View Full Version : The State of America’s Middle Class in Eight Charts
Some sobering visuals (charts at the link below) to ponder on the state of the struggling "American Dream"...
Richard
The State of America’s Middle Class in Eight Charts
Frontline, 9 July 2013
#1: Wages are down
#2: Less income for the middle class
#3: Union positions are shrinking
#4: More workers stuck in part-time jobs
#5: Fewer jobs from U.S.-based multinationals
#6: Rising debt
#7: Families are saving less
#8: Net worth has plunged
http://www.pbs.org/wgbh/pages/frontline/business-economy-financial-crisis/two-american-families/the-state-of-americas-middle-class-in-eight-charts/
GratefulCitizen
07-09-2013, 17:09
Perils of a consumption-based economy and inverted demographics.
Deflation is a logical consequence.
Baby boomers control about 70% of disposable income.
In aggregate, they're scaling back spending in preparation for retirement.
There aren't enough people (nor are they rich enough) in the generation that follows to replace that spending.
As a consequence, profitability drops, yields on investments drop, and interest rates drop.
With yields dropping, boomers increase savings rates to compensate.
This worsens the cycle.
The economy will grow, absent government interference, in the sectors where the boomers spend their money.
Enter the healthcare fiasco.
"Healthcare reform" is just a bunch of interested parties (government and private) lining up to fleece the accumulated wealth of a large generation.
Bush!
About a third of Americans, 35%, assign a high degree of blame to Bush alone for current economic problems, about double the percentage blaming solely Obama (19%). Another 34% blame both, while 11% say neither is highly to blame.
http://www.gallup.com/poll/163427/bush-bears-brunt-blame-economic-woes.aspx?utm_source=alert&utm_medium=email&utm_campaign=syndication&utm_content=morelink&utm_term=Politics
Trapper John
07-10-2013, 08:12
Forgive me for being a bit skeptical here. I have no doubt that there is increasing economic pressure on the middle class. However, whenever I see graphs or statistics presented along with a particular point of view, I question just how much "cooking" of the numbers has occurred. For instance, (i) are these data in constant $s and bench-marked to what year?, (ii) when incomes are calculated does the income include employer contributions to 401Ks, health-care insurance, and the like?, (iii) in the case of union v non-union wages are these for the same job? what region of the country was the sampling taken? what percentage of all manufacturing jobs does this represent? Is the data weighted for this sort of bias?
I could go on and on, wrt to each graph, but you get my point. I would take this presentation with a large grain of salt and a gross oversimplification to make a political point. Not that I disagree with political point, just that I think this sort of presentation discredits a very real issue and a valid point.
Just my $0.02 and that is in 2013 $ so its not worth much :D
TJ - the graphs are but an "executive summary" of the Frontline program.
Richard
While #3 above may have caused significant economic discomfort in the Mid-West and West, it has caused a surge in the economies of MS, AL, TN and SC. These UAW-Free states have become welcome homes to Toyota, BMW, Mercedes and GM. Also, Mexico, China, etc. While I celebrate the gains of the former, I mourn the job losses to the latter. Yes, Bush and Obama both have a hand in the shrinking of the Middle Class, but they aren't the Lone Rangers!
Streck-Fu
07-10-2013, 08:30
I don't see the decline of union membership as a negative thing...Public employment union contracts are choking state and local budgets nationwide.
I don't see the decline of union membership as a negative thing...Public employment union contracts are choking state and local budgets nationwide.
A private sector union can push too hard and kill a company.
A public sector union does not have to worry about "killing the company". The public sector is funded by taxes and the government invloved just needs to raise taxes.
Best jobs kids can get these days is government jobs - city, county, state and federal jobs - mostly job security and paid better than your private sector neighbors.
Best jobs kids can get these days is government jobs - city, county, state and federal jobs - mostly job security and paid better than your private sector neighbors.
I use to think that! I am not so sure that is an absolute anymore.
I got chewed out at staff call this morning because I answered my BB on a furlough day!
Trapper John
07-10-2013, 09:23
TJ - the graphs are but an "executive summary" of the Frontline program.
Richard
OK! So let's assume that the data has veracity and that bias in sampling is weighted or otherwise normalized. The second problem, I have with this is reflected in the Gallup poll, i.e. well, someones to blame, so who is it? I think the issue is much, much broader and really goes to mega-trends and misalignment of policies with the mega-trends.
For example, one mega-trend is the movement of our economy from a low-tech manufacturing base to a high tech manufacturing and information based economy. There is a huge misalignment of policy and these trends. For instance monetary policy is focusing on increasing consumption hence increased consumer debt. The Fed has been pumping dollars into the economy and artificially keeping interest rates down to improve the economy by increasing consumer activity. This is totally artificial and not sustainable in the long-term.
Education policy - well that's an oxymoron - there is no policy. What's the very first thing that is cut from every state budget in budget crisis? We are not educating children in a manner that is consistent with the mega-trends.
Tax policy. Whoa, that's the biggest issue IMO. We have a tax code that is totally out of touch and is not even consistent with the 19th century. More like a feudal system IMO.
Health-care policy. Shit, where do I begin? We don't have health-care system we have a disease management system that is only serving the status quo. Reforming the payer system is exactly the wrong thing to do and will have a huge damping effect on innovation and quality of health care while increasing the real cost. Health care reform as it currently is being debated is nothing more than rearranging the deck chairs on the Titanic. Oh, but PhRMA will be able to sell drugs that are only palliative and keep patients coming back for more. Good for their bottom line - not so good for patients.
Energy policy - give me a break!
Who's to blame? Answer: "We have met the enemy and they is us!"
I use to think that! I am not so sure that is an absolute anymore.....
An interesting article....
WI public sector workers earn nearly $12k more than private sector
http://watchdog.org/94453/wage-gauge-wis-public-sector-earns-nearly-12000-more-than-private-sector/
"MADISON – While labor unions grouse about public sector pay, a state government job is a good gig if you can get it, according to the latest income data from the U.S. Bureau of Labor Statistics.
In Wisconsin, state employees earned on average $53,552 in 2012, nearly $12,000 more than their fellow workers in the private sector, based on BLS data tracked by Stateline, the news service of The Pew Charitable Trusts............"
Badger52
07-10-2013, 14:41
I got chewed out at staff call this morning because I answered my BB on a furlough day!:eek: I'm surprised you didn't spontaneously combust.
What a motivational tool that staff call must've been.
GratefulCitizen
07-13-2013, 15:33
Recent new rules for the banks are stricter than the Basel III requirements.
Due to the nature of risk-weighting rules, this has the effect of driving down the supply of private lending and driving up the demand for government bonds.
More difficult for the private sector to grow, and cheaper financing for the government.
This results in lower returns on private investments and lower yields on government bonds.
The downward spiral tightens for those trying to establish retirement income and exacerbates the unemployment/low wage problem.