That is a very simplistic interpretation, indeed. First, the quality of WHICH goods? I agree that the quality of certain commodity fetishes, such as fancy clothing or electronic gizmos was indeed poor (if such commodities were produced at all) comparing to their western counterparts. But the quality of, say, public health care or public housing was superior to that in the US. The quality of housing in the US is very poor in general - most suburban homes are wooden-frame plywood shacks with a lots of gizmos that make them look nice - but such construction standards would not appropriate for barns in Eastern Europe. What is more, public housing (eg. Section 8) in the US is of truly dismal quality, slums indeed.
Of course, the US also has mansions owned by its plutocracy, and it is those mansions, not Brooklyn or Baltimore slums, that were shown on "Amerikun moooovies" in EE, so many people believed that these were the housing standard.
So the first point is that the consumption patterns in the EE were very much different from those in, say, the US. In EE many goods were produced and delivered as public rather than private goods - particularly housing, transportation, health care and education - and were generally considered as commercial commodities but a form of "manna falling from the sky." The discretionary were indeed of poor quality by Western standards, but these were mostly non-essential goods, wants rather than needs.
The second point is the availability of goods as compared to what? Using Western standards makes little sense in this context because of the very different patterns of consumption mentioned above. A more meaningful standard is to gauge it by the purchasing power - indeed the purchasing power (discretionary spending) was indeed greater than the supply of goods. But that brings us to the issue of overconsumption. People often hoarded goods either for later use or for speculation which resulted in irregularities in supply - a situation comparable to that in the US before a major storm. Those hoarding-induced shortages produced a sense of scarcity and induced even more hoarding. No economy in the world could sustain that!
Of course, in the market system shortages would result in price spikes which would curb hoarding, but in a centrally planned system prices were administratively regulated (mainly to prevent inflation from "overheated" economy) and thus were slow to respond to increased purchasing power or hoarding-induced shortages. What is more, any price increase sparked protests and made the authorities reluctant to use that measure - a far more common strategy was hidden price increases by introducing old goods with new labels and higher price and gradually withdrawing the old goods in old packages.
So the bottom line is that the actual standards of living in EE were relatively decent, even by western standards, but the consumer expectations (teased in part by Western commercial propaganda) and purchasing power exceeded the supply of discretionary goods (mainly semi-luxury items).
Wojtek