For example, the share of households living on more than $200,000 a year was unchanged from 2009 to 2010. Meanwhile, households getting by on less than $35,000 a year grew as a share of the area population.
“The rich are getting richer and the poor are getting poorer and the middle class is disappearing,” said Raj Aggarwal, a business professor at the University of Akron and the former dean of the business school.
Aggarwal spies a worrisome trend.
“Demand for goods and services comes out of the middle class,” he said. “If we don’t have a strong middle class, we’re not going to have demand.”
Census: 20- and 30-somethings ‘biggest losers’ in Recession
Nationwide, employment among young adults 16-29 stood at 55.3 percent, down from 67.3 percent in 2000 and the lowest since the end of World War II. Young males who lacked a college degree — typically black and Hispanic — were most likely to lose jobs due to reduced demand for blue-collar jobs in construction, manufacturing and transportation during the downturn. Among teens, employment was less than 30 percent.
In all, the employment-to-population ratio for all age groups from 2007-2010 dropped faster than for any similar period since the government began tracking the data in 1948. In the past year, 43 of the 50 largest U.S. metropolitan areas continued to post declines in employment, led by Charlotte, N.C., Jacksonville, Fla., Las Vegas, Phoenix, Los Angeles and Detroit, all cities experiencing a severe housing bust, budget deficits or meltdowns in industries such as banking or manufacturing.
Without work, young adults aren’t starting careers and lives in new cities, instead hanging out with their parents.
Among adults 18-34, the share of long-distance moves across state lines fell last year to roughly 3.2 million people, or 4.4 percent, the lowest level since World War II. For college graduates, who historically are more likely to relocate out of state, long-distance moves dipped to 2.4 percent.
Claims of class warfare by plutocrat Publicans ring hollow when one salient fact is considered: the evisceration of our manufacturing base. Everyone can not obtain an education to become employed in the heath care or IT fields. Lack of funds, transportation, or unsuitability are factors. Relatively few people have the talent to become a professional athlete or an artist or a blogger. There are those members of society whose “skill set” is conducive to performing repetitive tasks on a production line.
Life is what you make it but you can only play the cards you’ve been dealt.
Trade deficit with China costs Colorado jobs, study finds
About 2.8 million jobs, largely in manufacturing, have been lost as a result of the growing U.S. trade deficit with China since that country’s entry into the World Trade Organization in 2001 — including 55,800 in Colorado, according to a study released Tuesday by the Economic Policy Institute.
The greatest losses nationwide were in the computer and electronic parts industries, where 909,000 jobs were lost.
The report cited currency manipulation as a major cause of the rapidly growing U.S. trade deficit with China. Unlike other currencies, the Chinese yuan does not fluctuate freely against the dollar but is artificially pegged to boost China’s exports.
Rapidly growing imports of computer and electronic parts, including semiconductors and audio-video equipment, accounted for more than 44 percent of the $194 billion increase in the U.S. trade deficit with China between 2001 and 2010, the study found.
Karen Gerwitz, executive director of the World Trade Center Denver, said the study doesn’t appear to add back in jobs that were created by increased trade with China.
China purchased nearly $375 million of Colorado goods last year, an increase of 20.2 percent from 2009.
“If we apply the U.S. Department of Commerce’s formula of $95,000 in exports equals one job, then we’ve potentially had an increase of 665 jobs in Colorado (last year) as a result of Colorado’s increased exports to China,” Gerwitz said.
As background, it helps to know what has been happening to incomes over the past three decades. Detailed estimates from the Congressional Budget Office — which only go up to 2005, but the basic picture surely hasn’t changed — show that between 1979 and 2005 the inflation-adjusted income of families in the middle of the income distribution rose 21 percent. That’s growth, but it’s slow, especially compared with the 100 percent rise in median income over a generation after World War II.
Meanwhile, over the same period, the income of the very rich, the top 100th of 1 percent of the income distribution, rose by 480 percent. No, that isn’t a misprint. In 2005 dollars, the average annual income of that group rose from $4.2 million to $24.3 million.
So do the wealthy look to you like the victims of class warfare?
To be fair, there is argument about the extent to which government policy was responsible for the spectacular disparity in income growth. What we know for sure, however, is that policy has consistently tilted to the advantage of the wealthy as opposed to the middle class.
The class war began in 1971. That year, soon-to-be Supreme Court justice Lewis F. Powell Jr. wrote a confidential memorandum to a friend at the U.S. Chamber of Commerce about the “Attack of the American Free Enterprise System.” In the mid-20th century — from the New Deal to Social Security to environmental and civil rights laws — the government had cut into corporate profits while creating middle-class prosperity. Falsely believing that capitalism was under attack, Powell wrote: “It must be recognized that businessmen have not been trained or equipped to conduct guerrilla warfare with those who propagandize against the system.” His proposal, from which the modern conservative movement grew, was to equip business elites for that battle with aggressive policies to make Americans believe that what’s good for wealthy chief executives is good for them, too.
Between 1979 and 2007, the income gap between the richest 1 percent of Americans and the poorest 40 percent more than tripled. Today, the richest 10 percent of Americans control two-thirds of the nation’s wealth, while, according to recently released census data, average Americans saw their real incomes decline by 2.3 percent in 2010. Though our economy grew in 2009 and 2010, 88 percent of the increase in real national income went to corporate profits, one study found. Only 1 percent went to wages and salaries for working people.
Last year, American companies posted their biggest profits ever, and bonuses for bank and hedge fund executives not only reached record highs, but grew faster than corporate revenue. Meanwhile, almost one in 10 Americans is unemployed, and 15 percent live at or below the poverty level.
As a progressive activist who has marched against many wars, I try to avoid militant rhetoric. But only “class warfare” accurately describes a situation in which 400 people control more wealth than the poorest 150 million Americans combined. If “class warfare” isn’t the richest of the rich fighting tooth and nail against unions and any tax increases while record numbers of people lose their homes, what is?
The truth about ‘class war’ in America
Republicans claim, in Orwellian fashion, that Obama’s millionaire tax is ‘class war’. The reality is that the super-rich won the war
guardian.co.uk, Monday 19 September 2011 15.55 EDT
Republicans and conservatives always fight back against proposals to raise taxes on corporations and rich individuals by making two basic claims. First, such proposals amount to un-American “class warfare”, pitting the working class against corporations and the rich. Second, such proposals would take money for the government that would otherwise have been invested in production and thus created jobs.
Neither logic nor evidence supports either claim. The charge of class war is particularly obtuse. Consider simply these two facts. First, at the end of the second world war, for every dollar Washington raised in taxes on individuals, it raised $1.50 in taxes on business profits. Today, that ratio is very different: for every dollar Washington gets in taxes on individuals, it takes 25 cents in taxes on business. In short, the last half century has seen a massive shift of the burden of federal taxation off business and onto individuals.
Second, across those 50 years, the actual shift that occurred was the opposite of the much more modest reversal proposed this week by President Obama; over the same period, the federal income tax rate on the richest individuals fell from 91% to the current 35%. Yet, Republicans and conservatives use the term “class war” for what Obama proposes – and never for what the last five decades have accomplished in shifting the tax burden from the rich and corporations to the working class.
The tax structure imposed by Washington on the US over the last half-century has seen a massive double shift of the burden of taxation: from corporations to individuals and from the richest individuals to everyone else. If the national debate wants seriously to use a term like “class war” to describe Washington’s tax policies, then the reality is that the class war’s winners have been corporations and the rich. Its losers – the rest of us – now want to reduce our losses modestly by small increases in taxes on the super-rich (but not, or not yet, on corporations).
To refer to this effort as if it had suddenly introduced class war into US politics is either dishonest or based on ignorance of what federal tax policies have actually been. Or perhaps, for conservatives, it is a convenient mixture of both.
Much the same sort of analysis applies to the Republican claims that taxing corporations and rich people takes money that would otherwise be invested in business growth and thus create jobs. Last Friday, the US Federal Reserve reported a record quantity of cash on the books of US businesses (over $2tn). Even with the currently low taxes on businesses and the rich, that money is notbeing invested and is not creating jobs. It is not being distributed to anyone else and so is not being spent on consumer goods either. Taxing a portion of that money to finance Washington’s stimulation of the economy by spending that money – or even better, by using it to hire and pay the unemployed – would be a much more effective way to provide jobs than leaving it as cash hoards in corporations’ coffers.
Last month,Warren Buffett upset many of his “mega-rich friends” by what he stated categorically in a New York Times op-ed. He made it clear that he had never encountered any serious investor who decided whether or not to invest based on tax rates. It was always the prospects of profit that made the difference. He then urged Americans to raise taxes on the rich like himself. He also hinted – none too subtly – that it was becoming politically dangerous for the whole economic system’s survival to keep having the minority of extremely rich people paying federal tax at lower rates than the middle- and low-income majority.
The final irony of loose talk about class war is this: the Republican and conservative voices opposing all tax increases for corporations and the rich thereby provoke, as Buffett intimated and New York Mayor Michael Bloomberg more explicitly warned last week, a renewal of class consciousness in the US. Then, Washington might learn what class war really is.
With 46 million living in poverty, every number has its own story
New figures from Census Bureau put U.S. poverty rate at 15.1 percent.
By David Crary
Posted: Monday, Sep. 19, 2011
At a food pantry in a Chicago suburb, a 38-year-old mother of two breaks into tears.
She and her husband have been out of work for nearly two years. Their house and car are gone. So is their foothold in the middle class and, at times, their self-esteem.
“It’s like there is no way out,” says Kris Fallon.
Like so many others, she is trapped, destitute in the midst of America’s abundance. Last week, the Census Bureau released new figures showing that nearly one in six Americans lives in poverty – a record 46.2 million people. The poverty rate, pegged at 15.1 percent, is the highest of any major industrialized nation, and many experts believe it could get worse before it abates.
The numbers are daunting – but they also can seem abstract and numbing without names and faces.
It’s hard to find some of the poorest residents in Pembroke, Ill. They live in places like the tree-shaded gravel road where the Bargy family’s dust-smudged trailer is wedged in the soil, flanked by overgrown grass.
By the official numbers, Pembroke’s 3,000 residents are among the poorest in the region, but the problem may be worse. The mayor believes as many as 2,000 people were uncounted, living far off the paths census workers trod.
The staples that make up the town square are gone: no post office, no supermarket, no pharmacy, no barber shop or gas station. School doors are shuttered. The police officers were all laid off. Residents let their garbage smolder on their lawn because there’s no truck to take it away; many homes are burned out.
Ken Bargy, 58, had to stop working five years ago because of his health and is now on disability. His wife drives a school bus in a neighboring town. He sends his children, 15 and 10, to school 20 miles away. In the back of the trailer, he offers shelter to his elderly mother, bedridden and dying of cancer.
The $18,000 the family pieces together from disability payments and paychecks must go to many things: food, lights, water, medical bills. There are choices to make.
“With the cost of everything going up, I have to skip a light bill to get food or skip a phone bill to get food,” he says.
Kris and Jim Fallon
About 75 miles away, in the Chicago suburb of Hoffman Estates, dozens of families lined up patiently outside the Willow Creek Care Center as truckloads of food for the poor were unloaded.
Among those waiting was Kris Fallon, mother of a teen and an infant. She hitched a ride with a friend.
She recounted how she and her husband – once earning nearly $100,000 a year between the two of them – lost their jobs, forcing them to move from their rented home into an apartment and give up their car.
“We fight a lot because of the situation,” she said. “We wonder where we are going to come up with money to pay rent, where we are going to get food, formula for the baby.”
She began to cry.
“I never understood why there were so many food pantries and why people couldn’t just get on their feet and get going, but now that I’m in it, I fully understand,” she said. “I sometimes feel like I am a loser. … I have never been unemployed, and I never thought I would be going through this, ever.”
Her husband, Jim, 43, said he’s looked for jobs all over the country in the past two years, and just accepted an offer of a three-month stint in Paducah, Ky., on a hotel reconstruction project.
“I guess this is the new America,” he said.
Bill Ricker’s woes date back to the 1980s, when he injured himself falling through rotten floorboards while doing carpentry at an inn. He hasn’t worked since.
He now lives in one end of a cluttered old trailer in Hartford, Maine
It wasn’t supposed to be this way. Ricker has two college degrees. As a younger man, he worked as an electronics repairman, a pastor and a TV cameraman. He and his first wife had seven children.
Now he receives food stamps, gets donations from a local food pantry and drives an 18-year-old car with 198,000 miles.
For a treat, he goes out to lunch at a cafe in a nearby town – about once every two months.
After finishing high school in 1956, Ricker earned an associate degree in electronics engineering and went to work selling and repairing marine electronics.
He later earned a theology degree and served as a pastor at churches in New Hampshire and Vermont. But times were hard on a pastor’s salary, so he returned to Maine, eventually becoming a cameraman and studio engineer for a TV station.
After being laid off in the 1980s, he was hired to do some carpentry for an inn. His first day on the job, the floorboards gave way.
With his injuries, he could no longer tend to the three-unit apartment house he and his wife owned. They sold it and bought a used trailer for $7,000.
Ricker and his second wife, Judith Odyssey, divorced around 1995 and she moved out. But he offered to let her move back in nine years ago when she was going through a rough time, and she now lives in the other end of the trailer.
Census shows Akron facing new kind of poverty
Agencies aid more former middle-class residents
By Dave Scott
Beacon Journal staff writer
Published: September 22, 2011 – 12:01 AM
U.S. census data confirm what area social agencies already knew: The face of poverty is changing and it’s a lot meaner.
Poverty in Akron has increased to nearly 3 in 10 residents or 29.4 percent in 2010, according to the Census Bureau’s American Community Survey. The same category was 23.7 percent before the recession officially began in December 2007.
The report, released today, says 57,312 Akronites were living below the poverty line in 2010. The poverty line for a family of two adults and two children was $21,970 last year. (The figure varies for different-size families.)
Many area social agencies say they are hearing from formerly middle-class people who have no idea how to cope with being poor.
“These are individuals who have never been poor; they don’t know how to use the system,” Dottie Achmoody, chief executive of OPEN-M, said. “They don’t know where the resources are, and even when they find out what the resources are, they are embarrassed. They are ashamed. They come to us as the absolutely last resort.”
Many families are earning less.
The median Ohio household income fell from $49,000 in 2007 to $45,090 in 2010. For Akron, that number — meaning half brought in more, half less — fell from $34,626 to $31,171 in 2010.
“The one thing we are seeing is a whole new face of poverty,” Achmoody said. “We are seeing a lot more situational poor. Individuals or families where two-income households have gone down to one [wage earner], and one household income cannot cover all the bills and expenses.”
Ohio’s unemployment rate was estimated at 9.1 percent earlier this week.
Many of those jobless are turning to social services for the first time in their lives.
“What we are hearing a lot of individuals say is, ‘You know I have worked all of my life. I have never been without a job. I’ve always been able to find some kind of job.’ ” Achmoody said. “But now so many are out of work, it is hard to go out there and find any kind of job, no matter what the pay. We’re seeing people accept jobs much lower than their qualifications are, just to make ends meet.”
She gave the example of a Hudson family: The husband lost his job and the bigger share of family income. His family’s health insurance also was about to expire. He had never been needy before and didn’t know what to do. Eventually, he turned to OPEN-M’s free clinic.
Achmoody said the man wasn’t as savvy as some chronically poor people.
“Some with generational poverty, they’ve been dealing with this stuff all their life,” she said. “They are beyond embarrassed and they know where all the resources are … but this new poor, they do not know, and it’s difficult.”
Since 2007, median household income has declined in every major Ohio city, with Cleveland at the bottom rung, falling from $29,982 in 2007 to $25,977 in 2010.
Jeff Kaiser, executive director of Akron’s Haven of Rest, said the poor are younger now, too.
“What we are seeing is a younger generation of men coming into the facility,” he said. “It used to be anywhere from 45 to 65, and now it’s more like 18 to 35.”
In some cases, the young people have never held a job. Haven of Rest’s mission includes leading them to job training so they can become self-sufficient.
“Our goal is to get them back into society,” he said. “It takes time. It used to be two and three months, and now it’s taking a lot longer. It can take anywhere between four months up to a year to get them back into society.”
Women and children are feeling the brunt, he said.
He said the mission’s women’s director, Yvette Mc-Millan, reports that many women say they formerly lived with one and two other families under one roof and even then they couldn’t make ends meet and were forced to ask the Mission’s Harvest Home for shelter.
The Akron Canton Regional Foodbank tripled its storage volume with a new warehouse three years ago — and it needed it.
“Our distribution has shot up 48 percent in the last three years. That’s in the overall food we distribute,” said Dan Flowers, chief executive of the food bank. He saw 23 percent more people using the agency’s services in 2009.
“In this last few years and in this recession, a lot of people who have never had to access the food banks and the public benefits are finding them doing it for the very first time. … So by all means we have seen, certainly, a lot of first-time clients come in.”
He said national food distributors have had to reduce contributions, but local retailers, including Walmart, Sam’s Club, Acme and Giant Eagle, have made up the slack.
Flowers said no one who asks for food has been turned away. Still, there are hungry in the Akron area.
Instead of hunger, he uses the term “food insecurity,” which means an inability to provide necessary food. Flowers said 16 percent of Summit County residents – 25 percent of all children – faced that problem last year.
But help is available.
“I guess the one piece of advice I’d give to people in poverty is if they need help, don’t be scared to ask for it … because there are a lot of people that want to help,” Flowers said.