A good round up of the catastrophic economic situation for the middle class can be found at Alternet, yes, the favorite site of the loony left. I’ve noticed a tendency on the right to deny any fundamental problems, but the supposedly empirical demonstrations of this fact are unpersuasive to say the least (example). So is the right going to let the left run with this issue, be the only source to draw attention to the reality and propose solutions? Pathetic.
Source link: http://archive.mises.org/18527/middle-class-death-watch/
Middle Class Death Watch
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“Bush Derangment Syndrome” works both ways. Obama is doing the same things that Bush did, so the right is unable to conceive of any angle from which they could criticize him.
As much as the loony left, especially the elitists on the college campuses, like to pride themselves on intellectual superiority, they seem to be oblivious to the cause – the failure of socialist policies and central government planning.
It has probably not even occurred to them that college tuition is in the same bubble as the housing bubble with the same cause – the FED’s low interest policy allowing people to borrow much more money for college that they would otherwise be able to afford. This bubble will eventually burst.
A public sector middle class can only exist if it is paid for by the private sector producing goods and services that people want.
In the old USSR there was no middle class to speak of, and the US is headed in the same direction. Greece and Argentina have the same problem – too many people working for the government who expect to be kept in the lap of luxury relying on others to produce it.
Obama has already played the “Class Warfare” card. This is an admission of failure. A sure sign of a stagnant or declining economic opportunity is envy and covetousness. When this starts happening it is a sure sign that America has ceased to be the land of opportunity.
The people who frequent Alternet should do themselves a favor and educate themselves with the resources on this site. At least then they would understand what is happening and why it is happening.
Eh? How do you get that? For most of its history the Byzantine Empire basically consisted of an agricultural base, a few merchants (mostly foreigners, after the early centuries), a small group of specialist artisans, and a bureaucratic army and civil service. About the only thing the public sector middle class got from the private sector was food and maybe clothing, but that phrasing suggested you meant more than mere subsistence.
One word TAXES. That is how the gummint feeds itself.
“only” food and clothing… did the majority of people in the Byzantine Empire have much more than that?
I think it is becoming clear that the reason people are missing the death of the middle class is because the upper class isn’t doing so great either. If you look at professional people who used to be in the upper class you find them struggling in many cases to remain there. If you look at the numbers of people reaching the plateaus of earning more than the social security limits in income and a million dollars a year in income you will see much smaller numbers of each. And that is the income side, the asset side is much worse. The S&P 500 is down over the past decade in nominal dollars and has been crushed in terms of gold. All the cash stored in the S&P 500 is simply companies trying to keep cash on hand that is becoming progressively less valuable. And then the worst off group of all is the fixed income securities holders. They have been forced to exit bonds into more risky investments or take short term yields of below %4.
People are missing the death of the middle class because “middle class” is defined as 20 percentile either side of median income. If the median wage dropped to $15/hour (or $10/hour) most of the same block of people would still be “middle class” because they would be 20 percentile either side of median wage.
http://www.ritholtz.com/blog/2011/09/conservative-concern-runaway-inequality-will-destroy-economy/
Inflation killed the middle class.
The American middle class was built on fiat currency, inflation and debt. Honesty will destroy the middle class.
This author has completely abandoned any semblance of objectivity and gone for pure demagoguery. And lazy demagoguery at that: he typically writes three lines, then links to another article that “proves” his point. (It wasn’t the same author but once they quoted Michael Pachter. A quick Google search would have revealed that this charlatan is a video game “analyst” known for talking a lot and being usually wrong).
The typical worker makes less than 40 years ago? As much as in the 1950s adjusted for inflation? Really?
I’ve just read “It’s getting better all the time”, by Julian Simon. Let’s just say that every conceivable trend of wealth and ownership of non-essential stuff is through the roof. Then there are little non-monetary things, small anecdotal pieces of evidence, such as the fact that 50 years ago people were still dying from polio in the US.
It doesn’t really matter what year you choose: wealth tends to grow. Choose a given date, and 20 years after that people are better off in 99% of the cases, 99% of the metrics.
Given the absurdity of the idea that wages have declined, and just how at odds is with every other piece of evidence, maybe the reality is that the authors of the study have chosen the wrong metric. Or they measured it wrongly.
Maybe Tucker doesn’t really believe the nonsense……but then why does he provide that link?
You are leaving out inflation and debasement of the currency. When a government’s central bank prints money, they debase the currency. However, the debasement does not affect everyone equally. The people first in line benefit greatly because they get the money before the devaluation hits the marketplace. The people first in line are Fed affiliated banksters and others that feed at the federal trough.
Peter Schiff pointed out in his congressional testimony that Henry Ford’s 5$ per day salary equated to 1.25 ounces of gold per week. In today’s dollar, that is over $104,000 per year. Without a union. What Peter did not point out was that auto line workers did not pay income taxes in Henry Ford’s day, so that is 104K net. For a Michigan worker to clear 104K, he would have to earn almost 147K, after Federal, State and Social Security taxes.
You are also not taking into account that the people who benefit for heavy regulations are large corporations, who can afford to pay for those regulations which hurt would be competitors, and others well connected with the government, who get government jobs and other largess.
So the leftists are correct when they say that inequality is increasing. What they conveniently leave out is that THEIR SOCIALIST policies are the reason for it.
Correction: Peter Schiff did point out the $5/day Ford workers not paying income tax.
Peter Schiff also neglected to mention that Rolls and Royce ignored Ford’s wage theory but still did OK for themselves. Rolls and Royce didn’t care if their employees bought their product.
When the 20% who own (control) 80% of the hard assets (natural resources and infrastructure, not paper profits) own or control 95% of all the hard assets, will they care if the bottom 80% can purchase the products they produce? If “yes,” why will they care?
And the Kotex Corporation doesn’t care that their male employees don’t purchase their product either.
Now can you refute my point that you leftists didn’t cause the increase in inequality?
Albert,
How many wage earners does it take to maintain a household today? How about 40 years ago?
This entire article http://www.american.com/archive/2011/september/middle-class is based on a lie. The lie is that a decade has 8 years. If you figure a decade has 10 years and go from 2000 to 2009 or 2001 to 2010 then the picture changes drastically. Also, the median income is not some theoretical single person, it is: “In probability theory and statistics, a median is described as the numerical value separating the higher half of a sample, a population, or a probability distribution, from the lower half. ”
and that is a real number. And that number dropped significantly by the beginning of 2010
I have written an interesting article on this topic — well sort of it is about our descent into tyranny, something that psychopathic liars like this author are hastening —. Search for orwells boot. My article under the name factotum666 will be number 1 It is about 6000 words
From the Greek empire thru maybe the 100 years war or later, half the “middle class” or more were slaves and serfs. At least they were smart enough to know they were slaves or serfs.
When US median wages drop another 10 bucks and Chinese and Indian wages rise 5 bucks, half of all Americans will be a new class of industrial serf but will still call themselves “middle class.”
Inequality is caused by the reality that working class people must spend most of their annual increase for food, clothing, shelter, and transportation. Rich people don’t know how to spend, don’t spend half their annual increase and reinvest it. Without a bug death tax the magic of compound interest is enough to increase the gini index.
Side bar – long time ago I got conned by Peter Schiff’s Old Man and had interesting time with the IRS. Went to small claims tax court. The IRS and I parted friends. I send them the standard paperwork, pay taxes, and they leave me alone.
Taxes, income and payroll and inflation, you dumb leftist POS.
Also, if “rich people” don’t “know how to spend” how did they:
1. get rich in the first place?
2. remain rich?
Side bar – implicit threats of violence are still threats.
Rich people don’t buy toys on credit.
Further, most of the hyper-rich were born into “old money.” “Silicon Valley” rich is only paper profits. The old money rich own actual land and infrastructure.
And don’t forget that Gates had to start a medium sized (non-profit) company to tell him how to give away his money.
Jeff, I, for one, enjoy nearly all of the off-beat material you drop on the blog. Keep it up? As for this particular one, I’m afraid I can’t slog through 10 pages on almost anything on Alternet.
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