Thursday, October 25, 2012

The Impoverishing States of America

Hard times for the working man, indeed.  We're familiar with statistics showing working class wages have stagnated, even declined somewhat, since Reagan waved his wand across the U.S. but it seems the figures we've been given are actually pretty rosey.

This finding of stagnant wages is unsettling, but also quite misleading. For one thing, this statistic includes only men who have jobs. In 1970, 94 percent of prime-age men worked, but by 2010, that number was only 81 percent. The decline in employment has been accompanied by increases in incarceration rates, higher rates of enrollment in the Social Security Disability Insurance program and more Americans struggling to find work. Because those without jobs are excluded from conventional analyses of Americans’ earnings, the statistics we most commonly see — those that illustrate a trend of wage stagnation — present an overly optimistic picture of the middle class.

When we consider all working-age men, including those who are not working, the real earnings of the median male have actually declined by 19 percent since 1970. This means that the median man in 2010 earned as much as the median man did in 1964 — nearly a half century ago. Men with less education face an even bleaker picture; earnings for the median man with a high school diploma and no further schooling fell by 41 percent from 1970 to 2010.

And, of course, the question becomes how did the working classes tolerate this decline?   Why didn't they take to the streets with pitchforks and torches?   Well peace was maintained by a conjuring act made up of equal parts real estate bubble and cheap (and tax deductible) mortgage financing.   This created a powerful perception of wealth that, as many Americans finally realize, was all smoke and mirrors.

They're a good ways off still but some day the American people will realize the stark truth - that today's radical right has facilitated the greatest unearned and undeserved transfer of wealth in their country's history, gutting the middle class to engorge the richest of the rich.   Today the radical right remains reasonably successful at persuading many of its victims to blame themselves for their plight, for their loss of jobs, income and opportunity.    That won't last forever, it can't.

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