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Startling Statistics Speak Volumes

Posted by Larry Doyle on July 27, 2010 1:05 PM |

Thanks to a good friend of Sense on Cents for sharing an array of truly startling statistics about the distribution of wealth in our nation today. These stats are embedded in a recent article which ran at Yahoo Finance entitled, The Middle Class in America Is Radically Shrinking. Let’s review the statistics first and add comments later:

•    83 percent of all U.S. stocks are in the hands of 1 percent of the people.
•    61 percent of Americans “always or usually” live paycheck to paycheck, which was up from 49 percent in 2008 and 43 percent in 2007.
•    66 percent of the income growth between 2001 and 2007 went to the top 1% of all Americans.
•    36 percent of Americans say that they don’t contribute anything to retirement savings.
•    A staggering 43 percent of Americans have less than $10,000 saved up for retirement.
•    24 percent of American workers say that they have postponed their planned retirement age in the past year.
•    Over 1.4 million Americans filed for personal bankruptcy in 2009, which represented a 32 percent increase over 2008.
•    Only the top 5 percent of U.S. households have earned enough additional income to match the rise in housing costs since 1975.
•    For the first time in U.S. history, banks own a greater share of residential housing net worth in the United States than all individual Americans put together.
•    In 1950, the ratio of the average executive’s paycheck to the average worker’s paycheck was about 30 to 1. Since the year 2000, that ratio has exploded to between 300 to 500 to one.
•    As of 2007, the bottom 80 percent of American households held about 7% of the liquid financial assets.
•    The bottom 50 percent of income earners in the United States now collectively own less than 1 percent of the nation’s wealth.
•    Average Wall Street bonuses for 2009 were up 17 percent when compared with 2008.
•    In the United States, the average federal worker now earns 60% MORE than the average worker in the private sector.
•    The top 1 percent of U.S. households own nearly twice as much of America’s corporate wealth as they did just 15 years ago.
•    In America today, the average time needed to find a job has risen to a record 35.2 weeks.
•    More than 40 percent of Americans who actually are employed are now working in service jobs, which are often very low paying.
•  for the first time in U.S. history, more than 40 million Americans are on food stamps, and the U.S. Department of Agriculture projects that number will go up to 43 million Americans in 2011.
•    This is what American workers now must compete against: in China a garment worker makes approximately 86 cents an hour and in Cambodia a garment worker makes approximately 22 cents an hour.
•    Approximately 21 percent of all children in the United States are living below the poverty line in 2010 – the highest rate in 20 years.
•    Despite the financial crisis, the number of millionaires in the United States rose a whopping 16 percent to 7.8 million in 2009.
•    The top 10 percent of Americans now earn around 50 percent of our national income.

Sense on Cents comments:

1. Our national prosperity will not be sustained in which the very few control the vast majority of the wealth.

2. Is it any surprise why major corporations buy political and regulatory cover? The money spent on lobbying has obviously paid huge dividends.

3. Are those in lower income categories there because of the business practices of those in upper incomes? In my opinion, if we promote that reality (which many in our nation are wont to do), then I think we have lost our future. There remain real opportunities along with new avenues of growth in our nation. The spirit of competitiveness and drive, which has made our nation great in the past, is of paramount importance to drive our nation into the future. What is needed to spark that drive and competitiveness? An insatiable appetite for skills and education supported by the care and love of a strong family.

4. I strongly believe America needs to learn to live within, if not below, its means. Saving early and saving often needs to become a way of life. Allowing the savings to compound is the best path to wealth creation.

I am respectful of those with differences of opinion, but I believe this principle of thrift along with undying motivation, solid education, and strong love are the Sense on Cents keys for long term success.

I also recommend frequent visits to Sense on Cents!

LD

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  • phil trupp

    Destruction of the middle class equals destruction of the very concept of America. Cynics have smirked at the so-called American Dream, saying that to dream “you must be asleep.” That is pure nonsense. My family is a product of the dream, the concept of empowerment, of striving, saving, creating, giving back. The statistics cited in the above article are a threat; they are more menacing, and certainly more immediate, than any foreign enemy. The redistribution of wealth upward is poisonous. Having grown up in an Eastern European ghetto during WW-II, I can say without embarrassment that Concept America is a rare and unique gift to the world, and we would do well to take better care of all levels of that gift. Are we so in love with cheap goods and services that we are willing to export our entire manufacturing base, our skills, our technology, our science; and, in the meantime, allow the middle-class to vanish, to become the “underclass?” We appear to be suffering a glorification of, and domination by, the financiers, and their is a terrible price to be paid for this misguided ethic. While monopoly wealth-gathering thrives, true upstart capitalism dies. Is our love affair with competition at an end, like some adolescent summer fling? Are we falling back on pre-WW-II social models, the kind of economic stratification that built monarchies and oligarchies and fomented unending wars? In the preface to his new book, CORNERED: THE NEW MONOPOLY CAPITALISM AND THE ECONOMICS OF DESTRUCTION, author Barry C. Lynn writes: “Once we get our heads around the fact that monopolists rule most of our economy, our next step will be to understand how monopolists ruin our economy.” Government policy also plays into this whittling down of the middle class and the shift of wealth in the cruel and wasteful style of the Old World. Sense on Cents deserves praise for publishing the dangers of unequal wealth-shifting, the economic Darwinism that threatens to crush the energies and creativity of our country, and to place overwhelming power in the hands of financiers who need no country, no government, no moral or ethical boundaries.

  • Tycoon

    The great industrialists of the early 20th century led to the formation of unions and the labor movement.

    What will the collection of wealth in the banksters hands of the 21st century lead to?

    Civil strife and unrest?

    When people feel hopeless and desperate they will act accordingly.

    We live in peril if we do not address these issues. I agree that it begins and ends with families. The family unit is the single greatest answer for social ills.

  • CEO of E-Trade

    When does it stop??? When 1% of the nation owns 99% of the wealth???

    This is it. This I guess will be the century where everyone LEAVES America in search for a better life somewhere else.

  • Shark

    The middle class’s perpetual aspirations to have the “American Dream” is what cripples them with debt. The emulation of the upper class’s greed is present in the housing market, the lower and middle classes are extremely over leveraged with mortgages. They feel it is perfectly fine to have now and pay triple tomorrow, while they drown in debt. So, let us not begrudge those whom we happily hand our money over to. Let us truly have sense on cents and live beneath our means.

  • Where did Yahoo Finance get these statistics? I don’t doubt the middle class is getting squeezed, but I am forever the skeptic when it comes to statistics.

    • phil trupp

      The stats come from ACS Lending Report via “financemymoney.com and were summarized by Yahoo Finance.






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