Big difference between estimates by economists and US govt

manuel Saez and Gabriel Zucman have produced estimated accounts with considerable detail over the past half century. The main message is one of growth going disproportionately to the top and not shared with the bottom half of the population, but there are also some surprises in the other direction. For example, the middle class, while still lagging, has done better than some common measures indicated, thanks to fringe benefits.

But there’s a big difference between estimates produced by independent economists and regular reports from the United States government, both because the government has the resources to do the job more easily, and because people (and politicians) will pay more attention.

That’s why the Washington Centre for Equitable Growth, a progressive think tank, has been campaigning for something like the Schumer-Heinrich bill.

So why not do this?

Some might argue that creating distributional accounts is tricky, that it requires making some educated guesses about how to pool different sources of information.

But that’s true of the process used to create existing national accounts, including estimates of GDP. Economic numbers don’t have to be perfect or above all criticism to be extremely useful.

In a reasonable world, then, something like the SchumerHeinrich bill would become law in the near future. In the real world, of course, the proposal will go nowhere for the time being, because Republicans don’t want anyone to know what distributional national accounts might reveal.

The writer is a Nobel Prize winner and op-ed columnist for ‘The New York Times’. He is also distinguished professor of Economics at the Graduate Center of the City University of New York