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Spreads the blame rather evenly...

http://finance.yahoo.com/news/How-the-middle-class-became-cnnm-2876148381.html

Are you better off than your parents?

Probably not if you're in the middle class.

Incomes for 90% of Americans have been stuck in neutral, and it's not just because of the Great Recession. Middle-class incomes have been stagnant for at least a generation, while the wealthiest tier has surged ahead at lighting speed.

In 1988, the income of an average American taxpayer was $33,400, adjusted for inflation. Fast forward 20 years, and not much had changed: The average income was still just $33,000 in 2008, according to IRS data.

Meanwhile, the richest 1% of Americans -- those making $380,000 or more -- have seen their incomes grow 33% over the last 20 years, leaving average Americans in the dust. Experts point to some of the usual suspects -- like technology and globalization -- to explain the widening gap between the haves and have-nots.

But there's more to the story.

A real drag on the middle class

One major pull on the working man was the decline of unions and other labor protections, said Bill Rodgers, a former chief economist for the Labor Department, now a professor at Rutgers University.

Because of deals struck through collective bargaining, union workers have traditionally earned 15% to 20% more than their non-union counterparts, Rodgers said.

But union membership has declined rapidly over the past 30 years. In 1983, union workers made up about 20% of the workforce. In 2010, they represented less than 12%.

"The erosion of collective bargaining is a key factor to explain why low-wage workers and middle income workers have seen their wages not stay up with inflation," Rodgers said.

Without collective bargaining pushing up wages, especially for blue-collar work -- average incomes have stagnated.

International competition is another factor. While globalization has lifted millions out of poverty in developing nations, it hasn't exactly been a win for middle class workers in the U.S.

Factory workers have seen many of their jobs shipped to other countries where labor is cheaper, putting more downward pressure on American wages.

"As we became more connected to China, that poses the question of whether our wages are being set in Beijing," Rodgers said.

Finding it harder to compete with cheaper manufacturing costs abroad, the U.S. has emerged as primarily a services-producing economy. That trend has created a cultural shift in the job skills American employers are looking for.

Whereas 50 years earlier, there were plenty of blue collar opportunities for workers who had only high school diploma, now employers seek "soft skills" that are typically honed in college, Rodgers said.

A boon for the rich

While average folks were losing ground in the economy, the wealthiest were capitalizing on some of those same factors, and driving an even bigger wedge between themselves and the rest of America.

For example, though globalization has been a drag on labor, it's been a major win for corporations who've used new global channels to reduce costs and boost profits. In addition, new markets around the world have created even greater demand for their products.

"With a global economy, people who have extraordinary skills... whether they be in financial services, technology, entertainment or media, have a bigger place to play and be rewarded from," said Alan Johnson, a Wall Street compensation consultant.

As a result, the disparity between the wages for college educated workers versus high school grads has widened significantly since the 1980s.

In 1980, workers with a high school diploma earned about 71% of what college-educated workers made. In 2010, that number fell to 55%.

Another driver of the rich: The stock market.

The S&P 500 has gained more than 1,300% since 1970. While that's helped the American economy grow, the benefits have been disproportionately reaped by the wealthy.

And public policy of the past few decades has only encouraged the trend.

The 1980s was a period of anti-regulation, presided over by President Reagan, who loosened rules governing banks and thrifts.

A major game changer came during the Clinton era, when barriers between commercial and investment banks, enacted during the post-Depression era, were removed.

In 2000, the Commodity Futures Modernization Act also weakened the government's oversight of complex securities, allowing financial innovations to take off, creating unprecedented amounts of wealth both for the overall economy, and for those directly involved in the financial sector.

Tax cuts enacted during the Bush administration and extended under Obama were also a major windfall for the nation's richest.

And as then-Federal Reserve chairman Alan Greenspan brought interest rates down to new lows during the decade, the housing market experienced explosive growth.

"We were all drinking the Kool-aid, Greenspan was tending bar, Bernanke and the academic establishment were supplying the liquor," Deutsche Bank managing director Ajay Kapur wrote in a research report in 2009.

But the story didn't end well. Eventually, it all came crashing down, resulting in the worst economic slump since the Great Depression.

With the unemployment rate still excessively high and the real estate market showing few signs of rebounding, the American middle class is still reeling from the effects of the Great Recession.

Meanwhile, as corporate profits come roaring back and the stock market charges ahead, the wealthiest people continue to eclipse their middle-class counterparts.

"I think it's a terrible dilemma, because what we're obviously heading toward is some kind of class warfare," Johnson said.
 

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You know, I don't know how to respond to this or even if I should. I have spent a lot of time thinking about this over the last few years. I don't have a college education but I have succeeded into what some people consider upper income. More than 50k less than 150k. I think too many people think they should succeed just because they exist and I see people who should advance but don't for many reasons. I do know that the position I was hired into 15 years ago paid $15 per hour and I hire people into the same position today at $15 per hour. And of course we know everything costs the same. What is the solution? Until we look at this as a business/people situation and not a political situation where the same group of people profit it will not end. And I believe it does not matter which side of the aisle you are on. Now here comes the political part. I think it is time to stop buying the lies of the left that without them we can't succeed AND it is time to stop buying the lies that the right is interested in helping pull us up by the boot straps. I firmly believe the answer lies somewhere in the middle. Some people are going to have to fail because they won't try, some will succeed because they work extra hard but I think that is 10% on each end. What abouut the other 80%? I am sure I will think of more to say on this subject.
How about, if you reply, you try to bring some reasonable solutions/ideas instead of bomb throwing. It is only through the middle that we can influence the left and right and get back on the proper path.
 

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Told you I would forget something. Think about this, both left and right. What if term limits were imposed for the house and senate. 2 terms, that's it, your out. Remember, at the beginning of our country people were "forced" to leave their business or job and couldn't wait to get back home. Now people pay millions of dollars to win a job worth 100k?
 

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Told you I would forget something. Think about this, both left and right. What if term limits were imposed for the house and senate. 2 terms, that's it, your out. Remember, at the beginning of our country people were "forced" to leave their business or job and couldn't wait to get back home. Now people pay millions of dollars to win a job worth 100k?
I agree with the concept. But one unintended consequence might be 'get elected, spend like crazy, and leave.' With no senior legislators around to reflect on the past, or to get that legislation 10 years in the making thru... Could be a bummer.

On the other hand, such limits would stop these big ass bills that the fed.gov has no biz passing never happen...

See, on paper it can all be made to look however we want. But when human nature is involved, the paper does not mean ****. That is why psychlogists should be legislators, not lawyers!

:laughing:
 

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I agree this is unfortunate, and is becoming a bigger problem, but it seems to me that is boils down to value. As a contributor to the world economy, what do I bring to the table? If someone is willing to pay me 30K/yr, that's what I'll get. If I want to be worth more, I need to plan and work towards achieving that.

There have never been guarantees, and even hard work and an education don't mean I will automatically obtain a better paycheck. Certainly, if all I have is a high school diploma, and no specialized skills, my chances will be much worse.

Someone can say I'm worth a certain income, but until another is willing to pay that amount, it's just their opinion.
 

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There are a variety of reasons people earn what they earn.
Some are willing to go the extra effort to do what is needed.
Some will sit back and complain and use emotional phrases like
the " haves and have nots". Some have kids to early and for go the education they need. I did the 12 to 15 hour a day thing until I was 41. Now it's 10 hours a day in a gov. job. I've made my share of mistakes in life that hampered some of my earning potentiol. At other times I got lucky and made good choices that allowed me to save and pay down what's need for retirement years. There will always be those on both ends of the pay scale. If we got rid of the emotional and unproductive part of our thinking and put it into doing something about it that would be a good start. I've never been one to persecute those that have money. Because they spend it and provide work for others. Better than the government controlling it all. We sell our selves based on our ability and willingness in order to get a paycheck. More government controls on a free economy is not the answer. And we seem to forget at times the blame should be placed on the person in the mirror.
 

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The usual swipe at the rich always assumes that money making is a zero sum game. It assumes that if the rich make more, it is at the expense of the middle. That's not necessarily true. How would the rich making less enrich the middle? There is no system other than taxation that would take money the rich have earned and distribute it to the middle. Is that what we want? The middle is stagnating because technology and foreign competition have been a one-two punch to good middle class jobs. Both of those things have eliminated the good jobs that used to support Americans with a high school diploma. The rich getting richer had absolutely nothing to do with it.

Ever watch "How IT's Made" on TV? It's a simple little show that shows how every-day products are made. I saw one last night where they were making paper cups. There didn't appear to be a human in sight. It's all done with technology now. The same is true for almost every product they show. Machines make everything, so the only people needed are highly trained technicians who keep the machines working. Over the last 40 years, this has been a much greater hit to the middle class than outsourcing or rich people.
 

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Too much economic gap.

Class warfare is comming.
Just like in the middle east.
 

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This is because the bankers who have kept the middle class working 40-60 hours a week to make ends meet, have stolen the wealth of the country. Sorry Tex.. just a fact. While they had you on a tread mill for the last 40 years trying to stay middle class, they were devaluing your money, overvaluing your home, food, cars, necessities and telling you that their 2500% increase in income was earned.. :laughing:

So now, your dollar isn't worth the paper it's printed on, your debt load as a nation is about $45k per person and they also hold the mortgage on your extremely overvalued home and when you die, they will come take most all of the rest.

And you defend them... now tell me that isn't a slick scam!
 

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This is because the bankers who have kept the middle class working 40-60 hours a week to make ends meet, have stolen the wealth of the country. Sorry Tex.. just a fact. While they had you on a tread mill for the last 40 years trying to stay middle class, they were devaluing your money, overvaluing your home, food, cars, necessities and telling you that their 2500% increase in income was earned.. :laughing:

So now, your dollar isn't worth the paper it's printed on, your debt load as a nation is about $45k per person and they also hold the mortgage on your extremely overvalued home and when you die, they will come take most all of the rest.

And you defend them... now tell me that isn't a slick scam!
One application for banker position please, (I want to step up from middle class) :D

Basically you are against investments? Are you proposing regulation on profits? Please make up my mind

The great thing about this country is you can do what you chose. The problem I have is when you choose poorly somebody else is at fault or should pay for it :crazy:

My biggest criticizm is the stupid things people invest in.. Wireless phones, American Idol, .com's This country survives by making things not buying them :lookinup:
 

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I think that the word "value" is the key. What is the value of the American worker? How much per hour? And who decides?

For many years, it was a mixture of many factors. The marketplace, of course . . . and yes, the unions had their involvement as well, as did management and the corporate bottom line. So where are we now?

An increasingly global economy has brought some issues with it that were not significant factors in the past, such as the extremely low wages many foreign workers are (or at least were) paid. The quality of foreign-made items used to be a factor as well, now the pendulum has tended to swing the other way on that. As more and more foreign-owned companies set up shop on U.S. soil, they weigh their own corporate bottom lines based on many things, including the increased cost of predominantly non-union U.S. workers over labor costs in their home countries versus the savings on not having to ship and warehouse everything from overseas. It's a complicated picture, and likely to remain so.

So, what of the U.S. middle class? Where do they go from here, and how do they get there? Some will get there working for foreign-owned compnaies, an anethema years ago but increasingly acceptable, especially where those companies are frequently now the only game in town. Some will relocate to other parts of the country, to go where the jobs are. Some will seek further education to increase their appeal to prospective employers. Many will do all these things, and more.

I think a lot of the ballyhoo about "Class Envy" in the press has some validity . . . but I don't think it's so much the disappearing middle class that evies the well-to-do as it is the poorer among our citizens craving that "step up" that has always been so difficult to make. And it's getting tougher. Some will say that government programs and "entitlements" help these people to acheive their dream. Others counter that the vast majority of these programs serve only to artificially prop up these folks, and make them eternally dependent upon the public largesse for their very existence while virtually guaranteeing the re-election of the politicians who champion them.

Self-reliance and personal responsibility for yourself and your family should be the path everyone wants to walk as they pursue their goals. Is that, in fact, the case - or are we becoming increasingly a nation of citizens seated on the porches of government-subsidized housing, asking "Where's my check?". And if so, are those citizens entirely to blame?

We all have our own opinions of what's wrong with America. Most of us wish there was a simple, common-sense solution, but I don't think there is - and I certainly don't expect politicians on either side of the aisle to provide it. A politician's only job is to get himself re-elected. Period. That's why I try never to re-elect anybody. Once a power base of long-standing incumbancy is established, you can't get 'em out there with a crowbar. The problem with this theory, of course, is where and how do you get anyone qualified and/or concerned enough to serve?

And on we go.
 

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One application for banker position please, (I want to step up from middle class) :D

Basically you are against investments? Are you proposing regulation on profits? Please make up my mind

The great thing about this country is you can do what you chose. The problem I have is when you choose poorly somebody else is at fault or should pay for it :crazy:

My biggest criticizm is the stupid things people invest in.. Wireless phones, American Idol, .com's This country survives by making things not buying them :lookinup:
Yeah, so many people made poor choices in their homes, the stock market, their career their 401k ect. Come on, get out from under the gas and wake up man.. they just sheered this sheep for the last time and now the reckoning is coming.



Guess who is responsible for that? It sure won't be the "too big to fail" crowd. Take a long hard look at the comparison between the debt and the GDP.. this isn't rocket science..
 

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Too much economic gap.

Class warfare is comming.
Just like in the middle east.
Oh, class warfare is already here, as this thread shows. Only problem is, it's wishful thinking to think that slamming on the rich is going to improve the lot of the middle class. If the rich make less money, that won't do one thing to help the middle class make more. In fact, if you tell the entrepeneur class that they won't get to profit from their efforts, they will stop trying. And new small businesses are the number one source of new jobs. It's called cutting off your nose to spite your face. You hate the rich. You know hurting them won't help you. But you want to hurt them anyway. Self defeating.
 

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Bonnie, Clyde and NEWB!!!!:partyon:
 

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Oh, class warfare is already here, as this thread shows. Only problem is, it's wishful thinking to think that slamming on the rich is going to improve the lot of the middle class. If the rich make less money, that won't do one thing to help the middle class make more. In fact, if you tell the entrepeneur class that they won't get to profit from their efforts, they will stop trying. And new small businesses are the number one source of new jobs. It's called cutting off your nose to spite your face. You hate the rich. You know hurting them won't help you. But you want to hurt them anyway. Self defeating.
:agree: Atlas Shrugged???
 

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Oh, class warfare is already here, as this thread shows. Only problem is, it's wishful thinking to think that slamming on the rich is going to improve the lot of the middle class. If the rich make less money, that won't do one thing to help the middle class make more. In fact, if you tell the entrepeneur class that they won't get to profit from their efforts, they will stop trying. And new small businesses are the number one source of new jobs. It's called cutting off your nose to spite your face. You hate the rich. You know hurting them won't help you. But you want to hurt them anyway. Self defeating.
I dont hate the business owners/creators/job creators.
The problem I see and commented on before is too much paper money in banks and not in the flow of progress.

VetteNewb is blaming banks.
I'm blaming banks and investors that contribute nothing other than feeding off the labor of others.

Sure they add a small amount of equity for companys to use to expand and borrow, but over all, when your a 15 millionaire with 14 million in investment exposure via stocks and shares, and just sitting on that wealth for income, sure your not feeling safe and ready for retirement with 15 million.
Your at risk with it all on the line, and your also removing all that money from the market where it would otherwise get spent to fuel the economy, jobs, manufaturing, goods, commodities, more.
Die without spending your 14 million and pass in onto your children and repeat the cycle with more greed, savings, frugality....and compound the issue.

the number of wealthy savers increases, and the middle class and poor increases.
Economic gap grows.
 

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Atlas Shrugged???
Exactly! A prosperous country needs rich people and creative people. Rich people provide the financial capital and creative people provide the intellectual capital for prosperity. Occasionally they are one and the same - like Bill Gates. I won't argue that the crony politics between the banking industry and Washington is out of whack. I do believe bankers have screwed the country and government has kept them from suffering the consequences of their actions. That needs to be fixed. But an all out assault on rich people is shooting at the wrong target. It's simply jealousy that will not end up helping anyone.
 

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I dont hate the business owners/creators/job creators.
The problem I see and commented on before is too much paper money in banks and not in the flow of progress.

VetteNewb is blaming banks.
I'm blaming banks and investors that contribute nothing other than feeding off the labor of others.

Sure they add a small amount of equity for companys to use to expand and borrow, but over all, when your a 15 millionaire with 14 million in investment exposure via stocks and shares, and just sitting on that wealth for income, sure your not feeling safe and ready for retirement with 15 million.
Your at risk with it all on the line, and your also removing all that money from the market where it would otherwise get spent to fuel the economy, jobs, manufaturing, goods, commodities, more.
Die without spending your 14 million and pass in onto your children and repeat the cycle with more greed, savings, frugality....and compound the issue.

the number of wealthy savers increases, and the middle class and poor increases.
Economic gap grows.
I'm not rich, but I know a few rich people, and I can tell you your outline of their handling of wealth is way off base. The people know that the best way to make more money is good investment. They all have the majority of their money working in investments nearly all the time. Now, they do change their mode of investment as economic conditions change. Right now, most are in a capital protection mode investing in bonds, etc instead of stocks. But that's just wise investing. Most will tell you they are waiting for a signal that Obama is going to let up on business rather than press down harder. When investors are convinced government is going to quit strangling our corporate community, their money will go back to work. If it was your money, you would be doing the same thing.
 

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These numbers are skewed and do not give an accurate account for economic downturns. They are taken during downturns... while completely ignoring hot increases during the mid 90's and mid 2000's.
 

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The truth of the matter as usual lies somewhere in the middle. While bankers and wallstreet have taken a huge toll on both middle class and upper class investors it is very much let the buyer be ware when it comes to investing, or borrowing. If you don't understand the markets that you are getting into you have no business getting into them and trusting some financial adviser to make money for you is like trusting the fox to raise your chickens. Your home is just the place you live in not an investment, unless it is a second home or investment property. If you lost value on your home it is no problem unless you were stupid enough to borrow dangerously against the equity in it. If you didn't borrow against the equity then either you are in a hole that you will eventualy grow out of (if you bought at the peak) or you have lost the paper values that were just lies anyway. Those who walk away from a home just because they owe more than it is worth are just plain stupid. When your home is underwater you haven't lost anything but your risk.

As far as unions go, there was a time they were needed and that time is gone. The demands they place on companies are stupid in a time when companies are trying to compete with China. Union demands simply accelerate the demise of those companies and the loss of union jobs. Public unions should be illegal since the employers they negociate against are the tax payer, agroup that they make a significant portion of. They hold unfair advantages in influencing the politics that keep them getting unfair advantages over private sector workers.

As for foreign competition. The US has always been able to compete well against all foreign competition. The US worker is the most productive worker in the world and that is very hard to compete against. Add to that the technological advantages that the US holds and you see why even competition from Japan was no problem for the US. That is untill China declared economic war against us. This declaration was certainly not a public one. They just started doing what they knew would destroy us. They artificialy tied their currency to ours in such a way that our products would always be expensive in China and their products would always be cheap here. Being a communist country and so allowing them to control all aspects of investment they took much of the profits that they made from us and lent it to us knowing full well that we would borrow till we die. We think that the fact that China lends us so much money puts them in danger too, but they are not since what they realy want is for the dollar to stop being the world currency. If they succeed in doing that we are done and they become the sole economic super power. The money that they will loose in bad US investment will be nothing compared to what they will earn as the sole economic super power. I doubt that the US will wake up in time avoid this but I can hope, and point it out, in hope that we will all wake up and stop looking at each other as the enemy and realize that we are at war...economic war. And if we loose this war, we will loose a lot more than control over a few oil fields, we will loose our standard of living. Imagine not being able to use one half of the oil in the world even though we are just 1/10th of the population. Imagine the cost of food being one third or half of your income instead of less than a tenth. If you think the middle class has it bad now just imagine what it will be like when the US become equal to the rest of the world in standard of living. It will not be pretty.
 
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