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The Middle Class in America Is Radically Shrinking.

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  • The Middle Class in America Is Radically Shrinking.

    Yes, that's right, more doom and gloom for America. Wouldn't it be nice to have some good news about the economic conditions in this country? Sadly, there doesn't seem to be any.

    The 22 statistics detailed here prove beyond a shadow of a doubt that the middle class is being systematically wiped out of existence in America.

    The rich are getting richer and the poor are getting poorer at a staggering rate. Once upon a time, the United States had the largest and most prosperous middle class in the history of the world, but now that is changing at a blinding pace.

    So why are we witnessing such fundamental changes? Well, the globalism and "free trade" that our politicians and business leaders insisted would be so good for us have had some rather nasty side effects. It turns out that they didn't tell us that the "global economy" would mean that middle class American workers would eventually have to directly compete for jobs with people on the other side of the world where there is no minimum wage and very few regulations. The big global corporations have greatly benefited by exploiting third world labor pools over the last several decades, but middle class American workers have increasingly found things to be very tough.

    Here are the statistics to prove it:

    • 83 percent of all U.S. stocks are in the hands of 1 percent of the people.
    • 61 percent of Americans "always or usually" live paycheck to paycheck, which was up from 49 percent in 2008 and 43 percent in 2007.
    • 66 percent of the income growth between 2001 and 2007 went to the top 1% of all Americans.
    • 36 percent of Americans say that they don't contribute anything to retirement savings.
    • A staggering 43 percent of Americans have less than $10,000 saved up for retirement.
    • 24 percent of American workers say that they have postponed their planned retirement age in the past year.
    • Over 1.4 million Americans filed for personal bankruptcy in 2009, which represented a 32 percent increase over 2008.
    • Only the top 5 percent of U.S. households have earned enough additional income to match the rise in housing costs since 1975.
    • For the first time in U.S. history, banks own a greater share of residential housing net worth in the United States than all individual Americans put together.
    • In 1950, the ratio of the average executive's paycheck to the average worker's paycheck was about 30 to 1. Since the year 2000, that ratio has exploded to between 300 to 500 to one.
    • As of 2007, the bottom 80 percent of American households held about 7% of the liquid financial assets.
    • The bottom 50 percent of income earners in the United States now collectively own less than 1 percent of the nation’s wealth.
    • Average Wall Street bonuses for 2009 were up 17 percent when compared with 2008.
    • In the United States, the average federal worker now earns 60% MORE than the average worker in the private sector.
    • The top 1 percent of U.S. households own nearly twice as much of America's corporate wealth as they did just 15 years ago.
    • In America today, the average time needed to find a job has risen to a record 35.2 weeks.
    • More than 40 percent of Americans who actually are employed are now working in service jobs, which are often very low paying.
    • For the first time in U.S. history, more than 40 million Americans are on food stamps, and the U.S. Department of Agriculture projects that number will go up to 43 million Americans in 2011.
    • This is what American workers now must compete against: in China a garment worker makes approximately 86 cents an hour and in Cambodia a garment worker makes approximately 22 cents an hour.
    • Approximately 21 percent of all children in the United States are living below the poverty line in 2010 - the highest rate in 20 years.
    • Despite the financial crisis, the number of millionaires in the United States rose a whopping 16 percent to 7.8 million in 2009.
    • The top 10 percent of Americans now earn around 50 percent of our national income.

    Giant Sucking Sound

    The reality is that no matter how smart, how strong, how educated or how hard working American workers are, they just cannot compete with people who are desperate to put in 10 to 12 hour days at less than a dollar an hour on the other side of the world. After all, what corporation in their right mind is going to pay an American worker 10 times more (plus benefits) to do the same job? The world is fundamentally changing. Wealth and power are rapidly becoming concentrated at the top and the big global corporations are making massive amounts of money. Meanwhile, the American middle class is being systematically wiped out of existence as U.S. workers are slowly being merged into the new "global" labor pool.

    What do most Americans have to offer in the marketplace other than their labor? Not much. The truth is that most Americans are absolutely dependent on someone else giving them a job. But today, U.S. workers are "less attractive" than ever. Compared to the rest of the world, American workers are extremely expensive, and the government keeps passing more rules and regulations seemingly on a monthly basis that makes it even more difficult to conduct business in the United States.

    So corporations are moving operations out of the U.S. at breathtaking speed. Since the U.S. government does not penalize them for doing so, there really is no incentive for them to stay.

    What has developed is a situation where the people at the top are doing quite well, while most Americans are finding it increasingly difficult to make it. There are now about six unemployed Americans for every new job opening in the United States, and the number of "chronically unemployed" is absolutely soaring. There simply are not nearly enough jobs for everyone.

    Many of those who are able to get jobs are finding that they are making less money than they used to. In fact, an increasingly large percentage of Americans are working at low wage retail and service jobs.

    But you can't raise a family on what you make flipping burgers at McDonald's or on what you bring in from greeting customers down at the local Wal-Mart.

    The truth is that the middle class in America is dying -- and once it is gone it will be incredibly difficult to rebuild. Yahoo Finance.
    I'm under the opinion lately that the US needs to bring everything home - military, manufacturing, etc - and lock the door. Isolationism? I guess so. I mean, I'm no economist, but it seems a pretty futile freaking enterprise to keep going with an economic system that does not benefit the average American worker in any way, shape, or form. Unless, you're one of those multinational corporations that make huge profits by outsourcing manufacturing and labor. Where's the benefit to the US citizen in this global economy? I can't see any.

    In one of the offices that my wife works in - she has a very high paying job in the medical industry, 6 of the 9 women employed there have husbands who are at home and out of work - I myself being one of those. This is just one office in a relatively small area of Florida, I can only assume that on a national level the numbers are staggering.

    I was a construction superintendent and project manager for many years. Of course, that industry was decimated after the economic collapse. I made a rather large and exorbitant salary loaded with benefits, reimbursements, allowances, and bonuses - basically, you name it, and I got it. But, since this debt-fueled boom and bust construction industry has faltered, where am I supposed to find work?

    There really aren't any jobs, it's just sad. It works out well enough for my family because of my wifes job, and I stay home with my kid. But, many families just don't have it as good as we do. I never thought I would stand here and say that my families situation is good, but comparatively speaking, it really is.
    |TG-X| mp40x



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  • #2
    Re: The Middle Class in America Is Radically Shrinking.

    I'm not gonna say it isn't bad, because clearly it is. But economic isolationism has no chance of working, ever. We can't simply stop doing business with the rest of the world -- and if we did, our quality of life would drop faster than it did when this recession hit. Our paychecks might contain higher numbers, but inflation would far surpass that and you'd discover that your actual buying power had regressed to somewhere near where it was in the 50s. After you declare that US citizens can't buy any products from outside our borders, what ARE we going to buy?

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    • #3
      Re: The Middle Class in America Is Radically Shrinking.

      Hey, I agree with Kerstasis 100% on this one. Isolationism isn't feasible anyway, but more importantly for the topic it does nothing to address the disproportion in wealth even if it was feasible.
      |TG-6th|Snooggums

      Just because everyone does something does not mean that it is right to do.

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      • #4
        Re: The Middle Class in America Is Radically Shrinking.

        Well, I didn't mean complete isolationism, and lets not let that become the focal point of the thread.

        So what is to be done? It seems the economic system that's in place currently is not working, as it's concentrating wealth in the hands of a very few people, all to the detriment of the general public. Are we to just keep going with the current system? It would seem that in the long run the consequences of this system will have dire results for this country and it's people.

        Does anyone have any real ideas that could improve the job market and therefore help in the disparity between those who have, and those who don't - because they can't find a decent job. Or, should Americans just be accepting to the fact that eventually there will only be rich and poor, as the only jobs that will be available are lower end service type jobs, if any - with the exception of a very few specific industries. Because it seems that is exactly where we are heading.

        If the global economy model is the only viable option, then I fear that we are in big trouble. Because if Americans are forced to compete in that scenario, the American dream is over, and has become a nightmare.
        |TG-X| mp40x



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        • #5
          Re: The Middle Class in America Is Radically Shrinking.

          The disproportion in wealth isn't the real issue either though, it's just a distraction to vent anger at. The real issue is the reduction in wealth for the middle class. If the disproportion in wealth could be corrected, but in the process you reduced everyones wealth, that wouldn't be a solution -- its just spite.

          If the middle class could have it's wealth restored at the cost of the upper class, I'm sure you'd be ok with that. But economic isolationism doesn't accomplish that, it just reduces wealth for everyone.

          Edit: @mp40: Globalization has an inevitable consequence which, if you think about it a bit, you might actually like. Historically, wealth has been disproportionately focused in a small number of countries, of which the foremost was ours. As globalization proceeds, that will slowly break down and wealth will become LESS disproportionate (on a national scale). Since we are currently on the high end of the proportionality scale, having things become more equal feels painful for us.

          I'm not strictly certain how this national equalization interacts with individual equalization. It seems likely that individuals will profit a great deal from the process of equalization, kind of the same way a hydroelectric dam gets a lot of power from two bodies of water equalizing. Once global equalization has progressed far enough, that individual effect will die down and we'll begin to see personal equalization.

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          • #6
            Re: The Middle Class in America Is Radically Shrinking.

            Originally posted by Kerostasis View Post
            The disproportion in wealth isn't the real issue either though, it's just a distraction to vent anger at.
            But it's not. It's real data that shows a huge disparity that keeps increasing. If you choose to ignore those facts, then I guess we don't really have anything to talk about.

            Originally posted by Kerostasis View Post
            The real issue is the reduction in wealth for the middle class. If the disproportion in wealth could be corrected, but in the process you reduced everyones wealth, that wouldn't be a solution -- its just spite.
            I'm not following what you're saying exactly. We are not talking about the redistribution of wealth. We are talking about the lack of good jobs due to increased outsourcing and other factors, which therefore increases the wealth of the already wealthy.

            Originally posted by Kerostasis View Post
            If the middle class could have it's wealth restored at the cost of the upper class, I'm sure you'd be ok with that.
            Well, probably not. But it would be nice to not have the wealth as concentrated as it is. I think we have two different topics going on here, you're trying to turn this into class warfare, I am not.

            Originally posted by Kerostasis View Post
            But economic isolationism doesn't accomplish that, it just reduces wealth for everyone.
            Ok, please stop beating that drum. As usual, you will hammer home any perceived weakness in someones post. But don't like it when others do it to you, please move on.
            |TG-X| mp40x



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            • #7
              Re: The Middle Class in America Is Radically Shrinking.

              Originally posted by Kerostasis View Post
              The disproportion in wealth isn't the real issue either though, it's just a distraction to vent anger at. The real issue is the reduction in wealth for the middle class. If the disproportion in wealth could be corrected, but in the process you reduced everyones wealth, that wouldn't be a solution -- its just spite.
              In my opinion the downfall of capitalism is in the separation of ownership from a company through the stock market. By owning shares and turning the focus to money made from trading those shares and not being involved and owning a company directly the abuses of pump and dump schemes, subprime lending and of course the allowance of completely unethical behavior like 'shedding toxic assets' to a made up company to hide crappy decisions just makes the whole thing worse.

              It isn't that shares or stocks or legal ways to alter a company are bad in themselves, they are just easily abused. Regulation can only go so far, and to be honest the stock market is simply legal gambling for really rich people. Like a casino, the multitude of less wealthy people come and most likely lose their funds because they are unlikely to play long enough to break even in the many small losses to one big payoff environment. In the case of Wall Street things are even less even because instead be being based on complete randomness everyone has the ability to skew perception of the odds for their own means and rarely get busted for it, and if they do they usually get to keep it and the company (and the less wealthy shareholders) get stuck with the bill.

              The disproportion of wealth is the biggest problem because it allows for further disproportion through an unequal impact on government. Why does Rupert Murdoch get more say in decisions about the news industry? Because he has money to lobby. While we each get one vote, he gets to control the person who was elected. This allows for manipulation of the 'free market' which means it isn't free at all. Other examples include sugar taxation being a boom for the corn industry, the illegalization of marijuana and therefore hemp for books and other industries that are strangled by another industry through government action in the name of public opinion.

              I don't want everyone to get equal pay. I do believe in a free market but that requires regulations that force equal and ethical play. Like a sports game there will still be winners and losers, but the winners don't get to win because they were able to buy off the referees. They will still have an advantage based on heredity, natural talent and so on, but 1% of them won't crush everyone else all of the time.
              |TG-6th|Snooggums

              Just because everyone does something does not mean that it is right to do.

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              • #8
                Re: The Middle Class in America Is Radically Shrinking.

                The only thing bad about having a small number of people control so much wealth is that they have disproportionate power in society. This power allows them to make laws and take actions that ensure that they keep that wealth and power even at the cost of the general populace.

                Making the government smaller or bigger doesn't solve that problem. Only if the people use government to ensure that laws are in place to prevent the use of power gained through wealth and punish those that use their wealth to thwart the power of government can the situation be solved.

                But after a certain point where the power of wealth has become so unbalanced and concentrated and distorted there may not be a solution outside something like the French Revolution where those with power are beheaded.
                I’m not racists, I have republican friends. Radio show host.
                - "The essence of tyranny is the denial of complexity". -Jacob Burkhardt
                - "A foolish consistency is the hobgoblin of little minds" - Emerson
                - "People should not be afraid of it's government, government should be afraid of it's People." - Line from V for Vendetta
                - If software were as unreliable as economic theory, there wouldn't be a plane made of anything other than paper that could get off the ground. Jim Fawcette
                - "Let me now state what seems to me the decisive objection to any conservatism which deserves to be called such. It is that by its very nature it cannot offer an alternative to the direction in which we are moving." -Friedrich Hayek
                - "Don't waist your time on me your already the voice inside my head." Blink 182 to my wife

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                • #9
                  Re: The Middle Class in America Is Radically Shrinking.

                  Originally posted by Kerostasis View Post
                  Edit: @mp40: Globalization has an inevitable consequence which, if you think about it a bit, you might actually like. Historically, wealth has been disproportionately focused in a small number of countries, of which the foremost was ours. As globalization proceeds, that will slowly break down and wealth will become LESS disproportionate (on a national scale). Since we are currently on the high end of the proportionality scale, having things become more equal feels painful for us.
                  Well, the problem I see with that analogy is that US corporations are not losing any of that wealth. In fact, their profits keep going up in most cases, so it's only the American worker who is losing. So, globalization has not hurt the US corporation at all, only the US citizen. Basically, you were trying to appeal to my sense of social justice for average workers, but you failed to point out that US corporations are not giving up any wealth to balance the "disproportionate number of countries where wealth has been historically focused."
                  |TG-X| mp40x



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                  • #10
                    Re: The Middle Class in America Is Radically Shrinking.

                    Modern international companies are going through political power phases similar to the East India Trading Company without needing the complete monopoly.
                    |TG-6th|Snooggums

                    Just because everyone does something does not mean that it is right to do.

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                    • #11
                      Re: The Middle Class in America Is Radically Shrinking.

                      Originally posted by mp40x View Post
                      But it's not. It's real data that shows a huge disparity that keeps increasing. If you choose to ignore those facts, then I guess we don't really have anything to talk about.
                      I'm not ignoring them, I simply have a different view of their relevance. Rich people being rich isn't inherently a problem. It's only a problem when rich people being rich causes you to become less rich, and as near as I can tell that isn't happening here.

                      I'm not following what you're saying exactly. We are not talking about the redistribution of wealth. We are talking about the lack of good jobs due to increased outsourcing and other factors, which therefore increases the wealth of the already wealthy.
                      You need to separate those last two factors. Increasing the wealth of the wealthy is just a side-effect, it's not the main driving force here. The driving force is that the outsourcing you keep mentioning IS redistribution of wealth -- from us to places like India and Mexico.

                      Well, probably not. But it would be nice to not have the wealth as concentrated as it is. I think we have two different topics going on here, you're trying to turn this into class warfare, I am not.
                      I'm actually trying to avoid class warfare as much as possible. I have no objection to wealth.

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                      • #12
                        Re: The Middle Class in America Is Radically Shrinking.

                        Originally posted by Kerostasis View Post
                        I'm not ignoring them, I simply have a different view of their relevance. Rich people being rich isn't inherently a problem. It's only a problem when rich people being rich causes you to become less rich, and as near as I can tell that isn't happening here.
                        It is happening here, due to abuses of the investment system. If the rich become proportionally more rich as a portion of the economy then the middle and lower classes are becoming less rich in comparison.
                        |TG-6th|Snooggums

                        Just because everyone does something does not mean that it is right to do.

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                        • #13
                          Re: The Middle Class in America Is Radically Shrinking.

                          Originally posted by snooggums View Post
                          It is happening here, due to abuses of the investment system. If the rich become proportionally more rich as a portion of the economy then the middle and lower classes are becoming less rich in comparison.
                          Being less rich in comparison and being less rich are two very different things.

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                          • #14
                            Re: The Middle Class in America Is Radically Shrinking.

                            Originally posted by Kerostasis View Post
                            I'm not ignoring them, I simply have a different view of their relevance. Rich people being rich isn't inherently a problem. It's only a problem when rich people being rich causes you to become less rich, and as near as I can tell that isn't happening here.
                            But isn't that exactly what is happening? Some wealthy Americans and corporations keep pushing for more global free trade - like CAFTA, this in turn leads to fewer middle class jobs, therefore causing those workers to become less rich, as you put it.

                            Originally posted by Kerostasis View Post
                            You need to separate those last two factors. Increasing the wealth of the wealthy is just a side-effect, it's not the main driving force here. The driving force is that the outsourcing you keep mentioning IS redistribution of wealth -- from us to places like India and Mexico.
                            Take that a step further. Aren't the global trade policies of our government - supported wholeheartedly by US corporations - actually redistributing wealth by making US companies more profitable at the expense of the American worker? In essence, this is exactly a redistribution of wealth. Except, this time they are taking from the poor or middle class and giving to the already rich.
                            |TG-X| mp40x



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                            • #15
                              Re: The Middle Class in America Is Radically Shrinking.

                              I get a kick out of people (seems like almost everyone) who talk of "JOBS" as if they were a commodity. "We're losing jobs!" "There aren't any jobs out there for people who want them"... etc. When really, people must make jobs for themselves in a free society. The only reason you should be supported by others is if you're doing some useful thing for them. If "they" can have their wants provided for better by someone working harder, longer and/or for less pay in another country, that does not harm you. That is, unless you think you OWN the other person and can force them to do whatever you want. Then you might have a claim on them "taking" jobs away from you.

                              Whatever corporation or person has gained wealth by fraud or theft should be prosecuted. Those who've worked harder, smarter, or had better luck and thereby gained huge amounts of it cannot be prosecuted, if we are to consistently retain the idea of "private property" for Americans.

                              Originally posted by mp40x View Post
                              Except, this time they are taking from the poor or middle class and giving to the already rich.
                              How can a corporation make profit at the expense of the "worker?" If the helpless employee would have no way to earn bread if not for the corp, then is not the corp providing him a massive privilege? It's a mutual benefit... of if you'd rather invoke "exploitation," then the employee is exploiting the corporation, too.

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                              "The true genius shudders at incompleteness - and usually prefers silence to saying
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