Is the “Middle Class” disappearing in America? (1 Viewer)

[MarkHastings]

I would think that the upper middle class puts in some of the longest hours. Your lower executives, production people, paralegals, etc. - When you're JUST under upper class status, you usually tend to have a job that requires you to work hard to make your upper class boss (or supervisor) look good - or else get fired.

Of course, the biggest differnce there is, those people have to work long hours in order to maintain their higher pay, whereas poor people have to work long hours to get by.


p.s. and for the record, I never meant to infer that ALL poor people are lazy...I was just putting it out there that there are cases where people are just downright lazy and don't want to work. I think this country (now more than ever) has not only allowed people to act this way, but there are also those who don't even try. I'm sure that has to be a measurable chunk of the poor statistic.

 

[Eric_L]

The first observation I have is your mistaken presumption that everyone in America works for a corporation. The largest employer in America is the government. Corporations employ less than 1 in 4 workers.

The second observation is the presumption that an education entitles someone to a higher income - it does not.

Finally your income comparisons are unfounded and misleading. If you want to add impact to your otherwise presumptive statements you should provide verifyable data proving such.

 

[Chu Gai]

According to http://www.ncpa.org/ba/ba328/ba328.html this doesn't seem to be born out when looking at life expectancy. http://www.time.com/time/health/arti...533977,00.html though did find interesting longevity data when broken down by ethnicity.

 

[Buzz Foster]

Sorry, I have been away...


I hadn't intended that as a bomb...just as an example. My friend's wages are good enough right now to afford his modest lifestyle. But the future for him is uncertain because his company that hired him with the pension plan being a compensation mechanism, has now dropped that. In calculations of wages, future losses in earnings usually don't come into play. His retirement income will be less than what was promised him when he hired on.

Granted, this has little to do with the original question of the middle class disappearing, but it has a lot to do with how our lives are changing in the current business climate.

The tragic thing I see is that companies are going to go more like Wal~Mart, and discourage long-term loyalty so that they don't have to pay benefits. SO my friend who has lost his pension will also find himself being pushed toward the door as he ages and spends more time with the company, exactly at the point when he should be able to retire and move on.

But hey, business comes first, right? In the end, we will compete with the Chinese and Central African labor markets, make 10 cents and hour, and be happy with it.

 

[Mort Corey]

Hope he's not counting on Social(ist) Security......he's gonna get ripped on that boondoggle too.

Mort

 

[JonZ]

"The statistic shows that American workers are spending more of their lives enriching their corporate masters than any other worker in the major industrialized nations"

And this will continue as most corporations are feeling the squeeze from the nice packages they offered employees 20 years ago and want out of them. Youll have corp employees in management positions, but everyone will be contractors. Theyll save Billions in insurance, benefits, retirement,etc

I think the biggest problem is that salaries havent kept up with the cost of living. The cost of living in my area has gone up about 300% in the past 15-20 years yet salaries have only gone up 30%.

The average house was 50-70K here, now we have more homes for sale over 500K than we do for under 200. A one bedroom apt here is 150K.
Buy a house, furnish it, 2 cars to commute with and before you know it youre almost a 1/2 mil in debt.

Job security isnt there anymore either. People used to look at corporatins for job security.

I had this discussion with someone recently and he kept talking about widgets and ecomonics class BS. I agree debt is necessary for the eceomony but why are so many 30 year old living at home? Why are people marrying so much later? Why are so many americans without health benefits despite working for corporations?Why are 2 working parents the norm now (30 years ago you could raise a family working in a hardware store).

There was a recent article that said 30 years ago, most people/ parents were saving about 10 % of their income. The recent figures were 0-1%.

People I know in their 30s are already beginning to spend less.

I said 10 years ago the middle class is disappearing and everyone said I was overreacting.

 

[Holadem]

JonZ, who is the lady in your profile?

--
H

 

[JonZ]

Jennie Lyn Berntson

 

[Chu Gai]

If they're spending less now, perhaps they were caught up in consumerism and spent too much before. Perhaps if we were to think about signficantly reducing corporate income taxes this money could be used to attract more employees and/or reduce the costs of goods due to competition. Then maybe less of certain type of jobs would go overseas. I do think though that certain aspects of executive compensation need to be rethought like backdating stock options and such.

 

[Buzz Foster]

Somehow, I am imagining such funds being used to buy pivate islands, and not to do anything beneficial for employees.

The thing is, business as a whole wants it both ways...they want us to shell out as much as the market will bear for their goods and services, while at the same time paying out as little in wages as possible. Does anyone besides me see the deminishing returns in this?

Economies that successfully balance the needs of business inovation with the needs of the people rely not just on the invisible hand of the economy, but on the invisible foot of government regulation. I do think that such regulation can go to far, such as countries that require a certain percentage of music on the radio to be by native artists. But protecting workers from excessively low wages and standards of living is, in my opinion, essential for the good of a country as a whole.

 

[Chu Gai]

People and employees also want it both ways. The reduction of corporate income tax is a very controversial idea. Certainly someone can buy an island but some companies will use it to their economic and productive advantage by hiring better skilled employees, reducing the costs of their products..competition. The company that doesn't might soon find that whatever economic advantage they once had has been removed by the marketplace.

Yes, the economy is fueled by purchasing. If we purchase less, maybe grow some of our own veggies (anyone whose been into virtually any supermarket knows how piss poor the quality of things like tomatoes is) then changes will occur. This doesn't necessarily mean that companies like GM or Toyota are going to suffer. They'll have to think of more creative ways to justify their existence.

As tempting as it is to think of governmental intervention to improve the lot of those making less it's also the less obvious ways that government acts to milk the very ones they profess to care about. So we have legalized gambling and lotteries. Taxes on clothes and toilet paper. Programs that are supposed to improve education and yet scores don't improve. Programs that sound good but do nothing. Programs that encourage the destruction of two parent homes and the unintended consequences that has for children.

 

[RobertR]

Government regulations can’t repeal the laws of economics. Artificially holding wages above market levels will tend to create unemployment (a price above market will create a surplus). Holding prices below market levels will create shortages. It would be irrational for any business not to minimize its costs (or want to minimize the cost of taxation), including labor costs, and equally irrational not to maximize its revenue, just as it would be irrational for an employee to accept a lower wage than he can get. The irony is that those who want a different outcome with respect to what businesses do very often want to shield those businesses from the market forces that would force them to behave differently, while claiming that “the market doesn’t really exist”.

 

[cafink]

I could not disagree more.

Workers don't need to be "protected" from anything. They are not forced to work for any employer, and are certainly free to decline job offers from employers who pay an amount they deem "excessively low."

If an individual is unable to find work at his desired level of pay, then perhaps his contribution to the work force is not as valuable as he'd like to believe. It is unfortunate, but forcing employers to pay a "minimum wage" to employees does not magically make their skills more valuable. Rather, it creates unemployment among workers whose skills are worth less than that arbitrary minimum. Instead of earning a low wage, they earn no wage at all.

 

[Carlo_M]

CNN.com has a video talking about middle class woes on their website. I can't link to the video, but it's right there on the front page of www.cnn.com on the right hand side, under Top Stories, second to last item (as of now).

Of course, anyone who looks at this post later won't find it.

Timely for our discussion, though. And I do agree: one of the biggest problems is that wages have not increased along with inflation, cost of living, and especially real estate.

I make more than one of my parents did in the 80s, and with my live-in S.O. make about what both of them did. However they out-and-out own their house, and I can barely scrape together enough to make a decent down payment!

 

[nolesrule]

Or it is because a market is being flooded by workers who are willing to undercut livable wages for one reason or another. If they weren't in the market, those employers would be forced to raise those wages to a more reasonable level.

This applies to outsourcing as much as it does to illegal immigrants. The "global economy" is a myth because the imbalances between regional economies cause instability. Instead of the wages being returned to their own economy (a local worker will buy things locally) generating a balance, they are being sucked into other economies (illegal immigrants sending wages back home or outsourced employees keeping the money in their own country).

 

[cafink]

Those who do the same work for lower pay are, by definition, the most efficient workers. Why shouldn't those workers be free to work for however low a wage they see fit? And why shouldn't employers be able to hire workers however cheaply the market will bear? If the wages really are as unreasonably low as you suggest, then the employer will quickly find himself out of business, because no one would work for him. What need is there to get the government involved it it?

 

[nolesrule]

But the market itself isn't bearing the lower wages. It costs more to maintain the same standard of living as 20 years ago, yet wages aren't keeping pace. Instead, the companies are finding other markets that will bear the lower wages for them. This is no longer a nearly self-contained market and that throws all the market theories out the window, because they are based on almost self-contained systems.

The United States is one market. India is a separate market. If a company hires a call center rep in the U.S., those wages are then spent in the U.S. feeding the economy. If the company decides to hire the call center rep from India, the money spent in the U.S. goes to India.

If India and the U.S. shared resource costs as a single market and cost of living were equal, this wouldn't be an issue, but it's not.

A solar system works great for millions of years. It's balanced, everything orbits properly around its sun. There is the occassional gravitic wobble, but it is all self-correcting. Introduce a black hole to the solar system and see how long it remains stable. The black hole would "suck" the solar system apart.

Outsourcing labor does the same thing. Sure, it'll reduce prices in the short term, but at some point people will no longer be able to pay for the goods and services because the money is in India, not the U.S.

 

[george kaplan]

I can't believe that some people here are actually promoting trickle down economics! Cut the corporate tax rate? Are you kidding me? With their lawyers, most of these corporations end up paying a far smaller percent in tax than most of their workers. Cutting the tax even further is one of the worst ideas imaginable.

 

[KurtEP]

The idea that corporations actually pay taxes is somewhat of a fallacy. Yes, they file tax returns, and yes, they are pretty good at finding ways to avoid paying the tax. However, a corporation is simply a fictitious person for legal reasons, it's not an actual person.

Whenever a corporation is taxed, the tax is either paid via reductions in salaries, assuming it's a close corporation that isn't a subchapter S for some reason, in a reduction in dividends to the investors, or in a reduction of the funds available for growth, reducing the capital gain available to the investors. In all cases, the corporation is merely a vehicle to pass the tax on to the investor.

The only thing you really gain from a corporate tax is the ability for government to collect the taxes more easily from a some highly concentrated sources, and the ability for it to hide the true burden of taxes from the taxpayer.

 

[Garrett Lundy]

Since "middle class" seems to be difficult to post a fixed number on, can anybody give a good idea on what the typical lower & upper class persons are? Sometimes you'd like a nice rigid caste system to make life easier.

*I was personally taught "lower class" is reserved for homeless/transients, people in prisons, migrant laborers who don't speak the language.

*What is upper class? $1million in the bank?, $1million/year, $20million for 3 weeks of work on the latest studio blockbuster?