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:
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: 40.4 million
Official unemployed: 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.
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.