The pieces just don’t add up.

Credit card debt outstanding has fallen 27 straight months for a total decline of $177.2 billion.

The unemployment rate has been stuck above 9 percent for 20 months.

Average hourly earnings rose 1.9 percent in 2010.

Personal income rose less than 4 percent in the 12 months ended November.

About 23 percent of homes with mortgages are worth less than the amount of the loan.

Faced with these not insignificant hurdles, what did the U.S. consumer do? Why, he spent like there was no tomorrow.

Retail sales jumped an annualized 14 percent in the fourth quarter, a spending pace that’s been equaled only once in the last 18 years. (The Census Bureau changed the methodology for calculating retail sales in 1992 and says the data aren’t comparable to earlier measures.) For the year, retail sales rose 7.9 percent, matching the 2004 increase and the biggest since 1999.

With inflation low, the gains in nominal retail sales should translate to a 3.9 percent increase in real consumer spending in the fourth quarter, according to the median forecast of a Bloomberg News survey of 62 economists.

Is the American consumer back to his old shop-’til-he-drops ways? It sure looks that way on the surface.

And who can blame him? All the incentives are urging him to spend, spend, spend. The interest earned on checking and savings accounts is so minute it’s hard to find on the monthly bank statement. Economic theory teaches that high real interest rates are an inducement to defer consumption. Low real rates encourage consumers to spend today.

The Federal Reserve’s manipulation of short-term rates, not to mention central bank policy around the world, is based on that premise. The Fed lowered interest rates to zero to 0.25 percent in December 2008 to make it less costly to borrow and spend. It makes you wonder who’s driving the bus when the consumer, coming off a multiyear debt binge, is being encouraged to borrow more.

There’s another possibility that would better explain the inconsistency between weak job and income growth on the one hand and robust spending on the other.

“I think a credible case can be made that income and employment are being understated,” says Joe Carson, director of economic research at AllianceBernstein.

Exhibit 1 is Treasury data showing that fourth-quarter withheld income tax receipts rose 17 percent from a year earlier, according to Carson. “How can personal income be up 4 percent” when withholding rose more than four times that rate?

Even wealthy liberals aren’t rushing to pay taxes on money they didn’t earn. For that reason, tax data are considered the most reliable source of information.

Exhibit 2 is the tendency for spending data to provide a more accurate reading on the economy than statistics on income and employment, according to Carson.

“The income side is revised up continuously after the fact because payroll estimates understate job growth in the early stages of recovery,” he says.

The Bureau of Labor Statistics releases preliminary data on employment about one week after the end of the month. It isn’t until much later ― and only once a year ― that the BLS reconciles the results of its monthly survey of businesses (Current Employment Survey) with more comprehensive data from its Quarterly Census of Employment and Wages.

The QCEW report, which covers 98 percent of U.S. jobs, is derived from tax reports submitted by every employer subject to unemployment insurance laws. It is released six to seven months after the end of each quarter.

With the release of the January employment report on Feb. 4, the BLS will publish benchmark revisions to payrolls for the year through March 2010. The preliminary estimate from October suggested employment would be reduced by 366,000, or 0.3 percent, in line with most annual revisions.

Any revisions to subsequent months will result from the change to the March 2010 level of employment and revisions to the birth-death model, which attempts to estimate new business formation.

The BLS revisions won’t tell us anything about the latter part of 2010, when the economy appeared to pick up enough steam for Fed Chairman Ben Bernanke to point to evidence of a “self- sustaining recovery” taking hold.

Not self-sustaining enough to take the economy off life support. The Fed seems intent on ensuring that, if he hasn’t done it already, the consumer will revert to his old spendthrift ways.

By Caroline Baum

Caroline Baum, author of “Just What I Said,” is a Bloomberg News columnist. The opinions expressed are her own. ― Ed.

(Bloomberg)