Third Party & Independents Archives

From Economic Apartheid to Political Revolution

Americans have always accepted a certain level of economic inequality as the inevitable consequence of an open capitalist society where some people through their own efforts do better than others. The presumption is that there is fairness in the marketplace and economic system. What a quaint, outdated belief.

Do most Americans really believe that the game is not rigged by rich powerful elites to preferentially benefit them? As certain as the law of gravity, the game IS rigged, and more than ever.

We have a plutocratic corporate state that now has taken economic inequality to new levels – in fact to what now is a sick and shameful condition of economic apartheid. To a society that increasingly separates Americans into two classes: the wealthy Upper Class and the Lower Class. The Upper Class has protected and gated mansions, private vacation spots and spas, special access shopping venues, private schools, lavish entertainment options, luxurious hospital accommodations, and private jets and stretch limos. The Upper Class does everything possible to PHYSICALLY separate itself from the poor, repugnant and uncouth members of the Lower Class. This physical separation is the hallmark of economic apartheid. The only contact the wealthy have and want with Lower Class people is when the latter serve, protect and pamper them. And of course they expect the hugely larger Lower Class to keep spending and borrowing their way into economic despair and to keep sustaining the two-party mafia. Voting for Democrats and Republicans is as meaningful as voting for American Idol contestants. Nothing more than a self-destructive distraction.

In Las Vegas the truly rich have their private gambling rooms and clubs, and occupy special access suites. In sports stadiums they luxuriate in their glass boxes high above the masses. In the Pacific and Caribbean they have their private island hideaways. On the oceans they travel in self-indulgent yachts. They eat in private rooms in the most expensive restaurants. The biggest entertainment stars come to them in their private social functions. And, yes, they have all the access they want to high government officials in both major parties because they provide them with all the campaign money they need. And hidden from public view they – and only they – have incredible opportunities to invest their riches to easily receive 30 percent annual gains with little taxation. As they get ever richer they find it increasingly difficult to spend all their wealth – but they handle the chore with alacrity.

What is remarkable about this new society is that there are MILLIONS of these super-rich, physically isolated Americans. They mingle with millions more throughout the world. As globalization has devastated the once proud middle class it has expanded this elitist wealthy class worldwide, even in the poorest nations.

Economic statistics keep solidly documenting growing economic inequality. But I fear that the most economically oppressed and barely surviving peasants have neither the time nor energy to ponder and fret over these data. Here are some new data that reveal an important historic reality.

Economists Emmanuel Saez and Thomas Piketty have recently revealed just how horrendous the inequality gap has become. Way back in 1928, the last full year before the Great Depression began, the families that made up America’s richest top hundredth of 1 percent had incomes that averaged $8.2 million, as measured in dollars inflation-adjusted to 2005 levels. That is one per 10,000 households. In 1928 that amounted to some 5,000 households. These super-rich averaged 891 times more income than families in the bottom 90 percent averaged. By 1955, in the midst of post-World War II prosperity, families in the top hundredth of 1 percent took home only $3.8 million, in inflation-adjusted dollars. They made just 179 times the average bottom 90 percent income. There was much more economic equality because of shared prosperity. Even in 1980, the richest of the rich took home 175 times more than Americans in the bottom 90 percent - still relatively good economic equality. Then things changed.

Consider the figures for 2005: the top hundredth of 1 percent, about 10,000 households, averaged $25.7 million in income, three times the money in 1928. This amounted to 882 times more than the bottom 90 percent average — an economic inequality gap in 2005 that’s almost identical to the 891-to-1 divide in 1928! Welcome to the modern billionaire world of the rich getting much, much richer, while everyone else stagnates. Of course, the top 1 percent of households are also extremely rich – some 1 million families or 3 million people – relatively to the bottom, majority 90 percent.

Married couples with children now account for fewer than one-quarter of American households – the lowest in history. It is the Upper Class that now emphasizes marriage with children. Married households with children are twice as likely to be in the top 20 percent of income. Some 13 percent of the increase in the nation’s income inequality since the 1970s results from the marriage of high income earners. Marriage is now for the rich. What does that say about American democracy and culture? That the Upper Class is like an inbred aristocracy. Children of the rich will marry other children of the rich.

Another critically important change in the real (ugly) America is the bursting of the traditional fantasy-belief that people can educate themselves into wealth. Is getting more Americans educated and trained all we need to do to attack economic inequality? If so, then inequality should fall over periods of time when people become more educated. Right? Americans have become more educated over the last three decades. In 1970, only three out of four Americans aged 25-29 had completed high school. In 2004, nearly nine of ten Americans that age had a high school education. In 1970, only 16 percent of Americans in their late 20s held a four-year college degree. By 2004, that had nearly doubled to 29 percent. Something else has nearly doubled since 1970: the share of national income that goes to America's richest 1 percent.

That means that the share going to average Americans has dropped. Lower Class Americans in the bottom 90 percent of the nation's income distribution took home 67 percent of U.S. income in 1970, but only 53 percent in 2004, despite their greater education and productivity. American reality: We’ve become more unequal at the same time we've become more educated. Why? Education doesn’t determine how income and wealth – or macro domestic and global prosperity – are distributed in our unfair system. The Upper Class ensures that increasing fractions of income and wealth go to them.

Here is more painful statistical truth: In 2004, the most recent year with IRS data just about 25,000 taxpayers took home over $5 million. After exploiting every loophole they paid an average 21.9 percent of their incomes in federal income tax. Back in 1952, at the height of the Korean War, the comparable federal tax bite on America’s richest 25,000 averaged 51.9 percent. About a decade earlier, in the middle of World War II, the 25,000 highest-income taxpayers in the United States paid 68.4 percent of their incomes in federal income tax. How things have changed for the wealthy. A greater fraction of the nation’s prosperity has gone to the Upper Class AND they pay less tax! Economic power produces political power.

This is worth pondering: When will the economic inequality that has morphed into two-class economic apartheid provide sufficient pain and disgust for a few hundred million Americans to fuel political revolution?

When will the stranglehold of the Upper Class on the political system that criminally distorts the economic system be busted? When will Lower Class consumers that drive the economy take back their sovereign power? When will they understand they are losing the class war and revolt?

It will take historically unique action, not electing different Democrats or Republicans. Our Constitution provides the tool – not used for over 200 years because the power elites do not want it used – an Article V convention outside the control of the White House and Congress to consider political and government reforms. Learn more about it at www.foavc.org.

Posted by Joel S. Hirschhorn at April 5, 2007 3:04 PM
Comments
Comment #215248

Joel,

Good article!

I’ve been noticing that trend too for some time.
It all started to go terribly wrong after 1980.

Corpocrisy, corporatism, and other manifestations of unchecked greed gained control.
There is little (if any) loyalty anymore to nation, employer, or each other.
The debt problem also started to get out of control too about 1980 (see black line; National Debt in 2005 dollar$).

Will the voters finally become more aware and more interested in time?
We need to press Congress for an Article V Convention, but Congress will never allow it as long as too many voters keep rewarding politicians for ignoring the voters by repeatedly re-electing the same politicians, election after election. At least, not until there’s a crisis to motivate the voters, which may not be that far away, in view of a number of factors; one big one being the approaching entitlements/demographics/generational tsunami, as 77 million baby boomers start becoming eligible for entitlements at a rate of 13,175 persons per day. Another being the mushrooming $8.9 trillion National Debt, $12.8 trillion Social Security debt, the $450 billion Pension Benefit Guaranty Corp. debt, $20 trillion nation-wide personal debt, ballooning trade deficits, excessive money-printing, and the probable increase in excessive money-printing to keep from defaulting on the National Debt. There’s gonna be a lot of unhappy people as those systems begin to fail.

The only hope is education.
That is the only hope to avoid learning the hard way (again).

Posted by: d.a.n at April 5, 2007 4:19 PM
Comment #215252

Joel:

The flip side of your argument is that corporate profits are at an all time high in terms of % of GDP.

I tend to believet things go in cycles. It would seem to me that we are about to have a serious labor shortage with rising wages.

Look at some of the shortages in the high tech end. Serious numbers of jobs to unfilled.

Some of this was caused Nafta, some welfare reform, some globalization.

It might be time for globalization of unions!!

Craig

Posted by: Craig Holmes at April 5, 2007 4:41 PM
Comment #215253
When will the stranglehold of the Upper Class on the political system that criminally distorts the economic system be busted? When will Lower Class consumers that drive the economy take back their sovereign power? When will they understand they are losing the class war and revolt?

Sadly, it took the Depression last time. When masses of people begin to starve is what revolution is usually about. Laissez Faire visited this upon us before, it will do it again. When the oil and water shocks hit us hard, we’ll see the rise of Communism that we are now seeing in South America.

Posted by: gergle at April 5, 2007 4:53 PM
Comment #215255

In America there are ample programs to allow just about anyone with enough willpower to get a good education.

The answer to the problem is for everyone who is able to take advantage of that education and become one of the super rich. We have safety nets for those who can’t and the ones who won’t, I don’t care about.

Posted by: tomd at April 5, 2007 5:01 PM
Comment #215264

Interesting article Joel. I have a feeling however that the myth of the american dream holds too many in thrall for them to revolt. The popular imagination seems to become feverishly excited at that thought that they too could be one of the wealthy, despite the evidence to the contrary. I have alluded to the myths of american culture in other posts here in watchblog, and the idea that anyone can become wealthy seems to have as strong a pull as ever, despite the reality. I was on a coach trip in New York last fall and the guide, a man of advanced years, in that very New York accent, was drooling to the tourists about what a great country the US is, where anyone could become a millionaire. He didn’t seem to get the irony of someone like himself, seemingly past a normal retirement age, working as a tour guide, presumably for chicken feed. Yes indeedy, the myths and propaganda that feed the popular imagination in the US are alive and well.

Posted by: Paul in Euroland at April 5, 2007 6:06 PM
Comment #215269

Joel

It is funny how we can take the same information and come to different conclusions. To wit.

I wrote a post on marriage and income. I do not see marriage as “for the rich”. I see stable marriage as a way to build wealth. Society is dynamic. I am now in the top 20% of income. I have been married to the same woman for 25 years. When we got married we were in the lowest 20% with a negative net worth because of student loans. We didn’t get educations, decent habits and a stable marriage because we were rich (both our families relatively poor) we got relatively rich because of the stable marriage and education. The arrow of causality goes in that direction.

re workers - I also wrote an article re labor. About the time you mention when the income distribution turned is when labor began to be more plentiful because of the baby boom and women entering the labor force. Labor became less valuable for about 50 years. That situation is now beginning to change. This is another example were we disagree re cause and effect.

Paul

It is not only the American dream. I am sure it is a dream also in Ireland, which is why so many of your fellow people came to the U.S. YOu do not know the situation of the tour guide. As I get to know more old guys, I know that many like to work. I know lots of old guys in forestry, busting the old asses, driving old trucks who have millions in assets. They like what they do. I hope to work until the day I die (maybe not full time). Being a tour guide might be fun.

Posted by: Jack at April 5, 2007 6:26 PM
Comment #215296
It is funny how we can take the same information and come to different conclusions.
Perhaps not for long.
  • two workers per household only make about what one worker used to make
  • median incomes have fallen below 1999 levels
  • 846,000 foreclusures in 2005, 1.2 million in 2006, and 1.5 million estimated for 2007
  • National Debt now $8.9 trillion
  • the Pension Benefit Guaranty Corporation (PBGC) is $450 billion in the hole
  • 1% of the U.S. population used to have 20% of all wealth in 1980. Now 1% of the U.S. population used to have 40% of all wealth (one-simple-idea.com/WealthDistribution1920-1998.gif)
  • 13,175 per day (of 77 million baby boomers) becoming eligible for entitlements (one-simple-idea.com/PressingProblems.htm#SocialSecurity)
  • Social Security it $12.8 trillion in debt (source: CATO institute: www.socialsecurity.org/reformandyou/faqs.html#2)
  • huge trade deficits
  • Congress is pitting Americans and illegal aliens against each other by refusing to enforce existing laws; allowing millions of illegal aliens to flood into the U.S.; what good is a minimum wage when millions of Americans are displaced by cheap labor? Also, illegal aliens are costing U.S. tax payers over $70 billion per year in net losses. 32% of illegal aliens receive welfare and 29% of all incarcerated in all federal prisons are illegal aliens. What the hell the CEOs mean when they say they can’t find workers? We have 301 million people. What they mean is they can’t find workers to work cheap. Corpocrisy, corporatism, and other manifestations of unchecked greed are squeezing the middle class and selling out Americans.
  • energy vulnerability
  • world population increasing by 249,000 per day ! (one-simple-idea.com/Environment1.htm)
  • arable land disappearing by 38,610 square miles per year
  • increasingly unaffordable and unreliable healthcare; An average of 195,000 people in the U.S. died due to potentially preventable, in-hospital medical errors in each of the years 2000, 2001 and 2002, according to a study of 37 million patient records
  • increasingly expensive and declining quality of public education
  • a dishonest fiat-funny-money system and inflation from excessive money-printing, and it is liable to get worse due to pressure from the massive debt and unfunded liabilities for entitlements, war in Iraq and Afghanistan, etc.
  • and little (if any) chances for any badly-needed, common-sense, no-brainer reforms (e.g. campaign finance reform, election reform (and eliminating barriers to ballots by third party and independent candidates by the two-party duopoly), tax reform, ethics reform, an end to Gerrymandering, an end to pork-barrel (e.g. One-Purpose-Per-BILL), ending eminent domain abuse (with the support of the Supreme Court), ending abuse of Presidential pardons to put politicians above the law, legal plunder of Social Security surpluses, ending automatic annual raises for Congress, law-suit reform to end abuse of the legal system to quickly win lottery-type awards by capitalizing on others pain and misery, a Balanced-Budget-Amendment, Term-Limits, etc., etc., etc.)
  • Government is FOR-SALE. 83% of all federal campaign donations (of $200 or more) come from a tiny 0.15% of the 200 million eligible U.S. voters. The remaining 99.85% of the voters don’t have a chance against that (opensecrets.org/pressreleases/DonorDemographics02.asp).
  • environment issues exacerbated by 25% of the world’s emissions from only 4% of the world population (the U.S.)
  • circular partisan warfare fueled by many politicians, to divide and distract voters, tapping into the voters’ laziness, blindly pulling the party-lever, and choosing to wallow in the petty partisan warfare rather than do the hard work to think for themselves.
  • massive waste, fraud, corruption, pork-barrel, graft, and most (if not all) politicians that refuse to do anything that may even remotely reduce their power, or their opportunities for self-gain, or the $ecurity of their cu$hy incumbencies.
  • too many pandering politicians that perpetuate the myth that we can all live at the expense of everyone else, and too many voters that can be bribed with their own tax dollars.
  • The shrinking time limit; each day that goes by, we get farther and farther from solutions, and closer and closer to painful consequences of it all.

But you know what the worst part is; the most damning factor of all?

  • (1) A Do-Nothing, irresponsible, selfish, corrupt Congress, and

  • (2) too many voters that keep rewarding them for it by repeatedly re-electing them. That alone should give cause for alarm, because that alone may be why the much needed course change never comes … not until it is too late.

  • (3) The 110th Congress is made up of over 90% of the 109th Congress. So why should anyone think they’ve turned over a new leaf? They want us to believe that, but they have yet to show much in the way of results; in fact, the “first 100 hours” was a joke, the “5 day work week” didn’t last long, “no earmarks” didn’t last long, and the naiton’s most serious problems are still being ignored.

Yes, some of us look at the same things and draw different conclusions.
Still, anyone that doesn’t think any of that above is much to worry about needs to explain away the obvious implications of the culmination of those numerous problems, still growing in number and severity. To chaulk all of that above up to mere pessimism doesn’t cut it. Only a handful of those things above have the potential to trigger an economic meltdown; possibly another Great Depression.

In fact, the list above is possibly worse than it was before the Great Depression of 1929. For example:

  • the 1% of the population that own most (40%) of the wealth (up from 20% in 1980) in the U.S., which has NEVER been worse since the Great Depression of 1929.

  • the total $22 trillion of federal debt has NEVER been worse.

  • the $20 trillion of nation-wide personal debt has NEVER been worse

  • the U.S. population and the world population has NEVER been larger (increasing by 249,000 per day!); the 5.46 acres per person has NEVER been smaller

  • trade deficits have NEVER been worse

  • the impact of human activity on the planet has NEVER been more significant

  • illegal immigration has NEVER been worse; the problem quadrupled after the last amnesty of 1986, and Congress is likely to give another amnesty to over 12+ million more illegal aliens (one-simple-idea.com/BorderSecurity.htm)

  • a entitlements/demographics/generational storm is on the way, yet Congress ignores it and continues to plunder the Social Security surpluses

  • and the incessant inflation and rising CPI rates have NEVER been over 1% for a longer period of time (since 1955; one-simple-idea.com/DebtAndMoney.htm#Inflation1)

We may not have an economic meltdown as a result of all that above.
But to scoff at all those things above (a death of a thousand cuts) and say economic instability is not possible is hard to understand … especially since none of us can know for certain.
So, which is worse?
Acknowledging the real potential for an economic meltdown, and addressing those things above?
Or diminishing or completely dismissing all of it and calling the messengers Chicken Little pessimists?
And why would anyone think we are immune to a crisis when our history is strewn with crises after crises? (one-simple-idea.com/DebtAndMoney.htm#Panics).

Posted by: d.a.n at April 5, 2007 11:56 PM
Comment #215309

Jack,

Yes, most of the working old are actually wealthy. Uh huh. Do you you have any stats to back that up?
I’m beginning to wonder if you have McCain’s disease. Perhaps you should visit Iraq and walk trough the streets and wait for the bouquets of flowers to be tossed your way.

Posted by: gergle at April 6, 2007 4:11 AM
Comment #215317

Gergle

I was not saying that most of the working old are wealthy. But as I get older myself, I realize that many of the working old do not particularly need the money. They like to do something useful. I was speaking to Paul and I understand the cultural context is different. European pensioners behave differently. They have a different concept of work and leisure.

I gave a talk to a group of older Europeans a while back. I talked about the opportunities of older workers. I look forward to working (as a said, probably part time) well into my old age. THey did not. We were both surprised by the different attitudes.

d.a.n.

I know the end is coming. I have a little problem with the when part. When I look around at what even poor people own, the size of houses etc, I do not feel it is here yet.

I also think you have two problems with your median income stats. First, I understand that the 2006 numbers are higher than the 1999 numbers. Second 1999 is not a good reference year. It was the highest ever in the history of the U.S. and a bubble year. Even when median imcomes were lower in 2000-2005, they never dipped below the incomes before the middle 1990s.

Posted by: Jack at April 6, 2007 8:29 AM
Comment #215332

Joel, great post. The south americanization of this Country is a goal of the corporatist and their super rich buddies. Perhaps it is time for the Article V convention. Mybe the first change should be to take away human rights from the corporations of this world.

Posted by: j2t2 at April 6, 2007 10:05 AM
Comment #215351

“Mybe the first change should be to take away human rights from the corporations of this world.”

Are you willing to take away their taxes too?

Posted by: tomd at April 6, 2007 1:33 PM
Comment #215358

tomd. It would be a small price to pay to rid the Country of the corporist scouge.

Posted by: j2t2 at April 6, 2007 2:46 PM
Comment #215363
Jack wrote: d.a.n. I know the end is coming.

Jack, Why do you call the higher income of 1998-to-1999 a bubble? Why shouldn’t incomes of most Americans rise with GDP? Because incomes have not been rising for a long time. Corpocrisy, corporatism, and other manifestations of unchecked greed have been steadily squeezing and stagnating the wages for most Americans. It’s going to get worse before it gets better. Median incomes dropped in 1999-to-2000, and then they stayed there. Also, the 1% of the populaton that used to have 20% of all wealth now has 40% of all wealth, which has never been worse ssince the Great Depression:
.
Thus, the rich are getting richer, while the majority of American’s incomes have stagnated or fallen. So, there’s something wrong. There are many reasons for it all, but they are rooted in a simple root cause. Laziness and selfishness. The voters have themselves to thank for it too, since they keep re-electing the same politicians that keep selling them out. Also, the ranks of the poor are growing too. Millions no longer have medical insurance. And before you tell us about net worth, remember that it is mostly in over-priced real-estate and stocks. An adjustment there is in progress now, as foreclosures continue to rise (846,000 in 2005, 1.2 million in 2006, and 1.5 million expected for 2007). That will most likely all be erased when the next economic downturn occurs. Yes, our poor are not as poor as the poorest poor on the planet, but that’s not a great consolation. Also, as Craig states, “higher corporate profits” isn’t much comfort to falling and stagnated incomes for most Americans.

It’s not the end of the world.
But the many factors are getting harder and harder to rationalize away. If I had to make a guess, it will probably be a few years after 77 million baby boomers start becoming eligible for entitlements at a rate of 13,175 persons per day, the National Debt grows past $11 trillion, illegal aliens double to 25 million (already costing tax payers over $70 billion per year in net losses), and excessive money-printing to help afford all of it and not default on the interest jumps to double-digits (like in the 1980s). Craig Holmes thinks we’ll make the much needed course changes in time. I’m not so confident of that, based on the incredible arrogance of do-nothing Congress and their high confidence of re-election (90%+ for over a decade), and the slumbering, complacent voters that keep rewarding them for it by repeatedly re-electing them. Unfortunately, voters are mostly tuned out until the problem is too far along. That’s how we keep getting so far down the wrong course.

Anonther manifestion of all this unchecked greed and irresponsibility is government that is FOR-SALE. 83% of all federal campaign donations (of $200 or more) come from only a mere 0.15% of all 200 million eligible voters. No wonder politicians carry the water for their big-money donors and ignore the majority of voters that will re-elect them anyway. It’s that simple, and it can only end badly unless there are some course changes very soon.

Four things slumbering voters would be wise to do:
(1) Stop repeat offenders. Don’t re-elect them.
(2) Demand an Article 5 Convention.
(3) Stop blindly pulling the party-lever.
(4) Demand a number of badly-needed, common-sense, no-brainer reforms that Congress ignores along with the nation’s numerous pressing problems.

Posted by: d.a.n at April 6, 2007 5:05 PM
Comment #215392

d.a.n.

If you look at the long run of real incomes, you see that it rises generally, but fluctuates with economic cycles.

If you look at the long term, incomes are around 1/3 higher in real terms than they were a generation ago. If you look at the peak years, it goes down from there, but that is not realistic.

You can make all the charts you want. Charts are a form of interpretive art. You choose what to leave in and take out. Try this. Find the household income each year from 1967 to 2007 adjusted for inflation. Draw that chart. Keep it simple. Just those facts.

I cannot find the 2006 figures yet. WSJ says it median income rose again last year, but you can use these that give us 196702005. Use the 2005 dollars. They are already adjusted for inflation. That chart would show the real trend w/o the hyperbole.

We will see that we have had general increases since 1967. We could argue that we might do better, but we cannot argue that it has gotten worse.

Posted by: Jack at April 6, 2007 11:33 PM
Comment #215471

Jack,

GDP rose, but not median incomes.
Yeah, somebody is getting rich, but it ain’t the majority of Americans.
The wealth of a mere 1% of the U.S. population increased from 20% of all wealth to 40% of all wealth.
Healthcare insurance and healthcare are increasingly unaffordable (an unreliable).
Incomes have stagnated.
There are more workers per household.
People are working long hours.
The 40 hour work week is now more like 50+ hours.
People are spending months per year commuting.
Over-population is part of the problem.
Yet, Congress behaves like we’re in some sort of population race, because they are more interested in cheap labor and Democrats are interested in what they are cetain to become Democrat voters (once the Congress gives them amnesty again).
Never mind that illegal aliens are already costintg U.S. tax payers over $70 billion annually in net losses.
Most politicians don’t care about that, as evidenced by their BILL for a fraction of a fence, but NO money to fund it.
Then there’s the massive $8.9 trillion National Debt being used to prop up this economy.
And, even you recognize the approaching iceberg with the 77 million baby boomers (many that are members of AARP), that will soon become eligible for benefits at a rate of 13,175 persons per day.
The $8.9 trillion National Debt keeps growing and Congress keeps spending irresponsibly.
This new 110th Congress likes pork-barrel just as much as the 109th Congress. And why not, since 90% of the 110th Congress is from the 109th Congress?
Things are not as rosy as some want to believe.

Jack wrote:
we cannot argue that it has gotten worse.

Yes, we can, for MANY reasons.

Which is worse?
Trying to address these important issues?
Or, diminishing them, and pretending everything is rosy?
What’s the harm in trying to be prepared, or improve things?
What if I’m wrong?
So what?
But, what if YOU are wrong, and these things you pooh-pooh as mere pessimism really to lead to painful consequences?

One thing should be obvious from all the facts.
The nation is in decline.

But, voters have themselves largely to thank for it, because voters keep repeatedly re-electing the same irresponsible politicians. Voters keep rewarding and empowering crooked government that:

  • is FOR-SALE.
  • sells out their own citizens.

  • fosters corpocrisy, corporatism, and other manifestations of unchecked greed.

  • that pits their own American citizens and illegal aliens against each other.

  • refuses to pass any of the badly-needed, no-brainer, common-sense reforms.

  • but can vote itself raises and cu$hy perks and multi-million dollar retirement plans faster than you can say pork-barrel.

  • fuel and wallow in the circular, divisive, distracting partisan warfare.

  • spend most of their time filling their own pockets and their campaign warchest than doing any actual work.

  • doesn’t respect the Constitution.

  • refuses to enforce existing laws.

  • refuses an Article V Convention, despite ALL 50 states have requested it over 568 times.

  • refuses to fixed the tax system; they like it just the way they have perverted it.

  • starts wars based on flawed/trumped up intelligence.

  • only carries the water for its big-money-donors

  • and basically ignors the majority of voters, except to bribe them with their own tax dollars

Looking at all those graphs, and many others not shown, things started to go terribly wrong around 1976 to 1980. Periods of high inflation, increasing debt, increasing dependency on government, increasing intrusion by government, increasing corporcrisy, corporatism, and other manifestations of unchecked greed. The nation is swimming in debt. The net worth you speak of won’t mean much when their values plummet (as they always do in recessions and depressions). The arrogance of Congress and politicians, and the complacency and selfishness of the slumbering voters is not encouraging. It’s not at all far-fetched to see how it can all culminate into significant economic instability.

Posted by: d.a.n at April 7, 2007 4:42 PM
Comment #216347

Listed are the median incomes for the U.S. broken down by percentiles of 25% since 1992.

lowest 25% of wage earners

1992- $12,600 1993- $12,967 1994- $13,426 1995- $14,400 1996- $14,768 1997- $15,400 1998- $16,116 1999- $17,136 2000- $17,920 2001- $17,970 2002- $17,916 2003- $17,984 2004- $18,486 2005- $19,178

next 25%

1992- $24,140 1993- $24,679 1994- $25,200 1995- $26,914 1996- $27,760 1997- $29,200 1998- $30,408 1999- $31,920 2000- $33,000 2001- $33,314 2002- $33,377 2003- $34,000 2004- $34,675 2005- $36,000

next 25%

1992- $37,900 1993- $38,793 1994- $40,100 1995- $42,002 1996- $44,006 1997- $46,000 1998- $48,337 1999- $50,384 2000- $52,174 2001- $53,000 2002- $53,162 2003- $54,453 2004- $55,230 2005- $57,660

top 25% of wage earners

1992- $58,007 1993- $60,300 1994- $62,841 1995- $65,124 1996- $68,015 1997- $71,500 1998- $75,000 1999- $79,232 2000- $81,766 2001- $83,500 2002- $84,016 2003- $86,867 2004- $88,002 2005- $91,705

top 5%

1992- $99,020 1993- $104,639 1994- $109,821 1995- $113,000 1996- $119,540 1997- $126,550 1998- $132,199 1999- $142,000 2000- $145,220 2001- $150,499 2002- $150,002 2003- $154,120 2004- $157,152 2005- $166,000

The lowest 25% gained about 55% in income since 1992

The next 25% gained about 50%

The next 25% gained about 53%

The top 25% gained about 58%

The top 5% gained about 65%

As you can see there is an upswing every year, except 2001, in every single income category across the board. Do you wish to concede the Democratic lie now? That is not a totally unbalanced figure in overall percent of beginning income levels. Will the middle classes whine over a 50% income increase since 1992 just because it was not as much as the lowest 25% and the top 25% of wage earners? How spoiled can Americans get?

JD

Posted by: JD at April 13, 2007 12:47 AM
Comment #216520
JD wrote:
  • The lowest 25% gained about 55% in income since
  • The next 25% gained about 50%
  • The next 25% gained about 53%
  • The top 25% gained about 58%
  • The top 5% gained about 65%
  • JD,

    Your numbers above are the current (nominal) dollars.
    They are not cost adjusted for inflation.
    For instance, the bottom fifth for 1992 in 2005 dollars is $17,181 and the current (nominal) value was 12,600 (the value you used).

    If you adjust for inflation (as shown below), you get the following which does NOT show any large gains in household income, except for the upper top 5% (and not even a lot then between 1999 and 2005).
    As you can see, since 1980, incomes have not risen much.
    They are stagnant.

    The gains over 14 years (between 1992 to 2005) for each fifth and the top 5% are as follows:
    1st Fifth: 1992 to 2005: 11.62%
    2nd Fifth: 1992 to 2005: 9.37%
    3rd Fifth: 1992 to 2005: 11.57%
    4th Fifth: 1992 to 2005: 15.9%
    T_o_p 5% : 1992 to 2005: 20.3%
    Median HH: 1992 to 2005: 10.9%
    The jump in median is primarily a result of the jump in the upper 5% and the 4th fifth, since the jumps in the other 5ths are not that large.

    What the graph above reveals is that the rich are getting richer.
    For example, in 1980, the wealthiest 1% of the U.S. population had 20% of all wealth.
    Now (see graph), in 2007, the wealthiest 1% has 40% of all weatlh.

    Posted by: d.a.n at April 14, 2007 12:43 AM
    Comment #216529

    d.a.n,

    Perhaps when you adjust for inflation, you are correct. However, in real dollars, which is what people get paid and it is what raises are determined on, people have had significant increases across the board. It is unrealistic to blame companies for not factoring inflation into their raises. Generally, people get a three to four percent raise each year from their company, (unless you are able to determine your own raises as Congress does), and inflation is not a factor at all. You have to also figure that inflation also hits companies as hard as it does families. Companies have to pay for the same items for which families pay; shelter, utilities, etc.! In Illinois, Democratic Gov. Rod Blagojovich wants to tax all business sales receipts, doing away with the current system which allows companies to be taxed according to their profits after business expenses. Imagine how that is going to sock it to businesses in Illinois when they can not claim expense deductions like the average resident of Illinois does on their tax forms. Businesses do have expenses too!
    When I talk about income, the bottom line is how much an individual is paid for work performed, period.
    When you talk about inflation, other sources of income for families are not even tabulated, such as the appreciation of their belongings, or the appreciation of their homes, etc., solely due to inflation, so it is somewhat misleading. I never was one that felt inflation should be factored into income. But, we can disagree on this if you wish. It is a mere technicality.

    JD

    Posted by: JD at April 14, 2007 1:07 AM
    Comment #216536

    d.a.n,

    Also, my understanding of the figures I used is that the medians were figured from total population and were calculated by taking the high end of each percentile and the low end of each percentile and finding the median or middle range of the percentile group. If that is the case, based upon total population, I do not see how the top 5% affects the other percentiles much.
    If you have four billion people and you broke those down into 25% percentiles, regardless of how much the top 5% made, the other percentiles would still represent one billion people each, and their respective wage earnings. The only real affect of the top 5% would be in the top 25% percentile. That is why I say each of those real dollar figures show significant gains. The middle class is not shrinking, in fact no class is shrinking, if the figures are based on total population according to the U.S. census. Each of the four classes would have an equal amount of people within them, and the wealth of one percentile should not affect the wealth of another percentile in wages earned.
    If you know it to be figured a different way, I certainly am willing to be corrected, but that is how I understand the figures to be calculated.

    JD

    Posted by: JD at April 14, 2007 1:28 AM
    Comment #216630
    JD wrote: d.a.n, Perhaps when you adjust for inflation, you are correct. However, in real dollars, which is what people get paid and it is what raises are determined on, people have had significant increases across the board.
    JD,

    Respectfully, there have not been significant increases across the board.
    The only noticable increases are in the top 5% and the upper 4th fifth (the highest income level).
    Also, “real” dollars are dollars after they are adjusted for inflation.
    The ever present, incessant, dishonest inflation must be factored in to determine real dollars.
    That data is from the U.S. Census Bureau.

    JD wrote: It is unrealistic to blame companies for not factoring inflation into their raises.
    I don’t blame corporations for that. Companies don’t control inflation.

    However, I do blame corporations for greedy CEOs making tens and hundreds of millions, selling out Americans, trying to import cheap labor, hiring illegal aliens, and other manifestations of unchecked greed.

    JD wrote: Generally, people get a three to four percent raise each year from their company,
    Then many of them are just staying even, and the graphs above prove it, based on U.S. Census Bureau historical data.
    JD wrote: … (unless you are able to determine your own raises as Congress does),
    Isn’t that disgusting?

    While our troops risk life and limb, some troops couldn’t get body armor, some troops can’t get adequate medical attention, some troops are mistreated (like Spc. Sean Baker), and some troops can’t get promised benefits, Congress is gaving itself raises (just got their 9th raise in 10 years). When Congress isn’t giving themselves raises and cu$hy perks, they fly around the world pretending to do important business, while our problems here at home continually go ignored, growing in number and severity.

    JD wrote: … and inflation is not a factor at all.
    Sorry JD, but I have to disagree.

    Inflation is destructive.
    It erodes people’s hard earned dollars.
    The poor and those on fixed incomes are hammered the most.
    It is economically destabilizing.
    Inflation erodes the value of the dollar daily.

    JD wrote: You have to also figure that inflation also hits companies as hard as it does families.
    True. However, if the corporation has a lot of debt, inflation is good for them.

    The government has a lot of debt (about $22 trillion altogether).
    That’s why they like to print excessive amounts of money.
    M3 Money supply was only $135 billion in 1950.
    By 2005, M3 Money Supply grew to $10.15 trillion !
    M3 Money Supply increased by a factor of 75.2 !
    That’s not all growth.
    It’s not due to population growth (152 million in 1950, 298 million in 2005).
    It’s a LOT of excessive money printing.

    JD wrote: Companies have to pay for the same items for which families pay; shelter, utilities, etc.! In Illinois, Democratic Gov. Rod Blagojovich wants to tax all business sales receipts, doing away with the current system which allows companies to be taxed according to their profits after business expenses.
    Don’t fall for it.

    A National Sales tax is a bad idea.
    It lets the wealthy pay a smaller percentage of their income to taxes than most people.
    The middle class gets hammered.
    That is, anyone that spends most of what they earn to get by, gets hammered by a sales tax.
    What we need is a flat 17% income tax only on all income above the poverty level, and eliminate all deductions.
    That will require government to also cut spending about 7%.

    JD wrote: I never was one that felt inflation should be factored into income. But, we can disagree on this if you wish. It is a mere technicality.
    If incomes didn’t rise with inflation, everyone would be earning less.

    For 2006, inflaiton was 3.24%
    If employees didn’t get a 3.24% raise in 2006, you are making less money.

    They are going backwards.
    Most people don’t understand inflation.
    It is an insidious, dishonest, inflationist practice.
    Bankers, the government, and the Federal Reserve have their reasons for perpetuating it.
    It’s like playing Monopoly with one person who can print all the money they want.
    Before long, that person owns everything, and everyone else is broke, or deep in debt.

    JD wrote: d.a.n, Also, my understanding of the figures I used is that the medians were figured from total population and were calculated by taking the high end of each percentile and the low end of each percentile and finding the median or middle range of the percentile group. If that is the case, based upon total population, I do not see how the top 5% affects the other percentiles much.
    JD,

    Just the top 1% had 20% of all wealth in 1980.
    Now, 27 years later, that 1% of the U.S. population has 40% of all wealth.

    JD wrote: … I say each of those real dollar figures show significant gains.
    Sorry JD.

    Really, I’m not trying to be a smart ass.
    Real dollars are shown in the graph above.
    And some people suspect inflation is worse than the government reports.

    JD wrote: The middle class is not shrinking, in fact no class is shrinking, if the figures are based on total population according to the U.S. census.
    On that, you are correct.

    The middle class’ income is stagnant, while the wealthiest are getting wealthier (see graph above).

    JD wrote: If you know it to be figured a different way, I certainly am willing to be corrected, but that is how I understand the figures to be calculated.
    JD, I give you kudos for being openminded about it.

    The fact is, the rich are getting much richer.
    The rest of us are stagnant.
    See the flat curves above.
    That shows the stagnation.

    Now, here’s the bad news.
    Stagnation will seem great compared to what the next few decades hold.
    Especially as 77 million baby boomers start becoming eligible for entitlements at a rate of 13,175 per day!

    A storm is coming.
    It’s not the first.
    Voters can mitigate damages, but only if the pull their heads out before it’s too late.

    Posted by: d.a.n at April 14, 2007 10:56 PM
    Comment #217235

    d.a.n,

    I understand perfectly what you are saying, and we agree on a lot of items. However, you can not expect companies to pay their employees based upon inflation. A 3% to 4% raise is a significant raise, and cost for a company to pay. Wages are a major part of company expenses. I don’t know what the most significant way to control inflation would be because I am not an economist. However, I will not expect my company to figure my raise by factoring in 3.4% to break even with inflation and then another 4% for actual raise. Most companies just can not afford 7% to 8% raises every year for all of their employees. Only the government can support that, and only by raising our, and businesses taxes.
    The truth is that both of us are correct in our arguments. Sure, as inflation increases we all get raped. As taxes increase we all get raped. But, let’s not blame the wrong persons. If my company gives me a 4% raise, they have treated me fairly. It is better than trying to recoup that 3.4% rise in inflation with no raise at all, making the same wage I made last year.

    JD

    Posted by: JD at April 18, 2007 1:15 AM
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