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Wednesday, September 14, 2011

"The rich get richer and the poorer get poorer"

So says the lyrics of a recent Stephen Marley song (son of the late, great Bob Marley).
Only now you could add ... "and the middle class get poorer."

Here is what we now have in the US:

* The economy is growing
* Corporations are making record profits

Yet, most of us are falling further and further behind. Why?

* During the past several decades, the gap between the rich and the poor has widened as most of the tax breaks go to those that are the very best off financially
* Corporations making record profits are not hiring because of "uncertainty" in the economy (their words)

Thus, unemployment remains high because tax cuts do not spur hiring. In other words, the "trickle down" does not trickle down.

So one of the dominant stories in the news media over the past day has been the new report from the US Census Bureau. For example, USA Today reports:

* Poverty at 15.1%; its highest level since 1993.
* A typical U.S. family got poorer during the past 10 years in the first decade-long income decline in at least a half-century, new federal data show.
* Median household income fell 2.3% to $49,445 last year and has dropped 7% since 2000 after adjusting for inflation.
* Income was the lowest since 1996.
* Poverty rose, too. The share of people living in poverty hit 15.1%, the highest level since 1993, and 2.6 million more people moved into poverty, the most since Census began keeping track in 1959.
* This was most felt by the poor and minorities.
* The poor, the young and minorities had the biggest income drops last year. Median income for black households fell 3.2% to $32,068, while non-Hispanic white income fell 1.3% to $54,620, a decline that wasn't statistically significant.
* The share of Americans without coverage rose to 16.3% in 2010 from 13.1% in 2000. Government is insuring more people; employers are insuring fewer.

The only group NOT to do worse?

*  People 65 and older were the only group to prosper during the decade. Household income rose 7.5% adjusted for inflation over the decade, helped by Social Security.

Get that last part? Social security helped save old people from slipping into poverty.

And according to the non-partisan Congressional Budget Office, the federal stimulus prevented another 2 million people from falling into poverty, largely through the millions of jobs it created.

This seems like solid gold evidence against the pinheads who stood on the stage the other night and claimed things like the stimulus did not create a single job and that social security is a ponzi scheme.

Hope you're paying attention.

Either way, you're getting poorer, and so am I.

Median household income by demographic group. Note that since 2000, the average income in the US has NOT increased.


  1. And don't expect any of that wealth to trickle down any time soon.

  2. Maybe the "Buffet Rule" will pass. Instituting the rule may act like a "pulling lever" and encourage the wealthy to open the dam, and let the money flow again.