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Why US middle class is getting poor (Take a Poll)

submitted on February 16, 2011 by YanBz in "Member's Lounge"
Here is a great article that explains in simple words why US middle class gets poorer. Among the reasons are:

1. Decline of unions and subsequent erosion of collective bargaining

In 1983, union workers made up about 20% of the workforce. In 2010, they represented less than 12%.


2. Globalization - cheap labor gets outsourced to China and other countries while company executives and investors benefit from the savings

In 1980, workers with a high school diploma earned about 71% of what college-educated workers made. In 2010, that number fell to 55%.


3. Deregulation - tax cutting and explosive growth of financial sector is best environment for rich to get richer

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, President Bush 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.


What we as a country can do about it? If I had to choose any single thing it would be education. The low skilled jobs are gone and are not coming back (unless we get poorer Sad ), but we can help our kids do better in the white collar labor by investing in their education. What do you think?

Source:
http://finance.yahoo.com/news/.....48381.html
1. Why is middle class getting poor?
 Decline of unions
 Globarization
 Deregulation
 Other (please comment)
2. What will save the middle class?
 Investments in education
 Increased market regulation
 Progressive tax system
 Other (please comment)
 or See Results 

        

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  Comments
  • 104310
    deathbynosleep
    teacher
    7 1 1
    Posted by deathbynosleep on February 16, 2011
    [reply] 2 0
    middle class is getting poor because they overspend. Save your money. Stop buying brand new ipods and $100 shoes. Just because you have $1000 in your account, doesn't mean you can buy $800 wheels for your car...
      104318
    • orangearrows
      professor
      2 3
      7 1 1
      Posted by orangearrows on February 16, 2011
      [reply] 2 0
      If you spend less - then the economy takes a hit since less money is in circulation. Businesses would be hurt since people are buying less and hence they cannot produce more jobs.. The reason US economy is successful because there has been money in circulation.

      Globalization is hurting too since jobs are being lost. There needs to be a change / something big since all these jobs lost - they ain't coming back anytime soon.
  • 104312
    YanBz
    admin
    Posted by YanBz on February 16, 2011
    [reply] 3 0
    Well, the question is not "why middle class sank in debt" but rather "why the income level went down". Americans today make less (in inflation adjusted dollars) than they did in 1980. This has nothing to do with $100 shoes or new iPods.
  • 104366
    toohot4you
    novice
    Posted by toohot4you on February 16, 2011 [reply] 0 0
      104367
    • YanBz
      admin
      Posted by YanBz on February 16, 2011 [reply] 0 0
      This is precisely the article I am quoting (and referring to at the end)
  • 104369
    mooncow728
    professor
    1 1
    12 6 1
    Posted by mooncow728 on February 16, 2011 [reply] 0 0
    The rich complain about taxes. The middle class complain they are getter poorer. What ever happened to the lower class? I don't know about most places but I know in my state minimum wage just keeps jumping up. For people living on higher incomes this probably seems good but in all reality it makes it harder. When minimum wage raises so do prices. And for those people making just over minimum wage, they don't get raises. My husband has been at the same company for over 7 years now. He's made $5 and some change in raises but somehow is only making $1.15 more than minimum wage after all these years and he started $0.50 higher. So in other words people like him should be the ones that get to complain. It seems year after year we actually do worse and worse even though he gets an annual raise. I know there are other people out there that have to feel the same as me. The middle class need to stop complaining so much! I know it's hard to live with no money but in my honest opinion, the middle class don't understand what that means.

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