A ‘Lost Decade’ for the Middle Class Caused by Conservative Policies--Economic Policy Institute
A ‘Lost Decade’ for the Middle Class Caused by Conservative Policies
By Isaiah J. Poole
The latest edition of the Economic Policy Institute's "State of Working America" report, out today, documents in sharp detail what has been for the middle-class economy a "lost decade" in which working people have fallen behind. But what's more disheartening is its prediction that without radical change "nearly two decades likely will pass before American incomes regain lost ground and return to their 2000 levels."
The report makes clear what has been robbed from low- and middle-income people as a result of conservative policies that have their roots in the early 1980s, as the country turned from balanced growth policies in which labor and capital profited more or less in tandem to government policies that advantaged corporations and the wealthy at the expense of workers.
As a result of these policies, the report notes, "the business cycle preceding the recession was already shaping up as a lost decade for American
incomes," with median household incomes falling 6 percent during that period. But when the Great Recession hit, median income of working-age families fell another 7.1 percent between 2007 and 2010.
"This is an underappreciated economic calamity," the report says.
The report notes that this calamity is not caused by a lack of overall economic growth. National income, the report notes, has grown enough to substantially improve the fortunes for all. As the data reveal, however, it is the top 5 percent, the top 1 percent, and fractions of the top 1 percent that have received almost all the benefits of the economy’s growth.
These key slides from the report help tell the story: