Sunday, August 26, 2007

Where have all the middle class gone...far , far away

There's been an explosion of wealth creation in the U.S. in recent years. But it's not about trickle-down economics. It's more a matter of gusher-up capitalism, rivaling the days a century ago when business barons such as Carnegie, Ford and Rockefeller built empires and fortunes.

Three hedge fund managers earned one billion dollars or more as reported here .

Now the so-called middle classes are disappearing according to this newspaper article.

California became a more unequal place over the past generation, according to a new report released today by the California Budget Project, with about two-thirds of the state's recently created jobs at either the very top of the pay scale, or at the bottom. Relatively few jobs were created in the middle of the wage scale, resulting in a California of more haves and have-nots, with relatively few middle-class jobs available.

"When the middle rungs of the ladder are missing, it makes it hard to move up that ladder," said Jean Ross, executive director of the budget project, a non-profit research group .

Data in the report shows a decoupling of the connection between productivity gains and pay increases.
Across the state since 1979, the income gap widened between whites and Latinos, between those with a bachelor's degree and those without one, and between the purchasing power of those who hold the best-paying jobs and those who hold down the worst.
And while a four-year college degree still pays off, the study found that since 2000, new graduates have seen their pay decline by about 5 percent.

Few economists dispute that income inequality in California has increased over the past generation, particularly between the few at the very top of the income scale and everybody else.

A report by Public Policy Institute of California , "A Generation of Widening Inequality," found that the gap between low-wage and high-wage workers widened to a greater extent in California than in the nation because the state's low wage workers have fared worse than their counterparts in the nation overall.

The respected blog Huffington Post details :-

The top 10 % of income earners in the United States now owns 70 % of the wealth
The wealthiest 1 % owns more than the bottom 95 % .
In 2005, the top 300,000 Americans enjoyed about the same share of the nation's income -- 21.8 % -- as the bottom 150 million.

The top 20% of earners in Manhattan now makes 52 times what the lowest 20% makes -- $365,826 annually compared with $7,047 -- roughly the same as the income disparity in Namibia.

The ratio of average CEO-to-worker pay in the U.S. shot up from 301-to-1 to 431-to-1 in 2004.

The average CEO now earns substantially more in one day than the average worker earns all year.

The New York Times reveals :-

Americans earned a smaller average income in 2005 than in 2000, the fifth consecutive year that they had to make ends meet with less money - nearly 1 percent less . Many Americans are also paying a larger share of their health care costs and have had their retirement benefits reduced, adding to their out-of-pocket costs.

Those making more than $1 million , individuals who constitute less than a quarter of 1 percent of all taxpayers, reaped almost 47 percent of the total income gains in 2005, compared with 2000.

1 comment:

Anonymous said...

So, what I guess you are jealous?

Stop sitting around bitching about how you are poor and do something. Think up the next best and make your millions and get your 15 minutes.