The Fall of Middle Class America

2016 March 21
by bc3b

America’s middle class is shrinking. There are a number of reasons: the recession of 2008 and the housing crash, wage stagnation, outsourcing of jobs and importation of foreign, low-cost labor, etc. Perhaps nothing has been as devastating – not by itself, but as a trigger for other things – as the lack of representation in government. The Democrats represent the lower class and special interests. The Republicans represent the US Chamber of Commerce and big business. Middle class Americans are unrepresented.

That’s why Donald Trump is so popular with middle class Americans (aka knuckle-dragging white racisssts). Other than Trump, who is addressing the concerns of middle class America? Not Hillary Clinton … not Bernie Sanders … not John Kasich … not Ted Cruz.

Let’s take a closer look at what’s happening to the American middle class.

Downward mobility is catching on fast with America’s new economic underdogs — the emerging middle-class minority.

The ranks of the American middle class have sunk to a shocking new low.

After four decades as an economic majority, middle-class Americans are no longer in that admirable place. They’re down to 49.9 percent from 61 percent of the population in 1971, with the ranks of the poor and ultrarich growing to a majority in the US.

“The fabric of income distribution is stretching thin,” Rakesh Kochhar, lead author of the recent Pew Research Center study “The American Middle Class Is Losing Ground,” told The Post.

“There’s been a hollowing out in the middle, a bulking up on the edges. The gaps are at record highs,” Kochhar said, adding that the wealth of upper-income families is now about seven times that of the middle class, compared with three times about 30 years ago.

Meanwhile, the middle-class share of US household income has plunged from 62 percent in 1970 to 43 percent today.

And for lower-income families looking to move up to middle-class status, that accomplishment is getting harder to pull off, according to new analysis.

Analysts offer no single explanation for the decline of America’s middle class.

Years of wage stagnation, the decline of unions, a skills gap, economic malaise, taxation, debt and policymaking are often cited, as is technological efficiency in a more globalized economy that rewards outsourcing. Some analysts say the Fed’s trillions of dollars in quantitative easing ended up disproportionately in the hands and wallets of bankers and other upper-middle-class Americans.

This group sopped up extra millions in commissions, fees and bonuses, improving their status, at the expense of Main Street.

Meanwhile, partly because of the Great Recession and the housing market disaster, the middle class saw its median wealth (assets minus debts) drop by 28 percent from 2001 to 2013.

Statistically, middle-class Americans now number about 121 million.

Read more:

Hat tip: New York Post

23 Responses leave one →
  1. 2016 March 21 12:05 pm
    [1]
    bc3b permalink

    While Ted Cruz cloaks himself in “constitutional conservatism,” Donald Trump has been speaking out on issues that middle class Americans are truly interested in: immigration, outsourcing jobs, insourcing cheap foreign labor, trade, not getting involved in military actions that are not in the national interest, security, radical Islam, etc.

    We have gone from nationalistic business leaders during WWII to self-absorbed billionaires like Bill Gates and Mark Zuckerberg, who are only interested in making their next billion, not in the United States or what’s best for Americans. If a war broke out between the US and China, Gates and Zuckerberg would be backing China if they thought it wouldmprofit them.

    Trump is not especially conservative, but he is giving a voice to tens of millions of middle class Americans who have been shut out for 30+ years.

  2. 2016 March 21 1:00 pm
    [2]
    bc3b permalink

    mpt:

    Artificially low interest rates are what has propelled the stock market to record levels and kept the Obama economy from going completely into the toilet. At some time, we are gonna end up paying the price,

  3. 2016 March 21 1:27 pm
    [3]
    drdog09 permalink

    3,

    To put a finer point on it:

    ZIRP –> Corporate Stock Buybacks –> Rising Stock prices. But zero increase in fundamental EBIT value.

    ZIRP has also decimated the money market industry. When a Corp can get a near 0% loan direct from one of the TBTF’s why deal with somebody offering 1.5% above prime?

    However there will be hell to pay. Many of these loans are collateralized on the basis of the stock market value at the buy back price. When the market values drop, and they will, banks will be calling for additional backup. For which the Corps will be hard pressed to provide the collateral to do so. That affects the bank pricing as they now have an under collateralized loan. Technically the Corp is not in default so long as they pay the loan. Unless of course they were stupid with the contract terms.

  4. 2016 March 21 3:05 pm
    [4]
    gnqanq permalink

    Took the wife to the doctor today, nothing serious. While waiting for the doctor I was reading an article in a auto magazine. Pertaining to driverless vehicles, the most interesting part was that they project that within 20 years over half the jobs could be gone.

    Now, given automation with robotics plus AI we are going to need less and less workers. Why in the hell are we importing more people for less and less jobs? I just don’t think this is going to end well.

  5. 2016 March 21 3:17 pm
    [5]
    drdog09 permalink

    Final Gawker tally — $140m!

  6. 2016 March 21 3:31 pm
    [6]
    justrand permalink

    Gnqanq: “Now, given automation with robotics plus AI we are going to need less and less workers. Why in the hell are we importing more people for less and less jobs? I just don’t think this is going to end well”

    Gee, ya think? 🙂

    It’s almost like the ruling “Elite” don’t WANT it to end well.

  7. 2016 March 21 3:36 pm
    [7]
    drdog09 permalink

    Now, given automation with robotics plus AI we are going to need less and less workers. Why in the hell are we importing more people for less and less jobs? I just don’t think this is going to end well.
    ———————————

    Remember the ole mechanic joke punchline — “Pull off the radiator and drive a new car under it.”

    Well that is what the Pols are trying on us. They can’t remove the current population but they can certainly dilute it with a bunch of illegal know nothing electorate.

  8. 2016 March 21 3:48 pm
    [8]
    bc3b permalink

    JR –

    It looks like the winner of the Syracuse (#10 seed) and Gonzaga (#11 seed) is the team you should be rooting for. It’s a shame they are playing each other and one has to lose.

  9. 2016 March 21 5:02 pm
    [9]

    Yes #10, this has been so much more fun than I ever would have thought it could be……from the time Donald came on the scene and labelled Jeb ‘low energy’ and immediately destroyed the establishments favorite son……what a debt we owe him already.

    BTW if you have 15 minutes or so it’s worth listening to Trumps AIPAC speech….so refreshing to hear a speech like that from a non politician….he even went after the corrupt UN.

    https://www.youtube.com/watch?v=wfpS9iFVUhE

  10. 2016 March 21 5:59 pm
    [10]
    drdog09 permalink

    10,11,

    I have a word of advise for Trump on the emailgate affair — “Let Justice be done as Americans expect it.” — then step back and not say another word. If asked about it, say “no comment”.

    Why? The whole thing, DoJ, POTUS, SoS, Clinton, NSA, et. al. is all a Democratic Mexican firing squad for emailgate. Fact the only guy that can benefit out of it is Sanders and that ain’t a bad thing. The dirt is all going to be flung within the DNC and it operatives. Like monkeys throwing scat but they are throwing it at each other.

    There is not a single verb or adjective that can be added by the GOP on the affair. Fact I am sure the Dims are just waiting for an opening to drag the GOP into it. Don’t fall for it. Stand back and let it land where it belongs.

  11. 2016 March 21 6:38 pm
    [11]
    justrand permalink

    Splendid advice, drdog…I hope Trump gets it! 🙂

  12. 2016 March 21 7:25 pm
    [12]
    mulletover permalink

    Dr dog for Trump Campaign Spokesman.

  13. 2016 March 21 7:43 pm
    [14]

    watching aipac speech now, omg finally a teleprompter (good he’ll need that practice for the future even if he hates using it).

  14. 2016 March 21 7:48 pm
    [15]

    Told you guys this weeks ago.. that cruz tried this after SC\NV results, but more confirmation that not only did he try he’s still trying.

    http://www.politico.com/story/2016/03/exclusive-marco-rubio-rejected-unity-ticket-with-ted-cruz-221066

  15. 2016 March 21 8:06 pm
    [16]
    drdog09 permalink

    18,

    Why? Unless Rubio thinks his paltry number of delegates still gives him some trading power. Every primary that increases the spread between him and Trump-Cruz decreases their importance. GOP really is the stupid party. Dang baffling.

  16. 2016 March 21 8:09 pm
    [17]
    mulletover permalink

    #19. Trump derangement syndrome will do that.

  17. 2016 March 21 8:24 pm
    [18]

    Intel’s Former CEO (and First Hire) Andy Grove Dead at 79

  18. 2016 March 22 4:37 am
    [19]
    drdog09 permalink

    Putting together a Woodpile Report without every other link and essay being about Donald Trump is a problem. By my count, 200 out of every 100 articles on the internet mention Trump at least once. Here’s my methodology: read one random essay and extrapolate the rest. C’mon, everyone knows. For relief, it’s come to reading direct translations from Sumerian cuneiform, or recipes from the frontier days of Nebraska, or an analysis of hoe-handle production in Bangladesh. But I’ll make one observation and then let it go.

    The Democrat-Republican political enterprise appears to believe if it can stop Trump its troubles will be over. No no. Trump was as surprised as DC at the depth and breadth of it all. He says so himself, repeatedly. He’s the rider, not the horse. There will be others. As for DC, it fell into a panic when the Praetorian Guard failed to notice the barbarian hordes until they were holding tailgate parties just outside the gates. What else is going unnoticed? Are there more of these arrogant upstarts in the mysterious lands beyond Georgetown and Fairfax, they wonder. As ol’ Chasmatic puts it, I woulda told ’em, but they didn’t ask. On to other stuff.

    — woodpile report

  19. 2016 March 22 4:53 am
    [20]
    drdog09 permalink

  20. 2016 March 22 5:13 am
    [21]
    drdog09 permalink

  21. 2016 March 22 6:39 am
    [22]
    justrand permalink

    Yesterday the dictator (Raul Castro) of an oppressive Communist regime (Cuba) criticized the United States directly in front of Obama. Castro touted the wonderful life that Cubans have (their healthcare, education, etc).

    REALLY? Is THAT why Cubans flee Cuba in tiny “boats”, risking their lives to come HERE, when everything is so wonderful THERE? HUNDREDS of “dissidents” (anyone who dares to disagree with Castro is a “dissident”) were jailed just prior to Obama showing up…and he has said NOTHING about this.

    Did Obama even TRY to defend America? Are you kidding? Here is his response:

    “I personally would not disagree with him” .

    Meanwhile, at least 34 people were murdered in Belgium today, by ISLAMIC terrorists…and hundreds more in critical condition. It’s early in Cuba…so Obama hasn’t gotten around to blaming America…yet.

  22. 2016 March 22 8:14 am
    [23]

    22 – It’s one of various reasons I stopped going by there entirely in recent weeks.

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