The Vanishing Middle Class

The success of President Obama's presidential campaign turned on his focus on how the middle class had lost ground over the past decade. Unlike his competitors--both Hillary Clinton and John McCain--he hammered on this theme until even Bill Clinton complained on the campaign trail about Obama's criticism of his Administration's failure to bolster the middle class. Since taking office, he created the Middle Class Task Force led by Joe Biden and has repeatedly stressed the benefits of his policy initiatives for the dwindling middle class. Linked to this sitaution is the entropy of the union movement, which only represents 6% of private sector employees. As President Obama said," without a strong union movement, we can not have a vigorous middle class." And I might add--a strong democracy.

In the current economic climate, the middle class is actually vanishing and unless drastic steps are taken to reverse the trend, it may die all together. Bernie Sanders in speaking out against extending the moratorium on the estate tax or "death tax" if you are a Republican, charged that supporters of the idea wanted to 'kill the middle class and create an oligarchy." Unfortunately, there is a lot of truth to this as the American workers are now being melded into the global labor pool, which will require them to accept lower wages and only sporadic employment.

Michael Snyder at Business Insider lists 22 facts about how the middle class is dying in America and there are pretty ugly. Since these have been posted on the internet the last week, it's worth repeating them before the posts vanish in the blogosphere.

83% of all stocks are held by the top richest 1% of Americans.

61% of all Americans live paycheck to paycheck. This is up from 49% in 2008 and up from 43% from 2006.

66% of all income growth went to the top 1%.

36% of Americans do not contribute anything to retirement savings plans.

43% of Americans have less than 10K saved for retirement.

24% of Americans have postponed retirement in the last year.

1.4 million Americans have filed for bankruptcy in 2009; 32% above filings in 2008.

Only the top 5% of households since 1975 have earned enough to match the rise in housing costs.

This is the first time in American history that banks owned a greater share of residential housing's net worth than all Americans put together.

In 1950, the ratio of executives' pay to workers was 30-1. Since 2000 alone, the ratio has exploded to 300-500 to 1.

The bottom 50% of all income earners collectively own less than 1% of the country's wealth.

In 2007, the bottom 80% of all households held about 7% of all financial liquid assets.

Wall Street bonuses for 2009 were up 17% compared to 2008.

The average Federal worker now earns 60% more than the average worker in the private sector.

The top 1% own nearly 2 times as much of America's corporate wealth as they did 15 years ago.

The top 10% earn about 50% of our nation's income.

Between 2000 and 2007, productivity rose 20%, yet the average workers' income fell by $2,000.

40% of Americans now work in low-paying service jobs.

40 million Americans are now on food stamps and that is estimated to rise to 43 million in 2011.

The number of millionaires rose 16% to 7.8 million in 2009.

21% of all children are now living below the poverty line in 2010, the highest in 20 years.

The average time now that it takes to find a job has risen to 35.2 weeks.

If you are over 45, your best bet is to be self-employed since employers now seek younger employees.

Basically, no one has been minding the store and all the stock disappeared and all the customers vanished. To begin to reverse this death spiral, the basic fundamentals of the economy must change and given the current obstructionism on the Hill it's hard to see any major initiatives coming forth in the next two years. What Obama is achieving now is through stealth measures sprinkled throughout legislation, which will sow the seeds of future growth but are not apparent to the public.

Maybe this is the Vanishing America John Boehner is speaking about. I don't think he's connected the dots.