Chart Of The Day: The Death Of America's Middle Class

Tyler Durden's picture

There is one chart that everyone should see that is part of Reuters' must read special series: The Unequal State of America: Redistributing Up - it is the chart we have said over the past 4 years is the only one that matters for America - that showing the flattening of America's wealth distributon Gaussian curve, aka the plunder and accelerating destruction of America's middle class, at the expense of the poorest and the wealthiest. This is nothing but the inevitable outcome of a co-opted, conflicted and controlled marionette government, which does the bidding of the wealthiest lobby powers (read corporate shareholders and Wall Street), partitioning the bulk of the wealth to the richest, while sending the scraps to the poorest in order to keep itself in power due to the power of the ever poorer, democratic majority. Alas, since there is never a free lunch, and since the Fed does not create wealth but through its currency debasement merely accelerates the transfer of wealth, someone ends up footing the bill? Who? None other than that part of the US population which made the United States of America the greatest country in the world, and is now watching it implode first slowly, then fast.

The chart in question:

How does Reuters frame this ever so critical topic that only impairs the ever more disenfranchised, ever declining middle class, and thus few actually bother discussing:

In the town that launched the War on Poverty 48 years ago, the poor are getting poorer despite the government's help. And the rich are getting richer because of it.


The top 5 percent of households in Washington, D.C., made more than $500,000 on average last year, while the bottom 20 percent earned less than $9,500 - a ratio of 54 to 1.


That gap is up from 39 to 1 two decades ago. It's wider than in any of the 50 states and all but two major cities. This at a time when income inequality in the United States as a whole has risen to levels last seen in the years before the Great Depression.


Americans have just emerged from a close presidential election in which the government's role as a leveling force was fiercely debated. The right argued the state does too much; the left, too little. The issue is now at the center of tense negotiations over whose taxes to raise and what social programs to cut before a Jan. 1 deadline. And the government's role will be paramount again next year if Congress takes up tax reform.


The federal government does redistribute wealth down to struggling Americans. But in the years since President Lyndon Johnson took aim at poverty in his first State of the Union address, there has been an increasingly strong crosscurrent: The government is redistributing wealth up, too - especially in the nation's capital.


The beneficiaries are not the billionaire financiers and celebrities who
have come to personify income inequality in the 21st century. Yet the
Washington elite are just as much part of the trend, having influenced
laws and decisions that alter the entire country's distribution of

Read more here.

In summary: crony capitalism for the wealthiest, scrappy socialism for the poorest, and everyone else (that soon to be extinct creature known as the middle class) left to fend for themselves.

Some other charts:



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Thomas Jefferson's picture

Jon Corzined bitchez!

Unprepared's picture

Cop: Where is Whitney, Jon?

Jon: Dunnow! She just vaporized.

pods's picture

The government teet flows gravy, but there are only so many teets.

Who could be surprised that the locale which re-elected "The bitch set me up" mayor would have statistics like this?

One big cancerous mass smack dab in the middle of our vital organs.


ZeroAvatar's picture

New 'teets' keep popping up all the time, from what I've seen (TSA, HS,)

HD's picture

20k a year the new middle class. The dumpster behind Arby's the new retirement villa.

adr's picture

I remember in college we used to go to KFC at 11:00 and wait out back. The manager used to give us all the leftovers that would have just gone in the dumptster. But then there became some sort of policy that the maager could no longer give out food. Something about us actually paying for food if we knew we couldn't get it for free.

The problem was we were freshmen on a meal plan and none of us had money. So KFC just threw away hundreds of dollars worth of food every night.

MachoMan's picture

Exactly the same argument you see presented regarding piracy not being a victimless crime... 

Seer's picture

Still far above the majority of humans on the planet.  4+ billion live on $3/day or less: my wife is from an area that is closer to $2/day.  Kind of puts things in perspective.

Manage your expenses wisely.  Concentrate on those things that really do matter (are essential for life).  Spend more energy adjusting for the future that you want (be real with your expectations else be horribly disappointed) and less on bitching and blaming others...

Lord Koos's picture

Everything is Obama's fault.  Repeat until exhausted.

Unprepared's picture

Obam's Razor: Among competing agendas, the one providing the most lobbying wins.

ghostfaceinvestah's picture

Why do jobs matter for the poor? Under $30k a year it isn't worth working anyway.

Shizzmoney's picture

I hope the poor doesn't find this out, for the government's sake.

SeattleBruce's picture

Have you seen the food stamps and disability rolls lately?

Ballin D's picture

The poor already know.  Its the students and young people you need to worry about.  Once they learn that welfare pays better than entry level work there will be a major shortage of baristas and McDonalds employees. 

hooligan2009's picture

muammar? is that you? i thought you were dead!

mwarden's picture

you better tell the usda to stop spending millions (of tax dollars) advertising SNAP to potential eligibles, then

MachoMan's picture

Actually, there are quite a few places in this country where a $30k/year job is incredibly sought after and can lead to a very, very comfortable lifestyle...  especially if there is a second wage earner in the household.

Seer's picture

Jobs?  Well, "jobs" is what the industrialists brought to us in order to prop themselves up.  For billions of humans on the planet WORK is essential.

foodstampbarry's picture

Intended global depopulation bitchez.

alien-IQ's picture

No doubt that if you eliminate all those evil unions, the corporations will flow all the excess profits right back down to the workers and thus save the middle class.

HD's picture

Wait...why is my new Twinkie made in China?

alien-IQ's picture

Because the executives will make more money by paying Chinese workers $1 per hour and they aren't allowed bathroom breaks.

Consequently, despite the $1 per hour wages, the price of the product will not reflect this new low cost of production. You'll pay the same for what costs them a fraction of what it used to to manufacture.

Great deal for you huh?

HD's picture

It's a great deal if you enjoy the taste of Chinese dissidents in your cream filling. It's oppressively delicious!

Harbanger's picture

That's because the dollar is way overvalued and the yen is way undervalued.  China has a huge GDP and is becoming increasingly wealthy.  They build everything while we fight for govt. handouts and blame the rich.  At some point when the USD implodes and it corrects, you will see the average wages in China exceed the wages in the US.

alien-IQ's picture

yes, please, lower the value of the dollar even more so we can all feel the joy that comes with paying $15 for a loaf of bread and $25 for a gallon of gas.

isn't that what the bernanke means by "wealth effect"?

Harbanger's picture

Bernanke's wealth effect means we'll all be rich but can't afford anything.  All they can do is keep printing at this pont.

hooligan2009's picture

the yen and the dollar are going to is the pound, the euro and the yuan..that means you should else

MeBizarro's picture

This is a ridiculous oversimplication for how currencies work and are exchanged & valued against one another.

Seer's picture

If the USD implodes it'll mean that the US is basically no longer an importer of Chinese goods.  There goes China's main market.  And at that point, having scaled up infrastructure to build shit that the people there cannot afford, China will be sitting on a BIG contraction- not thinking that this is signaling "wage increases."

Also keep in mind that China is a heavy importer of energy.  Now that they have more and more people hooked on autos it's going to be hard to continue to subsidize the fuel.

China's a ticking time bomb.

Before all is said and done China will end up with the record for being the biggest to do the rags-to-riches-back-to-rags cycle in a short amount of time: Iceland probably wins in the small category (honorable mention to Ireland).

alien-IQ's picture


Union Membership rate / Middle Class Share of aggregate income

Does anyone see a trend?

Surely a glance at a chart of corporate profit trends in that same period of time will display the exact opposite trajectory.

Lord Koos's picture

Don't cloud the issue with unecessary facts.

Spastica Rex's picture

Facts are for commies, fags, and other pussies.

Seer's picture

A peak ALWAYS occurs.

I don't believe that this is necessarily a cause-and-effect relationship (between economic groups) so much as it's a sign of a system in decline.  Many here are "preparing" while others are not (and may not believe they need to- the missed the starting gun); those who missed might look at those who were preparing and claim foul play in just the same way we're now looking at the TPTB and crying fowl.

In no way am I trying to dismiss the ugliness.  Just trying to point out that we all have the same basic human nature in us.

Even if we were to level things out we'd still be playing the game of "perpetual growth on a finite planet," which would place us headed over the growth cliff.

Change is happening and there's nothing that anyone can do to stop it: and as I often do, I promote taking action toward moving yourself in a direction that's more suited for the future (no, I'm not going to spell out what that is- it's not my job [but if you're grounded in the fundamentals of Food, Shelter and Water then you're not likely to fail]).

besnook's picture

if .gov would just subsidize the wages of all labor up the middle management paid for by the fed printing press the usa would be on top of the world for a thousand years with all the money trickling down to the job creators in senior managemnt, share and bond holders and da banksters.

Ghordius's picture

All effects of globalization, including the Wealth Effect

In practice US Citizens are getting poorer, but the statistic includes "World Citizens currently residing in the US" that skew the top percentages

and before you think "oligarchs" and so: even doctors are part of it when they have clients from all over the world because they are the best

even Hollywood actors are part of this group, and of course CEOs of international companies - in the same way as their HQ employees or even the makers of commercials for global products like Coca Cola or Facebook

Or the pushers of their stocks and the providers of global reserve currency liquidity and their Connected Instruments

alien-IQ's picture

"even Hollywood actors are part of this group"

FYI: 90% of the active members of SAG (Screen Actors Guild) earn less than $5,000 per year.

Ghordius's picture

Did you compare them with - for example - their collegues from Bollywood?

Acet's picture

Here in London (UK), being an actor (screen or otherwise) is one of the worst paid specialist professions there is.

Maybe it has something to do with the fact that only 8% of actors have regular work (and by that, I mean basic acting work, not stardom). All those anonymous people doing one-off secondary characters that just appear once in TV Series are actually trained actors, usually with an acting degree and (here in the UK), the student debt that comes with it.

As for Hollywood, there's a saying that half the waiters and waitresses in LA are actors.

Ghordius's picture

and for every X number of lowly paid actors there is one star that rakes in with movies that are viewed globally

to get back to my point: for the wannabe actors on the stage their "pond" is local, for the stars it's global

it's a tale of two worlds: globalization

SheepDog-One's picture

Meh...whatever....pump the DOW a couple more hundred in futures and all will be well.

tawse57's picture

I want this crash to come but, after years of waiting, I have all but lost hope now. I can't see how anything other than printy, printy will occur.

If the markets far they just stop trading the shares falling or the entire market. I can't see how there will be any correction... and, in the meantime, hundreds of millions of middle class Americans, Brits, Europeans, etc, are being screwed.

I daren't think what the affects of these economic policies are on people in Africa.

NEOSERF's picture

I agree, I think all of those in power (banks and politicians) got a little taste during Lehman/AIG/GM and won't go there again.  Under the saving the world mantra, printing will never cease again ala Japan and it truly will be a race to the bottom when the ECB joins the fray formally probably by summer.   Even Japan which should be devaluing the yen by 33% has decided to go the stealth way vs. the shock way and to inflate their way to oblivion.  Thus the markets will be up another 15% next year short of huge earthquake in Tokyo, LA or NY or war in the Mideast...about all I can see that would derail this ridiculous ramp party.

SheepDog-One's picture

Well 'the markets' also aren't 'everything', or really even 'anything'....just wait until the morning the FED suddenly seizes everyones pensions and 401K's...declares gold illegal to posess unless you're a bank, declares guns outlawed. What do people think theyre just doing this for FUN? Or, pumping stocks and bonds up is some kind of 'end game' in itself? Total bullshit....they're moving real fast now and I dont believe for a second theyre just happy trading their own Bernank Clownbux, they're going to take this whole thing down to rubble and it wont be long off at all.

Seer's picture

I agree with the trajectory.  I don't, however, think that it's something that they desire, if they really had a choice.  Stability/status quo is what enables them to retain their positions of power; and, really, it should be clear that they pretty much own and control everything anyway.  The ONLY reason for any big change is because they see that the System cannot continue- THEY aren't the reason for the system failing (nor is any "left" or "right" paradigm*), they're just able to alter the speed.

* Not as long as the foundations are laid with a grow-or-die premise.

Shizzmoney's picture

The market will crash......but it probably will take a generation to do so.

The money managers and the bankers and the corporate assholes will finally wake up one day and realize 90% of the people who buy their stupid shit, are in debt and completely out of money.