Middle Class USA is Disappearing

Not only is the Middle Class in the USA disappearing, but it is evaporating in Canada and most First World nations.  Contrary to the pontifications of Ann Coulter, Rush Limbaugh, Glenn Beck and other GOP far-rightist demagogues, evidence shows that the USA is more and more becoming a land of the rich, with the poor working harder and longer for less.  As Michael Snyder in The Business Insider noted in his article posted on July 15, 2010:

•    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.

The reason for the collapse of the economy and shrinkage of the dollar in the USA is directly the result of outsourcing jobs: to Third World Nations where people will work ten or twelve or even fourteen hours a day (Latin America) or longer (Southeast Asia) for less than $1 an hour–far less than what corporations pay American workers ($10 hour average plus benefits)–and this increased with the inane passage of NAFTA that has further gutted USA worker rights. This is increased by faux-Democrats such as Blanche Lincoln of Arkansas and Ben Nelson of Nebraska who regularly legislate and vote against the economic welfare (Lincoln voted against tax cuts that would have increased federal funding for anti-hunger programs in 2001, but voted for the War in Iraq that further drained the US Treasury) and physical health of America’s workers in lockstep with ultra-conservative Republicans–and yet the workers of the USA continue to vote against their own interest and in favor of those who will see to their loss of jobs and benefits and health care (especially in the case of Iowa where Charles Grassley opposes any help for Iowa’s underinsured and “uninsurable” middle class). What hurts further, is that these fake-Democrats (especially Lincoln and Jon Kyle [R-AZ]) argue against taxing unearned income (inheritances of over $5 million which few middle class earners will ever see; and as Jonathan Chait notes: “Under current law, every individual will soon be able to pass on $3.5 million to his heirs tax-free. That’s $7 million per couple before a single dollar of taxes kicks in. And this assumes zero estate planning; any competent lawyer can shelter a whole lot more than that. Even among the tiny percentage of estates that pay inheritance tax, the effective rate is under 20%.”; Cp. Jonathan Chait, “Death, Taxes and Democrats, Los Angeles Times June 18, 2010, online at http://articles.latimes.com/2006/jun/18/opinion/oe-chait18; Senator Lincoln has justifiably won the title of “corporate whore” from both insiders and pundits) in exchange for a flood of money into their campaign chests from wealthy Republicans (see: http://downwithtyranny.blogspot.com/2009/04/estate-tax-blanche-lincoln-and-jon-kyl.html) –with the middle class paying the largest share of all taxes to support the rich.

The greatest problem facing labor in the USA today is outsourcing (See: William Raynor, “Global Outsourcing the Disappearing Middle Class” at http://www.newwork.com/Pages/Opinion/Raynor/Middle%20Class.html). In the last eighteen months the number of jobs sent overseas has skyrocketed.  “American employers hired far fewer workers than expected in November… The number of workers on U.S. payrolls outside the farm sector last month edged up by 57,000… far lower than economists’ forecasts of a 150,000-job gain…” (Willard, Anna. “Payrolls Disappoint, Factory Orders Jump” Yahoo News Service. December 5, 2003).  And, According to Dr. Paul Craig Roberts, “Only a few of the 116,000 private sector jobs created in October provide good incomes… the remainder of the 116,000 new jobs consist of temps, retail trade, telephone marketing, and fund-raising, administrative and waste services, and private education and health services.” Roberts, Paul Craig. “Loss of Jobs In America”. NewsMax On-line News Service. November 12, 2003.

Those already economically hurting are turning increasingly to Wal-Mart–which buys most of its products from abroad and thus further the decline of the dollar and the loss of jobs in the USA. COSTCO is second for throwing an economic dart into the pocketbooks of USA labor–yet its customers are the ones who are out 0f work or taking pay cuts and looking at (or have experienced) home foreclosures.

Big Business and Big Industry continues to cry out for “no more taxes” claiming they are losing their competitive edge in the market place, but these taxes they pay they pass on to the consumer–who buys regardless. It is time that consumers boycott Big Business and Big Industries and return to Main Street and its shops for their supplies and goods. Wall Street has long been the handmaiden to the wealthy whose wealth increases obscenely over months, with CEOs and other executives seeing multimillion dollar bonuses for doing little work other than paper shuffling while those working under these vultures who are in the thirties and forties frequently have to forgo home ownership, parentage, and a descent way of independent life as they continue to live with their parents out of need (See: The two-income trap : why middle-class mothers and fathers are going broke / Elizabeth Warren, Amelia Warren Tyagi [New York: Basic Books, c2003]), not desire (Gardner, Marilyn. “40 Years Old and Still Tied To Mom and Dad’s Purse Strings”. Christian Science Monitor. December 11, 2003).

Another problem in the USA and other First World Nations is that they have increasing “dumbed down” education (as seen most recently where the evangelical fundamentalist religious right has taken over the Texas Board of Education and demanded changes to basic realities, including claiming that slavery was not a bad institution, Wisconsin Senator Joe McCarthy was a good man who worked for the growth of the USA, and that integration stifled academic growth). As the USA and First World Nations continue to become less educated and more ignorant, there is a global surplus of highly educated workers, which is too enticing for U.S. firms to ignore. Not only can they hire high-end workers for a fraction of domestic salaries, but often also save money by avoiding U.S. OSHA, EEOC, EPA and other regulations (Cf. Kripalani, Manjeet; Engardio, Engardio; Hamm, Steve. “The Rise Of India”. Business Week. December 8, 2003); at the same time USA universities are actively recruiting Third World students for an MBA and other advanced degrees, although most of those admitted lack pronunciation or grammar fluency but meet a quota established to “ensure a world picture”. Food is brought in from Mexico, Perú, and other Latin American nations that compete unfairly with USA grown produce and fruit from Florida, California, Arizona, Texas, etc. Tourism demands a visit to foreign nations, while USA parks and historic places go wanting for tourists and their dollars.

Core expenses kept going up. By the early 2000s, families were spending twice as much (adjusted for inflation) on mortgages than they did a generation ago — for a house that was, on average, only ten percent bigger and 25 years older. They also had to pay twice as much to hang on to their health insurance. Elderly saw their doctors 60% fewer times in 2005 than ten years previously, and today there is a discussion in over 65% of all elderly homes if they should eat two or three meals in a day. Families today spend less than they did a generation ago on food, clothing, furniture, appliances, and other flexible purchases.

Buy America First is but a slogan that few recognize or accept. Thus televisions and automobiles are made in Japan; coffee comes from Columbia; games, toys, paper is imported from China; asparagus, fish, and rice is shipped in from Perú–which helps their 1% super rich while the rest of the Third World Nations poor get poorer, the education worse, the cost of living skyrockets–all so that the upper crust in the world live better than everybody else. While the current Administration is working at reigning in banks and the obscenity of their loan practices, Wells Fargo and other banking giants are doing everything possible to derail regulation. As Elizabeth Warren, Leo Gottlieb Professor of Law at Harvard University and currently Chair of the Congressional Oversight Panel noted recently: “According to polls, large majorities [68% to 70%; see: http://ourfinancialsecurity.org/2009/10/recent-polling-data-on-financial-reform-legislation/] of Americans have welcomed the Obama Administration’s proposal for a new Consumer Financial Protection Agency (CFPA). The CFPA would be answerable to consumers — not to banks and not to Wall Street. The agency would have the power to end tricks-and-traps pricing and to start leveling the playing field so that consumers have the tools they need to compare prices and manage their money. The response of the big banks has been to swing into action against the Agency, fighting with all their lobbying might to keep business-as-usual. They are pulling out all the stops to kill the agency before it is born. And if those practices crush millions more families, who cares — so long as the profits stay high and the bonuses keep coming.” (See: Elizabeth Warren, “America without a Middle Class,” The Huffington Post (December 3, 2009), at http://www.huffingtonpost.com/elizabeth-warren/america-without-a-middle_b_377829.html). The problem is simple: those with the most to lose will stay away from the election polls this November and allow the few, the entitled, the elite to sway the election led by their savior Sarah Palin, and jobs will continue to be lost, food will get more expensive, and with a GOP-controlled Congress health care reform will fade into dust while the rich get richer and the poor sink deeper into poverty.


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3 responses to “Middle Class USA is Disappearing

  1. While I agree that the way to hurt these businesses that have decided to bulk their quarterly statements by sending jobs to employees overseas is by shunning them and turning to mom and pop USA stores – it isn’t economically feasible. Sadly, this has enabled big businesses to reduce the cost of their services so it isn’t viable for anyone to shop at a local business – even less so in this economy.
    It is an action our government needs to wake up and take against these businesses, taxing them the difference in wages paid so that they will feel the sting, increasing the benefits to them if they bring those jobs back home, changing the stipulations for hiring workers out of the country for a US business to mirror the requirements of work visas…something – anything!
    IBM is one big business that has taken advantage of the tax breaks for bringing jobs home and creating new positions, but it is a small chunk of the big picture. Until Bernake, Obama and other political power houses start realizing their responsibility goes beyond stimulus packages and pretty speeches – we will continue to have this economic suffering and loss to American workers.

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