There is another round of bad news for most Americans. A study shows the top 1% of America's rich captured 121% of the income gains for the two years after the 2007-2009 recession was declared over. U.C. Berkeley Economist Emmanuel Saez released his study Striking it Richer: The Evolution of Top Incomes in the United States early this month to much press. It truly is astounding. Gone is America's strong middle class where work was rewarded.
The attack on labor is in full throttle. We hear reports of outrageous pay for government workers with economic fictional spin. Pundits weave tall tales blaming the workers themselves as the reason for America's economic malaise. Actual wage statistics are never mentioned. Nor is the never ending income inequality in the United States and the policies which cause it.
The election was won by identity politics. Black people voted for President Obama by over 93%, Hispanics 71% and Asians 73%. The exit polls show 55% of women voted for Obama, whereas 59% of white people voted for Romney. Ninety percent who thought the economy is good voted for Obama. Those who thought it is not so good voted for Romney by 60% margins.
Why Romney lost so big is a topic really outside our purview, yet we'll put in our 2¢ that it might be due to campaign rhetoric on policies promised. Unfortunately, there are words and there are deeds. What has the Obama administration done economically for the demographic groups who gave President Obama a second term?
A shocking claim was made by various press sources that those at the bottom of the American economic pile have living expenses which are double their income.
The bottom fifth of the U.S. income distribution -- 24.4 million households -- on average earned $10,074 in after-tax annual income and spent $22,001 last year,
Most of America is poor, broke, and getting poorer. So shows new Census statistics for 2011. Real median income for households declined 1.5% to $50,054 and has declined for the second year in a row. The household median income is 8.1% lower than 2007 and 8.9% lower than 1999! The median belies the growing income inequality in the United States. Below is the Census graph of real household income by selected percentiles and illustrates our tragic unequal state. The top 5% increased their income by 66.2% while the the median income has only increased 19% since 1967. Real means inflation is removed.
Most economists and the press look at personal income to think about America and wages. But there is another set of statistics which paints an even more stark picture. The social security administration publishes wage data, the last year available is 2010. While the average wage was $39,959.30, 66.2% of wage earners make less than this amount The median wage is $26,363.55. That means 50% of all wage earners in the United States earned less than $26,363.55 annually. That's poor.
The Federal Reserve released a report, the 2010 Survey of Consumer Finances. This is a report on household wealth from 2007-2010, removing effects of inflation. No surprise, median net worth declined by 38.8% from 2007 to 2010 and is down to 1992 levels. Why this should be no surprise is due to the housing bubble and declining home values. A home is the largest asset many people have.
It seems the entire world has been confused by the Census and understandable so. This past week saw dueling quotes on the number of people in poverty in the press. There are actually two major measures of poverty for 2010 and the experimental, research measure was released this week. This supplemental poverty measure shows there are more people in poverty, 49.1 million, than the official tally, 46.2 million.
The Census released a comprehensive report on poverty, income and health insurance coverage in the United States for 2010. There were 46.18 million people living in poverty, in the United States. The Census population for 2010 was 305,688,000. This means that 15.1% of people in the United States are below the poverty thresholds, or one in 6.6 people.
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