This page has been archived and commenting is disabled.
The Shriveling Middle Class In California
By Wolf Richter www.testosteronepit.com
An ominous trend picks up speed: the middle class is shriveling. In 1980, 60% of Californians lived in middle-income families. By 2010, only 47.9% did, according to a study by the Public Policy Institute of California (PPIC), a non-partisan research organization (24-page report PDF, 2-page summary PDF). Main culprits: declining incomes and disappearing jobs.
From 2007, when the recession began, through its end in 2009, family incomes across the spectrum dropped over 5%. But then, instead of going into recovery mode, they continued to go south for another 6% through 2010—the end of the timeframe of the study. Given the astronomical cost of living in California, the study defined a middle-income family as one that earned between $44,000 and $155,000 in 2010.
But the declines weren’t spread evenly across the income spectrum. Families whose incomes were in the top 10% saw their incomes decline 5%. Those at the bottom 10% of the spectrum, the poorest families in California, saw their incomes plummet by 21%.
In a further indictment of income inequality in California—something that is clearer than daylight if you walk or drive around with your eyes open—the upper 10% enjoyed incomes that were higher than those of their counterparts in the rest of the US, while the lowest 10% earned less than their counterparts elsewhere. And income inequality between to top 10% and the bottom 10% doubled since 1980, to where in 2010, the top end earned 12 times as much as the bottom 10%.
Family income is a factor of wages, hours worked, underemployment, and unemployment. The main culprit for the loss of family income during and after the recession was unemployment which, according to the Bureau of Labor Statistics, peaked at 12.5% from September through December 2010. It has since edged down but still hovers at 11.7% (preliminary, October 2011).
However, the BLS percentages of unemployment are a form of statistical hocus-pocus that distorts and understates the actual unemployment problem. Here are the raw numbers of employed people in California:
Peak employment in California occurred, according to the BLS, in January 2008, when 17,023,322 people were working. At the trough in August 2011—that’s correct, August 2011, that’s not a typo—only 15,830,729 people were working. During that period, 1,192,593 jobs had evaporated. Where the heck is the jobs recovery?
Maybe it’s in the future. Maybe it has started a couple of months ago. But there are certainly no signs of a jobs recovery in California before September 2011—and even that may turn out to be a fluke.
And if there actually is a jobs recovery that would raise family incomes? The PPIC warns:
If previous post-recession patterns repeat themselves, it is likely that lower-income families will recover much more slowly than those at the high end, potentially worsening income inequality that is already at a record high.
A thriving economy based on the American model requires a thriving and growing middle class. However, the current conditions—a shriveling middle class and rising income disparity—mark the transition to a banana republic.
Meanwhile, corporate tax dodging in California and elsewhere in the US puts the finger on the strenuously hushed-up Basic Flaw In The Tax Code.
Wolf Richter www.testosteronepit.com
»
- advertisements -
But that paint could hurt somebody. It could hurt...children.
You don't want to hurt children do you?
Oh, wait...worse than hurting children, that paint could hurt the environment. If you use that paint, you must be evil.
I see that iamnotmark has done time here.
No recovery, reverting back to whence she came.................Mexico
Bingo. A microcosm of the "California economy" is as follows: a Mestizo mowing the lawn of a White Person, who is over at the nearest Walmart spending money he does not have on crap he does not need. Pretty soon, WP gone, Mestizo squatting in house.
we can't afford to water our lawns anymore, and we squat in our own homes, while we remove the copper wire, and plumbing, to pay our iphone bill.
Paradise is not what its cracked up to be.
Cali could solve a lot of problems by splitting into 3 states noth, south, central. Legalizing cannabis and writing new state constitutions for all 3 states with new laws - a clean slate, a do over - but who gets the water from owens valley?
Its amazing how inept our nation has become. 70 years ago we could fight a war on 2 fronts and destroy a technologically superior foe, and now we can't even balance a fuckin budget.
We can't even use a spreadsheet, how lame! will we as a nation, choke on our own spittle and die of asphyxiation?
CA shows us what awaits America. It's in a terminal 'progressive' spiral, suffering a lingering death at the hands of the 'compassionate' left. There are so few people left there who value property rights and liberty that they can't come back. They'll keep electing people whose only ability is to make promises persuasively. CA sees government as the agent of 'progress', so they're toast: a big state full of little babies, their 'leaders' telling them to suckle! suckle!
'Progressives' had free reign to do whatever they wanted with the best piece of real estate on the planet. It's now headed for ruin, but guess what? It's _someone else's fault_. Progressives are never wrong, never to blame for any failure, and always the hapless victims of some nefarious evil. Maybe they should examine the dog-eat-dog impetus that under-girds their entire worldview, which exalts freedom only with regard to rutting.
In the process of ruining the state, lots of 'progressives' have woken up, and now see that the world cannot be made perfect and antiseptic. They're turned away from the sepsis of progressivism, but there are still lots of readers here who embrace it: "I would do it right. Progressivism seems to lead to debt slavery and dependency slavery, but only because people who think like me have not been in charge. I know better. I can confiscate and redistribute the resources fairly. I can determine the limits of property rights, and freedom of speech. I can, for all intents and purposes, be god." Progressivism is the delusion that man is god - progressive man, that is. The rest are dumb brutes who must be collared. There's no room in progressivism for leaving people be, to live their lives as they see fit, with the consent of those around them. Some weak-kneed, fat-assed control freak has to have their paws in the honey pot and their hand on the whip, or..... progressives won't have power.
Califas, FTW!