posted February 17, 2011 09:20 PM            

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

posted February 17, 2011 11:01 PM            

Teachers Union Protests Gov. Scott Walker's Bill To Limit Bargaining Rights

quote:

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The Wisconsin State Capitol bulged with thousands of union members, including teachers, Thursday protesting Wisconsin Gov. Scott Walker's bill that would limit union bargaining rights.

Walker says it's a way to tighten the state budget, and he's not singling out any one union group, the New York Times reports. Still, with two days of "sickouts" across the state, teachers are making sure Gov. Walker knows they feel targeted.

The governor's plan calls for teachers to pay more for their pensions and health insurance to help eliminate the state's budget deficit.

Politico calls the Wisconsin protests a "a convergence that is remaking the politics of education."

Both Democrats and Republicans want reform on teacher pay and employment practices, and what's happening in Wisconsin could be the beginning of a movement.

"Teachers unions, historically one of the most powerful interest groups in American politics, are being besieged like never before -- under attack from conservative GOP governors with a zeal for budget-cutting even while taking fire from some Democrats, including President Barack Obama, who has suggested he agrees that unions can be an impediment to better schools."

From Nevada to Florida to New Jersey, state governments have challenged their own public unions with plans similar to Walker's, The Atlantic reports.

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So far I am liking Uranus heading back into Aries...reminds me of that Paddy Chayefsky movie Network

posted February 18, 2011 09:23 AM            

Let no more be heard of "Bush tax cuts for the rich". That was always a con, hoax, scam and lie told by the Marxist Socialists among us...and their useful idiots.

Yes, all across America, citizens went to their windows, opened them and yelled..."We're not going to take this any more". But, these citizens went further. They then went to the polls and involuntarily retired the shmucks, con artists, liars and general screw-ups who were taking America in a direction they didn't want to go...including in the state of Wisconsin which now has a Republican Governor, a Republican state Senate and a Republican state Assembly.

"I'd rather entrust the government of the United States to the first 400 people listed in the Boston telephone directory than to the faculty of Harvard University."...or to the faculty of University of Wisconsin-Madison.

posted February 18, 2011 09:02 PM            

In order to win elections they already have most of the money, now the only thing stopping them is the Union strongholds. The right wing jihad against ACORN was similar...and the GOP went after them quite aggressively. Why? because ACORN wanted to raise the minimum wage AND they registered minorities and the disenfranchised, who tend to vote DEMOCRATIC.

Rachel Maddow argues a good case as to what is really going on here, GOP Goal- Bake Sales vs Billionaires

Walker gave away 140 million worth of breaks to big business. Coincidentally the same amount of the short fall he wishes to recoup.

posted February 19, 2011 09:54 AM            

Give it a rest Node. Walker hasn't given away $140mil to anyone...yet. He was only sworn in as Governor of Wisconsin on January 3, 2011.

After the incompetent former demoscat administration..along with the demoscats in the Assembly, Senate and rabid leftist regulators drove business...and the tax base they represent...out of the state; Walker was left to deal with a $3 billion shortfall to balance the state budget.

posted February 19, 2011 11:37 AM            

Btw, the American people back Walker, other Governors, Mayors and County Executives who are tackling the employee union death grip on cities, counties, states and...the federal government.

February 18, 2011
Categories:Labor.Poll: Public unions a hard sell

A new poll from the Washington-based Clarus Group asked:

Do you think government employees should be represented by labor unions that bargain for higher pay, benefits and pensions ... or do you think government employees should not be represented by labor unions?

A full 64% of the respondents said "no."

That includes 42% of Democrats, and an overwhelming majority of Republicans. Only 49% of Democrats think public workers should be in unions at all.

That's on the fundamental right to organize, before you get to wages and benefits. And that puts Scott Walker in a pretty good political place.

posted February 24, 2011 01:36 AM            

By Zachary Roth

The Great Recession and the slump that followed have triggered a jobs crisis that's been making headlines since before President Obama was in office, and that will likely be with us for years. But the American economy is also plagued by a less-noted, but just as serious, problem: Simply put, over the last 30 years, the gap between rich and poor has widened into a chasm.

Gradual developments like this don't typically lend themselves to news coverage. But Mother Jones magazine has crunched the data on inequality, and put together a group of stunning new charts. Taken together, they offer a dramatic visual illustration of who's doing well and who's doing badly in modern America.

Here are three samples:

This chart shows that the poorest 90 percent of Americans make an average of $31,244 a year, while the top 1 percent make over $1.1 million:

• According to this chart, most income groups have barely grown richer since 1979. But the top 1 percent has seen its income nearly quadruple:

• And this chart suggests most Americans have little idea of just how unequal income distribution is. And that they'd like things to be divvied up a lot more equitably:

To see the rest of these fascinating charts, click on over to Mother Jones.

posted February 28, 2011 06:27 PM            

“Should any political party attempt to abolish social security, unemployment insurance, and eliminate labor laws and farm programs, you would not hear of that party again in our political history. There is a tiny splinter group, of course, that believes you can do these things. Among them are H. L. Hunt (you possibly know his background), a few other Texas oil millionaires, and an occasional politician or business man from other areas. Their number is negligible and they are stupid.”

posted February 28, 2011 06:32 PM            

General Dwight Eisenhower

posted March 01, 2011 12:26 PM            

Privatization of Social Security has been a platform for Republicans. I don't know that any of them acknowledge that such a change would actually cost more than the current system.

Eliminate labor laws? You're aware of what's going on in Wisconsin, and you endorse it. Would that not be considered the elimination of at least one labor law? And what of today's news of proposed repealing of child labor laws? Who initiated that? Which party fights against minimum wage increases?

Unemployment insurance? So Republicans are now the party of unemployment insurance? Obama won't have to negotiate the continuation of unemployment compensation as part of a tax deal in the future? Further, would you say that Republicans would propose unemployment insurance if it didn't already exist? I don't. I think Republicans would call it "socialist" like they do all social programs these days.

Farm subsidies. Both parties have taken issue with farm subsidies.

posted March 01, 2011 01:10 PM            

False! A plan to permit those not nearing retirement age to place 5% of their Social Security premium into a private retirement account in no way amounts to "privatization of Social Security".

"Eliminate labor laws? You're aware of what's going on in Wisconsin, and you endorse it."..acoustic

Yes, I am aware and I also approve. However, removing collective bargining on items not related to wages and salaries is not eliminating collective bargining. Nor does that constitute an assault on "Labor Laws" Nor does requiring state labor unions to collect their own union dues eliminate collective bargining or affect "Labor Laws".

"Unemployment insurance? So Republicans are now the party of unemployment insurance?"..acoustic

I'm not aware of any conservative...or any Republican...not the same things...who is talking about the elimination of unemployment compensation. I am aware of some who do not consider unemployment compensation to be a "forever" employee benefit and I'm one of those. 99 weeks of unemployment compensation is far too long to pay people to not work.

posted March 01, 2011 02:19 PM            

Don't do your party a disservice by disowning the core principles to which you guys adhere. A summation of the Conservative/Republican desire is that the government would get out of people's lives (that, and the law tends to err on the side of protecting people). Philosophically, that counters every notion of desiring any of the Federal social institutions. The only reason Republicans don't dismantle these institutions is that they're actually popular.

posted March 01, 2011 03:33 PM            

Changing something does not equate to ending/terminating that thing...in the case you cited...farm subsidies.

I knew you wouldn't be able to actually name a conservative lawmaker who is down with the items on your grievance list.

posted March 01, 2011 06:09 PM            

What does the evidence say? Does it support your belief or not? I don't think it does. If Social Security went away, what Republican principles would the action uphold? It would shrink the government, right? You like that. It would force people to take personal responsibility. Everyone knows Republicans like that. What would losing the labor laws accomplish? Well, Republicans are pro-business, right? Businesses would enjoy being able to negotiate directly with their workers without any pesky interference from the government. Republicans could get behind that. What would Republicans gain from destroying unemployment insurance? Once again it would be a pro-business option. Republicans would opine that the money savings will create jobs, right? Finally, what if farm subsidies were to vanish? Smaller government and personal responsibility are perfectly in line with Republican ideals.

posted March 01, 2011 06:51 PM            

“Should any political party attempt to abolish social security, unemployment insurance, and eliminate labor laws and farm programs...Node

"An accurate representation of mid-20th century America, one which current Conservatives seem to forget"...acoustic

If you had read the Eisenhower letter, you would not have discovered all those mid-century conservatives you wish were mentioned.

Nor have you come forward with any conservative lawmakers from the mid-century or even today.

You will find the letter...and it was from a letter and not from a public speech that the quote was lifted.
http://www.eisenhowermemorial.org/presidential-papers/first-term/documents/1147.cfm

You're right Randall. There is no Social Security "Lockbox" as Algore defined the Social Security Program...and, there never was.

Social Security as it was envisioned by Roosevelt was a thing of beauty...for the federal government.

posted March 02, 2011 01:53 AM            

Whether a speech or a letter is immaterial. It conveys the thoughts of Eisenhower.

Q7: Is it true that life expectancy was less than 65 back in 1935, so the Social Security program was designed in such a way that people would not live long enough to collect benefits?

A: Not really. Life expectancy at birth was less than 65, but this is a misleading measure. A more appropriate measure is life expectancy after attainment of adulthood, which shows that most Americans could expect to live to age 65 once they survived childhood. (See more detailed explanation.)
http://www.ssa.gov/history/hfaq.html