Third Party & Independents Archives

Unthanksgiving

Most Americans have succumbed to tradition and advertising and stuffed their bellies with unhealthy food and stuffed their shopping carts with unnecessary stuff. Now, here are some tough facts about the sad state of the American economy from the late 1960s to the early 2000s, as revealed recently by the Economic Mobility Project.

Anyone who still gives thanks for the classic American dream of rising from poverty to riches is not facing reality. Research has documented that only 6 percent of children born to parents with family income in the bottom fifth of the income spectrum move to the top fifth. The rags to riches story is garbage. Meanwhile, an amazing 42 percent of children born into that lowest fraction remain stuck in that lowly economic class, not even making into middle class status. At the other end, four out of 10 children born to rich parents stay rich.

Looking more generally at economic mobility this is reality: 34 percent of Americans make more than their parents’ family income and move up at least one rung on the economic ladder. But more experience downward mobility, with 38 percent moving down the economic ladder.

What about black Americans?

Only 31 percent of black children born to middle-income parents make more than their parents‟ family income, compared to 68 percent of white children. Almost half (45 percent) of black children whose parents were solidly middle income end up falling to the bottom of the income distribution, compared to only 16 percent of white children.

For every parental income group, white children are more likely to move ahead of their parents’ economic rank while black children are more likely to fall behind.

What about women versus men?

47 percent of daughters born to parents on the bottom rung stay on the bottom rung, compared to 35 percent of sons.

And here is the really bad news for American men: In contrast to data on family income, the personal income of men has been almost perfectly flat for the past three decades. The better incomes of working women have caused apparent increases in family or household incomes.

Inflation-adjusted median income for men ages 30-39 actually fell by 12 percent between 1974 and 2004, from $40,000 a year to about $35,000 a year in constant dollars.

When it comes to America’s democracy and economy, keep dreaming.

Posted by Joel S. Hirschhorn at November 25, 2007 4:43 PM
Comments
Comment #239217

I find your post interesting for the way it makes dire statements which are often not supported (or are even contradicted) by your data. You seem pretty determined here to say that the glass is half empty.

Meanwhile, an amazing 42 percent of children born into that lowest fraction remain stuck in that lowly economic class, not even making into middle class status. At the other end, four out of 10 children born to rich parents stay rich.

So, in other words, less than half of those born poor stay poor, and less than half of those born rich stay rich. Sounds like there’s more social mobility here than even I suspected.

And when you say that only 6 percent of those born in the bottom fifth make it to the top fifth, what does that really mean? By my calculation, 6 percent of the bottom fifth would be about 3.5 million people. If that many people have moved from the very bottom to the very top, it sounds to me that it’s still very possible, through hard work and perseverance, to do just that. And incidentally, going from the very bottom to the very top shouldn’t be used as the only benchmark of success. Going from the very bottom to the middle, which more than half can do here, is also a lot more success than most of the rest of the world can even dream about.

Posted by: Loyal Opposition at November 25, 2007 6:13 PM
Comment #239221

Gracious, Joel…how horrible for all of us. And to think, I was just about to go out to buy a couple of those unnecessary things for my family for Christmas. Instead, I will move to one of the many countries who do all of this better than we do. Let’s see…China? (no, too many people in grinding poverty.)Russia? Cuba? (Nope, ditto for them too.) India? Pakistan? Indonesia? (More losers, again.) How about France? (Nope, nobody moves up and unemployment is awful) Germany? (Same as France, with apologies to sensitive Germans.) How about one of those fine, free, upwardly mobile African or South American countries? (Ha ha ha ha.) Maybe, Joel, what with all your extensive research, you can help me with this. Tell me about all the better places.
Or, perhaps I should just stay here and make this place better. We could jack up the taxes on the top two quintiles, and give all the money to the bottom two quintiles. That would even things out a lot. Then we could get rid of that 40% of the rich kids who grow up to be rich adults. Of course, we would also get rid of the 6% of poor kids who grow up to be rich adults, but who cares about rich adults, anyway.
If we do it right, we could eliminate the top and bottom quintile, giving us only three quintiles. We would have created a fairer country as well as a mathematical impossibility.
Or, we could pass a law prohibiting downward mobility (but, should we exempt the 60% of the rich kids who drop to a lower quintile? We still want them to drop, don’t we?)
Joel, your post seems to have no point. I read the Economic Mobility Project report from start to finish. Much of it sounded pretty good…such as that 68% of kids end up with greater family income and smaller families than their parents, even after adjusting for inflation. In fact, for parents in the lowest quintile, 82% of their kids earn more. True, only 6% of them make it to the top, but 82% doing better is still pretty darn good. So, what is your point?
Our system and our country are far from perfect, whatever perfect may be, but we seem to be getting better with each generation. And, we seem to do better than almost any other country and system. So, what is your point?
We have a free press, freedom to post stuff like this whenever we want to, freedom to participate as fully or as little as we wish in our political system, and the opportunity to use our skills, talents, and education to improve our financial lives. So, what is your point?
If this is a pitch for a third party that will make life better, name that party. If not, what is your point?

Posted by: Steve at November 25, 2007 6:41 PM
Comment #239227

The growing economic disparity is real. And this is the short list. Your corrupt government is FOR-SALE. That’s plenty to worry about, unless you are a member of the oligarchy.

Posted by: d.a.n at November 25, 2007 8:36 PM
Comment #239252

I was going to write a post re this talking about the good news. We have a country where hard work and talent are rewarded, but where you cannot count on just getting ahead. Good.

And do you have to put in all that BS about food? Those of us who are reasonably old, reasonably heathly and consumers of this food find it a little boring. If you eat moderately and exercise, you are fine. If you are lazy and piggy, probably not. Another example of choices mattering. If you are fat and weak, just say no.

So, yes - we have a society that provides opportunity, not guarentees. I would change some of the details, but we clearly got the big picture right.

Posted by: Jack at November 26, 2007 8:46 AM
Comment #239263


If one were to compare our society with any other, past or present, the only one that fits well is the society of the Roman Empire. The fall of the Roman Empire was enabled far more by greed, corruption and depravity within the Empire than it was by barbarian hoards from without. Because of our Weapons of Mass Destruction, the fall of the American Empire is far more likely to bring on another Stone Age than another Dark Age.

Vanity, sex and violence have become a large and growing portion of our economy. Let’s look at vanity and the cosmetics industry. The amount of money that will be spent in this nation for cosmetics during the next decade would engineer, build and deploy a space based solar power generating plant in orbit that would provide us with nearly all of our energy needs. A small portion of that money would maintain the system after it was built. The infrastructure and manpower that would be needed to build the plant could then be used to build factories, tourist destinations and other infrastructures that will become the base of a new industrial/technical revolution which will dwarf what man has so far created.

We have created a great and wealthy society. There is so much wealth that with the aid of government redistribution, even the poorest of us benefit from the wealth.However, we have developed a system which encourages us to squander that wealth. Another name for disposable income is savings.

The amount of wealth that can be generated on this planet is dwarfed by the wealth that can be generated in the rest of the solar system.

Many argue that the amount of wealth that has been expended on the space program was wasted and could have been used to make life better here. they ignore reality and lack vision. The knowledge learned and the technologies developed from the space program have generated wealth that far exceeds the expenditures for that program.

Iraq is our wakeup call. We now know that our troops are never coming home from Iraq and that Iraq will be used as a staging ground for the invasion of Iran and the eventual invasion of Russia. Make no mistake about it, the taxpayers of this country are going to pay the bill.

We can pay the bill for war or we can pay the bill for a green revolution and a space thchnologies revolution. The choice is ours.

Posted by: jlw at November 26, 2007 1:02 PM
Comment #239270

jlw,

I think you touched briefly on what is the cause of America’s ills.

Americans lack vision. In this gotta have it now society, the future is little thought of.
In our quest for the moon, the original basis for in space was for America’s defence.
Project Mercury was first conceived during the Eisenhower administration as a means of defending America against a growing Soviet threat.
Kennedy was reticent, at first, to spend the money, and only declared our mission to go to the moon after we had put our first man in space.
The entire project cost to go to the moon was a mere 24 billion dollars.
Since then, how many things do we use on a daily basis that were developed for that program make the 24 billion seem insignificant?

On another note, I wonder if perhaps we should rename our Department of Defence, the Department of Offence, as invading another country, no matter the “good” intentions seems less a defensive action than an offensive one.

Posted by: Rocky at November 26, 2007 1:42 PM
Comment #239282


Rocky: We abandoned vision for indentured servitude to the credit market and planned obsolescence. We have allowed the powerful and greedy to design the paradigm which best suits their desires.

For those who wish to create a Pax Americana it is imparative in a democratic society to redefine offense as defense. The pax will become a pox.

Posted by: jlw at November 26, 2007 4:20 PM
Comment #239295

Rocky, the number of things we use on a daily basis that came out of the space program are miniscule compared the number of things we use on a daily basis that came out of defense research and spending. On that basis alone, I don’t favor increasing funding for either space exploration or defense. Developing technology for civilian use is now handled very nicely by private enterprise operating under a profit motive.

In any case, as I recall, Bush’s proposed manned mission to Mars was met with nothing but derision and mockery—as well it should have, in my opinion. But the media and the left, it seems, is not willing to embrace either defending this country OR scientific exploration unless they are the ones proposing and leading it.

Posted by: Loyal Opposition at November 26, 2007 6:30 PM
Comment #239322

While I agree with Jack that food is food and not unhealthy,inherently, I agree with the substance of your post.

The sad truth is there never was an American Dream.

Jefferson used the frontier as a means to create the myth of cheap upward mobility. Using the military and smallpox to kill off the Native Americans allowed a free ride for the government to relieve poverty by giving away land and selling it cheaply to immigrants as a means of a revenue stream and expanding tax base.

They didn’t protect the populous, just helped to kill off the Natives after the land Rush. The Oceans made it difficult for Europe to defend their interests.

Of course Mr. Liberty railed about slavery (sometimes, when it was convenient) while supporing himself and the nation on their labors.

Now libertarians rant about the unconstitutional loss of liberty, as if slavery or land theft never occured, and Free Marketers rant about the free market born on the backs of slaves.

As our population becomes more literate than it was 80 years ago and mass communication becomes faster, and the black, brown, yellow and female subjugates demand equality….White men bemoan the loss of their beloved “freedom and free markets” due to the lazy cradle to gravers.

Suddenly slave labor ain’t so cheap, people wonder about the Uber class, killing foreigners so corporate icons can jack up fuel doesn’t seem as fun as it used to. Maybe a good Depression will create the myth again when a few Hoovervilles rise up in D.C. and labor can be told “Arbeit macht frei.”


Posted by: googlumpugus at November 26, 2007 9:28 PM
Comment #239334

One of the biggest problems facing our country right now is illegal immigration, and we’ve also got a list miles long of people trying to get in here legally.

Honestly, if you think that America offers such a raw deal to its inhabitants, why don’t you offer to trade places with those who so foolishly want to come here and (in your opinion) end up in hell on earth?

Arbeit Macht Frei? Oh, I get it. Living in America is like living in Auchwitz. No differences at all worth mentioning. Anybody who really feels that way better head for the exits now. Nobody’s stopping you.

Is it hard to go from being poor here to being filthy rich? Yes it is. God forbid that anybody should have to struggle or even inconvenience themselves before buying a mansion in Beverly Hills. But is it better to be poor here than poor in other places?

Much of the rest of the world’s poor lives in dirt-floored shacks. The tragedy of our poor is that they get fat from eating too much junk-food and can’t afford to pay their credit-card bills after maxing them out on plasma television sets.

In the immortal words of Bush the elder: “Whine on, Harvest Moon.”

Posted by: Loyal Opposition at November 26, 2007 10:49 PM
Comment #239349


“For every dollar the U.S. spends on R and D in the space program it recieves $7 back in corporate and personal income taxes from increased jobs and economic growth. Besides the obvious jobs created in the aerospace industry, thousands more are created by many other companies applying NASA technology in nonspace related areas that effect us daily. One cannot even begin to place a dollar value on the lives saved and improved lifestyles of the less fortunate. Space technology benefits everyone and a rising technological tide does raise all boats.”

If not for the space program, this country would not be the technological capital of the world and our economy would not be what it is.

L.O. Poor people don’t get plasma tv’s on credit cards. They get them at rent to own. If they miss a payment, their plasma tv goes to the next poor sucker. They also get their washers, dryers, stereos and furniture from rent to own.

Posted by: jlw at November 27, 2007 2:38 AM
Comment #239351

Jlw

Point of fact re Roman Empire. We have a skewed point of view on the whole Roman thing. The Roman Empire existed in the west for around 700 years (if you take it from the time they actually could be called an empire). It persisted in the east for almost 1000 years after that. The Eastern Empire was a powerful and vigorous state for much of the time. The Roman Empire holds many lessons, but none of them are simple.

The existential problem of the Roman Empire was lack of a reliable succession procedure for the emperors. Later on the economy was ruined by wage and price controls and meddling government. Greed and depravity were more rampant when the empire was expanding than when it fell.

I blame Edward Gibbon for the general misconception.

Re poor people – we have lots of ways for the poor to better their situation. Maybe they should stay away from renting or owning a plasma TV until they can afford it. I just got my first big screen TV less than two years ago and it is not very big. In our rich country the problems of the poor include obesity and over consumption and some of those things help keep them poor.

Googlump

Slavery existed from pre-history until the 19th century when Western societies abolished it. If you want to be cynical about it, you can point out that in a free market society slavery was no longer economically viable. That is why the south fell back in relation to the north. The market economy works better when it is inclusive. The greater inclusion of other peoples and parts of the world in the market economy will make us all better off, just as it has in the past. A believer in the free market welcomes the new producers and consumers doing their parts.

Posted by: Jack at November 27, 2007 2:57 AM
Comment #239366
Re poor people – we have lots of ways for the poor to better their situation.
It’s not easy with these many unfair and regressive systems that did NOT all come about by mere accident, and have been hammering the middle-class for over 30 years, and causing the steady decline of the U.S. Sure, there’s plenty to be thankful for if you are one of the 1 in 5 people that own 83% of all wealth in the U.S. (a trend that has worsened since 1976).

Have you noticed the falling U.S. Dollar lately? Stock Market volatility? Inflation? Foreclosures?

    In the last five years:
  • $1 U.S. Dollar fell from 0.98 EURO to 0.6825 EURO between Jan-2003 and Oct-2007

  • $1 U.S. Dollar fell from 1.80 British Pound (GBP) to 1.07 GBP between Jan-2003 and Oct-2007

  • $1 U.S. Dollar fell from 1.57 Canadian (CAD) to 0.926 CAD between Jan-2003 and Oct-2007

  • $1 U.S. Dollar fell from 1.78 Austrailian (AUD) to 1.077 AUD between Jan-2003 and Oct-2007

  • $1 U.S. Dollar fell from 1.46 Swiss Franc (CHF) to 1.13 CHF between Jan-2003 and Nov-2007

  • $1 U.S. Dollar fell from 3.51 Argentine Peso (ARS) to 3.13 ARS between Jan-2003 and Nov-2007

  • $1 U.S. Dollar fell from 31.8 Russian Roubles (RUB) to 24.59 RUB between Jan-2003 and Nov-2007
It is ALREADY too late to avoid some of the approaching painful economic consequeces.
Sticking our head in the sand ain’t gonna make it go away.
There is no one thing that is causing the decline of the U.S.
There are many factors that essentially add up to general fiscal and moral bankruptcy:
  • Massive personal debt ($20 Trillion or more).

  • Massive federal debt ($22 Trillion).

  • Massive foreclosures.

  • $12.8 Trillion borrowed and spent from Social Security with a 77 million baby boomer bubble approaching.

  • $450 Billion PBGC pension debt.

  • The dishonest monetary system is screwed up and largely responsible for bubbles (or delaying bubbles to only create worse bubbles later).

  • Inverted yield curves.

  • Inflation; the dollar is falling fast against all major currencies. And watch the Federal Reserve and government make the problem worse with more excessive money creation and easy credit. What is our government telling us to do? Spend more! Well, eventually, that isn’t possible when people are in debt up to your eyeballs.

  • Negative savings rates.

  • The disparity trend; assets don’t mean much to most Americans when only 1 in 5 Americans own 83% of all wealth! The consequences of decades of all of these REGRESSIVE systems (which did NOT all come about by mere coincidence) will be painful.

  • Two wars in Iraq and Afghanistan, with massive costs in lives, limbs, and monetarily, and Congress has rewarded itself for all of it with 9 raises in the past 10 years (between 1997 and 2007).

  • We don’t manufacture much of anything anymore. There are more jobs in government than ALL manufacturing jobs. We can’t all ride in the wagon.

  • The tax system is unfair and REGRESSIVE. Just ask Warren Buffet. He paid a 17.7% income tax rate on $46 million. His secretary paid a 30% income tax rate on a $60K income.

  • The retirement age will have to be raise to 70 or 72 years of age, and people will have to work much longer.

  • Medicare is most likely going to collapse, and Social Security might too.

  • Healthcare isn’t only increasingly unaffordable, but dangerous. Pharmaceutical corporations and the FDA are becoming pill pushers that are killing hundreds of thousands in the U.S. (annually). That does not even include the huge number of patients that are irreversibly damaged and maimed. JAMA reported that over 2.2 million hospitalized patients in 1994 had serious Adverse Drug Reactions (ADRs) and 106,000 were fatal, making these drug reactions the 5th or 6th leading cause of death in the U.S.! JAMA’s conclusion was that “the incidence of serious and fatal ADRs in U.S. hospitals was found to be extremely high”. On 27-July-2004, HealthGrades.com reported that “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 new study of 37 million patient records”.

  • Rampant illegal immigration as bought-and-paid-for politicians despicably pit Americans and illegal aliens against each other.

  • Crime is on the rise again.

  • We have energy vulnerabilities.

  • And worst of all, our severely bloated government is so corrupt, incompetent, arrogant, and irresponsible that they are essentially useless at solving any problems. Do-Nothing Congress is FOR-SALE and caters mostly to their big-money donors and the vastly wealthy (a tiny 0.15% of all 200 million eligible voters make 83% of all federal campaign donations of $200 or more; the remaining 99.85% of the 200 million eligible voters haven’t a chance of outspending those that abuse vast wealth to control and influence government). But, maybe voters will become less complacent and apathetic when they are homeless, jobless, and hungry? But maybe not. After all, voters have been rewarding irresponsible incumbent politicians with an average 96.5% re-election rates since year 1980.
The signs are there (and have been for a while).
There is no magic bullet left to fix it (not without some pain).
There are too many things; that is, the combination of so many bad things that have the real and dangerous potential for not only a recession, but another depression that will last for many years.
To make matters worse, we seem to be doing just about everything possible to make recovery more difficult.
How anyone can paint a rosy picture out of all this isn’t just mere optimism. It is as Joel states: It is delusional.

Posted by: d.a.n at November 27, 2007 12:15 PM
Comment #240289

The report is interesting, and probably true within the confines of the parameters. It left out, however, the influence of household expenses on the income. Even if overall our incomes are better off than our parents, the rise in expenses has far outpaced the rise in incomes.

Posted by: Weefay at December 8, 2007 7:22 AM
Comment #240299

True. Inflation is a constant destabilizing force. It punishes the lower income levels, who are less able to invest wealth so that it will be preserved and not eroded by perpetual inflation. Also, there are more workers per household. The warfare on the middle-income group is real.

Posted by: d.a.n at December 8, 2007 11:18 AM
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