It seems widely believed that the United States has a K-shaped economy these days – one in which the affluent are doing well, but the not-so-affluent, especially the lowest-income Americans, not nearly so much. That’s widely considered particularly important because it’s supposed to have emerged just as the standard indicators of the economy’s health, like its growth and unemployment rates, are looking awfully good.

If you’re skeptical about the popularity of this view, check out recent Google mentions. Over the last year, the phrase “K-shaped economy” generated 25 million searches. The related terms “two-tier economy” and “two-speed economy”? 12.5 million and 48.3 million searches, respectively.

That’s nowhere close to, say, Taylor Swift (615 million searches) and Donald Trump (464 million). But those numbers ain’t beanbag, either.

Moreover, interest in this theme seems to have intensified since the first government data pointing to a strong rebound in economic growth were released. Specifically, on July 30, the Commerce Department reported that the gross domestic product (GDP – the standard measure of the economy’s size and its changes) was expanding at a healthy three percent annual rate.

Since then, “K-shaped economy” was searched for 9.42 million times, “two-tier economy” 4.27 million times, and “two-speed economy” 15.5 million times. The clear implication? Beneath its healthy-looking surface, lie big new economic problems.

Of course, you can’t trust everything you see on-line. And what the actual data appear to be telling us is that although there’s plenty of inequality in the U.S. economy, it’s nothing new.

The first piece of evidence comes from the World Bank via the St. Louis Federal Reserve’s handy-dandy FRED graphics series. It’s a graph showing how the United States has performed historically according to the Gini Index – a widely used measure of income inequality. The higher the number, the greater the degree of inequality and, as the FRED chart makes clear, through 2023 (the latest available data) there’s been virtually no change since 2006. That’s more than a decade.

Something else especially interesting about the graph: the deep nosedive it took during the scary Covid-induced downturn of the early 2020s, and the strong rebound it took afterwards. So whatever’s recent about the K-shaped economy has resulted from the sharp decline in inequality during the pandemic – due to a combination of falling incomes for the rich and propped- up incomes for the poorer thanks to the massive pandemic relief programs – and then a return to more normal patterns as the V-shaped Covid recovery took off and the relief programs began winding down.

Consumer spending trends also reveal that the K-shaped economy has been with Americans for decades. Check out the below graph from Moody’s Analytics. It’s not interactive, but it makes clear that although the share of consumer spending by the top ten percent of income earners has risen appreciably since 1990 (and now stands at 50 percent), the share of the rest – and especially of the bottom 40 percent – has barely changed at all over those 35 years.

No doubt there are reasons to be worried about the persistently high levels of inequality displayed in the FRED chart. In particular, I’ve long been concerned about the impact of concentrated wealth on American politics. But the idea that a K-shaped etc economy is something new, and that it’s revealing major weaknesses masked by strong growth and unemployment indicators, simply isn’t backed by the data – unless you think those internet search numbers are more important.