Middle class financially squeezed by the plutocracy – 13 million people added to food assistance from 2007 to 2010. Nearly 40 percent of all unemployed have been out of work for 27 weeks or more.
- 3 Comment
The mainstream press and their lack of focus or even caring about a shrinking middle class is disturbing. Yet this shouldn’t be a surprise given that their focus of appeasing their sponsors is directly focused at keeping people stuck in a debt induced sleepwalking financial nightmare. Wall Street has successfully infiltrated our government and most policies are vetted to ensure banking success before ever becoming law or what we now pass as reform. Take this sobering figure as a measure of how deep this recession has impacted our national economy; in December of 2007 at the start of the recession 27 million Americans were receiving food assistance (already high in a supposed recovery). Today, we have over 40 million receiving food assistance and we are supposedly in a recovery. From March to April of 2010 we added 300,000 people to the food assistance column. This is what passes as recovery. Also, the persistent long-term unemployment is a perplexing issue facing the middle class:
This chart is daunting:
The amount of people that are long-term unemployed is at record levels. The chart above shows that we have never been close to a similar situation going back to the late 1940s when records started being kept. These are structural problems. Nearly 7 million of the officially unemployed today have been out of work for 27 weeks or more. The working and middle class saddled with incredible amounts of debt are losing any ability to stay above water. This is why we see those jumping on food assistance exploding even at a faster rate than those losing their jobs. Why? We have a giant class of working poor in the United States.
9 of the top 10 industries in the United States are low paying service sector work:
Source:Â BLS
There are many Americans that are actually counted as officially employed but are also receiving food assistance. Think about the data for a second:
People receiving food assistance:Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 40.4 million
Official unemployed:Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 14.6 million
Part of the gap comes from the data of counting children in the food assistance figures. Yet many people today are labeled as fully employed but are barely scraping by. The median household income in the U.S. is roughly $52,000 – I’m sure this figure is lower or stagnant once data is released in September from the Census. The economy is extremely weak for certain sectors. If we crunch the data on the long-term unemployed future prospects do not look promising:
What does the above chart tell us? The above chart shows very little recovery going on in the real economy. Those that stay unemployed 27 weeks or more are likely to stay that way for a long period of time. Now if we really want to see where things are heading, we can look at a few major sectors of our economy:
What you’ll notice in the chart above is that the manufacturing sector in the U.S. has been taken apart and this goes back to the 1970s. These were quality jobs that are not coming back. If you take a look at the actual FIRE side of things (finance, insurance, and real estate) job losses are showing up in good numbers but this sector has gone up on a very clear path since the 1950s. We have decided to push real estate and toxic loan products instead of making things. The banking sector has outsourced our workforce. Why else are the top 10 job sectors in low paying service sector work like cashiers or servers? This correlation did not happen by accident.
The government has been adding jobs over this time:
You really don’t want to see the government sector expanding at the same time the overall employment base is going lower. Yet this recession is striking at the core of the working and middle class. There was a recent story of a city manager in Bell California making $800,000 a year in a city of roughly 30,000 people. The city is working class and people are rightfully outraged. This is no different than a CEO making millions of dollars creating toxic mortgage products that required taxpayers to bail them out. The country is being run by plutocrats on both sides of the aisle. The middle is getting squeezed out.
It is no wonder that anger against both political parties is at record levels. People are rightfully disenfranchised. With no solid job growth we can expect further problems in many sectors of our economy and we will see even more incredible financial problems come to the surface that were hidden during the halcyon days of the credit bubble. When the light comes on, the roaches scatter.
If you enjoyed this post click here to subscribe to a complete feed and stay up to date with today’s challenging market!
3 Comments on this post
Trackbacks
-
bob said:
The dismantling of the once great nation , USA !!..sad, sad, sad…..all part of the PLAN !…………..
The PLAN , is the community dismantled, the family dismantled, the industrial base dismantled…………until all that is left is a mongrelized people from one parent “families” serving as waiters and cashiers.
July 23rd, 2010 at 11:32 am -
Don Levit said:
The government sector expanding at the “expenses of the private sector.
These government workers, at least those who are federal, may have a tough tome getting their retirement benefits.
Up until yesterday, I thought federal employees had a similar funding program that the state employees have, with a mix of assets, and a small portion of Treasury securities, and a real trust fund to hold the assets for retirement benefits.
From a paper entitled “Analytical Perspectives, Budget of the U.S. Government, Fiscal Year 2009,” it states on page 345 “In 1984 a new system was set up to finance military retirenment benefits on a full accrual basis. In 1986, full accrual funding of retirement benefits was mandated for federal civilian employees hired after Dec. 31, 1983. Since many years will pass between the time when benefits are earned and when they are paid, the trust funds will accumulate substantial balances over time. THESE BALANCES ARE AVAILABLE TO FINANCE FUTURE BENEFIT PAYMENTS, BUT ONLY IN A BOOKKEEPING SENSE. THESE FUNDS ARE NOT SET UP TO BE PENSION FUNDS, LIKE THE FUNDS OF PRIVATE PENSION PLANS.
WHEN TRUST FUND HOLDINGS ARE REDEEMED TO AUTHORIZE THE PAYMENT OF BENEFITS, THE DEPARTMEBNT OF THE TREASURY WILL HAVE TO FINANCE THE EXPENDITURE IN THE SAME WAY AS ANY OTHER FEDERAL EXPENDITURE: BY USING THEN CURRENT RECEIPTS, BY BORROWING FROM THE PUBLIC, OR BY REDUCING BENEFITS.”
And this is how the government fully accrues retirement benefits for its employees? By using the Treasury securities for other current expenses, and relying in the power of bookkeeping and the public debt to pay their benefits?
These federal employees may be working a lot longer than they anticipated.
Go to: http://www.gpoaccess.gov/USbudget/fy09/pdf/spec.pdf.
Don LevitJuly 23rd, 2010 at 3:13 pm -
RICHARD RALPH ROEHL said:
The name of the game for Amerika’s ruling class elite is based on keeping the people (the common wealth) $tewepid (meaning clueless). And the plutocratic elite (bankster gambler addicts in the Wall $treet casino; Pentagon boners in the military industrial complex; et.al.) also want to keep Amerikan people in debt… or addicted to something… or working 2-3 pisswater wage jobs to make ends meat… or in jail… or on probation… or bombed out on $hrink drrrugs, etc. Thus… the UNITED $TATES OF PERPETUAL WAR PROFITEERING in Iraq-NAM (and elsewhere) slowly devolves into a third world plutocratic $tate where the wealth gap between the haves and have $nots becomes interminably wide.
Oh say can you $ee? Probably not! Too many faster poo food ewe folks in capitalist/fascist Amerika, boobtube sheeple people indulging in pro-$ports bread an’ circus for the sake of denial and distraction.
The extinction will NOT be tell-lie-vised!
July 23rd, 2010 at 5:57 pm