Guest Post: The Housing Bubble Broke The Middle Class

Tyler Durden's picture

Submitted by Charles Hugh Smith from Of Two Minds

The Housing Bubble Broke the Middle Class

The bursting of the housing bubble wiped out half of the net worth of the Mortgaged Middle Class.

On the face of it, American households were not that affected by the bursting of the housing bubble. If we look at the Fed Flow of Funds report, the Balance Sheet of Households and Nonprofit Organizations, we find that net worth only declined by about 11% ($7.3 trillion) from 2007 to 2010: a $2.9 trillion decline in financial assets and a $4.9 trillion decline in tangible assets, i.e. real estate and consumer durable goods.

Here are the basic numbers, rounded, in trillions:

total assets:
2007 $78.5 trillion
2010 $70.7

2007: $14.4
2010: $13.9

Net worth:
2007: $64.2
2010: $56.8

Financial assets:
2007: $50.5
2010: $47.6

Tangible assets:
2007: $28.0
2010: $23.1

Most of the decline in assets results from the popping of the real estate bubble: $6.3 trillion of the $7.3 trillion decline is housing:

Real estate:
2006: $22.7
2010: $16.4

Despite massive write-offs from millions of foreclosures, mortgage debt barely budged:

2007: $10.5
2010: $10.0

Ditto consumer credit, essentially flat: no deleveraging here:

Consumer credit:
2007: $2.55
2010: $2.43

This is a better reflection of the true devastation left by the bubble: I will explain why below:

Owners equity as percentage of real estate:
2006: 56.5%
2010: 38.5%

Despite the 100% rally off the March 2009 low, stocks and mutual fund assets are still down by a trillion dollars:

Corporate equities and mutual fund shares:
2007: $14.2
2010: $13.2

Households pulled money out of stocks and put it into Treasury bonds. Yeah, the public really bought the stock rally....

Treasury securities:
2007: $255 billion
2010: $1.0 trillion

Cash clicked up a bit:

Savings and money market funds:
2007: $7.2
2010: $7.5

On the surface, this rise in income looks good, too bad the increase is mostly Federal transfers of borrowed money:

Disposable personal income (SAAR):
2007: $10.4
2010: $11.5

If we look beneath the surface at the distribution of wealth, the picture isn't so benign.
Over the years I have often posted the basic facts of wealth distribution and housing in the U.S., for example Will Delinquencies Trigger a New American Revolution? (April 7, 2008).

The numbers have changed from 2008, of course, but the basic outlines and percentages have not.

Beneath the surface, most of the income and wealth is held by the top 10% of households. Over a quarter of households are at or below the poverty line; they have no appreciable assets and depend heavily on government transfers.

Almost half of the total income (47%) goes to the top 10%, and 21% flows to the top 1%.

Over 18% of personal income is transfers from the Federal government, most of which is borrowed, of course: Reliance on Uncle Sam hits a record :

    A record 18.3% of the nation's total personal income was a payment from the government for Social Security, Medicare, food stamps, unemployment benefits and other programs in 2010. Wages accounted for the lowest share of income — 51.0% — since the government began keeping track in 1929.

From 1980 to 2000, government aid was roughly constant at 12.5%

If we extrapolate the additional 6% increase in transfers, that comes to $700 billion. So roughly 70% of the increase in personal income was simply money borrowed by the Federal government (recall the $1.6 trillion annual Federal deficit) and distributed to the citizenry. In other words, people aren't making more money--the Central State is simply borrowing more and it's being counted as "income" when it's distributed.

There are about 105 million households in the U.S. and about 72 million owner-occupied dwellings. Roughly 25 million are owned free and clear, and 48 million have a mortgage.

Let's look at homeowner's equity, which stands at 38.5%. Equity is what's left if you sell your house and pay off the mortgage.

About 27% of all homeowners (13 million) are underwater, i.e. their house is worth less than their mortgage. This is called negative equity, but in practicality it means zero equity.

Since a third of all homes are owned free and clear, then their equity is 100%. Assuming a broadly even distribution of these homes owned without mortgages (most likely, the majority are owned by elderly people who paid off their mortgages), then we can conclude that 33% of total owner's equity resides in these homes owned free and clear.

That leaves 5.5% of total equity spread among the 35 million mortgaged homes which are not underwater.

Calculated another way: household real estate is worth $16.4 trillion, and there is $10 trillion in outstanding mortgage debt, so total equity is $6.4 trillion. One-third of homes are owned free and clear, so one-third of $16.4 trillion is $5.4 trillion. $6.4 trillion - $5.4 trillion = $1 trillion in equity spread over 35 million homes.

That's not much--roughly 1.8% of all household net worth.

The family house was the traditional foundation of household wealth. As for all those trillions in financial wealth--as we all know, 83% is owned by the top 10%.

So here's the reality: over one-fourth of all households are at or below the poverty line: 28 million.

The top 10%--10.5 million households--own the vast majority of the financial assets ($45 trillion)(the total owned by non-profits is not broken out).

The next 10% own 10% of this wealth, or about $4 trillion. So the top 21 million households own 93% of all financial wealth.

The Great Middle Class between those in poverty and the top 20%--56 million households-- owns about $2.7 trillion in financial wealth, and the millions with mortgages own an additional $1 trillion in home equity. That comes to $3.7 trillion, or about 6.5% of the total household net worth.

Consumer durables--all the autos, washing machines, jet-skis, etc.--are worth about $2.2 trillion ($4.6 T = $2.4 T in consumer debt). Add the durables and the other wealth, and the Great Mortgaged Middle Class holds about 10% of the total household wealth ($5.9 trillion).

Before the housing bubble, households owed about $5 trillion in mortgages
. The housing bubble came along, introducing the fantasy of home-as-ATM-cash-withdrawal-machine, and mortgages ballooned to over $10 trillion.

Back at the top of the bubble, the middle class had $6 trillion more assets on the books. Considering the Mortgaged Middle Class now owns about $6 trillion in net assets, then the bursting of the housing bubble caused their net worth to drop by 50%.

I'm not making any political statement here--these are the numbers.

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Long-John-Silver's picture

I can by the house next door for a single Monster Box of Silver Eagles.......

I wonder if I should..... Hmmmmmmm

In Fed We Trust's picture

The housing crash was just the first part of robbing the middle class.


Wait until we have $7 gas, then Americans will feel the pressure.


Food prices, double , tripple over the coming years, it will be check mate against the citizen.


Citizens will comply or yeild to ANY demands put upon them.


Like a nifty chip in your arm to keep track of your daily transactions, points toward GNP and such,

and physical coordinates of your reabouts, only to fight terrisiom pf course.


You the citizen, are just another record in the master data base, your social security number followed by every mouse click you ever made. 

When Steve Jobs passes on, Apple will become the trojan house that suckers every one in to, being ........

Robslob's picture

So here's the reality: over one-fourth of all households are at or below the poverty line: 28 million.

I'm pisssed...this basically means there are roughly 18 million people that are using food stamps and NOT considered poor...Let them eat iPad2s I tell ya...

Seriously though...this is a bad time to be an Amerikan.

FEDbuster's picture

Households and number of people on food stamps are two different things.  Assume a household contains three people, 3 x 28 million households = 74 million people below the poverty line.  Currently there are about 45 million people on food stamps, we still have 30 million more to sign up.  As the gap between the haves and the minimum wager earners grows, so do the chances for a real revolution.  The coming economic collapse should be enough to push the masses over the edge.  As Bob Marley sang:

"Cost of livin' gets so high,
Rich and poor they start to cry:
Now the weak must get strong;
They say, "Oh, what a tribulation!"
Them belly full, but we hungry;
A hungry mob is a angry mob."

Alcoholic Native American's picture

Ownership society fail

Bob Sacamano's picture

Ownership not the problem.  Borrowing is the problem.  Living within your means is the problem.

sgt_doom's picture

Yo, Sacamano moron, can you read, it is fundamental, you know?

Recall that Fed Rerserve report just released under court order detailing all those trillions the Fed had to pump out to all those foreign banks and foreign corporations?

Oh, yeah, I forgot you can't read.  Those monies were to reimburse them for all those trillions of dollars the banksters sold to them in worthless securitized debt!

You understand what securitized debt is???

Didn't think so, doody, but I guess it's about time all those debt-financed banksters lived within their means, and that we got their ill-gotten gains back from their grubby thieving hands?

Bob Sacamano's picture

Isn't the root cause of the housing bubble (and therefore presumably the subsequent "trillions the Fed had to pump out") that people borrowed too much money?  Over-borrowing produces "worthless securitized debt."   Without over-borrowing, there would not be trillons of worthless debt for the Fed to purchase.   

I presume you would argue the lender foisted these loans on people (who really wanted to borrow much less).  I just disagree.  Borrowers and lenders were greedy.  The fact the Fed decided to bail out some lenders is primarily the Fed's fault -- but that is your government in action. 


lynnybee's picture

Borrowers and lenders were greedy.     the blame shouldn't be put entirely on the borrowers.   Like Dr. Faber says, "if you offer the people cheap money, they're going to take it!"    Whoever heard of lending people basically unlimited money !   Years ago when I was younger, no bank in their right mind would have lent me unlimited credit !    

This is nothing but a banking scheme & scam & fraud directed from the highest places of both government & the banking industry.     Isn't the whole idea to pay off that house, or pay off that loan so you are at zero balance, have money in your bank account so you can retire !!!   The ultimate object is to be debt - free by retirement so you can live on a lower income .   Damn banks don't want people to be "paid-off" , all they want are endless interest payments .  The damn country is bankrupt, the citizens are bankrupt, we are in a credit collapse just like in the 1930's ........ another fucking WALL ST. scam to come in & buy up real assets at firesale prices .   

damn i'm mad.   the young people are deep in debt, the middle aged are in debt.     The only reason I'm not in debt is cause I'm so cheap that I refuse to pay out interest to bankers .   

the money shouldn't have been lent out in the first place.   we need to go to a utilitarian banking system .

Miss anthrope's picture

Lynnbee I've seen you here for a long time and I always look for your level headed wise comments.  I agree that the young people are deep in debt.. primarily because of student loan/big government collusion to make those loans non-dischargeable.  Whoever heard of a debt that SURVIVES a bankruptcy., especially an unsecured debt!... unbelievable.  The middle aged however, like myself, I do say need to take responsibility where it is due  since they did live beyond their means.  I have downsized several times, changed working for a private to a non-profit, stopped eating out, started shopping at second hand stores, And all of this in the late 90's after reading "your money or your life".  I am now at this moment preparing to move to a small apartment...... while my house is rented in order to  be debt free within 3 years...... in other words, sometimes it takes extraordinary measures, suffering and sacrifice to get there but it is possible if you truly can extricate your ego from the opinions of others.  Americans LOVE to keep up their image.

Bob Sacamano's picture

Thank you MA. 

LBee - glad you and MA are proving not being ensnared by debt can be done. 

I am not putting the blame "entirely on the borrowers."  It takes two to tango, so I will call it 50/50 borrower/lender for argument sake (noting that the borrower initiates the transaction).  Less than 0.1% of the posts on this site suggest borrowers had a significant role in the debt crisis -- everyone here focuses exclusively on lenders (of which I am not one nor have a vested interest in).  'The money shouldn't have been lent out in the first place" can be countered with "the money shouldn't have been borrowed in the first place" -- just trying to add an ounce of balance to the argument on this site.

I do not buy the argument that borrowers are unable to resist the overwhelming temptation when lenders offer a loan.  But that philosophy is common in the US -- I am a victim, I can not control myself, I am not responsible for my actions, and I can't be held responsible for the agreement I signed (and did not read and/or understand), I was dazzled by the pile of cash -- it must be someone else's fault.  

TimmyB's picture

I agree.  We have austerity being pushed on  working class Americans to finance the bail-out of the fraudster class.

Oh well, whatever the owners of this country want, they will get.  Why else would they buy up all the politicians?     




malek's picture

You loose oversight if there is more than 1 piece on the table?

The money people took out of their house-as-an-ATM, or flushed by buying a too big house, is already gone and most have realized that now.
The bailout trillions will rob them some more through inflation in the coming months/years, and most haven't realized that yet.

However the insane bailouts don't grant absolution to MEWs and other craziness committed by countless middle class households.

pan-the-ist's picture

If everyone lived within their means there would be even fewer jobs.  I'm not saying that's good or bad, I'm just sayin'.  The only way to get there would be to trigger a huge deflationary event.

JW n FL's picture

Corporate America Paying LESS! than $0 Fucking! Dollars!! in TAXES!!! is what Broke the Middle Class!


Austerity! for the Poor!

Taxes Credits for the Rich who already pay NO Fucking Taxes!


I understand that when the Republicans and democrats tested the Term "Tax Breaks" in market study programs across the Nation that it tested well... As well I understand that BOTH! Parties have kept thier Word! Taxes are Lower and zero in some instances.. but in no way does this help and / or effect the middle, working class of this Nation in any sort of positive way... Trickle Down the Leg Tax Breaks have NOT! Helped our Country.


If the Corporate America needs Tax breaks to create Jobs?? why arent they hiring? they pay fucking $0 Now!


Maybe it is becuase Corporations get a Tax break to send jobs Offshore?


since 2001 (on average) 50,000 manufacuring jobs a Month Leave for Off-Fucking-Shore!


So the I.R.S. does give Tax Breaks that DO! in Fact undermine the Tax Base! which is in the best interests of this Country?


But lets talk about birther documents! so much more fun! how about abortion? How about people pulling themselves up by thier boot straps? how about some Austerity that what the broke, un-employed of this country need.. More Austerity! it is all the broke peoples fault any way! we all know that! Tax Breaks for the Rich are a good thing! trickle down your chin you fucking cock sucking ignorant fucks!

MachoMan's picture

First, taxes are passed on to consumers until margin squeezes won't allow it...  at which point the businesses fold up the tent and go home.

Second, in a world where corporations can be located anywhere and in which america has a laughable trade deficit, what do you think the effect would have been if corporate taxes were raised and all loopholes/deductions removed?  I'll posit that they would be headquartered offshore and what trickle of taxes we presently collect would deteriorate further...  If you wanted to have imposed retroactive trade restrictions, then...  we need to stop talking.

Third, governments never have a collection problem...  rather, they only have a spending problem...  they collect what they collect, but they spend what they can borrow...

weinerdog43's picture

I call bullshit.

If we raise taxes on the top 1% leaches and corporate scum, they are not going anywhere.  Bahrain? China? Singapore?  Nope, nope and nope.  It's just tax dodging, plain and simple. 

JW n FL's picture

Boehner says “Lazy Un-Employed Scumbags to Blame for Recession” I am paraphrasing a lil.

Boehner: "Can't pay your student loan? Face it your parents were lazy and you couldn't afford college. The world needs ditch diggers and you were born into a family of them. Can't pay your mortgage? Your house was too expensive and you couldn't afford it. Your taxes going up too much? That's what you get for electing a democrat president. Never had a job after you got a degree? You learned nothing in school and you're lazy. I didn't get to be a congressman by watching jersey shore or playing xbox. You think there's no jobs for you? There used to be. There was when I was your age. You don't have fee time because you have to work all days of the week for 16 hours a day and you don't get paid hourly? Thank the unions. They made decent jobs so out of price range of the average American company that they can't hire anymore people and the works' gotta get done. These unions... I tell you they won't be happy till no one in America has a job. And health care? Don't get me started on health care- doctors study their entire lives and they barely make enough to live and yet Obama, who had his entire life handed to him on a silver plate wants to cut their pay. You know that's gonna do? Increase costs- the average persons going to have to work even harder just to see a doctor. "


Taibbi: "With mounting unemployment what do you think is the possibility that we'll see an Egyptian style uprising of the youth? Should we be worried?"

Boehner: "It's not going to happen in the US. The kids here are too fat, too lazy, to addicted to TV, fast food, cheap credit, and facebook. I have news for you- there are plenty of jobs out there- the unemployed don't want them. Today's college student feels entitled to make at least $24 right after college. When they find out they can collect unemployment they would rather do that. You know the average college educated unemployed person is collecting $60k a year? The CATO institute did a study- and I mean, you and me we're hard workers we could just sit around and live, but these kids today- that's all they've been doing their entire lives. I'm not worried for this country- there are a few of them who actually want to work, take Mark Zucker(sic). You don't build a site like facebook out of thin air- it takes talent and hard work. I went to a community college and all I saw were people sitting in front of computers typing away, their eyes were fixed. Probably just facebooking away."


Boehner $26m Lobby Whore! "We the People" dont have enough $'s to Bribe / Lobby the "WHORE"!


Karl Rove Builds Shadow Gov / Republican Party with Plutocracy $$$

Henry Hub's picture

Regarding **Boehner says “Lazy Un-Employed Scumbags to Blame for Recession”**

You should know that Matt Taibbi has said that he never interviewed Boehner. The whole thing is a forgery, although it is probably what he could have said.

JW n FL's picture

Thanks! I will take it out of my line up. It had to be wrong it felt to good!

MachoMan's picture

Why beat around the bush?  If you're going to impose punitive penalties on the wealthiest people, why not just confiscate their existing wealth? 

The question I have is that at this juncture, why stay?  The corpse has nearly been picked dry after decades of looting...  once you have stolen everything, there isn't much point in sticking around waiting on the remainder to get pissed and take it back...  No, they'll move on to the next soon to be corpse...  that's what they do...  we'll rebuild, maybe never achieving our former relative position, and they'll come knocking again...  and we'll lube up and grab our ankles at the slightest hint they would enjoy it...  just a bunch of credit junkies that believe in perpetual motion and disregard exponential functions.

Bicycle Repairman's picture

Why should the wealthiest leave?  The USA is a relatively safe place.  No need to worry about the locals.  They're prepared to accept serfdom.

JW n FL's picture

Not why should they..

Why would they?? General Electric $14.2 Billion in Profits, Pays $0 in U.S. Taxes

$39M Dollar Lobby in 2010 $14B in Profits =’s NO TAXES PAID!

$10 billion sale of F.D.I.C.-backed debt


MachoMan's picture

You do realize that subchapter S corporations, limited liability companies, and the like are not taxed at the entity level (unless opting to be taxed at an entity level)?

Further, why is it that money flowing through a corporate entity should be taxed multiple times?  E.g., at the entity level, when distributed, etc.  Is there some material difference in types of limited liability entities that justify different treatment in this department?  Would increasing the tax on the wealthiest individuals not likely accomplish the same thing, while also attracting corporations to migrate here?

I'm just really curious with your myopic approach...

JW n FL's picture

they could run things out of a P.A. group and take another 20% off too?

MachoMan's picture

I think the jury is still out...  we have to wait and see what happens when the wealth effect renders the citizenry incapable of living in denial...  I strongly suspect a...  err...  change in behavior.

TimmyB's picture

Frankly, I agree with your proposal to confiscate wealth.  Let's begin with a wealth tax on those who didn't pay any taxes while they accumulated huge fortunes.

As Warren Buffet himself states, he pays a smaller share of his earning in taxes taxes than his secretary does.  We have hedge fund opperators making over a billion dollars a year, and not paying a cent in federal, state or social security taxes. 

Yeah, I know, they supposedly pay pay federal taxes at the long term capital gains rate of 15%.  But that's only on the money they spend!  But they don't even pay 15% on the money they spend.  Instead, they take out loans for spending money, and keep the billion earned in the fund, where it earns them more next year.  And the year after that and year after that.  

Screw that.  Just because you bribed a bunch of politicians so you can pay nothing in taxes doesn't give you the right to be a free-loader forever.  We need a wealth tax   

MachoMan's picture

What is your time line for America's recovery after capital flees en masse?  10 years?  50?  200?  Ever?  Why is capital weary of countries that are more apt to confiscate wealth?

The problem with the concept of wealth confiscation is that, if not incredibly prudent, you may open the door to pandora's box.  If the ability for the government to confiscate is not already on the books, then I strongly suspect the prospective law would largely overstep moral boundaries and pave the road to tyranny, abuse, and abitrary enforcement (hence, all small fish).  Before confiscation can be considered, as well as giving the government this right, I believe the citizenry must be convinced that those powers would be used for purposes of good rather than as a mechanism and tool to selectively enforce consolidation of industry and implement governmentally imposed monopolies (about the only things the government is good at).

It is my opinion that a significant portion of the wealth gap has been accumulated through fraud, subterfuge, and illegal (certainly immoral) endeavors.  However, not all of it has been...  we have to devise a way to separate breaking reasonable boundaries and successfully operating within the system...  I'm not sure this is possible...  and I can tell you the mob will use a machete, not a scalpel.

11b40's picture

Perhaps you could take the time to explain to us just how and why multi-national corporations can roam the world and decide where they want to artificially reside.  Why do we allow this shopping around of our jobs and our corporations?  This is all fixable if we insist that our elected officials re-write the laws in favor of the citizens instead of the corporate overlords and financial institutions. 

Not very likely, I concede, but this whole free trade thing has been nothing but a way to loot America.  I am sick of this argument that we have to have open trade, no restrictions, blah, blah, blah. 

No we don't!  Tell G.E., Haliburton, or whoever else to move their f''ing corporation off-shore, then hit them with import taxes up the wazoo when they try to sell here in America.  If they don't like it, tell them to peddle their crap in the 3rd world.  This economy is still almost 14 times bigger than China.  Good luck to virtually any multi-national who wants to do without the U.S. market.

What is wrong with our country now is the lack of import controls and tariff off-sets.  If I want to make my widget here, I have more rules, regulations, code restrictions, and social obligations and expenses than most folks can imagine.  And, you know what?  That's all fine by me.  We voted for it.  We want clean air & water, good working conditions, a living wage.  We want health care (top-notch, too), an educated public, good roads, safe harbors, and a retirement system to protect us in our inevitable old age.  The problem is, we let these corporate raiders convince (buy) our lawmakers that we somehow 'deserve' to be able to buy anything we want at the lowest possible price...regardless of where it was made.  We got free-trade rammed down out throats and our manufacturing infrastructure has been decimated....simply because we refused to impose tariffs at the border to off-set the expenses of running our country.  It is just STUPID to allow like items made in countries with none of the safeguards we enjoy (or have imposed on ourselves) to come here and compete against the domestic industries that provide the tax base and jobs that keep us going.

Now, tell me how I am wrong, plese, 'cause I want to know.

JW n FL's picture

Republicans Block! a Push by Democrats To End The Tax Break for Sending U.S. Jobs Offshore!  Debt Spending in America! $100 Million a Day! with NO! New Spending, Takes 300+ years to pay off!


“Matt Taibbi” Explains How Wall Street Works and how Wall Street Wives Grabbed $220 Million in TALF Funds!


Gang of 6! Raising the Retirement Age & Reducing Social Security Benefits. /  Treasury Direct $14 Trillion Debt /   $15 Trillion in Loans /  / ='s $29T

Escapeclaws's picture

What the republicans are doing is good! Why should I pay for those middleclass moochers. It's about time those fat, lazy, feckless middleclass parasites are weaned from the welfare nipple. Let's hope the repulicans succeed in decimating their social security, removing any deductions for home mortgage and real estate taxes, and do anything else they can to force middle class people to pay back a lifetime of government bennies.  No more tax exemptions for having spawned like rabbits just to attract more federal largesse.

Bobbyrib's picture

And let the rich fight the next war.

MachoMan's picture

This is what will likely happen as a reactionary policy...  the trick is to identify shifts in offshoring, etc., before and while they're happening to held stem the tide, presuming it is even possible.  When america actually produces something (other than toxic bullshit), we'll be crying to get our goods to the rest of the world...  but we'd have to put on our other face then.  Presuming of course we're not branded economic terrorists.

I'll also posit that we've done a pretty damn good job of offshoring all the things that go along with production, such as pollution...  production, in and of itself, isn't a magical panacea...  it has burdens too.

In the end, I think a lot of this talk originates with the perception that america is some important world player...  or that should be some important player...  the winds of change are howling and I see no reason why these presumptions must hold true.  Soon enough, we will not have a mechanism to import much, so your trade barriers and jobs will eventually return (all else ignored), but of course it will be with a much lower standard of living...

I want to know where you were 30 years ago when the jobs were leaving (other than spending fiatscos).

JW n FL's picture
by MachoMan
on Wed, 04/27/2011 - 13:39


First, taxes are passed on to consumers until margin squeezes won't allow it...  at which point the businesses fold up the tent and go home.

Second, in a world where corporations can be located anywhere and in which america has a laughable trade deficit, what do you think the effect would have been if corporate taxes were raised and all loopholes/deductions removed?  I'll posit that they would be headquartered offshore and what trickle of taxes we presently collect would deteriorate further...  If you wanted to have imposed retroactive trade restrictions, then...  we need to stop talking.

Third, governments never have a collection problem...  rather, they only have a spending problem...  they collect what they collect, but they spend what they can borrow...


The only people the Budget cuts effect are the little people without a Billion dollar fucking lobby..

and for anyone that is stupid enough to quote some bullshit austerity measure squeeze the little guy bullshit I hope your children burn in front of you, slowly, to death.

the Corporations who pay NO fucking FEDERAL taxes... make the Country strung out like a fucking addict.. these same corporation who have a FED Window to draw down from, at fucking will. These same Corporations who have moved jobs off shore only to be given a pat on the back and a tax break for moving U.S. jobs off shore.. SHOULD PAY FEDERAL TAXES!! and then we would not need fucking Austerity Measures now would we?

It is not that there is not enough money to go around, those same corporation are sitting on Trillions in cash.. NOT paying taxes and moving American Jobs Off Shore only to enjoy a tax break..

It is NOT "We the Little Peoples" Fault.

It is our fault, the ones who know better and who have known better but sit on our hands like we are stuck on stupid.

Austerity is BULLSHIT!

Fuck the FED and their $15 Trillion in Loans to anyone and everyone!

Fuck the Government for the Lobby Whores they truly are!

Fuck anyone who is to fucking stupid to grasp these facts.


$15 Trillion Dollars since 2008 in Loans to Everyone BUT! Main Street / Local Town’s & City’s

The United States Loans $$’s to Gaddafi in Libya! But no money for States, Unions or "We the People"!

Send U.S. Jobs Off Shore and get a Tax Break for Sending those Jobs Off Shore! General Electric $14.2 Billion in Profits, Pays $0 in U.S. Taxes  $39M Dollar Lobby in 2010 $14B in Profits =’s NO TAXES PAID!

$10 billion sale of F.D.I.C.-backed debt

Wall Street Entitlement Welfare! $15B a week 2 buy Lobby Whores with! Most U.S. Corporations Do NOT! Pay Federal Taxes!! For a good long while now!


and what we can all look forward too.. is the Government turning this Country into a Fucking 3rd world police state. FBI Don’t Need No Stinking Warrants! Personal / Civil Rights are a thing of the past!


and the next step.. will be to cause Towns and City's to default so that the Banks can own all the Public Property.. turn it all into condo's! JP Morgan says 100’s Town’s & City’s will go Bankrupt at which point JP Morgan or like will sell them off piece by piece.


Privatize America into a Police State! keep voting Republican and Conservative.. or whatever suits you, but please put those fucking Bush stickers or leave those Bush stickers on your car so when the lights do go out that you will be easier to find.

Not all Liberals or Anti-Soulless-Corporation Folks are gay, tree hugging anti-violence.. some of us would love to fucking string you fucking morons up.. just to watch you fucking jerk around from the end of a rope for the treason that you have smothered this once Great Country in!

Bill Moyers at the Howard Zinn Lecture


MachoMan's picture

What I'm telling you is that regardless of our tax revenues, the system requires more outlays than inflows...  having increased tax revenues simply means our debt would be that much bigger...  that much more wealth transferred to keep measurement "ratios" in check (laugh).

We are now caught in a vise.  We need a large government to be able to combat the wealth gap, but at the same time, the government is the confisaction vehicle of the wealthy...  Do we reduce the size and scope of the government and hope that the principal actors of the fraud/elite leave us alone when they purchase all the hard assets?  Do we continue on our current course and hope that we can confiscate enough ill gotten gains and "level" the playing field before the wheels fall off?  Decisions decisions...

JW n FL's picture General Electric $14.2 Billion in Profits, Pays $0 in U.S. Taxes

$39M Dollar Lobby in 2010 $14B in Profits =’s NO TAXES PAID!

$10 billion sale of F.D.I.C.-backed debt

sgt_doom's picture

Ya know, JW, I saw a planted piece in the NY Times about "self-made billionaire" Peter G. Peterson.  It would take pages to deconstruct all the fictions and lies within the article, but suffice it to say they got one thing right, Peterson was kicked out his freshman year at MIT for major, big-time cheating, which he continued to do ever since.

He has destroyed endless numbers of jobs and companies with privte equity firm leveraged buyouts, and when his firm, Blackstone Group, finally went public, they bought a couple of congress crooks to make a few tax code changes, so they still continue to pay the much lower capital gains tax when they should be paying the mich higher corporate tax, which isn't in vogue anymore.

Of course, that's the same Peterson who bought and closed refineries to drive up oil prices, was a major force in the privatization of prisons, and has always urged an end to Social Security, Medicare, any employment left in the USA (major force in the offshoring of all American jobs), and that the super-rich should never pay taxes.

He got his start originally by guiding Davy Rockefeller's Commission on Foundations (a k a the Peterson Commission) to keep foundations as tax-free holding companies to hide wealth and avoid any and all taxation.

And there are still people out there who believe those over 50,000 foundations are really only good spiritual entities.

The billionaires set up a foundation, throw all that money at them, then somehow miraculously the money comes back threefold.

Ain't fairy tales wonderful?

11b40's picture

Exactly, Sarge!  Really bright socio-paths have been working hard for decades to loot America, and they have just about done it, too.

MachoMan's picture

When the system corrales our best and brightest into fraud and obfuscation vehicles, then it shouldn't come as a surprise when our system becomes cratered into a service based shell, exports toxic financial securities, and the assholes become worshipped at the alter, if not by the people, then at least by their representatives.

fxrxexexdxoxmx's picture

United Auto Workers-UAW paid $0.00 in taxes.

Service Employees International- SEIU paid $0.00 in taxes.

Communications Workers of America- CWA paid $0.00 in taxes.

Teamsters, yada, yada, yada paid $0.00 in taxes.

These same tax exempt groups gave $10's of millions to Barrack Obama who also got $10's of millions of dollars from George Soros who paid $0.00 dollars in taxes.

velobabe's picture

yep, i am most definitely a poverty bitch†

stoneman sacked's picture

a good peasant is a poor peasant

rosiescenario's picture

Very nice to read an article based upon reality.


Another point to ponder is that most all homes that are in positive equity are owned by folks nearing retirement. So while their noses are above water, they are going to still be spending less in the coming years.

Henry Chinaski's picture

This probably has as much to do with demographics as economics or politics. 

The traditional family is probably the best arrangement for building and retaining wealth.

weinerdog43's picture

No, the best way to build and retain wealth is to be born into the upper class. 

kaiserhoff's picture

Or have big tits, or buy some.

I am Jobe's picture

Has anyone heard from Bernie Madoff? Maybe he should come back to prop up the Econ and teach ECON at Harvard and other Ivy league Schools.

sgt_doom's picture

He'd certainly be an improvement on all those crooked jackholes there now (Feldstein, Binder, Ferguson, et al.)

Nope, Madoff was never an Army of One -- as America is nothing more today than a fraud-based society.

Which is why so many of the consumers appear so profoundly ignorant and stupid.