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WillyT

(72,631 posts)
Mon Oct 20, 2014, 01:47 PM Oct 2014

All The Wealth The Middle Class Accumulated After 1940 Is Gone - HuffPo

All The Wealth The Middle Class Accumulated After 1940 Is Gone
The Huffington Post | By Mark Gongloff
Posted: 10/20/2014 12:05 pm EDT Updated: 41 minutes ago

<snip>

Here's more proof the middle class is dying.

The middle-class share of American wealth has been shrinking for the better part of three decades and recently fell to its lowest level since 1940, according to a new study by economists Emmanuel Saez of the University of California, Berkeley, and Gabriel Zucman of the London School of Economics.

In other words, remember the surge of the great American middle class after World War II? That's all gone, at least by one measure.

In this case, "middle class" is defined rather expansively as the bottom 90 percent of all Americans. "Wealth" is the total of home equity, stock and bond holdings, pension plans and other assets, minus debt. As such assets are mostly owned by mid- to higher-income households -- and considering most Americans define themselves as "middle-class" -- it seems reasonable to use the bottom 90 percent as a proxy for the "middle class."



...
...
...

And who has been the beneficiary of this middle-class misery? The top 0.1 percent of Americans, whose incomes have just kept rising, and whose share of wealth has soared to levels not seen since Jay Gatsby was still staring at the blinking green light at the end of Daisy Buchanan's dock:



<snip>

More: http://www.huffingtonpost.com/2014/10/20/middle-class-wealth-shrinks-1940s_n_6014874.html?utm_hp_ref=business





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All The Wealth The Middle Class Accumulated After 1940 Is Gone - HuffPo (Original Post) WillyT Oct 2014 OP
And you know the worst part? Brigid Oct 2014 #1
And some are actually OK with..... daleanime Oct 2014 #3
I know sakabatou Oct 2014 #15
That's because they imagine somehow they can join that .01%... nt Bigmack Oct 2014 #38
Reminds me of... FiveGoodMen Oct 2014 #59
Back in 2005, George Carlin said it about as bluntly as anyone has deutsey Oct 2014 #2
He was The Great American Truth-Teller. hifiguy Oct 2014 #24
ERISA -- JDPriestly Oct 2014 #28
WillyT, I have to disagree with the title of your post... BillZBubb Oct 2014 #4
Wealth is relative jeff47 Oct 2014 #7
Not My Title... It's The Author's... And WillyT Oct 2014 #10
Oh, I agree. It's just that the middle class wealth isn't "gone". BillZBubb Oct 2014 #25
The pie may have grown, Curmudgeoness Oct 2014 #13
My point is that middle class wealth isn't "gone". We agree on the rest. BillZBubb Oct 2014 #26
so has the number of slices quaker bill Oct 2014 #39
Yes, and Curmudgeoness Oct 2014 #41
What's reflected in those charts is despicable. Hissyspit Oct 2014 #18
+10000000 It's a crime. woo me with science Oct 2014 #43
I'm not so sure you are right. JDPriestly Oct 2014 #31
Look at the numbers and you will find I am right. BillZBubb Oct 2014 #36
I find stocks to be mostly a big swindle for small investors. If you have a pension fund JDPriestly Oct 2014 #37
I think you will find that the net worth of the households of the upper 1-10% has grown, but JDPriestly Oct 2014 #48
My links? Google is your friend. Where are your links? BillZBubb Oct 2014 #64
Notice when the curve turns and the middle class share starts falling. BillZBubb Oct 2014 #5
The people behind Reagan initiated the disaster. hifiguy Oct 2014 #8
Powell Memorandum ReRe Oct 2014 #32
Yes, that first quote of William Kuntsler in the memo: Eleanors38 Oct 2014 #54
I loved William Kuntsler... ReRe Oct 2014 #66
+1 an entire shit load. Enthusiast Oct 2014 #58
It's not gone, it just migrated. Le Taz Hot Oct 2014 #6
BINGO! Octafish Oct 2014 #11
And it isn't over yet! NutmegYankee Oct 2014 #9
"They" have always regarded feudalism as the most perfect hifiguy Oct 2014 #14
This is why we need things like the inheritance taxes back in place as well as cstanleytech Oct 2014 #12
+10000. Penalize the hoarding of wealth and reward spending and closeupready Oct 2014 #22
Yup. I mean if a company is providing good paying jobs to all its workers cstanleytech Oct 2014 #23
Won't come back this time. The rich not only control more but ballyhoo Oct 2014 #16
Not gone. Deliberately given to the 1% by every administration since Carter. n/t jtuck004 Oct 2014 #17
k and r - they looted our families. nashville_brook Oct 2014 #19
NOW I wish I had never had children. This world is not going to get better. jwirr Oct 2014 #20
And It's No Coincidence That The Middle Class Share Reverses Course and Starts To Decline in 1981. TrollBuster9090 Oct 2014 #21
+1 SunSeeker Oct 2014 #27
Reagan smash. EEO Oct 2014 #29
Ronny Robin-Hood-In-Reverse. Stealing from the poor, and giving to the rich. Amazing. TrollBuster9090 Oct 2014 #71
You are right. I was there. Watched it first hand. Enthusiast Oct 2014 #53
Here is another table that tries to normalize for inflation exboyfil Oct 2014 #30
K&R ReRe Oct 2014 #33
This message was self-deleted by its author appalachiablue Oct 2014 #42
Welcome to DU! ReRe Oct 2014 #46
This message was self-deleted by its author appalachiablue Oct 2014 #47
This thread deserves hundreds of recommendations? Enthusiast Oct 2014 #55
Yes.... ReRe Oct 2014 #67
I agree. Enthusiast Oct 2014 #69
Kick again... ReRe Oct 2014 #70
They have an army of strategists, what do we have? AZ Progressive Oct 2014 #34
This message was self-deleted by its author appalachiablue Oct 2014 #44
Not to mention so many people who claim to be liberal and insist they care about the future. raouldukelives Oct 2014 #50
Kick !!! WillyT Oct 2014 #35
Guess the wealthy could afford higher taxes now...? grahamhgreen Oct 2014 #40
Good god. woo me with science Oct 2014 #45
You Are Quite Welcome !!! WillyT Oct 2014 #49
Still hard to imagine that wealth was even more concentrated in the 1920's than it is today. pampango Oct 2014 #51
John Kenneth Galbraith, as he often did, hifiguy Oct 2014 #63
So, when someone gets ALL the money, can we quit and play something else? world wide wally Oct 2014 #52
K&R! This post should have hundreds of recommendations! Enthusiast Oct 2014 #56
Today I'm going to party like it's nineteen twenty nine. adirondacker Oct 2014 #57
Recommend...and the Charts..... KoKo Oct 2014 #60
Kick and rec. nt Union Scribe Oct 2014 #61
K&R liberal_at_heart Oct 2014 #62
kick woo me with science Oct 2014 #65
K&R for the original post and subsequent informative posts and links. JEB Oct 2014 #68

deutsey

(20,166 posts)
2. Back in 2005, George Carlin said it about as bluntly as anyone has
Mon Oct 20, 2014, 02:04 PM
Oct 2014

They want your fuckin' retirement money. They want it back so they can give it to their criminal friends on Wall Street. And you know something? They’ll get it. They’ll get it all from you sooner or later 'cause they own this fuckin' place. It’s a big club and you ain't in it. You and I are not in the big club. ...The table is tilted, folks. The game is rigged and nobody seems to notice. ...And nobody seems to notice. Nobody seems to care. That’s what the owners count on. The fact that Americans will probably remain willfully ignorant of the big red, white and blue dick that’s being jammed up their assholes every day, because the owners of this country know the truth. It’s called the American Dream, 'cause you have to be asleep to believe it.

BillZBubb

(10,650 posts)
4. WillyT, I have to disagree with the title of your post...
Mon Oct 20, 2014, 02:05 PM
Oct 2014

The graph only shows the relative share of total wealth, not the actual wealth. The wealth of the United States has grown substantially over the years. The middle class still controls a lot of wealth. The middle class wealth isn't "gone".

It is just that relative to the rich, the middle class's share of the pie has diminished, but the pie is growing.

jeff47

(26,549 posts)
7. Wealth is relative
Mon Oct 20, 2014, 02:11 PM
Oct 2014

Wealth as a raw number is pretty useless. It really doesn't matter that the value of my house has gone up since I bought it, if everything I'd want to do with that additional "wealth" has gone up by more.

Share of wealth provides a decent measure of this relative effect.

It is just that relative to the rich, the middle class's share of the pie has diminished, but the pie is growing.

The pie isn't growing enough to keep up.
 

WillyT

(72,631 posts)
10. Not My Title... It's The Author's... And
Mon Oct 20, 2014, 02:25 PM
Oct 2014
In other words, remember the surge of the great American middle class after World War II? That's all gone, at least by one measure.


From the OP.




BillZBubb

(10,650 posts)
25. Oh, I agree. It's just that the middle class wealth isn't "gone".
Mon Oct 20, 2014, 04:49 PM
Oct 2014

What is gone is the middle class benefitting at an acceptable rate in the new wealth being created.

Curmudgeoness

(18,219 posts)
13. The pie may have grown,
Mon Oct 20, 2014, 02:57 PM
Oct 2014

but so had the cost of all the necessities of life. In 1940, being a millionaire would have been a significant feat. Today, we have many billionaires, which would have been unheard of in 1940.

But that doesn't mean that the middle class condition has improved over time. They have not.

Curmudgeoness

(18,219 posts)
41. Yes, and
Mon Oct 20, 2014, 10:10 PM
Oct 2014

there are so few getting bigger slices. Leaving the rest of us to fight over the rest. With more slices, the expected solution would be smaller pieces for all. Well, in a world that made sense.

JDPriestly

(57,936 posts)
31. I'm not so sure you are right.
Mon Oct 20, 2014, 05:11 PM
Oct 2014

A lot of the middle class wealth was in the family home. And the value of that diminished a great deal in many parts of the country. Our neighbors borrowed against their house to remodel it completely thinking of it as a great investment. Houses in our area have gained in value but not enough to justify the cost of the additional debt to fix the house. That's my guess.

If you worked an ordinary middle class job and then were promised a pension from your employer, your pension may have been lost in a buy-out. If your employer was a government agency, you may be doing OK. But money invested in the stock market in spite of the paper gains in the stock market really don't substitute for owning land that you can sell for value. And the real estate of the middle class went through a massive purge. The banks have made out. The middle class homeowners not so much. Stocks are just paper. They go up and down according to the whims of the big investors, the hedge funds, banks and pension funds.

I am retired. My friends are retired. Wealthy people are doing fine. The middle class -- not so well.

BillZBubb

(10,650 posts)
36. Look at the numbers and you will find I am right.
Mon Oct 20, 2014, 08:40 PM
Oct 2014

The net worth of households in the US has increased by about 6x since 1945 adjusted for inflation. The pie has really grown. The population over that time has increased by 2.25x. So, the per capita pie has grown by 2.6. Even with the the top tier getting a much bigger portion of the pie, the middle class has more wealth in per capita real dollars than in the 1940s.

We also fundamentally disagree on the value of stocks. You can sell stocks for value as well as you can with land. Land prices also go up and down in prices depending on a number of factors. We've seen a good lesson on that recently.

JDPriestly

(57,936 posts)
37. I find stocks to be mostly a big swindle for small investors. If you have a pension fund
Mon Oct 20, 2014, 09:08 PM
Oct 2014

investing for you, your account does much better than when you try to invest on your own. I say that based on my experience.

As a senior, the only reliable, good source of income is Social Security. The rest of the "investments" are mostly useful only for very wealthy people.

What annual income do you consider to be middle class?

If you raise two children on a combined income of say $60-70,000 per year in California, you are not going to have it easy. If you have that much money in Baton Rouge Louisiana maybe it is a different matter.
On edit:
The big problem for many middle class people now is that the young people with college educations can't get good jobs. And their parents in their 50s and 60s are also unable to get decent jobs and are living off their retirement savings. I think that a lot of the government statistics, etc. are trumped up and untruthful. Sure, if you have a job and haven't spent your savings to pay back debt or educate your children, you may be in good shape. But too many people are in a far worse situation than that. Businesses lost. Jobs lost. And if people are lucky enough to have gotten a new job, it probably pays far less than the job they lost in the recession. We are in recovery, but again, Main Street is not doing well. I don't think the inflationary figures reflect that kind of increase in the cost of for example housing. It depends on how they sample the items they put in the basket to figure the rate of inflation.


50 years ago (I'm 71, so I recall this), a person could still have a small grocery and survive on the income. Today, that person is working as an employee for a supermarket in a job that is uncertain. There is always a boss to please. It's really tough.

We bought a house for $13,400 in 1968 or 1969. Zillow estimates that it is now worth over $223,000. That's an increase of 16 times the amount we paid.


College teachers, for example, a major part of the middle class, are not paid nearly as much more now than in the 1960s. Not nearly as much as you claim.

Back in 1968, a college teacher was paid maybe $12,000 to $13,000 per year. Today, a professor with a similar rank at Cal State LA makes maybe a little over $67,000 per tear. That is only five times what that same person made in 1968. And I am if anything overestimating the income of a professor today. I happen to know what a college teacher made in one state in 1968, but the state was not California. California would probably pay more than the other, smaller state.

http://www.calstate.edu/hr/employee-profile/2011/faculty/salary.shtml

I think your numbers are off. If you define middle class to include upper level management of corporations, then you might get the increase in income that you claim took place. But the real middle class is suffering. And for older members of the middle class, jobs are often part-time ore not available. Please let me know where you got your numbers. Thanks.

JDPriestly

(57,936 posts)
48. I think you will find that the net worth of the households of the upper 1-10% has grown, but
Tue Oct 21, 2014, 01:41 AM
Oct 2014

that the net worth of the rest of us has not grown much at all.

Is the US in general "wealthier." Maybe. But the money has gone to the top.

Net worth of households -- which households. Where are your links?

BillZBubb

(10,650 posts)
64. My links? Google is your friend. Where are your links?
Tue Oct 21, 2014, 06:50 PM
Oct 2014

I supplied the numbers that disproved your point. There are numerous sources for the numbers I provided. This isn't a dissertation, I don't provide footnotes to publicly available data.

You've provided NO numbers. The US is MUCH wealthier, even after inflation. And even though the top 10% get a bigger piece of that wealth, the rest of us are worth more on a per capita basis than in the 1940's even after adjusting for inflation. That is a fact.

BillZBubb

(10,650 posts)
5. Notice when the curve turns and the middle class share starts falling.
Mon Oct 20, 2014, 02:07 PM
Oct 2014

Right in the middle of the reagan disaster. He certainly was a transformational president, but not in a good way.

 

hifiguy

(33,688 posts)
8. The people behind Reagan initiated the disaster.
Mon Oct 20, 2014, 02:13 PM
Oct 2014

Clinton contributed his bit, and His Chimperial Highness just finished the job and nailed down the lid.

It was all carefully planned. Read the Powell Memorandum.

http://law.wlu.edu/deptimages/Powell%20Archives/PowellMemorandumTypescript.pdf

http://billmoyers.com/content/the-powell-memo-a-call-to-arms-for-corporations/

ReRe

(10,597 posts)
32. Powell Memorandum
Mon Oct 20, 2014, 05:29 PM
Oct 2014

This should be everyone's homework for this weekend. Thank you hifiguy for adding these links.

Seriously. I beseech each and every DUer who doesn't know about the Powell Memorandum to click on that link and also watch the Bill Moyers clip. Yeah, the document is 34 pgs long, but it's double spaced lines & large print. But believe me, it reads fast. Once you start reading it you won't stop till it's done. You just might catch yourself speed-reading.

And if you want even more info, check out Hedrick Smith's book Who Stole the American Dream.
Remember when Randi Rhodes used to give us homework for the weekends?

 

Eleanors38

(18,318 posts)
54. Yes, that first quote of William Kuntsler in the memo:
Tue Oct 21, 2014, 11:18 AM
Oct 2014

"You will learn to fight in the streets, to revolt, to shoot guns..."

That very first quote. The Big Boys know what to fear.

ReRe

(10,597 posts)
66. I loved William Kuntsler...
Tue Oct 21, 2014, 09:33 PM
Oct 2014

His beautiful daughters did a documentary on him a few years ago. Besides Wiki and possibly C-Span, you can probably go to http://www.DemocracyNow.org and plug his name in the archive search and find some video files of him.

NutmegYankee

(16,177 posts)
9. And it isn't over yet!
Mon Oct 20, 2014, 02:18 PM
Oct 2014

The 1% doesn't want to repeat the Gilded Age, it wants to exceed it. Serfdom is coming back.

 

hifiguy

(33,688 posts)
14. "They" have always regarded feudalism as the most perfect
Mon Oct 20, 2014, 03:03 PM
Oct 2014

of all systems. They don't even have the responsibilities of slaveholders under the feudalism that has been on the drawing board for about 40 years now.

cstanleytech

(26,080 posts)
12. This is why we need things like the inheritance taxes back in place as well as
Mon Oct 20, 2014, 02:53 PM
Oct 2014

higher taxes on the extreme wealthy and the extreme wealthy do "not" create enough jobs to justify the tax break they now enjoy.

cstanleytech

(26,080 posts)
23. Yup. I mean if a company is providing good paying jobs to all its workers
Mon Oct 20, 2014, 04:29 PM
Oct 2014

I can see rewarding them with a lower tax probably on their earnings as companies can provide jobs to alot of people a single wealthy person though only will provide a small finite number of jobs and after that they will build their hoard up more without really providing anything back so why should they be rewarded?

 

ballyhoo

(2,060 posts)
16. Won't come back this time. The rich not only control more but
Mon Oct 20, 2014, 03:06 PM
Oct 2014

those that could have caused a resurgence of the middle class are gone and continue going. There is no one that will do that necessary to get the rich to back off because it would be terrible to even conceive such things.

TrollBuster9090

(5,953 posts)
21. And It's No Coincidence That The Middle Class Share Reverses Course and Starts To Decline in 1981.
Mon Oct 20, 2014, 04:24 PM
Oct 2014

That was the start of the famous Reagan REDISTRIBUTION of the tax burden.

Notice how I deliberately didn't call them the Reagan Tax Cuts, because Reagan (and everybody who followed) didn't cut taxes at all. They merely re-distributed the tax burden from the top 1% to the middle and lower classes, but lowering the tax rate for capital gains, shifting the burden for Social Security to Payroll Taxes, and then capping the Payroll tax for incomes above $100K.


Conservatives are always whining about "government REDISTRIBUTING wealth." Well, guess what. THEY'RE RIGHT! Government, under conservative rule, has REDISTRIBUTED WEALTH from the BOTTOM to the TOP by repeatedly lowering capital gains taxes, and raising surtaxes like the Payroll Tax.

Enthusiast

(50,983 posts)
53. You are right. I was there. Watched it first hand.
Tue Oct 21, 2014, 11:15 AM
Oct 2014

Advocates of lower taxes on the ultra wealthy and corporations are still singing their song.

Only now, decades later, they have used their tax cut largess to buy office holders and candidates.

They have invested wisely.

Now our democracy is in shambles.

And let us never forget, while they did this they also sent our good paying jobs overseas creating a vast rust belt.

These assholes have never had to answer for this.

ReRe

(10,597 posts)
33. K&R
Mon Oct 20, 2014, 05:40 PM
Oct 2014

We need to keep this kicked so a majority of DUers can see it. I hope readers click on hifiguy's links up there!

Homework! Homework! Homework!

Response to ReRe (Reply #33)

ReRe

(10,597 posts)
46. Welcome to DU!
Mon Oct 20, 2014, 11:25 PM
Oct 2014

You are exactly the DUer I was hoping to reach in my replies in this thread. Many of us have been reading, searching and learning for many years and sometimes we fail to think of those who AREN'T familiar with what is being discussed. DU is a learning place, if you are hungry for knowledge. You did see hifiguy's post above with the two links, didn't you? If you have any questions while you're reading the Powell Memorandum, just holler at any of us.

Response to ReRe (Reply #46)

ReRe

(10,597 posts)
67. Yes....
Tue Oct 21, 2014, 09:39 PM
Oct 2014

Because of what is found in the thread. Particularly hifiguy's reply with the Powell Memorandum document link and also to the Bill Moyer link. The PM doc itself explains in full detail why the middle class started disappearing when Ronnie took over.

AZ Progressive

(3,411 posts)
34. They have an army of strategists, what do we have?
Mon Oct 20, 2014, 05:58 PM
Oct 2014

Their Army of strategists, i.e. the Republican Party, right wing think tanks, right wing media. Of course the rich would be getting richer because of their behemoth size structure and mastery of cunningness that would make movie villains and even the devil envious.

When the people get angry, they know how to deflect anger and even divert it back to the people by dividing the people. What chance do you have when you have an army of manipulative cunning geniuses that are basically 10th degree black belt masters and your side is full of people that are basically orange belt amateurs? It's like the outcome of a bruce lee or jet li movie.

Response to AZ Progressive (Reply #34)

raouldukelives

(5,178 posts)
50. Not to mention so many people who claim to be liberal and insist they care about the future.
Tue Oct 21, 2014, 09:44 AM
Oct 2014

Then turn around and invest in and support the corporations funding the very attacks against those of us trying to save our democracy and GOTV.

pampango

(24,692 posts)
51. Still hard to imagine that wealth was even more concentrated in the 1920's than it is today.
Tue Oct 21, 2014, 10:50 AM
Oct 2014

Republicans and their policies foster inequality throughout the ages.

 

hifiguy

(33,688 posts)
63. John Kenneth Galbraith, as he often did,
Tue Oct 21, 2014, 04:20 PM
Oct 2014

summed it up with pithiness and profound accuracy: "The modern conservative is engaged in one of man's oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness."

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