A closer look at the shift out of the middle reveals that “a deeper polarization is underway in the American economy,” says Pew Research Center report. (Image: DonkeyHotey/flickr/cc)
The American middle class is shrinking.
For the first time in more than four decades, middle-income households have lost their majority status in the U.S., according to new findings, and are now outnumbered by their counterparts on opposite ends of the income spectrum.
“The fastest-growing segments are the ones at the extremes, the very lowest and highest ends of the income distribution.”
—Pew Research Center
Based on the definition used in the Pew Research Center report released Wednesday, the share of American adults living in middle-income households—that is, with an income that is two-thirds to double that of the overall median household income, or $42,000 to $126,000 annually in 2014—has fallen from a high of 61 percent in 1971 to 50 percent in 2015.
At the same time, the share living in the upper-income tier jumped from 14 percent to 21 percent over the same period, and the share in the lower-income tier rose from 25 percent to 29 percent.
“The hollowing of the middle has proceeded steadily for four decades, and it may have reached a tipping point,” the Pew study suggests. Furthermore, a “closer look at the shift out of the middle reveals that a deeper polarization is underway in the American economy.”
“The movement out of the middle-income tier has been more than just a step in one direction or the other,” the report says. “The fastest-growing segments are the ones at the extremes, the very lowest and highest ends of the income distribution.”
In addition, middle class families have fallen further behind financially, the study shows, with the share of U.S. aggregate household income held by middle-income households having “eroded significantly over time.”
“Upper-income households now command the greatest share of aggregate income and are on the verge of holding more in total income than all other households combined,” the report reads. “This shift is partly because upper-income households constitute a rising share of the population and partly because their incomes are increasing more rapidly than those of other tiers.”
The Pew findings support what many 2016 presidential candidates, led by U.S. Sen. Bernie Sanders, have been saying on the campaign trail.
In an op-ed published this summer, Sanders decried what he called “the war against the American middle class,” marked by Wall Street greed, anti-worker policies, and corporate tax evasion.
A Wall Street Journal/NBC News poll in January found that 47 percent of respondents considered reducing income inequality an absolute priority for the government to pursue this year, with Democrats placing far greater importance on it than Republicans.
In a piece for Gawker on Thursday, Hamilton Nolan responded to Pew report with an irreverent eulogy.
“The Middle Class, a popular figure in American folklore, died this week after a long battle with capitalism,” Nolan wrote. “Its passing has been expected since the recent death of its partner, The American Dream.”
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Are You Prepared For The Coming Economic Collapse And The Next Great Depression?
JP Morgan And Citigroup Agree That The U.S. Economy Is Steamrolling Toward A Recession
By Michael Snyder, on December 6th, 2015
As we approach the end of 2015, researchers at both JP Morgan and Citigroup agree that the probability that the U.S. economy will soon plunge into recession is rising. Just last week, a member of the U.S. House of Representatives asked Janet Yellen about Citigroup’s assessment that there is a 65 percent chance that the United States will experience an economic recession in 2016. You can read her answer below. And just a few days ago, JP Morgan economists Michael Feroli, Daniel Silver, Jesse Edgerton, and Robert Mellman released a report in which they declared that “the probability of recession within three years” has risen to “an eye-catching 76%”…
“Our longer-run indicators, however, continue to suggest an elevated risk that the expansion is nearing its end, and our preferred model now puts the probability of recession within three years at an eye-catching 76%.”
The good news is that the economists at JP Morgan believe that a recession will probably not hit us within the next six months. But due to steadily weakening economic conditions, they are convinced that one is almost certain to strike within the next few years…
“When we first wrote, only manufacturing sentiment was signaling an above-average probability of imminent recession,” they said. “But recent weakening in the Richmond Fed services survey and the ISM nonmanufacturing index have now pushed the nonmanufacturing sentiment probability up somewhat as well.”
In the short term, the note says that the 6-month likelihood is only 5%, but within a year it stands at 23%, in two years 48%, and in three years the “eye-popping” 76%.
To be honest, I believe that this assessment is far too optimistic, and it appears that researchers at Citigroup agree with me. According to them, there is a 65 percent chance that the U.S. economy will plunge into recession by the end of next year. Last week, Janet Yellen was asked about this during testimony before Congress…
In testimony before Congress’ Joint Economic Committee, Yellen was asked by Rep. Pat Tiberi about a piece of research released by Citigroup’s rates strategy team Monday.
Specifically, Tiberi, an Ohio Republican, wanted to know what Yellen made of Citi’s conclusion that there is a 65 percent chance of a U.S. recession in 2016.
“The economists said that they would assign about a 65 percent likelihood of a recession in the United States in 2016. Now, 65 percent sounds high to me, but I’m not an economist and I’m not the Fed chair. But zero risk might be too low as well. So what would you assign a risk level of a recession next year?” Tiberi asked.
Fed’s Williams says low neutral interest rates a ‘warning sign’
WASHINGTON
John Williams, president of the Federal Reserve Bank of San Francisco, speaks in San Francisco, California March 27, 2015.
Reuters/Robert Galbraith – RTR4V7IP
San Francisco Federal Reserve President John Williams said on Friday that low neutral interest rates are a warning sign of possible changes in the U.S. economy that the central bank does not fully understand.
“I see this as more of a warning, a red flag that there’s something going on here that isn’t in the models, that we maybe don’t understand as well as we think, and we should dig down deep deeper and try to figure this out better,” he said during a panel discussion at the Brookings Institute in Washington.
Williams, who is a voting member of the Fed’s policy-setting panel through the end of the year, has said the central bank should begin to raise interest rates soon but thereafter go at a gradual pace.
He added that the low neutral interest rate had “pretty significant” implications for monetary policy, and put more focus on fiscal policy as a response.
“If we could come up with better fiscal policy, find a way to have the economy grow faster or have a stronger natural rate of interest, then that takes the pressure off of us to try to come up with other ways to do it, like through a large balance sheet or having a higher inflation target,” Williams said. “It also means we don’t have to turn to quantitative easing and other policies as much.”
Bankers who are found guilty of market rigging, fraud and irresponsible lending should be imprisoned, a member of the Scottish Parliament has said.
Scottish Government Cabinet Secretary Keith Brown said the UK should follow Iceland’s example of jailing corrupt financiers, rather than merely imposing fines, which is the current punishment for rogue bankers in Britain.
Speaking to the BBC on Thursday, Brown praised the actions of Iceland, which jailed its top banking chiefs for criminal behavior.
Iceland, which suffered a deep recession after the 2008 crash, set up a prosecuting team to investigate 21 alleged reports of illegal banking practice.
This resulted in the chiefs of Iceland’s three biggest banks – Glitnir, Kaupthing and Landsbanki – being convicted.
Hopes are dimming that Congress will intervene to block a hugeMedicare premium increase of over 50 percent for nearly a third of the 50 million elderly Americans who receive their physician care and other health services through Medicare Part D.
Republicans and Democrats are deadlocked over how to come up with roughly $10.5 billion to prevent Medicare premiums from skyrocketing for millions of seniors beginning next January. The looming increase is the result of a quirk in the law that drives up premiums for wealthier Americans and poor people with chronic medical problems in years when the Social Security Administration doesn’t approve a cost-of-living adjustment for beneficiaries.
While both parties are interested in doing something to reduce or avert the premium hikes, Republicans are demanding that the cost of any bailout be offset by cuts in other areas of the Medicare program, while Democrats are resisting that approach. Moreover, there is a division between House Minority Leader Nancy Pelosi (D-CA) – a major champion of a bailout – and some Senate Democratic leaders who are less enthusiastic about the effort and how to pay for it.
“It’s a big mess,” said one Washington health care expert who is following the negotiations closely.
Negotiations may pick up later this month once the Centers for Medicare and Medicaid Services formally releases its official 2016 premium rates, according to a report on Thursday by the Morning Consult.
Empty coal gondolas in a rail yard in Danville, W.Va. Patrick Morrisey, West Virginia’s attorney general, said President Obama’s climate change regulations would have “devastating impacts” on families in his state.Credit Luke Sharrett for The New York Times
WASHINGTON — As many as 25 states will join some of the nation’s most influential business groups in legal action to block President Obama’s climate change regulations when they are formally published Friday, trying to stop his signature environmental policy.
In August, the president announced in a White House ceremony that the Environmental Protection Agency rules had been completed, but they had not yet been published in the government’s Federal Register. Within hours of the rules’ official publication on Friday, a legal battle will begin, pitting the states against the federal government. It is widely expected to end up before the Supreme Court.
“I predict there will be a very long line of people at the federal courthouse tomorrow morning, eagerly waiting to file their suits on this case,” said Jeffrey R. Holmstead, a lawyer for the firm Bracewell & Giuliani who represents several companies that are expected to file such suits.
While the legal brawls could drag on for years, many states and companies, including those that are suing the administration, have also started drafting plans to comply with the rules. That strategy reflects the uncertainty of the ultimate legal outcome — and also means that many states could be well on the way to implementing Mr. Obama’s climate plan by the time the case reaches the Supreme Court.
Since our worlds collided on that fated day in 2008 when the American dream became even more elusive for the majority of us there has been some time to reflect on our mistakes. Some of us have learned from what we have lived and experienced. Others, however, are still stuck in the partisan la la land of Rabid Conservatism or Rabid Liberalism. Each side pulling for its own without taking pause to understand the long-range consequences of their actions.
Politicians will do what politicians do best, protect their pockets and those who keep them full. What excuse do the common folk (non-corporate or lobbyist) have? You vote Republican or Democrat because they hold the best future for our country? Or do you vote because it is all you know and you cannot fathom the fact that both sides of the aisle serve the same master? It has gone way beyond the scope of political party or leanings. It is time to put those patriotic gestures, slogans and mindsets to actual use by truly putting your country first. We must put a stop to the criminal Washington/Corporate agenda that is killing us.
Until we truly and seriously address the criminals who are selling our Nation and our children’s future to the highest bidder we are doomed. Are you ready to face the truth or will you just sit back and blame another while you do nothing to change the problem?
The only answer to the putrefaction that is taking place all across this nation is in the hands of the people. Many laughed at the Occupy movement. Some vilified those who wanted to make a difference and voice their displeasure with the status quo. How many of you have done anything to make a change? How many of you have cared enough to even consider what role you may have to play?
Truly, I do not see a way out of this unless people stop seeing right or left and start seeing stars and stripes. This nation depends on it’s People, not its politicians. Why have we become so complacent that we are no longer willing to fight the good fight for our freedom and our way of life? When did this nation become the home of the lazy and the weak? It is time the strong and the brave stood up, if there are any left.
What will it take to make you see that politics is a trap? An illusion to make us believe we have a choice when in reality we have none. They have both evolved to serve the same masters and fulfill the same agenda. An agenda that serves neither you nor me. When will you wake up from your blue and red slumber to see that we have all been lied to ?
When do we take America back as a People not a political party?
The time is growing short people! Unless you open your eyes and understand what is truly at stake. You will never live in America the Land of the Free and the Brave again. We will simply exist in a land run by petty politics and corrupt corporations willing to do whatever it takes to maximize their bottom line. Even if it means exploiting our children’s lives and futures.
Is that an outcome you are willing to live with ?
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Just in case you still don’t have a clue what I am talking about. Here is a very short list of examples of the Corporate Assault on Our Lives And Our Health that our politicians have allowed to take place for a price.
GMO’s in our food supply
Digestive disorders, Obesity,Endocrine disorders on the rise
Glyphosate in our foods, our water and our breast milk
Kidney and Liver damage on the rise
Fracking chemicals in the water supply
Cancers on the rise
Fluoride in the water supply
Vaccines causing deadly reactions in children and adults
Autism on the rise
Heavy metals in our food supply
Alzheimer’s on the rise
Deadly chemicals being pawned off as sugar substitutes from saccharine to splenda all have been found to cause cancer in animal studies. The biggest culprit and most dangerous thus far being Aspartame.
Life saving drugs monopolized by Big Pharma to bloat prices beyond most people’s reach. Daraprim being the latest going from $13.50 per pill to $750.00. Basically condemning those who cannot afford them to die.
There are so many more examples you just need to open your eyes and want to see the truth
~Desert Rose~
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David Korten: From Serving Money to Serving Life: A Sacred Story for Our Time
When we get our story wrong, we get our future wrong. Much like the Trans-Pacific Partnership “trade deal”, everything we are told about capitalism and our economy is a pack of lies. Time for a new story, says preeminent scholar and critic of corporate globalization, David Korten, the best-selling author of When Corporations Rule the World and The Great Turning. David has a brand new book, Change the Story, Change the Future – a Living Economy for a Living Earth. He is the co-founder and board chair of YES! Magazine, co-chair of the New Economy Working Group, founder and president of the Living Economies Forum (formerly the People-Centered Development Forum), a member of the Club of Rome, and a former board member of the Business Alliance for Local Living Economies (BALLE) and associate of the International Forum on Globalization.
This Earth Day address was recorded April 22, 2015 at Seattle University Pigott Auditorium.
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Local Communities Dismantling Corporate Rule, part 1
Community Rights educator Paul Cienfuegos explains how “We The People” are exercising the authority to govern ourselves and dismantle corporate rule. When small farmers in rural Pennsylvania wanted to say “no” to a corporate factory farm coming into their community, they learned they couldn’t, because it would violate the corporation’s “rights” and state pre-emption laws. So they did something technically illegal – their town passed an innovative ordinance banning corporate factory farming. It worked! The corporation left town. Pittsburgh upshifted the approach: Rather than define what we don’t want, define what we DO want. Their “Right to Water” stopped natural gas fracking in the city. Ordinances like this have been passed in over 150 communities in 9 states. Tune in to learn how this works. Episode 258. [paulcienfuegos.com, celdf.org, YouTube channel “Community Rights TV” and communityrightspdx.org]
Peak Moment TV exists because of viewers like you. Subscribe to news and donate at http://www.peakmoment.tv, right side. Thanks for being in the Peak Moment community.
Have we forgotten about the national debt? Congressional Republican leaders and the Obama administration have begun private talks about a new two-year spending plan that would keep the government operating beyond the 2016 election but would do little to address more fundamental structural problems, including entitlement and health care spending for an aging population.
Even before Congress completed work on a short-term spending measure to avert a government shutdown at least until early December, Senate Majority Leader Mitch McConnell (R-KY), outgoing House Speaker John Boehner (R-OH) and President Obama held preliminary talks on a possible multi-year budget agreement to increase spending for both defense and domestic programs by lifting fiscal 2016 discretionary spending caps imposed by the 2011 Budget Control Act.
The agreement would be similar in scope to a two-year mini-budget agreement that was struck by Sen. Patty Murray (D-WA) and Rep. Paul Ryan (R-WI) following a 16-day government shutdown in late 2013 that temporarily put an end to inter-party budget warfare. That agreement allowed for $45 billion more in spending above the caps in 2014 and $20 billion more in 2015, as well as $20 billion of deficit reduction.
USS Ronald Reagan and its embarked air wing, Carrier Air Wing (CVW) 5, provide a combat-ready force that protects and defends the collective maritime interests of the U.S. and its allies and partners in the Indo-Asia-Pacific region. (Photo: U.S. Navy Specialist 2nd Class Paolo Bayas)
The Russians are bombing CIA-backed rebels in Syria and continuing to hold parts of Ukraine. ISIS continues to spread in the Middle East and inspire attacks around the world. Iran is receiving hundreds of billions in sanctions relief, some of which will likely go to destabilizing the Middle East. China is building illegal islands in the South China Sea. Hundreds of thousands of refugees are streaming across Europe. The Taliban is on the rise in Afghanistan. And our national secrets are being vacuumed up by Chinese hackers.
At the same time, our national defense budget is being slashed.
Since 2011, the defense budget has been cut by 15 percent in real terms. If you include the war budget, which has been going down as we reduce troops in Afghanistan, the national defense has been cut 25 percent in four years.
As a result of these budget cuts, the U.S. military is smaller than it was on 9/11 and in many cases the smallest it has been in recent history.
The world is a mess, our military is being slashed, and now President Obama is going to veto a bipartisan bill that would increase the national defense budget by 6 percent in real terms.
The House of Representatives just passed the National Defense Authorization Act for Fiscal Year 2016 (NDAA), and it is headed to the Senate. This is a bipartisan bill that has been signed into law every year for 53 straight years, but Obama plans to veto it for one simple reason: it doesn’t increase non-defense spending. The president believes that defense and non-defense spending should be increased, and, according to the White House, “he will not fix defense without fixing non-defense spending.”
John Boehner Admits Republicans are Willing to Put U.S. at Risk to Play Partisan Politics
February 16, 2015 By Allen Clifton
Republicans are anything if not predictable. The moment they gained power back in the Senate it was obvious that they were going to use that power to play petty partisan politics. The truth is, controlling Congress means very little as long as the person in the White House has veto power.
So no matter what sort of propaganda Republicans spew about the nonsense they’re going to undoubtedly shove through Congress, it’s still on them to send the president legislation that they know he will sign, otherwise they’re essentially just wasting time.
The president is the one person who’s voted into office on a national scale, meaning that they’re the one individual who truly “represents the majority of the people.” So no matter what anyone in Congress says, it’s beholden upon them to make sure whatever bills they’re sending to the president’s desk actually have a chance at being signed. It’s extremely rare for both the House and Senate to have the two-thirds majority needed to override a presidential veto.
All that being said, as many already know the Department of Homeland Security is set to run out of funding fairly soon. Normally this wouldn’t be a huge deal; all it would take is for Congress to pass a bill funding the department, which would almost certainly be signed by President Obama.
Bill
Holter is back and he says “Something Just Happened”. In fact,
something changed three weeks ago and a series of events began which has
led to a cascading collapse in global markets and some very strange
happenings in the precious metals markets.
In silver last week
there was confirmed volume of 122,482 contracts traded in a single day
which represents 612 MILLION ounces of physical silver … or over 87% of
annual global silver production. Meanwhile China has sold $100 billion
worth of Treasury bonds over the last two weeks.
Bill warns, the
leverage in all markets suggests a “holiday” will occur because the
unwinding cannot be orderly. The “unwinding” by the way will need to
undue the credit built upon credit going all the way back to Aug. 15,
1971.
Mr; Holter concludes: “We’re going to have an absolute
Biblical collapse of our standard of living, and no one even has a clue
that it’s coming.”
Obama, Geithner and the Missing Six Trillion Dollars
by ROB URIE
Timothy Geithner, President Barack Obama’s first Treasury Secretary and chief architect of many of the various and sundry bank bailouts and associated programs carried out during Mr. Obama’s first term in office, recently wrote a book telling his side of ‘the story.’ To be clear, I haven’t read the book and have no intention of doing so. Life is short and the relevant side of the story, the economic consequences of Mr. Geithner’s policies, is the one of interest here. The prevailing storyline in the banker’s ghettoes of New York and London is of an indispensable and functioning financial system saved and a second Great Depression averted through Mr. Geithner’s necessary but unpopular programs to transfer public resources to nominally private corporations— Wall Street banks, in order to save them. Implied is that the travails Wall Street faced in 2008 – 2009 were the result of ‘natural’ forces and that its restoration is substantially related to restoration of ‘the economy.’ Mainstream economists have put forward variations on this latter claim through repeated assertion that ‘the economy,’ as measured by GDP (Gross Domestic Product) and the official unemployment rate, has ‘recovered’ to pre-recession levels.
Graph (1): Contrary to the view on Wall Street and within the Western economic establishment restoration of Wall Street has not ‘fixed’ the economy. The policies of Mr. Geithner, the Obama administration and the Federal Reserve have ‘fixed’ profits, compensation and bonuses for Wall Street. The drop in median income is evidence of ongoing economic Depression for most citizens of the West. Assertions to the contrary by Mr. Geithner, the Obama administration and the ‘eternal sunshine of the spotless mind’ crowd of Western economists are evidence of whose interests they represent. Apparent in the recovery of financial profits without a recovery in household incomes is that Wall Street doesn’t need a functioning economy to earn ‘profits.’
Is the Fed “tapering”? Did the Fed really cut its bond purchases during the three month period November 2013 through January 2014? Apparently not if foreign holders of Treasuries are unloading them.
From November 2013 through January 2014 Belgium with a GDP of $480 billion purchased $141.2 billion of US Treasury bonds. Somehow Belgium came up with enough money to allocate during a 3-month period 29 percent of its annual GDP to the purchase of US Treasury bonds.
Certainly Belgium did not have a budget surplus of $141.2 billion. Was Belgium running a trade surplus during a 3-month period equal to 29 percent of Belgium GDP?
No, Belgium’s trade and current accounts are in deficit.
Did Belgium’s central bank print $141.2 billion worth of euros in order to make the purchase?
No, Belgium is a member of the euro system, and its central bank cannot increase the money supply.
So where did the $141.2 billion come from?
There is only one source. The money came from the US Federal Reserve, and the purchase was laundered through Belgium in order to hide the fact that actual Federal Reserve bond purchases during November 2013 through January 2014 were $112 billion per month.
In other words, during those 3 months there was a sharp rise in bond purchases by the Fed. The Fed’s actual bond purchases for those three months are $27 billion per month above the original $85 billion monthly purchase and $47 billion above the official $65 billion monthly purchase at that time. (In March 2014, official QE was tapered to $55 billion per month and to $45 billion for May.)
Why did the Federal Reserve have to purchase so many bonds above the announced amounts and why did the Fed have to launder and hide the purchase?
Some country or countries, unknown at this time, for reasons we do not know dumped $104 billion in Treasuries in one week.
Best-selling author Nomi Prins warns, “Never before have the Government and the Fed collaborated so extensively by propping up the banking system to the detriment of the population.” Prins lays out a long history of the relationships between U.S. Presidents and bankers that date back to Teddy Roosevelt and JP Morgan. On her new book titled “All the Presidents’ Bankers,” Prins contends, “That connection with Teddy Roosevelt was a very powerful established entity between two people that has allowed all this stuff that has happened in the last hundred years to really happen. The friendships, the social ties, the idea that the bankers could sort themselves out with Treasury Department help if it needed to. Of course, it’s epic now. All of that was solidified then. Banks being hands-off with respect to the oval office was all solidified then. We’ve only been consolidating that message throughout the century since.”
Fast forward to JFK and the bankers of the day, and Prins points out the banks in the early 1960’s didn’t want a gold standard to restrict them. It is dollar debasement history as Prins explains, “If bankers have a peg, if they have to put gold or any type of asset behind it or have any restriction, they don’t like it. So at the time, they weren’t working on trying to demolish the regulations that happened from the 1930’s to separate bank speculation from depositors, but they saw something else, and that was getting off gold. They really worked to push JFK off of gold. JFK was a little less friendly with the bankers. JFK, when he did invite bankers to the White House, he would have very short meetings. It was like hello, goodbye and thank you. Where LBJ, who came after JFK, was very friendly to the bankers and opened the White House to the bankers.”
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By Michael Snyder, on December 6th, 2015
