There is a chilling report out from the Federal Reserve that the median net worth of families plunged by 39 percent in just three years, from $126,400 in 2007 to $77,300 in 2010. That returns American families to the wealth level of 1992.
The biggest hit were the middle class families. The wealthiest families actually saw a slight rise. The median for credit card debt did not materially change, however. Much of this decline is due to the decline in home values which remains the biggest investment for most families. Forty-seven percent of citizens do not pay taxes income taxes and 87 percent of those earn less than $20,000 a year.
These figures are remarkable since they parallel the Great Depression but we have not seen the same degree of displacement or social or political upheaval as a result. There are different theories from better public welfare programs to a new political dynamic with many lower and middle class families supporting either the Tea Party or GOP. It may also be that many families have experienced the decline but continue to hold on to their homes so that the diminishing in wealth does not manifest as sharply in their lives. Whatever the cause, the reduction in wealth has not produced a comparative political backlash that I can see.
Source: Washington Post
http://www.dailykos.com/story/2012/06/12/1099405/-Daily-Kos-SEIU-State-of-the-Nation-Poll-Nearly-half-of-voters-think-GOP-is-sabotaging-recovery
The life in a plutonomy governed by a plutocracy is not the same as an economy governed by the economic habits of a robust middle class:
(The Homeland: Big Brother Plutonomy). Certain aspects of this disaster, which also culminated in the 2008 economic collapse, have been attributed to psychological problems, not economic problems.
Until the mania goes away the plutonomy will continue to do what a plutonomy does naturally, which is to continue to become unstable, because the minds working upon it are unstable.
Barkin’Dog,
Does anyone else read previews of DSM-V? I mean anyone who initially encouraged Willard? What else that killing small children (Obama does that too) can we expect form him as Prez?
And now of course, we are experiencing “compassion fatigue”:
http://www.usatoday.com/news/nation/story/2012-06-10/cities-crack-down-on-homeless/55479912/1
A growing number of cities across the United States are making it harder to be homeless.
By Aaron Ontiveroz, AP
A protester holds a sign before a Denver City Council meeting last month to vote on a proposed urban camping ban. The ban passed 9-4.
Philadelphia recently banned outdoor feeding of people in city parks. Denver has begun enforcing a ban on eating and sleeping on property without permission. And this month, lawmakers in Ashland, Ore., will consider strengthening the town’s ban on camping and making noise in public.
And the list goes on: Atlanta, Phoenix, San Diego, Los Angeles, Miami, Oklahoma City and more than 50 other cities have previously adopted some kind of anti-camping or anti-food-sharing laws, according to the National Law Center on Homelessness & Poverty.
The ordinances are pitting city officials against homeless advocates. City leaders say they want to improve the lives of homeless people and ensure public safety, while supporters of the homeless argue that such regulations criminalize homelessness and make it harder to live on the nation’s streets.
“We’re seeing these types of laws being proposed and passed all over the country,” said Heather Johnson, a civil rights attorney at the homeless and poverty law center, which opposes many of the measures. “We think that criminalization measures such as these are counterproductive. Rather than address the root cause of homelessness, they perpetuate homelessness.”
Vagrancy laws
Cities that have adopted laws affecting the homeless:
Anti-Camping
• Atlanta
• Denver
• Los Angeles
• Miami
• New York
• Seattle
Anti-Food-Sharing
• Phoenix
• Orlando
• Cleveland
A number of organizations including the American Civil Liberties Union of Pennsylvania filed a lawsuit against the city of Philadelphia this month in response to its feeding ban.
Indigo Jones,
Then it must be true, the citation of Madison I have cited a few times here:
“The purpose of the Constitution is to protect the opulent from the rest.”
How much truth lies hidden in the Fed papers to reveal our incompetency, designed from the beginning.
And we are still hoodwinked—constantly.
I just love it when there is class warfare between the traders and investment bankers…..
Not all parts have seen a decline in real property values….. Nor have they seen a decrease in income…..
Good posts Indigo Jones. I always laugh when the government comes out to say there is little to no inflation. hahahhahahahhahaha Everything I must buy, food, insurance, gas has all gone up in price by many factors.
Things are worse than they seem. I travel all over the nation for my job and I have seen the poverty increasing in all our major cities.
They live in their cars, or on the bank of a canal across the street from the Hard Rock Casino in Vegas.
They wash up in Starbucks bathrooms.
All these empty climate controlled buildings, the monuments to Capital, stand empty while the homeless scramble hard against the elements.
They are mostly invisible now, but you can see all these people if you are looking.
Willard will employ another 100,000 troops. He will buy more warships and planes. He was against saving General Motors. He is against a basic mantra of the GOP since the 20’s: Whats good for General Motors is good for the USA. So what would Ike say about Willard? Military Industrial Complex Willard. You can find the definition in the new DSM V when it comes out next year. The Diagnostical Statistical Manual (soon to be Fifth Edition) deliniates and carefully defines mental illness in America. Willard has Histrionic Personality Disorder. This is evident by his obsession with his appearance, his mop of hair, his blue jeans ever so fresh and collegiate looking, his putting the dog on the top of the car. HPD, as it is called, is the disorder that Sandusky is claiming as his defense for raping all those minors.
But Willard has it. It is real. Coming to a White House soon.
@Swarthmore mom
This is buy design.
It’s no accident that this is where we find ourselves, living as we do in a legal system explicitly deisgned to preserve the privilige of a wealthy minority and to PREVENT majority rule.
While American textbook talk about state conflicts around the drafting of the constitution, the whole move to restructure the articles of confederation was pushed by capitalists. They were united by a class identity, which the other classes (the working classes) lacked.
There were four major categories of property interests responsible for drafting the US Constitution: land owners who profited from rent; slave owners who profited from agriculture; money interests who profited from lending; and mercantile and manufacturing interests.
Women were excluded. Slaves were excluded. Renters were excluded. Laborers were excluded. Given that a majority of Americans — even white collar workers and CEO’s — earn wages, this is a huge class of society that was DELIBERATELY WRITTEN OUT OF THE CONSTITUTION.
This is why the Framers wanted a Republican government — Democracy was too threatening to their privilege. Everywhere, States were cancelling debt and the capitalists wanted a strong federal government to enforce contractual obligations; land speculators wanted a strong Federal government to clear the Western lands of their Indian inhabitants; and the capitalists wanted trade protections from European competitors. These were the driving factors for the Constitutional Convention, and, incidentally, why labor unions are important today: labor unions were a historical compromise that is now being dismantled.
Just how deliberate this all was can be seen in the words of Publius (Hamilton or Madison) in the Federalist no. 51:
“It is of great importance
in a republic not only to guard the society against the
oppression of its rulers, but to guard one part of the society
against the injustice of the other part. Different interests
necessarily exist in different classes of citizens. If a
majority be united by a common interest, the rights of the
minority will be insecure. There are but two methods of
providing against this evil: the one by creating a will in the
community independent of the majority that is, of the society
itself; the other, by comprehending in the society so many
separate descriptions of citizens as will render an unjust
combination of a majority of the whole very improbable, if not
impracticable.
“The first method prevails in all governments
possessing an hereditary or self-appointed authority. This, at
best, is but a precarious security; because a power independent
of the society may as well espouse the unjust views of the major,
as the rightful interests of the minor party, and may possibly be
turned against both parties. The second method will be
exemplified in the federal republic of the United States. Whilst
all authority in it will be derived from and dependent on the
society, the society itself will be broken into so many parts,
interests, and classes of citizens, that the rights of
individuals, or of the minority, will be in little danger from
interested combinations of the majority.”
The “minority” here spoken of, which needs protection, is the wealth of the capitalists. The Framers thought strong, centralized authority (like a hereditary monarchy) was best for business, but next best is a government that capitalists can control, keeping the majority fragmented and therefore without influence.
These figures are remarkable since they parallel the Great Depression but we have not seen the same degree of displacement or social or political upheaval as a result.
————————–
Gosh I could be wrong but we started the decline in a better place than in the great depression……are we so stupid that we need these ultimate disasters to manifest before we right the ship????!!!!
Good G*d help us…………..
The article said that the bottom 20% pay at least 16.3% of their income in payroll tax (social security tax, and medicare tax), state tax, municipal tax, utilities tax, gas tax, real estate tax, personal property tax, sales tax, and their employer paid another 8.5% of their income for social security and a couple percent more goes for unemployment insurance. They just don’t pay federal income tax . 24% of the population is under 18 and 13% are over 65. Another 6.5% are under 5. Statistics are just that, statistics. People like to throw around the 47% figure but very few bother to actually look at the detail.
TPM
Paul Werdel June 12, 2012, 9:41 AM 5392
If you watched Fox & Friends interview Mitt Romney on Tuesday morning, you heard from the inestimably chipper Steve Doocy that the Federal Reserve announced on Monday that forty percent of Americans’ wealth had been wiped out in “the last three years.” One problem. It’s not true.
No doubt the Fed report made for sober reading, showing that median household net worth was in 2010 at its lowest level since 1992 when adjusted for inflation. But the years studied — the height of the recession with a cratering housing market — were 2007 to 2010. Not (for the time-challenged) the last three years.”
@importanttopics
Do you mean CORPORATE WELFARE to recapitalize insolvent banks?
I ask because, AS FAR AS INDIVIDUALS ARE CONCERNED, WELFARE ENDED UNDER CLINTON WHEN WISCONSIN’S W2 PROGRAM BECAME A NATIONAL MODEL.
And in case you haven’t noticed, we’re seeing massive price inflation NOW. The coffee I buy in the past year jumped from $9/pound to $12. The rice I buy jumped from $1.25 to $2.60. Peanuts went from $3/pound to $6. My health insurance has increased in cost fourfold over the past couple years even though my health hasn’t changed (in fact, I quit smoking and eat better now). Gas is up too.
There is inflation, but I don’t think you have correctly identified the source…
Trickle what?
Notice that the stock market has been restored, major corporate financial institutions have been restored, households…
importanttopics.
“This is due to modern welfare programs which didn’t exist when the depression began.”
————-
Can you kindly specify the most important ones?
It is definitely a different dynamic. The tea party supports lower taxes for the wealthy and reduced government services across the board while billionaire Warren Buffett supports increasing taxes on the wealthy. Scott Walker was elected on the tea party platform and the democrats and unions did not succeed in recalling him. Even Jeb Bush is being called out by Grover Norquist for being too moderate.
For clarity’s sake would it be the GOP or the Dems who should have taken the backlash? And what do you make of 2010 Dem congressional defeat? Was that an expression of dissatisfaction with the Dems, with government or the rise of the teabaggers. Are we to assume you mean that no appreciable shifts have neen noted over the period cited?
Two more analyses please. Smile. 😉
You’re correct, Professor. There hasn’t been a political backlash, and we haven’t seen as much displacement. This is due to modern welfare programs which didn’t exist when the depression began. Today we simply borrow money to pay everyone what they need. I think this activity is eventually going to affect the U.S. dollar. I see massive price inflation coming sometime in the next few years.