We develop adjustments to align the NIPA measures of key household flows with cash flow concepts that better reflect household budgets and demand. The adjustments significantly change important macroeconomic time series and give different perspective on household spending and saving....

Rising inequality reduced income growth for the bottom 95 percent of the US personal income distribution beginning about 1980. To maintain stable debt to income, this group’s consumption-income ratio needed to decline, which did not happen through 2006, and its debt- income ratio rose...