Why are so many Americans sour on the economy? Look at this new data.

To the many economists and politicians who wonder why Americans seem so sour on their economic prospects even though median incomes are rising, take a look at this measurement of economic well-being from American Compass.

The conservative think tank crafted a measurement it calls the cost-of-thriving index (COTI), which starts from a simple premise: Americans must prioritize five sets of goods when providing for their family. That includes food, housing, health care, transportation and higher education. Those who can pay for those needs without worry can enjoy some luxuries without risking their children’s future.

COTI is an attempt to measure how the median American family is doing in obtaining that goal. It looks at the cost of those five items in 1985 and today and compares them with the median wage for a man 25 years or older working full-time. It then calculates the number of weeks it would take for that person to pay for the five items.

The news is sobering: In 1985, it took 39.7 weeks of work each year to pay for these things, giving families plenty of room to enjoy other consumer goods and luxuries. But today, it takes 62.1 weeks of work to cover the same expenses. In other words, about 40 years ago, the median American family could enjoy a middle-class life on one earner’s paycheck. Today, it takes two.

One might argue that the move from one-earner to twoearner families is unimportant. That would be correct if families preferred it that way, but most do not. A 2021 survey showed that more than half of married mothers would prefer to have one parent in the home full-time with children aged 5 or younger. That preference is especially pronounced among lower-or working-class families.

People who aren’t living the life they want typically turn to politics to change the equation. That’s as true for working-class families today as it was for their ancestors who supported extensive welfare state benefits and economic interventions to afford the economic stability that pure capitalism seemed unable to provide.

Government has been indirectly responding to this demand. Concerns over rising costs for higher education has led to state-level efforts to hold down college tuition. Democrats also push federal programs to defray costs, such as increased Pell Grants or higher education tax credits, expanding food stamp eligibility and passing more child-care and health-care subsidies. Republicans have competed by passing expanded child tax credits or increasing the standard deduction for families’ income taxes.

But all this accomplishes is simply to shift the cost of thriving from the private economy onto the public purse. The underlying issue — families with two or more children are unable to comfortably rely on one earner — remains. Families thus have to choose between a menu of undesirable options: two-earner families, a lower standard of living, fewer children or all of the above.

There’s another undesirable option that families increasingly turned to: take on debt. Consumer credit has exploded since the mid-1980s. Federal Reserve data show that Americans held $599 billion in consumer debt in December 1985; in December 2022, it was $4.8 trillion. Outstanding student loans comprise more than onethird of that total, illustrating how the inability of families to thrive pushes some of those costs onto their children.

One can quibble with some of the specific calculations that American Compass uses to derive its index. For example, it includes the full cost of health insurance premiums even though many workers have those costs subsidized by their employer. It also does not account for changes in after-tax income or the availability of financial aid for college. Making those and other technical changes could provide a clearer measurement of the degree to which the cost of thriving has changed over time.

But it’s not likely to change the trajectory. Evidence of the downward trajectory is everywhere: Americans are having fewer children; they are forming families later in life; they increasingly rely on public subsidies for the employed; and many of them have moved from high-cost to lower cost regions. Families with two full-time, college-educated parents — most of you, dear readers — are getting ahead. Everyone else is swimming upstream, stuck or worse.

The economic challenge of our time is not increasing aggregate growth irrespective of who benefits. It is ensuring that most Americans who work can economically thrive in lives they want to live. We are far from meeting that challenge.