Wednesday, November 25, 2020

Most Voters Now Feel Hopeful

The 56 percent majority of all American voters now feel "hopeful" about the state of the United States, according to a Pew Research Center survey fielded November 12-17. Before the election in June 2020, a smaller 47 percent of registered voters felt hopeful. 

Not everyone feels more hopeful now than they did before the election. Hope has increased greatly among those who voted for Biden. Trump voters are much less likely to feel hopeful...

Percent of Biden voters who feel hopeful about the state of the nation
June: 42%
November: 72%
Change: +30 percentage points

Percent of Trump voters who feel hopeful about the state of the nation
June 53%
November: 39%
Change: –14 percentage points

Tuesday, November 24, 2020

Fewer Support the Death Penalty

The 55 percent majority of Americans support the death penalty for a person convicted of murder, according to a recent Gallup Survey. This is the lowest level of support for the death penalty since 1972. The percentage of the public favoring the death penalty peaked at 80 percent in 1994. 

"Demographic trends may lead to further erosion in death penalty support," says Gallup. That's because the fastest-growing segments of the population are the ones least likely to support the death penalty—Gen Z and Millennials, non-whites, and college graduates. Here is the percentage who support the death penalty by generation...

Percent who support the death penalty for persons convicted of murder, 2020
Generation Z: 45%
Millennials: 51%
Generation X: 57%
Baby Boomers: 59%
Older Americans: 62%

Monday, November 23, 2020

144 Million Americans Cancelled Trips in 2020

Have you cancelled your traditional Thanksgiving travel plans because of coronavirus? If so, you belong to the supermajority of Americans who have scuttled 2020 travel plans during the pandemic. 

Because of coronavirus, fully 144 million Americans aged 18 or older report that they cancelled one or more planned overnight trips to a place 100 or more miles from their home. That's 66 percent of the adult population, according to the Census Bureau's Household Pulse Survey. Just 7 percent of those who had planned an overnight trip went ahead with the trip despite the pandemic. The remaining 27 percent of adults had not planned on taking any trips in 2020. 

There is little difference by age in the percentage of people who had to cancel a 2020 trip. There are big differences by household income, however. Take a look...

Percent who cancelled any planned overnight trips in 2020 because of the pandemic
Less than $25,000:         45%
$25,000 to $34,999:       55%
$35,000 to $49,999:       66%
$50,000 to $74,999:       68%
$75,000 to $99,999:       74%
$100,000 to $149,999:   78%
$150,000 to $199,999:   82%
$200,000 or more:          86%

Why the big difference by household income in the percentage of people who cancelled trips? Because those with lower incomes were much less likely to have planned on taking any trips in 2020. Only 45 percent of Americans in households with incomes below $25,000 cancelled any overnight trips in 2020 because an even larger 49 percent had not planned on taking any trips—they had no trips to cancel. Regardless of household income, only 5 to 8 percent of those who had planned a 2020 trip still traveled despite the risk. 

Source: Census Bureau, Household Pulse Survey, Week 18 (October 28–November 9) 

Thursday, November 19, 2020

What Americans Owe

American households owed a median of $64,800 in 2019, according to the Federal Reserve's Survey of Consumer Finances. This means half of households owe more than this amount and half owe less. Here are the details of debt in 2019...

% of households 
with debt
    median amount
                      owed
Any debt76.6%$64,800
Credit card balance45.4%$2,700
Primary residence42.1%$134,800
Vehicle loans36.9%$13,100
Education loans21.5%$22,300
Other installment loans10.5%$3,800
Other loans secured by residential property
4.7%$122,000

The most common type of debt is credit card, with 45 percent of households having a credit card balance after their last payment. The majority of households use credit cards only for convenience, the Federal Reserve reports, paying the balance in full each month. 

Sixty-five percent of households owned their primary residence in 2019. With 42 percent of households having debt secured by their primary residence, this means about one-third of households own their home free and clear.

Wednesday, November 18, 2020

What Americans Own

Almost all American households own something of value. Fully 99.6 percent of households owned one or more of the assets measured by the Federal Reserve Board's 2019 Survey of Consumer Finances. But only four kinds of assets are owned by most households: transaction accounts (checking and savings accounts), vehicles, a home, and a retirement account. 

Here is the percentage of households owning each type of asset, ranked from most to least common, and the median value of the assets for households that own them:

               percent of
households owning
   median value
        for owners
Any asset99.6%$227,600
Checking/savings accounts98.2%$5,300
Vehicles85.4%$17,200
Primary residence64.9%$225,000
Retirement account50.5%$65,000
Cash value life insurance19.0%$9,000
Stocks (directly owned)15.2%$25,000
Business equity13.4%$89,100
Other residential property13.1%$160,000
Pooled investment (mutual) funds9.0%$110,000
Certificates of deposit7.7%$25,000
Savings bonds7.5%$800
Equity in nonresidential property6.7%$72,000
Other managed assets5.9%$115,000
Bonds (directly owned)1.1%$121,000

Source: Federal Reserve Board, 2019 Survey of Consumer Finances

Tuesday, November 17, 2020

Does Happiness Rise in Old Age?

Over the years, happiness studies have revealed a "paradox of well-being"—the finding that life satisfaction increases with advancing age. This is a paradox because no one can explain why older people appear to become increasingly satisfied with their life despite more illness and the greater likelihood of widowhood.

Now a study explains the paradox. It is a mirage, according to a National Bureau of Economic Research study by researchers at RAND. In an examination of longitudinal data from the Health and Retirement Study, the researchers find that older Americans with higher life satisfaction live longer than their counterparts with lower satisfaction. Consequently, as people age, those with higher life satisfaction account for a larger share of the survivors, driving up overall satisfaction levels. But looking at life satisfaction at the individual level shows a decline with age. While satisfaction is relatively stable from ages 65 to 75, the researchers report, the rate of decline grows with age at older ages. 

"Our results suggest that the optimistic picture about well-being among older persons based on cross-sectional data is misleading," the researchers conclude. "Those with lower levels of life satisfaction die younger and those who survive experience declining life satisfaction as they age."

What a bummer.

Source: National Bureau of Economic Research, The Age Profile of Life-Satisfaction after Age 65 in the U.S., NBER Working Paper 28037

Monday, November 16, 2020

Americans Are Mixed Up about Crime

If you ask the American public about crime in the United States, you almost always get the same answer. Crime is increasing. The trouble is, the American public is wrong. Gallup surveys reveal just how unhinged attitudes are about crime, reflecting fear rather than facts.  

Let's start with the facts. When Gallup asked respondents in 2020 whether their household or they personally had been victimized by crime in the past 12 months, the percentage who said yes was at a record low on both measures. Twenty percent said their household had been victimized by crime and 13 percent said they personally had been a victim. These are the lowest rates of victimization recorded by Gallup since it first asked these questions in 2000. 

Now let's move on to the fear. Here's what Gallup reports: "Americans are more likely to perceive crime in the U.S. as having increased over the prior year (78%) than they have been at any point since 1993." But if you ask Americans about crime in their local area, where they are more familiar with the facts, only 38 percent say crime has increased in the past year. The gap between perceptions of crime in the U.S. as a whole and local areas is fully 40 percentage points—the largest recorded by Gallup in the three decades it has tracked these trends.

The perception of increased crime in the U.S. as a whole is being driven largely by Republicans, Gallup reports. The percentage of Republicans who say crime in the U.S. is increasing surged by 24 percentage points in 2020 and stands at 83 percent. Among Democrats, 73 percent say crime in the U.S. is increasing, 4 percentage points higher than a year earlier. But when asked whether crime has increased in their local area, a similarly small percentage of Republicans (38 percent) and Democrats (36 percent) say yes. 

"Americans' persistent belief that crime worsened in the past year has been out of sync with federal crime statistics showing that crime rates have fallen," Gallup concludes. "Much of this is politically driven."

Source: Gallup, U.S. Reports of Crime Victimization at 20-Year Low and Perceptions of Increased U.S. Crime at Highest Since 1993

Thursday, November 12, 2020

68% Support Legal Marijuana

More than two-thirds of the American public (68 percent) supports the legalization of marijuana, the highest percentage recorded by Gallup since it first asked the question in 1969. Back then, only 12 percent of the population said yes when asked, "Do you think the use of marijuana should be made legal?" Three decades later in 2000, just 30 percent supported legalization. Then attitudes really began to change. The figure surpassed 50 percent in 2011 and has continued to rise upward almost steadily since then. 

The majority of every age group now supports the legalization of marijuana. Here are the percentages who support legalizing marijuana by age, education, and political affiliation...

Percent who think the use of marijuana should be made legal
Aged 18 to 29: 79%
Aged 30 to 49: 75%
Aged 50 to 64: 60%
Aged 65-plus: 55%

Not a college graduate: 64%
College graduate: 76%

Democrats: 83%
Republicans: 48%

Wednesday, November 11, 2020

Big Spenders on Food

A century ago, 38 cents out of every dollar spent by the average American household was spent on food. Today, the figure is just 11 cents. Whew, right? 

Not so fast. Many Americans still spend more than one-third of their income on food—and it's not because they're dining out at fancy restaurants. The share of income a household devotes to food is greatest for households with the lowest incomes. Here is the food share of household expenditures by household income quintile...

Percent of after-tax income spent on food by household income quintile, 2019
Bottom quintile: 36%
Second quintile: 18%
Middle quintile: 14%
Fourth quintile: 11%
Highest quintile: 8%

Note: Households in the bottom income quintile have a before-tax income below $22,488; second income quintile $22,488 to $43,431; middle income quintile $43,432 to $72,233; fourth income quintile $72,234 to $120,728; highest income quintile $120,729 and above.

Tuesday, November 10, 2020

Want to Do Well? Be Financially Literate

Does it pay to be financially literate? Yes, according to the findings of a longitudinal study by the FINRA Investor Education Foundation. The study began in 2012 when researchers measured the financial literacy of a group of participants in the RAND American Life Panel. The study ended in 2018 when the financial status of the same respondents was measured to determine whether those with greater financial literacy were doing better than those with less. They were.

Financial literacy was measured using the FINRA Investor Education Foundation's National Financial Capability Study questionnaire, which consists of five questions about savings, inflation, mortgages, interest rates, and credit cards. The questionnaire can be accessed here

The study measured three positive outcomes: the respondent's level of satisfaction with their financial situation, the respondent's ability to meet an unexpected $2,000 expense, and whether the respondent is planning for retirement. All three positive outcomes were increasingly likely with greater financial literacy, even after controlling for demographic characteristics and current financial condition. The biggest impact was seen in the ability to pay an unexpected $2,000 expense. Among those who failed to answer any of the financial literacy questions correctly, only 46 percent said they would be able to pay such an expense. Among those who answered all five questions correctly, a much larger 67 percent said they would be able to pay the expense. 

"Differences in one's stock of financial knowledge can lead to increasing disparities over the life course," the researchers conclude. "Thus, differential levels of financial literacy may contribute to widening inequality among different segments of the population."

Source: FINRA Investor Education Foundation, The Stability and Predictive Power of Financial Literacy: Evidence from Longitudinal Data

Monday, November 09, 2020

Grim Findings from the Household Pulse Survey

Now that the election is over, let's hope the nation's attention returns to the devastating impact of the coronavirus pandemic on American lives and livelihoods. Attention is required. The latest Weekly Pulse Newsletter from the Census Bureau lays it out in grim detail. Here, verbatim, is how things stood at the end of October...

  • 24.1% of American adults expect someone in their household to experience a loss in employment income in the next 4 weeks
  • 36.9% of adults live in households where at least one adult substituted some or all in-person work for telework because of the coronavirus pandemic
  • 10.9% of American adults lived in households where there was either sometimes or often not enough to eat in the previous 7 days
  • 7.0% of adults are either not current on their rent or mortgage payment or have slight or no confidence in making their next payment on time
  • Of adults living in households not current on rent or mortgage, 28.4% report eviction or foreclosure in the next two months is either somewhat or very likely
  • 33.1% of adults live in households where it has been somewhat or very difficult to pay usual household expenses during the coronavirus pandemic
  • 82.5% of adults in households with post-secondary educational plans had those plans cancelled or changed significantly this fall

These findings come from the Census Bureau's Household Pulse Survey, which is measuring the impact of the coronavirus pandemic on American households. Phase 1 of the survey assessed households every week from April 23 through July 21. That was supposed to be the end of it, but the pandemic had other plans. So on August 19 the Census Bureau began Phase 2 of the survey, collecting data every two weeks...until November 4. Meanwhile, the pandemic rages on. 

Source: Census Bureau, Household Pulse Survey, October 14-26

Thursday, November 05, 2020

We Spend More on Pets than Child Care

The average American household spent $681 on pets in 2019, including pet food, veterinary services, medicines, toys, grooming, doggy daycare, and so on. This is more than the average household spent on cable television ($647) and many other items, such as...

Alcoholic beverages ($579)
Lodging on trips ($619)
Child care ($429)
Internet services ($557)
Furniture ($521)
Women's clothes ($602)
Airline fares ($513)
Drugs ($486)

Average household spending on pets was 21 percent greater in 2019 than in 2010 ($563), after adjusting for inflation. It was more than double the $311 spent by the average household in 2000. But the 2019 figure is not the highest it has ever been. Peak pet spending occurred in 2017, when the average household spent $740 on pets. 

Source: Demo Memo analysis of unpublished tables from the Bureau of Labor Statistics 2019 Consumer Expenditure Survey

Wednesday, November 04, 2020

How Much Will You Inherit?

If you're in the top tiers of the household wealth distribution, chances are it's because your parents (and their parents) were generous with their money. Up to one-half of total household wealth is attributable to intergenerational transfers, reports a Federal Reserve analysis of trends in the distribution of wealth. So, it's no surprise that the wealthiest households are the ones who expect to receive the largest inheritances. Here are inheritance expectations by household net worth percentiles...

Size of Expected Inheritance by Household Net Worth Percentile, 2019
Net worth percentile    Expected inheritance
Top 1 percent          $941,100
Next 9 percent          $266,600
Next 40 percent            $60,100
Bottom 50 percent            $29,400

Not sure where your net worth ranks in the U.S. wealth distribution? Among all households, median net worth was $121,800 in 2019. Among households in the top 10 percent of net worth, median net worth was $2.6 million and average net worth was $5.7 million. 

Tuesday, November 03, 2020

Has God Granted America a Special Role?

Four years ago, the 57 percent majority of Americans agreed with the statement: "God has granted America a special role in human history." Back in 2016, fully 76 percent of Republicans and 53 percent of Democrats agreed, according to PRRI's American Values Survey. 

Most Americans don't feel that way anymore. Four years of the Trump presidency have caused many to lose faith. Either they've decided God has nothing to do with the current state of affairs, or they've decided the U.S. has no special role to play. Only 40 percent of the public now agrees with the statement. Among Democrats, the share who agree fell by more than 20 percentage points to 32 percent. Among Republicans, the share agreeing fell 12 percentage points to 64 percent—still the great majority. 

Source: PRRI, 2020 American Values Survey