The Cratering Of The Middle Class and Working People

This is going to be an angry post.  I’m angry about this.  Everybody should be angry about this.  Now I’m not going to blame any individual or group.  It’s not Wall St, or the Democrats, Republicans, bankers, unions or anybody else’s fault.  It’s ultimately everybody’s fault. All too many of us have looked at our narrow self interest and ignored what was happening.  It was always somebody else’s fault.  Well what’s happening is something that NOBODY can ignore and yet far too many people are still fooling themselves.

It’s worse than you know.

It may actually be worse than everybody can even conceive.  Things are far closer to total breakdown than I think that most people understand. I’ve got a bunch of links here that tell part of the story.  The thing is that everything I see says that not only is the economy in depression, it’s become fully dysfunctional and cannot recover.  The problem is that nobody sees the forest because everybody’s looking at trees.

As Bubba Clinton says, far too many people have been painted out of the Democrats pretty picture:

So why is it such a wacky election? Because, millions and millions and millions and millions of people look at that pretty picture of America he(Obama) painted and they cannot find themselves in it to save their lives.

http://www.washingtonexaminer.com/bill-clinton-millions-and-millions-and-millions-and-millions-left-out-of-obama-recovery/article/2585134

Seemingly the Conservatives want to paint those people out of the picture as well, or at least piss on them and stomp all over them. I’ve been reading National Review since I was about five years old and this year is the first time that I realized just how out of touch they were.

National Review Writer: Working-Class Communities ‘Deserve To Die’

Typically for Conservatives, this is a result of yet another fight amongst ourselves while ignoring the big picture. I suppose that when you are a silver spooner type you don’t have to worry about where money comes from.  The people in flyover country are getting truly screwed though.

http://theweek.com/articles/603701/how-conservative-elites-disdain-workingclass-republicans

All of which is just plain stupid and ignores the fact that the problems out here in the real world are deep and people are getting desperate.  Here’s a clue from somebody outside the DC bubble, the problems aren’t just the working class people in upstate NY.  Westport and Darien have been hit too, hard, if the numbers of “for lease” signs I see are any indication.

https://theartsmechanical.wordpress.com/2015/04/12/how-many-for-lease-signs-are-in-your-neighborhood/

The funny thing is that the whole argument is about fictional people who don’t represent what’s happening in the real world.  real world, the guys in Fairfield County see the same issues as the guys in rural upstate NY. And both sets of  people are feeling the same pain from the same issues.  I know bunches of both types and I’ve heard gobs  from all.

To put things in perspective there’s this piece in RCP.

http://www.realclearpolitics.com/articles/2016/03/13/in_a_corner_of_ohio_lessons_of_2016_129959.html

“What I guess most frustrates me about politicians is that they don’t understand that, for me and most people that I know, work is part of our culture. When they continue to make it harder for us to find ways to work, we eventually hit a boiling point,” Biddlestone said, trying to explain Donald Trump’s appeal with regular voters.

“We don’t fit in with Washington. We have done absolutely everything that we were supposed to do all of our lives and our values are looked at as backwards. Our homes are worth less than we paid for them and there is no great replacement for the jobs we are skilled to perform.”

I think that sums it up in a nutshell.  Multiply that man times 40 odd million and you have a real problem.

The legacy of the last eight years will be the great depression that our elites never saw. If you read most of the papers or watched most of the newscasts you might believe that the economy is booming.  Well until you walked down the street. Here’s a bunch of reports. I’ve been collecting them for some time now.

It would be ne to believe that what’s happening is due to individuals screwing up.  When there’s so much of it, you have to rethink  that logic.  And what’s happening is happening across the country and is affecting just about everybody.

http://www.zerohedge.com/news/2015-05-08/americans-not-labor-force-rise-record-93194000

http://www.theospark.net/2015/05/remember-borax-20-mule-teamfrom-rico.html

http://hosted.ap.org/dynamic/stories/U/US_ECONOMY?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2015-05-08-08-31-08

When people say that immigrants are taking American jobs, they may actually be right.

http://www.breitbart.com/big-government/2015/05/08/most-net-job-gains-went-to-immigrants-since-recession/

http://www.breitbart.com/big-government/2015/05/08/all-net-employment-gains-among-women-went-to-foreign-born-since-recession/

http://cnsnews.com/news/article/ali-meyer/record-56167000-women-not-labor-force-womens-participation-rate-matches-27

http://www.aei.org/publication/progress-stalled-can/

http://www.washingtonpost.com/sf/business/2014/12/12/why-americas-middle-class-is-lost/

http://fivethirtyeight.com/features/the-american-middle-class-hasnt-gotten-a-raise-in-15-years/

https://www.americanprogress.org/issues/economy/report/2014/09/24/96903/the-middle-class-squeeze/

http://www.nytimes.com/2014/04/23/upshot/the-american-middle-class-is-no-longer-the-worlds-richest.html?_r=0

http://www.cbsnews.com/news/another-death-knell-for-the-middle-class/

http://www.alternet.org/economy/robert-reich-whats-really-destroying-american-middle-class

http://www.theguardian.com/money/us-money-blog/2014/sep/21/who-is-america-middle-class-upper-lower-poverty

http://www.breitbart.com/big-government/2015/02/11/gallup-connecticut-dead-last-in-job-creation-in-2014/

http://www.americanthinker.com/blog/2016/02/fun_with_numbers_the_real_story_behind_the_unemployment_report.html

http://www.zerohedge.com/news/2016-02-05/update-waiter-and-bartender-recovery

http://www.washingtonexaminer.com/what-jobs-bls-says-665000-job-losses/article/2582535

Bastiat’s gas tank, on empty. When the velocity if money is zero, it’s like when the velocity of a car is zero, nothing much happens.

http://sippicancottage.blogspot.com/2014/12/damocles-had-nothing-to-do-with-it-it.html

So the public spent their savings on something they were mandated to spend for rather than things that would have enhanced their lives or on starting businesses and creating new wealth. What happens when the savings run out? There comes a point when you can’t cook the numbers anymore.

http://www.zerohedge.com/news/2014-12-23/exposing-deception-how-us-economy-grew-140-billion-q3-due-data-revisions

How can anybody believe this is a good thing.:

http://www.zerohedge.com/news/2014-12-23/here-reason-surge-q3-gdp

This is simply robbery on a massive scale. Robbery from people who can’t afford it. And people know it.

Forty years of the Laffer Curve: Taxes are still too high: http://www.washingtonpost.com/opinions/the-laffer-curve-at-40-still-looks-good/2014/12/26/4cded164-853d-11e4-a702-fa31ff4ae98e_story.html

If the millenials really knew what they were in for.

http://www.businessinsider.com/stan-druckenmiller-on-generational-theft-2013-9?utm_content=bufferd6434&utm_medium=social&utm_source=facebook.com&utm_campaign=buffer#druckenmiller-says-that-our-health-care-system-is-screwed-up-one-reason-is-malpractice-insurance-he-says-lawyers-take-large-share-of-what-would-be-physician-income-then-malpractice-insurance-also-incentivizes-hospitals-to-run-all-these-unnecessary-tests-and-the-costs-go-up-dramatically-16

The problem with central planning is that there is no such thing as a miracle and nobody knows all the boxes to fill in.: http://maggiesfarm.anotherdotcom.com/archives/25398-The-pipe-dream-of-central-planning.html

Unfortunately, from my experience, American Companies haven’t learned a thing. This link seems appropriate: http://www.thisamericanlife.org/radio-archives/episode/403/NUMMI

Every penny wasted on a Solyndra does triple damage. First of all it takes money away from hard working types who earned it. Then it gives the money to sompebody who makes his money through his connections. Finally it enables enterprises that fourish in that kind of environment rather than the inovative and hard working companies who have to struggle twice as hard. To say nothing about what happens to growth and middle class jobs.

http://www.againstcronycapitalism.org/2014/12/crony-capitalism-is-killing-entrepreneurs-and-the-american-dream-even-the-washington-post-sees-it/

The problem with believing the “people are stupid” narrative is that people aren’t stupid and will react to your perverse incentives not as you want them to, but in ways that are in THEIR best interest. Raise the CAFE standards and you are probably going to have bootleg cars. Manipulate how healthcare is payed for and people WILL use that to their advantage. I mean even Gruber proved that. Gruber was asked a question in class about how Obamacare was enacted, which he answered. Then as part of the lecture turned right around and demonstrated, correctly, why passing Obamacare was a bad idea using the moral hazard incentive argument.

https://www.youtube.com/watch?v=pmolioUklXI

I’m not sure that he knew was he was doing.

OK,  how about this report from that highly conservative journal, The New York Times: http://www.nytimes.com/2014/12/12/upshot/unemployment-the-vanishing-male-worker-how-america-fell-behind.html?abt=0002&abg=0 How’s that for outcomes. It’s got to be REALLY BAD if the NYT i stalking about how bad it is in The messianic era of the current administration.

“In 1971, according to the Pew Research Center, 61% of all adults lived in middle-income households. By 2011, the middle-income share had fallen to 51%, while the lower- and upper-income sectors grew. Median household income in 2011 was not significantly higher than it had been in 1989. Because upper-income households fared much better during those four decades, their share of total household income increased by 17 percentage points—to 46% from 29%—while the middle-income share fell by 17 points, to 45% from 62%. No wonder Neiman-Marcus and Wal-Mart are doing well while J.C. Penney and Sears are nearing collapse.” http://www.wsj.com/articles/SB10001424052702303914304579193663817816486\l

Here’s one that I consider even more important, new small business startups: http://www.aei.org/publication/startups-americas-economic-calcification/

Full time employment isn’t looking so hot either. :

http://wallstreetexaminer.com/wp-content/uploads/2014/09/M7402100131021232438713582158.gif

Here are the links I get when I google “american middle class.”: http://www.washingtonpost.com/sf/business/2014/12/12/why-americas-middle-class-is-lost/ http://fivethirtyeight.com/features/the-american-middle-class-hasnt-gotten-a-raise-in-15-years/ https://www.americanprogress.org/issues/economy/report/2014/09/24/96903/the-middle-class-squeeze/ http://www.nytimes.com/2014/04/23/upshot/the-american-middle-class-is-no-longer-the-worlds-richest.html?_r=0 http://www.cbsnews.com/news/another-death-knell-for-the-middle-class/ http://www.alternet.org/economy/robert-reich-whats-really-destroying-american-middle-class http://www.theguardian.com/money/us-money-blog/2014/sep/21/who-is-america-middle-class-upper-lower-poverty

I probably don’t agree with what the links say, but all of them point at the same problem. None of them are Koch, Murdoch, or Saudi connected. If the Center for American Progress, the New York Times, The Wall St Journal, AEI, Zero Hedge, Doug Jones, the Market ticker and just about every single website I log into is saying that the middle class is being cratered, you have to believe that the middle class is being cratered. That’s a mertic that exists. It may have started in the Bush years, but the unending recession and the Cloward Piven policies that being enacted by the current administration have exacerbated the problem. Unfortunately, like it or not that’s a fact.

Unfortunately the statistics are showing that the rate is low not because of people retiring, because many people had their retirement cratered by the great recession but by more people claming disability and living off savings: http://www.nytimes.com/2014/12/12/upshot/the-rise-of-men-who-dont-work-and-what-they-do-instead.html?action=click&contentCollection=Business%20Day&module=RelatedCoverage®ion=Marginalia&pgtype=article&abt=0002&abg=1&_r=0

From the article: “Among prime-age workers, early retirement has increased slightly since 2000. Far more drastic changes have occurred among workers 55 and older, who have been doing the opposite and putting off retirement. The decline of traditional pension plans and rising education levels, which are associated with less physically demanding jobs, may both help explain why the elderly are working longer. The full retirement age for Social Security benefits also began gradually increasing in 2000.”

From the article again, under disability: “About 20 percent of the new nonworkers say they are disabled, a category whose numbers have risen particularly for workers above age 50. Once people have a disability and neither have a job nor are looking for one, it’s unlikely they will work again. Less than 10 percent of the prime-age nonworkers who say that they have a disability will be in the labor force one year later, according to a study by economists at the Federal Reserve Bank of Atlanta. Instead, most of those who receive disability benefits will do so until they reach retirement age or die.” I said that more people were claiming disability and 20% increase is more isn’t it?

I already posted the part where the article said that the elderly were working longer and where the number of people claiming disability had increased by 20%. That’s people not in the work force thereby lowering the labor participation rate, The article also talked about men staying at home or at school, but not working, again lowering the labor participation rate. Apparently the Times thought it was a big enough deal that they also ran this: http://www.nytimes.com/2014/12/12/upshot/unemployment-the-vanishing-male-worker-how-america-fell-behind.html?action=click&contentCollection=The%20Upshot&module=RelatedCoverage®ion=Marginalia&pgtype=article&abt=0002&abg=0 Frankly the reason for the big drop in the labor participation rate? No JOBS. Something that every single link I posted and a bunch I didn’t has pointed out.

http://www.aei.org/publication/arent-labor-force-dropouts-now-dropping-back/

http://www.aei.org/publication/real-us-unemployment-rate-isnt-37-2-cmon-man/

http://www.aei.org/publication/america-needs-startups-heres-ignite-explosion-us-entrepreneurship/

http://www.theguardian.com/sustainable-business/2014/nov/07/radical-new-economic-system-will-emerge-from-collapse-of-capitalism

http://www.businessinsider.com/labor-force-participation-rate-september-2014-2014-10

http://www.pbs.org/newshour/making-sense/middle-class-cant-get-ahead/#.VKC-Sf-IqRU.facebook

What happens when young and inventive entrepreurs are nickel and dimed out of business.

http://www.zerohedge.com/news/2014-11-14/reason-small-businesses-are-disappearing-explained-small-business-owner

China apparently passed us as the world’s largest economy. Here’s a clue, it wasn’t because of the massive state run enterprises and it wasn’t due to Foxconn making all those Iphones. It was becasue it’s easier to start and run a business without being taxed and regulated to death when you are starting out.  The one big issue that nobody sees is that the risk reward issues have been perverted. It’s easier to start a business in Japan or China where you know that the rules, for whatever reason aren’t going to be changed on you half way.:

http://www.dannychoo.com/en/post/27241/How+I+started+my+company+in+Japan.html

 

OK, how about this report from that highly conservative journal, The New York Times: http://www.nytimes.com/2014/12/12/upshot/unemployment-the-vanishing-male-worker-how-america-fell-behind.html?abt=0002&abg=0

How’s that for outcomes. It’s got to be REALLY BAD if the NYT is talking about how bad it is in The messianic era of the current administration.

More of how the American people are getting screwed by the current Administration’s Cloward Piven strategies:

http://www.zerohedge.com/news/2014-12-12/devastation-americas-working-class

 

http://www.aei.org/publication/progress-stalled-can/

You mean like this: “In 1971, according to the Pew Research Center, 61% of all adults lived in middle-income households. By 2011, the middle-income share had fallen to 51%, while the lower- and upper-income sectors grew. Median household income in 2011 was not significantly higher than it had been in 1989. Because upper-income households fared much better during those four decades, their share of total household income increased by 17 percentage points—to 46% from 29%—while the middle-income share fell by 17 points, to 45% from 62%. No wonder Neiman-Marcus and Wal-Mart are doing well while J.C. Penney and Sears are nearing collapse.”

http://www.wsj.com/articles/SB10001424052702303914304579193663817816486

Perhaps the most annoying part about this it that the Conservative movement is blowing a HUGE opportunity to change things for the better.  Conservative are never going to get a better opportunity to make their case to the American people.  The collapse of the  Progressive blue model is as big a disaster as it gets. Of course that may actually be why the people in  the Conservative  Movement  can’t seem to get their head around it.  The Blue  Model has been with us our entire lives.  It’s been the defining element of the political space for almost a Century now.  So it’s hard to believe that the collapse is as large as it is.

It might be easier putting together and entire  issue of Trump hate than dealing with the issues that created the Trump phenomenon.   I don’t really understand it, actually. Trump has been going to CPAC for years and saying the same things he’s saying now  for a long time now.  I don’t see what’s changed.

Maybe if the silver spooners of the  Conservative Movement got out of their wealthy, but unpretentious enclaves and  drove out  in their unpretentious Fords and looked at what as happening outside the golf courses and polo grounds they would realize that things are not working.

It’s time for new ideas.  Radical ideas, because the Blue Model we all grew up with is dead. We need to say a quick prayer for dead and move on.  The welfare  state is going to collapse.  It’s inevitable.  The problem is demographics and a lack of people.  The numbers can be played with, the key fact though is that too few people are working and too many are collecting.  At some point, far sooner than most people realize, the economy will not be able to support the welfare state as it stands.

This is what happens when people ignore the obvious.  We have too many expert who are clueless because they never actually get in amongst real people and find out what’s really going. We need economics that deals with real people, not studies and statistics.

https://theartsmechanical.wordpress.com/2015/06/25/economics-as-if-humans-were-in-the-driver-seat/

The fact is that change is going to come.  We can reshape the change to something better or we can watch everything that all too many of us have worked for collapse as things go further and further down the dysfunctional road that the country is on. Frankly I’m tire of butting my head against a dysfunctional job market, a dysfunctional state and a dysfunctional economy.  It’s time to make things work again.

For more on the dysfunctional economy click Here or on the tag below.

Advertisements

4 comments

  1. roger · March 17, 2016

    It is my belief that compliance costs (government regulation, i.e. taxes not counted as taxes) prevent small business startups of the desired kind. The compliances costs have grown every year since they were first introduced. I remember more that twenty years ago looking into starting a machine shop; the various plans I had to satisfy (fed, state, and local) required over 100K in capital before anything (which was way more that I could come up with). I don’t suppose it is any less now.

    Like

  2. Pingback: Who Are You? | The Arts Mechanical
  3. Pingback: The Human Condition – a blast from the past post Jan. 12 2014 | The Arts Mechanical
  4. Pingback: Death Of A Million Paper Cuts | The Arts Mechanical

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s