Middle Class Living Standards: Changing the Yardstick

The story on middle class living standards over the last quarter century is pretty bleak. There are some gains, but most of this is attributable to an increase in the number of workers per family � women have been entering the labor market. While this is the story from the official data, many of those arguing that living standards actually have been increasing rapidly go behind the data and argue that the consumer price index (CPI) overstates the true rate of inflation, and therefore understates the improvement in living standards.

David Leonhardt presents this case today based on the anecdotes of Robert Gordon, a member of the notorious Boskin Comission, and one of the leading proponents of this view. As the Boskin Comission's primary opponent, I can't let this one slide.