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How the Middle Class Became the Under Class

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posted on Feb, 16 2011 @ 10:45 AM

NEW YORK (CNNMoney) -- Are you better off than your parents?
Probably not if you're in the middle class.

Incomes for 90% of Americans have been stuck in neutral, and it's not just because of the Great Recession. Middle-class incomes have been stagnant for at least a generation, while the wealthiest tier has surged ahead at lighting speed.
In 1988, the income of an average American taxpayer was $33,400, adjusted for inflation. Fast forward 20 years, and not much had changed: The average income was still just $33,000 in 2008, according to IRS data.
Meanwhile, the richest 1% of Americans -- those making $380,000 or more -- have seen their incomes grow 33% over the last 20 years, leaving average Americans in the dust.

“We were all drinking the Kool-aid, Greenspan was tending bar, Bernanke and the academic establishment were supplying the liquor," Deutsche Bank managing director Ajay Kapur wrote in a research report in 2009.
But the story didn't end well. Eventually, it all came crashing down, resulting in the worst economic slump since the Great Depression.
With the unemployment rate still excessively high and the real estate market showing few signs of rebounding, the American middle class is still reeling from the effects of the Great Recession.
Meanwhile, as corporate profits come roaring back and the stock market charges ahead, the wealthiest people continue to eclipse their middle-class counterparts.
"I think it's a terrible dilemma, because what we're obviously heading toward is some kind of class warfare," Johnson said.

Perhaps we need a class war. Enough is enough. Certainly I'm not advocating a violent revolution, but calling for legislative innovations that will bring the middle class back into the game. We've been sitting on the sidelines being complacent and disgruntled observers for way too long.

Some of the other points made that have and are contributing to the continuing demise of the middle class are made below. We essentially know these things already, but in seeing them together here, might perhaps cause us to begin to think about what we can do to change things, one step at a time.

Globalization and International Competition; or the outsourcing of jobs. Strictly orchestrated for the cheaper production of goods. It helps developing countries, but hurts our own. It's a win-win for wealthy corporations, but a huge loss for middle-class Americans, who lose jobs and wages.

The Stock Market. While it helps the economy grow, the benefits are disproportionately reaped by the wealthiest.

Tax Cuts for the rich. Even our current President has jumped on this band wagon. A major win for rich corporations. Watch Obama extend Bush's tax cuts, while continue to target the poor and middle-class for designated cut-backs.

Decline of Unions and other labor protections. The erosion of collective bargaining explains why wages are not keeping up with inflation.
Is this decline due to on-going intimidation? Are people afraid to form and join unions due to fear their employers won't tolerate demands, and move their companies to another country, leaving them completely jobless?

Bank Deregulation
In the 1980's, there was a period of bank de-regulation put in place by a very wealthy President.
Ronald Reagan. Needless to say, they took this and went completely wild with it, to the point of criminalization.

Education Expenses. The gap is widening between what a college graduate earns, opposed to someone with a high school diploma. According to the study, People with a high school diploma previously earned 71% of what a college grad earned. Now it is only around 55%.

The wealthiest are experiencing a surge of wealth, while the poor become poorer, and the middle-class is simply stagnant.

Surely there is something we can do. This is after all our country, and we seem to have lost sight of that. The government is supposed to work for us, and they are not. Have we lost our spirit?

I honestly think we all want to change things.....we just don't know how.

posted on Feb, 16 2011 @ 10:54 AM
I think we (the middle class) have always been part of the underclass.

We just realize it now. Meaning we feel it.

posted on Feb, 16 2011 @ 11:00 AM
reply to post by butcherguy

Perhaps you are right. But if it is this way, I contend that it is because we are permitting it.
We are behaving like whipped dogs.

posted on Feb, 16 2011 @ 11:05 AM
While I agree with your premise, I have always hated the terms middle, upper, lower class. We allow ourseves to be shoe-horned into a subset of society. Then, when we allow ourselves to be categorized, we automatically agree to the standards and principles that are projected to that "class".

Personally, I stopped allowing myself to think in terms of "I can't do that, I'm not rich" or "I have to do this because I make X amount of money.

I have a small son who still thinks I'm a hero.
I have a beautiful wife who supports me.
I'm working on book #2. Book # 1 will be on in a couple of months in E form. At least, that what my agent says.
I work hard and am respected at my job.
I have friends who care about me and my family.

I'm already wealthy beyond words.

posted on Feb, 16 2011 @ 11:12 AM
reply to post by beezzer

Whether you like the terms or not, they are alive and well.

I personally am fine with my income also, and feel very lucky in many ways. But I'm not thinking about myself.

I'm thinking about our country and where all this is headed. Your children are very likely to have far less than you do.

It's complacency that is driving the middle class to poverty.

posted on Feb, 16 2011 @ 11:15 AM
Great list. Rising health insurance costs too, no cost of living raises, decreasing salaries, rising energy costs. So much went into it all. It was a systematic unraveling over three decades, and is pretty eerie when you see it mapped out.

At the same time as what you list, they attacked our psyche with both rumors of us being dumb and lazy and our bodies with fake food and also distracted us by convincing us we needed more toys and encouraging us to spend money we didn't have (I know that we played a part in this too...that's not the issue before anyone starts picking.)

This probably didn't help either: Middle Class--Not the Rich or the Poor--Pay Majority of Federal Taxes, Says CBO Data and with attitudes like this in the media and maybe half (or more) of Congress, how will we dig out?

The tax cuts for the rich being extended was the real (recent) icing on the cake. Many of the rich are even willing to pay more, and are laughing.

posted on Feb, 16 2011 @ 11:16 AM

Originally posted by ladyinwaiting
reply to post by beezzer

Whether you like the terms or not, they are alive and well.

I personally am fine with my income also, and feel very lucky in many ways. But I'm not thinking about myself.

I'm thinking about our country and where all this is headed. Your children are very likely to have far less than you do.

It's complacency that is driving the middle class to poverty.

True. If my children have less than I, it'll be my fault because I didn't prepare them. Complacency is a fault on both the parent and the child. Teach a work ethic, tell them the trut when they are old enough, and give them th tools they need to succeed.
This fight won't be won like a walk/march in downtown DC. It may take generations. But by preparing our children, we will become better armed for it.

posted on Feb, 16 2011 @ 11:19 AM
I just did my taxes. and those leeches sucked a good $14,000 out of me. I'm just a regular guy, i drive a Mazda....that's almost the cost of my car...and my next door neighbors are voting like morons to have the government take MORE from our checks....

I guess i should be more upset about being "middle" class, when i know plenty of people with just as nice of things that i work my @$$ off for, when all they do is collect government handouts. Which is just paid in taxes.

I bet the rich people paid about the same in taxes, finding different ways to weasel out of their debt.

posted on Feb, 16 2011 @ 11:22 AM
Much of that list and the other suggestions to be added can be synthesized to one word - profiteering. Who does that? The top one percent.

posted on Feb, 16 2011 @ 11:23 AM
reply to post by beezzer

You're right about generations. It will take some very tough measure involving both foreign and domestic policy, all the measure being fought tooth and nail by those who benefit from the dismantling of the middle class. And even if we were to start on the right path today, things would still get worse before they got better, before we regained our footing, started prioritizing our needs with different ideals in mind, made the drastic cuts and measures it's going to take, and then started building back up. Real change is hard and comes with a price. There's no magic wand anyone can wave to "fix" this.

posted on Feb, 16 2011 @ 11:36 AM
I just heard a financial expert on TV call the middle-class the FLAT-LINE Generation.

Think about it. If your children earn the same thing you do now, and it looks like they might since the middle class wages are stagnant, in twenty-five years they won't be able to afford much of anything, because inflation hasn't slowed down. They won't be able to make ends meet.

If we had no other choice, heck, I could accept it. But we do have a choice. We can change things. Again I assert that we have lost our American spirit, become lazy, and to make things worse, we don't know how to change things, and aren't even thinking about it.

We need to figure this out, even if it means sitting on the white house lawn for a few days to show we still have a voice and we are not afraid to use it. At least they would know that *we know*.

posted on Feb, 16 2011 @ 11:48 AM
reply to post by beezzer

Beezer, this is not you. I'm sure there is everything right about your parenting skills. This is bigger than us. We do have a way to prepare our children, and it is trying to get our government back under control, and recognize that 90% of it's citizens don't want to remain stagnant. We want to progress, keep up with inflation, and maintain our buying power and standard of living.

I don't know about you, but I don't think I would like impoverishment, when the company I buy my toothpaste and computer from has a house in every country in the world, and spends more on a yacht than the rest of us will earn in a lifetime. They are not better than us.

They are NOT better than us. It's got to stop somewhere, and the government obviously is not going to do anything about it.

I think collective bargaining with unions has stopped from fear and intimidation. The corporations will take their little red wagons to Korea, or somewhere else, and people are frightened by this. We have lost our voice.

posted on Feb, 16 2011 @ 11:59 AM

Originally posted by ladyinwaiting
reply to post by beezzer

We have lost our voice.

Then we need to speak louder, ma'am.

If I had a crystal ball (shaped like my favorite bottle of scotch) it'd tell me that we will WIN this fight.

And it is a fight. Our country, our future is at stake. We will find our voice because America isn't defined by it's politicians.

It's defined by its people.

posted on Feb, 16 2011 @ 12:11 PM
No one should be offended by use of the term "middle class". It's only a sociological and economical designation, essentially used for study.

Besides, at the rate we're going it will be an historical term, used only in history classes. That is, if the rich decide to continue to let us go to school.

Eighth grade teacher: "and there was a time when our country had *three* classes, instead of two like the rest of the world. It was called "the middle class". They made up the majority of the US population, until of course, we realized they weren't needed. They must have known this too, because they sure as hell didn't object when it was eradicated by the rich."

edit on 2/16/2011 by ladyinwaiting because: Future eighth grade teachers are naughty.

posted on Feb, 16 2011 @ 02:19 PM
reply to post by ladyinwaiting

We will have class warfare. Unfortunately because of the brainwashing people do not realize how we got here and who is primarily responsible.

This would not be occurring if we did not have government:

1. Imposing a criminal banking monopoly on us

2. Imposing a fiat currency on us.

3. Imposing outrageous regulations that make competing internationally near impossible

4. Imposing outrageous taxes that steal from the productive and give to the unproductive

5. Engaging in all manner of warfare and domestic make-work projects that destroy resources rather than allowing those resources to be used by the private sector for the production of real goods and services.

The bigger government gets, the more wealth disparity we will have.

edit on 16-2-2011 by mnemeth1 because: (no reason given)

posted on Feb, 16 2011 @ 05:20 PM
reply to post by mnemeth1

You are absolutely correct, sir.

If we screamed long enough about these issues, they would at least toss us a bone, don't you think?
We barely make a quiet whimper. It's either apathy, or our spirit is broken. We know these things, and yet continue to tolerate it.

What is happening to us? We are not the country we used to be, even back two or three decades ago.
The hippies at least knew how to be noisy, and organize. We don't even do that, and with the internet, we have better opportunities than they did.

Shame on us for not taking matters into our own hands, and ending this national greed and destruction.

posted on Feb, 16 2011 @ 05:37 PM
It's also interesting that we weren't "broke" when we were spending a billion dollars a month on wars.
And we weren't broke when we were giving tax cuts to the filthy rich.

But now we are so broke we having to put social programs, like Pell Grants, and other social services, on the "chopping block".

Ain't it a wonder.

I'm becoming disillusioned with the President. He's not negotiating well. He's giving in to values (greed) which have no place here, to keep the peace, and to find a middle ground to increase his chances of winning in 2012.
It may be a political strategy, but that doesn't mean it doesn't suck. That doesn't mean it's the right thing to do.

posted on Feb, 16 2011 @ 05:40 PM
reply to post by ladyinwaiting

I believe this might be called hypocrisy? Among other things. I find it hard to become disillusioned with a person when the entire system is what's broken. He's just trapped in that system as we all are.

posted on Feb, 16 2011 @ 06:04 PM
reply to post by ~Lucidity

My expectations were a little higher. I do consider recent actions at least partially strategic for the future election, but I don't expect diminishing values. That, I can't tolerate. He is caught in the same trap as we, and I expect there will have to be some concessions. But it's always the poor. It's not very imaginative. It's what the Republicans have always done, stuck in their little box, listening to their same little tunes. Frankly I expected a more lofty approach. More resistance to the same old demands.

posted on Feb, 16 2011 @ 06:59 PM
reply to post by ladyinwaiting

who would choose to play monopoly if the game was never started over?

the rich folks appetite for wealth growth grows until it bankrupts evryone else then they become richer!!

the elephant in the room keeps growing, its hunger never stopping no matter how much you feed it until all starve because of the greedy elephant

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