Shrinking Middle Class?

[saveliberty]

U.S. Poverty and a Shrinking Middle Class, by the Numbers - Yahoo! News

According the an Associated Press article from December 15, recent census data shows a shrinking middle class, with nearly half of all Americans poor or low-income. Here is a look at this portion of the U.S. population, by the numbers.


97.3 million Americans fall into the low-income category. Low-income is described as those earning between 100 and 199 percent of the poverty level. 146.4 million Americans had incomes below the poverty line.


About $45,000 a year for a family of four is what is needed to stay above the low-income threshold. Many families are slipping below that number, the Associated Press reports, because of pay cuts, a forced reduction of work hours or a spouse losing a job.

Precisely my point. media uses a standard from years ago and then shows a supposedly shocking statistic that more Americans are poor or a shrinking middle class. What has happened is middle class is still there intact. Their standard of living has shrunk. Due to reduced housing values, job loss and the like. That is a reflection of the economy contracting, not an shrinking middle class. Oh, it sounds like it is someone else's fault when you say it that way. As I mentioned in the first post, no savings and homes worth less than that's owed is poor financial management on the part of the middle class.

 

[saveliberty]

I think the media and politicans have this all wrong. The middle class is not shrinking at all. We are all still here, just have less due to poor financial decisions. Many bought homes at too high a price and bailed out when they owed more than they were worth. The economic principle of putting 20% down has always been there. Middle class America ignored it and payed the price.

We all know saving money is important. Americans are not savers, so when the economy took a turn south, we paid again. What about debit? Are we really going to say that accumulating all that debt was anyone's fault but our own?

Nope, the middle class is still here. Just hopefully a lot wiser.

Not all of us did those stupid things.

True, but your comment is also true that they wre stupid things done by middle class Americans. Far different than having the rich hurt you.

 

[saveliberty]

Been away too long. Even with some rust I can kick lib ass.

 

[saveliberty]

It is called personal responsibility.

If you have been fiscally conservative, most likely your still okay and firmly in the middle class. Of course, many liberals wnat you to blame everyone else. Just spend your way out, the government uses that method.

 

[Dragon]

The reason the middle class has shrunk is simple, and no, it is not because Americans have become, for some unexplained reason, stupider than our grandparents.

In the postwar decades, many jobs existed which paid a middle class income. Any high school graduate willing to put in a full day's work could count on getting a job like that (well, as long as he was white and male -- in some ways it was far from idyllic). The reason why there was such a large middle class was because there were so many opportunities to attain that status. People did not become middle class by saving money; they became middle class by getting a well-paying job.

Today, we have returned to the pre-Depression situation in which the only people able to achieve a middle-class income are high-educated professionals (doctors, lawyers, accountants, and the like). It's not that it's literally IMPOSSIBLE to achieve middle-class status, but it has become much, much HARDER, and that means that much fewer people will get there.

Why did this happen? Because our government stopped supporting the middle class and went back to skewing the economy to benefit the rich.

 

[saveliberty]

What a laughable post Dragon. Middle class bought homes back then. How did they do that? It took 20% down to get a loan back then. That meant saving money. Who had a credit credit back then? No one.

 

[Dragon]

Savedliberty, you and I have not crossed paths before, so I'm going to take this moment to acquaint you with a practice of mine. I always snip, discard, and refuse to respond to any empty rhetoric, pointless personal insults, and the like. So if there is part of your post that doesn't appear in my quote and to which I don't respond, that's why.

Middle class bought homes back then. How did they do that? It took 20% down to get a loan back then. That meant saving money. Who had a credit credit back then? No one.

Actually that last isn't true at all. Credit card - Wikipedia, the free encyclopedia The first credit cards came out in the 1920s. The first modern credit cards (bank-issued and usable with multiple merchants on a revolving credit basis) were issued in 1958. So at the height of the American middle class, credit cards as we know them were certainly available.

But more to the point, buying a home was a result of a middle-class income, not a cause of it. Saving money was necessary; on a middle-class income it was also feasible. My father the machinist could buy a house; he could also buy two cars, send both his kids to college, and let my mom stay home unemployed (until she went stir-crazy and got a job anyway -- but that's another story). That's not because he was more responsible than people today (if anything he was less responsible -- but that's another story, too, and one I'll let stay buried with him). It was because he was paid more in constant dollars than most people earn today.

And that's really what the change is about: a decline in jobs that are available to most Americans that pay a middle-class income.

 

[hortysir]

Are you anticipating that anyone will waste the time it would take to explain the ways in which you have missed the mark with that post? I'd expect someone who has posted 14,000 times to have been involved in.........or at least read....several discussions that began in the same, lame way.

Try learning something while you are here.

If time on the board and post count = wisdom, your 2 months and <2k explains alot.

 

[hortysir]

Shrinking Middle Class?

And, FTR:

I was in the pool!!!

 

[saveliberty]

Savedliberty, you and I have not crossed paths before, so I'm going to take this moment to acquaint you with a practice of mine. I always snip, discard, and refuse to respond to any empty rhetoric, pointless personal insults, and the like. So if there is part of your post that doesn't appear in my quote and to which I don't respond, that's why.

Middle class bought homes back then. How did they do that? It took 20% down to get a loan back then. That meant saving money. Who had a credit credit back then? No one.

Actually that last isn't true at all. Credit card - Wikipedia, the free encyclopedia The first credit cards came out in the 1920s. The first modern credit cards (bank-issued and usable with multiple merchants on a revolving credit basis) were issued in 1958. So at the height of the American middle class, credit cards as we know them were certainly available.

But more to the point, buying a home was a result of a middle-class income, not a cause of it. Saving money was necessary; on a middle-class income it was also feasible. My father the machinist could buy a house; he could also buy two cars, send both his kids to college, and let my mom stay home unemployed (until she went stir-crazy and got a job anyway -- but that's another story). That's not because he was more responsible than people today (if anything he was less responsible -- but that's another story, too, and one I'll let stay buried with him). It was because he was paid more in constant dollars than most people earn today.

And that's really what the change is about: a decline in jobs that are available to most Americans that pay a middle-class income.

So for the first 10 years or so you admit there was little acces to credit cards. That is progress. You failed to remember that post WWII had a great deal of pent up demand which fueled those job's creation. It was an expanding economy that drove those wages. We are in an economic contraction which was made worse by government policy.

P.S. My policy is take no prisoners.

 

[Dragon]

So for the first 10 years or so you admit there was little acces to credit cards.

As that is both a fact and does nothing to support your argument, it's hardly an "admission."

You failed to remember that post WWII had a great deal of pent up demand which fueled those job's creation.

No, I haven't forgotten that. However, it's not the reason for the four decades of unprecedented prosperity that followed the war. It is perhaps the reason why we didn't slip back into depression as the government cut the military budget, and at least partially accounts for a year or two of that prosperity. But that's all.

It was an expanding economy that drove those wages. We are in an economic contraction which was made worse by government policy.

We are talking about 40 years of prosperity. We did not go for 40 years with no recessions. What we had was something that transcended the business cycle and made the business cycle work around a higher level. And while that higher level of performance certainly contributed to the strong middle class of the period, the other way around is even more true.

Introducing This Blog - NYTimes.com

Scroll down a ways to the chart that Krugman presents maybe halfway through this article. Note that the chart depicts how much of the national income, as a percentage, was taken by the richest 10 percent of the people at varying times through history from 1917 until 2002. You'll note that for the same period that we've been talking about, the richest 10 percent made about 32% of the national income, where in the pre-Depression economy it was between 40 and 45%, and the same is true now.

So it's not just that the economy was doing better, although that's true as well. It's also that the distribution of wealth was much less unequal. Wages were higher, and more of the nation's income was made by those who were not in the richest ten percent.

 

[saveliberty]

40 years of prosperity, yet you admit there were recessions. Pretty funny. It is precisely due to the government policies that this down turn is so bad. You think we are pre depression? That is ridiculous.

You are using blogs for facts? You're killing me. Funny stuff there Dragon.

 

[LoneLaugher]

Are you anticipating that anyone will waste the time it would take to explain the ways in which you have missed the mark with that post? I'd expect someone who has posted 14,000 times to have been involved in.........or at least read....several discussions that began in the same, lame way.

Try learning something while you are here.

If time on the board and post count = wisdom, your 2 months and <2k explains alot.

Do you think time on the board and post count = wisdom? Or, was that just another nutter failing to produce an interesting concept?

 

[editec]

Is the quality of life and the security of that life going up or down, folks?

THAT is the measure of the state of affairs.

The BIG LIE of denial isn't going to work, kids.

The truth of people's lives cannot be overcome with a load of nonsensical propaganda.

 

[DaGoose]

Are you anticipating that anyone will waste the time it would take to explain the ways in which you have missed the mark with that post? I'd expect someone who has posted 14,000 times to have been involved in.........or at least read....several discussions that began in the same, lame way.

Try learning something while you are here.

Speaking of learning...let's see how accomplished you are in that arena.

1. In actuality, the income of full time wage and salary workers increased between 1980 and 2004, and so did real income- either by 13% or 17%, depending on which price index is used in the calculation. Reynolds, “Income and Wealth,” p. 63.

a. If health and retirement benefits are included, as they should be, worker compensation rose by almost a third. And, even this is illusory, as it doesn’t include the “statistically invisible (not on taxes) returns inside IRA and 401(k) plans.” Reynolds, op. cit., p.64.

b. And, the way real income is computed tends to understate its growth (money income divided by some price index, to account for inflation), and government indexes are open to questions of accuracy. Many economists regard the CPI as inherently- even intentionally- an exaggeration of inflation. http://www.econport.org/content/handbook/Inflation/Price-Index/CPI.html

c. An example: while the price of automobiles is increasing, also increasing are the features, once defined as add-ons, or found only in luxury autos. Therefore, not all of the increase is simply inflation. And this is true of many if not most consumer products.

2. Shrinking? The broadest and most accurate measure of living standard is real per capita consumption. That measure soared by 74% from 1980 to 2004. U.S. Department of Commerce. Bureau of Economic Analysis

a. A study of table 7.1 would show that between 1973 and 2004, it doubled. And between 1929 and 2004, real per capita consumption by American workers increased five fold. The fastest growth periods were 1983-1990 and 1992-2004, known as the Reagan boom.

I'm pretty suspect of anything that refers to those timetables as a "Reagan Boom". Does that mean that all of our fantastic post war growth in the 50's and 60's was the FDR Boom?

And I found it interesting that they measured living standards by "consumption". That means spending. Bear in mind that credit cards became VERY popular and along with it credit card debt. People were buying things they could not afford. And if you're going to measure our Standard of Living by our spending then we must be living the highest standard in the history of the US.

Does that mean that we need to keep on spending?

 

[DaGoose]

40 years of prosperity, yet you admit there were recessions. Pretty funny. It is precisely due to the government policies that this down turn is so bad. You think we are pre depression? That is ridiculous.

You are using blogs for facts? You're killing me. Funny stuff there Dragon.

What Bush policies led to this downturn? Do we need to go back to Clinton's policies to turn it around?

 

[saveliberty]

Are you anticipating that anyone will waste the time it would take to explain the ways in which you have missed the mark with that post? I'd expect someone who has posted 14,000 times to have been involved in.........or at least read....several discussions that began in the same, lame way.

Try learning something while you are here.

If time on the board and post count = wisdom, your 2 months and <2k explains alot.

Do you think time on the board and post count = wisdom? Or, was that just another nutter failing to produce an interesting concept?

Hey is this lonelaugher anyone's chew toy? I know yesterday was a long time ago already, but this concept was yours goofball.

 

[LoneLaugher]

If time on the board and post count = wisdom, your 2 months and <2k explains alot.

Do you think time on the board and post count = wisdom? Or, was that just another nutter failing to produce an interesting concept?

Hey is this lonelaugher anyone's chew toy? I know yesterday was a long time ago already, but this concept was yours goofball.

I think you misunderstood something.......I offered no such concept.

 

[hortysir]

Are you anticipating that anyone will waste the time it would take to explain the ways in which you have missed the mark with that post? I'd expect someone who has posted 14,000 times to have been involved in.........or at least read....several discussions that began in the same, lame way.

Try learning something while you are here.

If time on the board and post count = wisdom, your 2 months and <2k explains alot.

Do you think time on the board and post count = wisdom? Or, was that just another nutter failing to produce an interesting concept?

Your premise. Not mine.

 

[saveliberty]

Are you anticipating that anyone will waste the time it would take to explain the ways in which you have missed the mark with that post? I'd expect someone who has posted 14,000 times to have been involved in.........or at least read....several discussions that began in the same, lame way.

Try learning something while you are here.

So this is short term memory loss or just poor communication skills?