A long, steep drop for Americans' standard of living

[High_Gravity]

A long, steep drop for Americans' standard of living

Not since at least 1960 has the US standard of living fallen so fast for so long. The average American has $1,315 less in annual disposable income now than at the onset of the Great Recession.

Think life is not as good as it used to be, at least in terms of your wallet? You'd be right about that. The standard of living for Americans has fallen longer and more steeply over the past three years than at any time since the US government began recording it five decades ago.

The average individual now has $1,315 less in disposable income than he or she did three years ago at the onset of the Great Recession – even though the recession ended, technically speaking, in mid-2009. That means less money to spend at the spa or the movies, less for vacations, new carpeting for the house, or dinner at a restaurant.

In short, it means a less vibrant economy, with more Americans spending primarily on necessities. The diminished standard of living, moreover, is squeezing the middle class, whose restlessness and discontent are evident in grass-roots movements such as the tea party and "Occupy Wall Street" and who may take out their frustrations on incumbent politicians in next year's election.

What has led to the most dramatic drop in the US standard of living since at least 1960? One factor is stagnant incomes: Real median income is down 9.8 percent since the start of the recession through this June, according to Sentier Research in Annapolis, Md., citing census bureau data. Another is falling net worth – think about the value of your home and, if you have one, your retirement portfolio. A third is rising consumer prices, with inflation eroding people's buying power by 3.25 percent since mid-2008.

"In a dynamic economy, one would expect Americans' disposable income to be growing, but it has flattened out at a low level," says economist Bob Brusca of Fact & Opinion Economics in New York.

To be sure, the recession has hit unevenly, with lower-skilled and less-educated Americans feeling the pinch the most, says Mark Zandi, chief economist for Moody's Economy.com based in West Chester, Pa. Many found their jobs gone for good as companies moved production offshore or bought equipment that replaced manpower.

"The pace of change has been incredibly rapid and incredibly tough on the less educated," says Mr. Zandi, who calls this period the most difficult for American households since the 1930s. "If you don't have the education and you don't have the right skills, then you are getting creamed."

Per capita disposal personal income – a key indicator of the standard of living – peaked in the spring of 2008, at $33,794 (measured as after-tax income). As of the second quarter of 2011, it was $32,479 – almost a 4 percent drop. If per capita disposable income had continued to grow at its normal pace, it would have been more than $34,000 a year by now.

The so-called misery index, another measure of economic well-being of American households, echoes the finding on the slipping standard of living. The index, a combination of the unemployment rate and inflation, is now at its highest point since 1983, when the US economy was recovering from a short recession and from the energy price spikes after the Iranian revolution.

A long, steep drop for Americans' standard of living - CSMonitor.com

 

[mskafka]

Yes. Now that I can no longer afford those gorgeous shoes at the top...my life is over!

Seriously, yeah, I feel it. Most of my money now goes toward food and gas. Considering letting go of the cell phone, cable, internet, etc.., because I would much rather be able to go hiking, climbing, or kayaking than be able to receive obscene jokes on my phone, while standing in line at the local Kroger.

It's going to come down to necessities and priorities.

Great article.

 

[High_Gravity]

Yes. Now that I can no longer afford those gorgeous shoes at the top...my life is over!

Seriously, yeah, I feel it. Most of my money now goes toward food and gas. Considering letting go of the cell phone, cable, internet, etc.., because I would much rather be able to go hiking, climbing, or kayaking than be able to receive obscene jokes on my phone, while standing in line at the local Kroger.

It's going to come down to necessities and priorities.

Great article.

I think for most people thats how it is now, after you pay for the rent/mortage, bills, food etc there is barely anything left over for the little extras, barely anyone takes vacations anymore except the rich and upper class, we are barely staying afloat.

 

[California Girl]

This is the wealth redistribution, folks. What Obama's masters want... the USA to crumble for the good of the rest of the world.

Thanks Obama.

 

[Ropey]

A long, steep drop for Americans' standard of living

Not since at least 1960 has the US standard of living fallen so fast for so long. The average American has $1,315 less in annual disposable income now than at the onset of the Great Recession.

Think life is not as good as it used to be, at least in terms of your wallet? You'd be right about that. The standard of living for Americans has fallen longer and more steeply over the past three years than at any time since the US government began recording it five decades ago.

The average individual now has $1,315 less in disposable income than he or she did three years ago at the onset of the Great Recession – even though the recession ended, technically speaking, in mid-2009. That means less money to spend at the spa or the movies, less for vacations, new carpeting for the house, or dinner at a restaurant.

In short, it means a less vibrant economy, with more Americans spending primarily on necessities. The diminished standard of living, moreover, is squeezing the middle class, whose restlessness and discontent are evident in grass-roots movements such as the tea party and "Occupy Wall Street" and who may take out their frustrations on incumbent politicians in next year's election.

What has led to the most dramatic drop in the US standard of living since at least 1960? One factor is stagnant incomes: Real median income is down 9.8 percent since the start of the recession through this June, according to Sentier Research in Annapolis, Md., citing census bureau data. Another is falling net worth – think about the value of your home and, if you have one, your retirement portfolio. A third is rising consumer prices, with inflation eroding people's buying power by 3.25 percent since mid-2008.

"In a dynamic economy, one would expect Americans' disposable income to be growing, but it has flattened out at a low level," says economist Bob Brusca of Fact & Opinion Economics in New York.

To be sure, the recession has hit unevenly, with lower-skilled and less-educated Americans feeling the pinch the most, says Mark Zandi, chief economist for Moody's Economy.com based in West Chester, Pa. Many found their jobs gone for good as companies moved production offshore or bought equipment that replaced manpower.

"The pace of change has been incredibly rapid and incredibly tough on the less educated," says Mr. Zandi, who calls this period the most difficult for American households since the 1930s. "If you don't have the education and you don't have the right skills, then you are getting creamed."

Per capita disposal personal income – a key indicator of the standard of living – peaked in the spring of 2008, at $33,794 (measured as after-tax income). As of the second quarter of 2011, it was $32,479 – almost a 4 percent drop. If per capita disposable income had continued to grow at its normal pace, it would have been more than $34,000 a year by now.

The so-called misery index, another measure of economic well-being of American households, echoes the finding on the slipping standard of living. The index, a combination of the unemployment rate and inflation, is now at its highest point since 1983, when the US economy was recovering from a short recession and from the energy price spikes after the Iranian revolution.

A long, steep drop for Americans' standard of living - CSMonitor.com

It's tough when one can not buy the shoes in every color possible eh? Now they want the shoes given to them?

Nuh Uh....

Back to Europe with that view...

 

[mskafka]

This is the wealth redistribution, folks. What Obama's masters want... the USA to crumble for the good of the rest of the world.

Thanks Obama.

Uhm...I would entirely believe that, IF all of this started in the last 3 years. I believe that we're now feeling the effects of multiple things. One of which is NAFTA. Instead of competing with 330 million people (US population estimate), we're now competing with 7 billion people (world population estimate); in the form of a global economy.

Has Obama done amazing things? No. Did he cause all of this in my opinion? Absolutely not.

NAFTA-crafted under Bush Sr., and signed into law under Clinton. This goes WAY beyond simple partisanship. It would be nice if that were the only element.

 

[High_Gravity]

A long, steep drop for Americans' standard of living

Not since at least 1960 has the US standard of living fallen so fast for so long. The average American has $1,315 less in annual disposable income now than at the onset of the Great Recession.

Think life is not as good as it used to be, at least in terms of your wallet? You'd be right about that. The standard of living for Americans has fallen longer and more steeply over the past three years than at any time since the US government began recording it five decades ago.

The average individual now has $1,315 less in disposable income than he or she did three years ago at the onset of the Great Recession – even though the recession ended, technically speaking, in mid-2009. That means less money to spend at the spa or the movies, less for vacations, new carpeting for the house, or dinner at a restaurant.

In short, it means a less vibrant economy, with more Americans spending primarily on necessities. The diminished standard of living, moreover, is squeezing the middle class, whose restlessness and discontent are evident in grass-roots movements such as the tea party and "Occupy Wall Street" and who may take out their frustrations on incumbent politicians in next year's election.

What has led to the most dramatic drop in the US standard of living since at least 1960? One factor is stagnant incomes: Real median income is down 9.8 percent since the start of the recession through this June, according to Sentier Research in Annapolis, Md., citing census bureau data. Another is falling net worth – think about the value of your home and, if you have one, your retirement portfolio. A third is rising consumer prices, with inflation eroding people's buying power by 3.25 percent since mid-2008.

"In a dynamic economy, one would expect Americans' disposable income to be growing, but it has flattened out at a low level," says economist Bob Brusca of Fact & Opinion Economics in New York.

To be sure, the recession has hit unevenly, with lower-skilled and less-educated Americans feeling the pinch the most, says Mark Zandi, chief economist for Moody's Economy.com based in West Chester, Pa. Many found their jobs gone for good as companies moved production offshore or bought equipment that replaced manpower.

"The pace of change has been incredibly rapid and incredibly tough on the less educated," says Mr. Zandi, who calls this period the most difficult for American households since the 1930s. "If you don't have the education and you don't have the right skills, then you are getting creamed."

Per capita disposal personal income – a key indicator of the standard of living – peaked in the spring of 2008, at $33,794 (measured as after-tax income). As of the second quarter of 2011, it was $32,479 – almost a 4 percent drop. If per capita disposable income had continued to grow at its normal pace, it would have been more than $34,000 a year by now.

The so-called misery index, another measure of economic well-being of American households, echoes the finding on the slipping standard of living. The index, a combination of the unemployment rate and inflation, is now at its highest point since 1983, when the US economy was recovering from a short recession and from the energy price spikes after the Iranian revolution.

A long, steep drop for Americans' standard of living - CSMonitor.com

It's tough when one can not buy the shoes in every color possible eh? Now they want the shoes given to them?

Nuh Uh....

Back to Europe with that view...

I want my Air Jordans in every color in the rainbow damn it.

 

[mskafka]

Okay, explain to me what Europe has to do with entitlements? Are you speaking of France's mandatory vacation time? When Yugoslavia, Czechoslovakia (were one country, and socialist)? The old East Germany? USSR?

We fear their way of life? I just want to make sure that I fully understand this.

 

[High_Gravity]

Okay, explain to me what Europe has to do with entitlements? Are you speaking of France's mandatory vacation time? When Yugoslavia, Czechoslovakia (were one country, and socialist)? The old East Germany? USSR?

We fear their way of life? I just want to make sure that I fully understand this.

Europe has a way more generous welfare and entitlement systme from what I heard, supposedly in England you can sit on your ass and get a house, money, food and college tuition paid for, anyone please feel free to chip in if I am off base here.

 

[Article 15]

This is the wealth redistribution, folks. What Obama's masters want... the USA to crumble for the good of the rest of the world.

Thanks Obama.

lol

Idiot.

 

[California Girl]

A long, steep drop for Americans' standard of living

Not since at least 1960 has the US standard of living fallen so fast for so long. The average American has $1,315 less in annual disposable income now than at the onset of the Great Recession.

Think life is not as good as it used to be, at least in terms of your wallet? You'd be right about that. The standard of living for Americans has fallen longer and more steeply over the past three years than at any time since the US government began recording it five decades ago.

The average individual now has $1,315 less in disposable income than he or she did three years ago at the onset of the Great Recession – even though the recession ended, technically speaking, in mid-2009. That means less money to spend at the spa or the movies, less for vacations, new carpeting for the house, or dinner at a restaurant.

In short, it means a less vibrant economy, with more Americans spending primarily on necessities. The diminished standard of living, moreover, is squeezing the middle class, whose restlessness and discontent are evident in grass-roots movements such as the tea party and "Occupy Wall Street" and who may take out their frustrations on incumbent politicians in next year's election.

What has led to the most dramatic drop in the US standard of living since at least 1960? One factor is stagnant incomes: Real median income is down 9.8 percent since the start of the recession through this June, according to Sentier Research in Annapolis, Md., citing census bureau data. Another is falling net worth – think about the value of your home and, if you have one, your retirement portfolio. A third is rising consumer prices, with inflation eroding people's buying power by 3.25 percent since mid-2008.

"In a dynamic economy, one would expect Americans' disposable income to be growing, but it has flattened out at a low level," says economist Bob Brusca of Fact & Opinion Economics in New York.

To be sure, the recession has hit unevenly, with lower-skilled and less-educated Americans feeling the pinch the most, says Mark Zandi, chief economist for Moody's Economy.com based in West Chester, Pa. Many found their jobs gone for good as companies moved production offshore or bought equipment that replaced manpower.

"The pace of change has been incredibly rapid and incredibly tough on the less educated," says Mr. Zandi, who calls this period the most difficult for American households since the 1930s. "If you don't have the education and you don't have the right skills, then you are getting creamed."

Per capita disposal personal income – a key indicator of the standard of living – peaked in the spring of 2008, at $33,794 (measured as after-tax income). As of the second quarter of 2011, it was $32,479 – almost a 4 percent drop. If per capita disposable income had continued to grow at its normal pace, it would have been more than $34,000 a year by now.

The so-called misery index, another measure of economic well-being of American households, echoes the finding on the slipping standard of living. The index, a combination of the unemployment rate and inflation, is now at its highest point since 1983, when the US economy was recovering from a short recession and from the energy price spikes after the Iranian revolution.

A long, steep drop for Americans' standard of living - CSMonitor.com

It's tough when one can not buy the shoes in every color possible eh? Now they want the shoes given to them?

Nuh Uh....

Back to Europe with that view...

You need to look further than our nation's borders. This has jack shit to do with a short term blip economically. This is a step towards a global redistribution of wealth.

 

[mskafka]

A long, steep drop for Americans' standard of living

A long, steep drop for Americans' standard of living - CSMonitor.com

It's tough when one can not buy the shoes in every color possible eh? Now they want the shoes given to them?

Nuh Uh....

Back to Europe with that view...

You need to look further than our nation's borders. This has jack shit to do with a short term blip economically. This is a step towards a global redistribution of wealth.

There are many theories, hypotheses, and conspiracies on the methods of the global redistribution of wealth. Googling is making my head spin. Whose theory are you referencing?

 

[Dont Taz Me Bro]

America is in decline because our government for decades has refused to make the responsible choices they need to make. Of course, they've dodged this responsibility because the American people themselves have refused to adapt to a changing world. Our energy policies, labor policies, education system, environmental policies, regulatory environment, welfare policies, and tax policies have all contributed to this.

 

[mskafka]

America is in decline because our government for decades has refused to make the responsible choices they need to make. Of course, they've dodged this responsibility because the American people themselves have refused to adapt to a changing world. Our energy policies, labor policies, education system, environmental policies, regulatory environment, welfare policies, and tax policies have all contributed to this.

Yes, we have become complacent in many areas. Education, yes, it's a problem. We have a 99 percent literacy rate (100 is preferable, but 99 is much better than many), but I'll have to look at the basic math comprehension rate. Something tells me that this is much lower. One suspects this when one works with some adults who cannot round decimels. (Yes, I've really seen this...in healthcare no less).

It all depends on whom you listen to, and what you choose to believe. Some say that jobs are being shipped overseas because of the massive tax rates. Yes and no. Some have relayed that it's the education level and work ethic of some foreigners. Some countries, yes. It's probably a little bit of both.

Well-intentioned people (and I believed it in the beginning) say that we need to stop giving tax breaks to people who ship American jobs overseas. It's just not that simple.

It's good to be spirited. But saying you're the best, doesn't mean that you are. If we're going to be where we once were, we're going to have to work at it. And we're going to have to stop blaming others.

 

[expat_panama]

...The average American has $1,315 less in annual disposable income now than at the onset of the Great Recession...

Well, sort of. These are the numbers the wonk is talking about:

FRED Graph Observations
Federal Reserve Economic Data
Link: Federal Reserve Economic Data - FRED - St. Louis Fed
Help: Help and FAQs - FRED - St. Louis Fed
Economic Research Division
Federal Reserve Bank of St. Louis

2007-01 $32,651 ___ 2008-01 $33,140 ___ 2009-01 $32,785 ___ 2010-01 $32,057 ___ 2011-01 $32,666
2007-02 $32,683 ___ 2008-02 $33,220 ___ 2009-02 $32,365 ___ 2010-02 $32,084 ___ 2011-02 $32,678
2007-03 $32,730 ___ 2008-03 $33,248 ___ 2009-03 $32,251 ___ 2010-03 $32,157 ___ 2011-03 $32,668
2007-04 $32,710 ___ 2008-04 $33,054 ___ 2009-04 $32,348 ___ 2010-04 $32,345 ___ 2011-04 $32,648
2007-05 $32,663 ___ 2008-05 $34,609 ___ 2009-05 $32,768 ___ 2010-05 $32,508 ___ 2011-05 $32,636
2007-06 $32,608 ___ 2008-06 $33,716 ___ 2009-06 $32,155 ___ 2010-06 $32,568 ___ 2011-06 $32,700
2007-07 $32,656 ___ 2008-07 $33,163 ___ 2009-07 $31,980 ___ 2010-07 $32,563 ___ 2011-07 $32,598
2007-08 $32,675 ___ 2008-08 $32,867 ___ 2009-08 $31,868 ___ 2010-08 $32,628 ___ 2011-08 $32,479
2007-09 $32,779 ___ 2008-09 $32,802 ___ 2009-09 $31,854 ___ 2010-09 $32,552
2007-10 $32,778 ___ 2008-10 $32,820 ___ 2009-10 $31,680 ___ 2010-10 $32,620
2007-11 $32,748 ___ 2008-11 $32,964 ___ 2009-11 $31,750 ___ 2010-11 $32,604
2007-12 $32,877 ___ 2008-12 $32,763 ___ 2009-12 $31,916 ___ 2010-12 $32,660

Percapita disposable income is America's total private income divided by the entire population. We can truthfully say that average income dropped $1,315 ($32,479 from $33,794?), and we can also say that right now the average family of four has an income of $129,916.

Hmmm, we can also say that since Obama took office that the average income for a family of four has increased $912.

OK class, what's wrong with this whole line of thinking?

 

[Mr Natural]

American workers competing with cheap foreign labor will have a definite effect on our overall standard of living.

And not in a positive way.

 

[mskafka]

American workers competing with cheap foreign labor will have a definite effect on our overall standard of living.

And not in a positive way.

Yes it has, and yes it will. How do we stop it?

If entrepreneurship was my gift, I'd be all over it. But I'm no entrepreneur.

 

[PoliticalChic]

...The average American has $1,315 less in annual disposable income now than at the onset of the Great Recession...

Well, sort of. These are the numbers the wonk is talking about:

FRED Graph Observations
Federal Reserve Economic Data
Link: Federal Reserve Economic Data - FRED - St. Louis Fed
Help: Help and FAQs - FRED - St. Louis Fed
Economic Research Division
Federal Reserve Bank of St. Louis

2007-01 $32,651 ___ 2008-01 $33,140 ___ 2009-01 $32,785 ___ 2010-01 $32,057 ___ 2011-01 $32,666
2007-02 $32,683 ___ 2008-02 $33,220 ___ 2009-02 $32,365 ___ 2010-02 $32,084 ___ 2011-02 $32,678
2007-03 $32,730 ___ 2008-03 $33,248 ___ 2009-03 $32,251 ___ 2010-03 $32,157 ___ 2011-03 $32,668
2007-04 $32,710 ___ 2008-04 $33,054 ___ 2009-04 $32,348 ___ 2010-04 $32,345 ___ 2011-04 $32,648
2007-05 $32,663 ___ 2008-05 $34,609 ___ 2009-05 $32,768 ___ 2010-05 $32,508 ___ 2011-05 $32,636
2007-06 $32,608 ___ 2008-06 $33,716 ___ 2009-06 $32,155 ___ 2010-06 $32,568 ___ 2011-06 $32,700
2007-07 $32,656 ___ 2008-07 $33,163 ___ 2009-07 $31,980 ___ 2010-07 $32,563 ___ 2011-07 $32,598
2007-08 $32,675 ___ 2008-08 $32,867 ___ 2009-08 $31,868 ___ 2010-08 $32,628 ___ 2011-08 $32,479
2007-09 $32,779 ___ 2008-09 $32,802 ___ 2009-09 $31,854 ___ 2010-09 $32,552
2007-10 $32,778 ___ 2008-10 $32,820 ___ 2009-10 $31,680 ___ 2010-10 $32,620
2007-11 $32,748 ___ 2008-11 $32,964 ___ 2009-11 $31,750 ___ 2010-11 $32,604
2007-12 $32,877 ___ 2008-12 $32,763 ___ 2009-12 $31,916 ___ 2010-12 $32,660

Percapita disposable income is America's total private income divided by the entire population. We can truthfully say that average income dropped $1,315 ($32,479 from $33,794?), and we can also say that right now the average family of four has an income of $129,916.

Hmmm, we can also say that since Obama took office that the average income for a family of four has increased $912.

OK class, what's wrong with this whole line of thinking?

I like your data....nice work.


Ya' thinkin' that CSMonitor has an agenda?

Next.....is it aimed at suggesting that Obama did a terrible job as steward of the economy....
...or Bush did it?



Christian Science Monitor (liberal)
http://library.lakelandcc.edu/PDFs/research/bias.pdf

 

[PoliticalChic]

America is in decline because our government for decades has refused to make the responsible choices they need to make. Of course, they've dodged this responsibility because the American people themselves have refused to adapt to a changing world. Our energy policies, labor policies, education system, environmental policies, regulatory environment, welfare policies, and tax policies have all contributed to this.

1. An interesting historical anomaly is the period 1945 through 1965, a golden age in many ways. This was the period after the war, when any of our potential competitors were rebuilding from the devastation, making it impossible for the United States economy not to thrive. Beneficiaries included the unions and blue collar high school graduates…who were assured of high paying jobs. That is no longer true, and probably won’t be again, short of a third World War.
H.W. Brands ,“American Colossus: The Triumph of American Capitalism, 1865-1900.”

2. That being said, standard of living is a function of two factors: amount of education one has, and the amount of work one is willing to do.

Do you know the the unemployment rate for college educated?


"However, if one examines the August BLS jobs report closely, one finds something interesting -- the unemployment rate for college graduates (that is, those holding at least a Bachelor’s degree) is only 4.3 percent. Moreover, this figure has slowly declined from 5.0 percent in August 2010.

Or, to put it another way, more than 95 percent of college graduates in the Unites States are working – in the aftermath of one of the worst recessions in living memory."
Institute for Economic Competitiveness | Despite Unemployment Worries, 95% of U.S. College Grads Have Jobs

For September, 2011, it is down to 4.2.


So, in the words of that great intellectual, Flavor Flav, 'Don't Believe the Hype."

 

[Old Rocks]

There has been vast wealth redistribution in this nation. From the working poor and middle class to the very wealthy. That is what OWS movement is all about. So, we will see what happens in 2012.

Do we get a President that will enable all of the 'Conservatives' to cheer every time an unemployed citizen dies because of lack of health care? To cheer everytime someone states that the loss of a job due to a factory shutting down and move offshore is the workers fault. Someone that creates laws that require women and girls to carry to term the children of rape and incest? What a wonderful world you 'Conservatives' are preparing for us.