Economic recoveries should be judged not simply by how many jobs come online, but by whether the jobs created pay a reliably middle-class wage.

It has been an interesting month, with some overall good news for the economy – particularly for low- and middle-income Americans.

LISEP was born out of my longstanding focus on the economic realities for middle- and low-income Americans, which has become even more central, I believe, for our shared American experience.

After decades of calls to expand the Community Reinvestment Act’s anti-redlining obligations to nonbanks, the idea is going mainstream thanks to key endorsements from states and even the chairman of the Federal Reserve.

“If we walk around America and walk around Washington D.C., we see some things that are quite disturbing,” says former Comptroller of the Currency Gene Ludwig. “You see huge homeless communities in many cities and towns in America, you see dilapidation in areas that used to be lovely. And you begin to say, well, if we have the low unemployment rates that the Bureau of Labor Statistics has put out, why do we have the situation that we see?”

The gap between White Americans’ wages and everybody else's grew even larger in the first quarter of this year, according to new data from LISEP, the Ludwig Institute for Shared Economic Prosperity.