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Income Growth For Bottom 90% In America Since 1966 Is... $59!
Submitted by Michael Krieger of Liberty Blitzkrieg blog,
We’ve all seen these statistics before in one form or another, but David Cay Johnston does an excellent job going into more detail for us in an article he published late last month. As he correctly notes, when things get extreme like this you ultimately end up with extreme social unrest. Furthermore, as I have pointed out for years and years, this kind of disparity does not happen under free markets with rules and regulations applied equally to all. It happens under totalitarian societies, whether fascism, communism or crony capitalist corporatism (which is the model in the USA). It only happens when a very small oligarch class takes over the political process of a nation and then uses it to game the system.
However, I would take exception to Mr. Johnston’s conclusion that the root problem is the tax system. While I do not for one moment deny that the oligarchs game the tax system to provide loopholes for themselves, this is not why the 1% of 1% has taken all the wealth of the nation. This is much more related to the Federal Reserve and its policies of printing trillions of money out of thin air and distributing it to the oligarchs, either directly or through low interest loans. If you tax the rich more, they will still make more because they will still have the access to the cheap money. The Federal Reserve is the core cancer of the entire thing and they must be stopped. Some excerpts below:
The average increase in real income reported by the bottom 90 percent of earners in 2011, compared with 1966, if measured at one inch, would extend almost five miles for the top 1 percent of the top 1 percent.
Remember, we got off the gold standard in 1971, after which the Federal Reserve could print as much as they wanted and distribute it wherever they wanted…and they have.
Incomes and tax revenues have grown from 2009 to 2011 as the economy recovered, but an astonishing 149 percent of the increased income went to the top 10 percent of earners.
If you wonder how that can happen, the answer is simple: Incomes fell for the bottom 90 percent.
Ponder that last fact for a moment — the top 1 percent of the top 1 percent, those making at least $7.97 million in 2011, enjoyed 39 percent of all the income gains in America. In a nation of 158.4 million households, just 15,837 of them received 39 cents out of every dollar of increased income.
In 2011 the average AGI of the vast majority fell to $30,437 per taxpayer, its lowest level since 1966 when measured in 2011 dollars. The vast majority averaged a mere $59 more in 2011 than in 1966. For the top 10 percent, by the same measures, average income rose by $116,071 to $254,864, an increase of 84 percent over 1966.
Between 1980 and 2005, more than 80 percent of the total increase in income went to the top 1 percent of American households.
The median wage has been stuck since 1999 at a bit more than $500 per week in real terms and job growth has lagged far beyond population growth. But capital gains and dividends have soared, a new Congressional Research Service study shows. And, of course, the rich get most of that income. Thomas Hungerford concluded:
That is a lot of stress being placed on people between the bottom rung and the top. I think it is more stress than the social ladder can bear, although when and how it will break no one will know until it happens.
Tax policy is driving these trends.
As I mentioned before, I disagree with the statement above. He correctly points out that the super rich make their money from capital gains and dividends, but why have those grown so much? It’s all Federal Reserve policy, which targets increases in assets prices that the oligarchs own. It’s not a secret that Ben Bernanke is actively targeting the stock market with his money printing and not the real economy. So who does that benefit? That’s not tax policy, that’s monetary policy.
Full article here.
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This just isn't true.
What isn't true Krug?
What's the answer to "extreme social unrest"?
1.7 billion hollowpoints, why thank you!
-Janet
The incentive is either get rich, join the welfare-class or work for cash.
Doesn't matter coz we're all savers....right?!
59 bucks? Better than 59 Euros in Cyprus bank :)
Can you recommend a good bank?
Bank Of Gold & Hole
Yes... I've heard of that bank. Apparently only REAL MONEY is kept there.
Bill McBride of Calculated Risk (a Hope & Change production)& Paul Krugman should collaborate and produce an awesome work of fiction. Those two have some extreme talent in that genre.
In the interim, it will all work out because we have legislators such as Maxine Waters, Harry Reid, John Boehner, Nancy Pelosi, Max Baucus, Dianne Feinstein, John McCainus, Lindsey Graham, Spencer Bachus, et al., along with a President as highly competent as Barack "I don’t know what the [national debt] is" Obama.
We also have The Federal Reserve, the SEC, the CFTC, The Treasury Department, the DHS, and the SCOTUS.
All is well.
p.s. - At least Obamacare will reduce health care costs. Errr...I mean massively inflate them...
Study: Obamacare to Raise Average Claims Cost 32 Percent (and as much as 80% in certain states)
ABC News - 4 hours ago By RICARDO ALONSO-ZALDIVAR Associated Press WASHINGTON March 26, 2013 (AP)But being rich is not enough, as Cyprus has shown. You must outrun the rich man next to you continuously until there is but one man standing. The top will now feed off themselves as there is no meat left on the bottom 90%.
-Seven Psychopaths
"The top will now feed off themselves..."
Yes, in the end there can be only one!
Now where have I heard that before?
'What's the answer to 'extreme social unrest'?"
Whatever the required number is of hollow bankster heads--hollow because they have had one side of their heads blown off due to a point blank encounter with one of their victims, aka, Inhabitants of planet Earth.
Oh snap
Krug, take out the banksters cocks out of your mouth before speaking, it's impolite.
krug was cooking socks. he thought it was a roast beef sandwich.
but - on a relative basis - he's really rich. and get's lots of attention. if only he could get richer.
why do you think bernake has such a shiny head? think jamie and lloyd have the shamy cloth on there when they meet?
Here in Krugoslavia, the land of make-believe, we don't need no stinkin' facts.
And Scruffy don't need no stinkin' trial.
Krugoslavia and the Blank 'Czech' Republic...it would make nice punk band name. Give Pussy Riot a run for their rubles.
That might be your most incisive analysis yet.
A room full of children that cannot do simple math is a tragedy.
A room full of adults that cannot do simple math is a meeting of PHD Economists.
they can do the math. they just get paid not to.
Whats not true Mr. Krugman? Speak to us ....Do you have the kahunnas...
That's what I expected........No response
I picture you pouting, arms folded, kicking the wall, like my toddler.
Meat Hammer: You didn't name your kid "Kruggers" by any chance?...
Whats not true? The 2 next to your UP arrow? Oh, its true, man.
Yes. From his two ZH accounts.
Watch this Krug...
http://mashable.com/2013/03/02/wealth-inequality/
You're wasting your time.. anything vaguely intelligent which requires THINKING, will scare Krug off!!!
Alright. I've had enough. I'll bite. What part of 'this' 'just isn't true'? And is it just not true from an 'in possession of irrefutable factual proof of a falsehood' kind of perspective, or from a 'Luke Skywalker clinging to a railing, reacting to Darth Vader's revelation' kind of perspective?
People like you make your living on the temporal and evidentiary disconnect between misguided policy and it's inevitable consequences. You wallpaper your monument to self with the accolades of the hopeful who are incapable of the kind of root cause analysis it requires to identify the truth in this clouded world, and believe this is proof of a life well-lived.
So let's ignore the fact that the vast majority of commenters on this site are registered under something other than their given names, and what conclusion some might draw about the ego needs of the one well-known individual on the site (do not assume there are no such others) that does not do so, and assume that you are Dr. K. Please share the meaning of your remark. Please prove to me and others here that you are something other than the uber useful idiot; the Jack Kevorkian of free enterprise in the 21st century.
What part of 'this' 'just isn't true'?
___________________
Probably the stuff with the free markets in it...
I'm sure it's nothing that some good old-fashioned ground "dragon bones" and fried tiger penis in bear gallbladder sauce cannot cure. The efficacy of the cure, of course, being proportional to the degree of endangered status of the exploited species in question. But do not look for self-indictment of overconsumption and exploitation from hypocritical Chinese Citizenism, for you will never find it.
Somebody round off Krugger's for 60 junks. I got him at 59.
If I remember correctly, there was a time in ZH days past when 50 'junks' would get a post pulled.
You, SIR, are someone w/a THICK INFLATED HEAD.. but NO BRAINS!
YOU DON'T THINK.. almost robotic in your transmissions..
YOU PROGNOSTICATE, but do not show your reasoning!
Hi Paul,
What are your thoughts on Big Business leveraging dictator controlled slave labor camps over in China to maximize profits?
What are your thoughts on a government that provides tax incentives to do so?
----------------------------
You might have missed this question the last 5 times I asked it, so here we go for try number 6 (and yes, I will continue to increment the numbers until you answer the question):
If growth is defined in monetary terms and money is debt (interest bearing), please explain how exponential growth of debt is sustainable into eternity.
If money (debt) exponential growth is not sustainable into eternity, then WHAT HAPPENS WHEN THE EXPONENTIAL MONEY (DEBT) GROWTH FAILS?
TIA...
This just isn't true.
Why yes, it is true. One of those bastard children you had with that Austrian hottie, also known as the "Chicago Boys", showed, empirically, that in a monetary regime of intentional creeping inflation, real wages NEVER keep pace with real inflation. His name was Melchior Palyi.
The best income democracy can buy!
You mean trickle down doesn't work? Who knew?
But... I'm told even the poorest in America aren't real poors... whatever that means.
"It only happens when a very small oligarch class takes over the political process of a nation and then uses it to game the system."
Like Buffet's railroads hauling while pipelines are blocked by regulatory capture or picking basketball brackets instead producing a budget request?
Hear, hear.
"While I do not for one moment deny that the oligarchs game the tax system to provide loopholes for themselves, this is not why the 1% of 1% has taken all the wealth of the nation. This is much more related to the Federal Reserve and its policies of printing trillions of money out of thin air and distributing it to the oligarchs, either directly or through low interest loans."
And remind me who runs the Fed?
Yes, its extraordinary isn't it?
The executives of A123, Solyndra, GM, FNM, FRE, GE, C, BAC, GS, Fisker etal make off like bandits and no one on the face of the planet saw it coming and NOW everyone wants to bitch about it.
Remarkable, the feeling of guilt without any association ;-)
Do you ever think Bernanke or any other of the Fed Reserve heads ever just print money for themselves, like $100 or $500 whenever they want, so they'll have money to go out drinking with after helping oligarchs game the system?
You gotta feel like a God when you print that money, man.
He wouldn't need to print money to go drinking. Drinks are free for him as a professional courtesy.
$100 or $500? Not a chance...
Now $100 to $500 billion in free loans and "currency swaps" (where no swapping takes place) to banks and foreign CB's who lend it on to other banks that Bernanke says he doesn't even know about for free?
Yes... that they do.
Watch Grayson ask Benny where the 500 bill went...
http://www.youtube.com/watch?v=n0NYBTkE1yQ
Now if I were a recipient of that free Bank Of God largess I would be more than happy to throw a couple of bills Benny's way...
Debt slavery courtesy of the federal reserve and your friendly neighborhood federal government.
Bitchez!
the federal reserve is not the problem. the problem are the greedy hofjuden that own the fed and run the fed not for the benefit of the nation, as the nation was led to believe in 1913, but the hofjuden run the fed to benefit themselves by enslaving individuals by debt and stealing the fruits of their labor by debasing the currency.
Don't forget the sophist sychophants who led society down the path to serfdom... at least he gets more than 30 sheckels, right Paul?
"What does diversity in the workplace mean to you?"
“Uh, household incomes double and low skill workers earn middle class wages?”
“Very good Barry”
“But what affect does diminishing the value of labor have on income growth?”
“Just take your Adderall and draw a rainbow”
That just isn't true!
There is NO WAY the average Joe is making more in inflation adjusted $ than in '66!
The rich get richer...
Arbeit macht frei folks!!
I have that tattooed on my penis for obvious reasons.
C'mon now. 59 bucks is 59 bucks. That's valet tip level for all of us.
And those numbers don't accurately take into consideration that an entire generation of female wage slaves entered the work force since 1966. Two working poor incomes are now needed to raise a family when in 1966 even a common laborer could do so on his wages.
CD: Are you suggesting Gloria Steinem worked for the CIA? How dare you speak the truth!
Total?
Never scoff at 2 oz of the shiney, Ag.
"...The Federal Reserve is the core cancer of the entire thing and they must be stopped..."
there is more truth and wisdom in this one statement than in 200,000 hours of rockefeller nazi programming on msnbc, cnbc, bloomberg, wsj, economist, and hosts of other economic whores who have polluted our knowledge of the truth...
one sure way to stop the fed is to execute owners of the fed for crimes against humanity.
Hoax n Chains
Cute; I hadn't heard that before.
Well, then riddle me this:
http://www2.ucsc.edu/whorulesamerica/power/wealth.html
As a similar author commented in his 1970's book: "The USA is the banana republic par excellence."
According to the chart showing 1922-2010 wealth distributions in that article, the wealth of the 1% peaked (in relative terms) under JFK/LBJ, fell under Nixon/Ford, began to rise under Carter, rose more under Reagan, Bush 1 and Clinton - during Clinton's reign it peaked - then fell when the dotcom boom ended, only to creep back up under Bush 2 and Obama.
Apparently the rich prosper under presidents from both parties, although I don't recall a meaningful reason for the 9% drop under Nixon/Ford while inflation ramped up.
$59 eh? That's still more than the $0.89 I made on my six figure money market fund balance last month.
Huh. And I have been told all of my life that there wasn't a "war" between the classes.
Perhaps I was told the truth, as I was born in 1970, and apparently, any such "war" was both waged and completed prior to my birth.
I guess I know what class won the war, then.
Coincides very well with the "great society" bullshit of LBJ!
The Federal Reseve manipulated markets illegally and with malice from 2006-2013. The Federal Reserve is a criminal entity the leaders of wich are individually guilty of treason. The white no jewish Americans should have the millitary destroy th federal reserve as an enemy combatant.
FREE WHITE PEOPLE DESTROY THE FEDERAL RESERVE AND DESTROY THE TALMUD LOCK ON US LAW
Looks like Krugman has another ZH alias for diversionary purposes.
Let's debate it out Paul. I think Tyler should create a special thread dedicated to a debate with the good Dr. Of course any debate should exclude the juvenile attacks that are often made here.
Specifically i want to know why there is no direct relief to the taxpayers? Why doesn't the Fed simply buy all the so-called 'bad" consumer debt, get the banks off the hook for it, refinance it with the consumer at better terms and leave it at that. It will resurrect consumer spending and put this bank bad debt stuff behind us.
Good things the feds are gonna solve it all uh...
http://news.yahoo.com/little-hope-seen-millions-priced-health-overhaul-2...
Millions of Americans will be priced out of health insurance under President Barack Obama's healthcare overhaul because of a glitch in the law that adversely affects people with modest incomes who cannot afford family coverage offered by their employers....
Certainly, Hussein Obama's regime is waging an economic jihad against the American people and the several states.
Since LBJ or so, this has been a quasi-socialist country.
KILL ALL THE USERERS. KILL ALL TRAITORS.KILL ALL FALSE JUDGES WHO COMMIT CRIME ON US CITIZENS.
DESTROY THE TALMUD SLAVE TRADERS> KILL THEM ALL
Where do I pick up my 59 bucks?.....
If we just let the wealthy "productive class" get a little richer and have fewer regulations, all will be solved. Wealth will surely flow down to the middle class if we just tighten the belts of the greedy poor and let the wealthiest exist without any controls whatsoever. The oligarchs exist and seek to make us all their serfs only because we have an elected government that can be bribed by them. It is so obvious.
LTER: Anything priced in "Benny Bucks" or Euros means even the rich are poor. The paper is worthless.
Wagewise, I doubt I am in the top ten percent......asset wise and PM wise, I'd say I am.
I feel richer than ever, but that could just be the divorce! Wahooo! The bitch had to pay ME!
Cut the cancer from the system.
i suggest that owners of the fed receive aggressive radiation treatment along with chemo therapy
I heard someone (alt. radio) today that said if minimum wage had kept up it would be over $22hr.
CNBC Anchor - "What do you think about the research that shows that income growth for bottom 90% in America since 1966 is... $59!?"
CNBC Guest Host - "Well, we see QE filtering down to those 90% very soon. This will have a major effect on those people."
CNBC Anchor -"Those people?"
CNBC Guest Host -"Yes, those people that are poor."
"Filter down" sounds so much more reasonable than "trickle down." No urine or semen connotation, so that's a plus. But both expressions smell a lot like the same bull shit.
Monk wants to know if you could round that out to $60. Seriously, this is not shocking but it is disgusting in the extreme...
There's no education, there's education and then there's REAL EDUCATION. Sadly, the majority of Americans fall into the first two categories...
What you see as "no one wants to work" is really the everyday people saying to themselves: The system is rigged; I wasn't born to the right family; I will never get into an Ivy League school - even if I had the brains, I don't have the money, and besides, I'd never be accepted by that culture anyway (As Alice learned in Wonderland, "She's a weed! She's a weed!" not a flower, so you'll be chased out of the Garden of Riches) - the people with money either inherit it (Trust Fund babies), or come from families so they can borrow it (Bill Gates, Zucker Facebook, Steve Jobs, et al.) . . .
hey know that the reason you read about some man or woman making a billion is because of the billions of people on Earth, only 1,426 people in the world have ever reached that level - so extraordinary attention is paid to them - as if this is something that if you only worked harder, longer, smarter, then you too could be a billionaire,
I hate to break it to people, but your chances of hitting it big in crony capitialist America is no better working your fanny off for a lifetime than it is to play the lotto.
So the next time you smuggly look down your nose at the slackers, maybe they have a more realistic view of their chances, than you have of their chances. They know they are born poor, they will live poor, and they will die poor.
For those of you juiced up on motivational tapes and books, please keep in mind your background wasn't the same as theirs. You really can't relate to them on any level - any more than you can realte to the uber-wealthy who run the world.
Please spare me the rah-rah about the Land of Opportunity. If your IQ is under 130, you're dead in the information culture. Because the IQ curve is a type of bell curve, it explains why there are so many "low information voters" - they naturally lack the IQ necessary to absorb and manipulate information the way those of you understanding what is written on this site can do.
It's all very tragic. As the need for a higher IQ to survive in the upper reaches of the economy increases, more and more people will just be unable to compete - not because of character flaws - but because of genetic realities.
-30-
Mars: I've got a dumb shit relative that got in the ground floor on "positive thinking" during the Hippie Days and has made MILLIONS during the past 30+ years. The fucker has an IQ of about 90. His cock rules his past, present, and future. He's still fucking 20-somethings at age 65+.
The old Boomers/Hippies have a much tighter audience and fan club especially amongst themselves. It's like a fucking cult... and they have wealth to spread around amongst each other. You know what makes me truly puke?... Watching my rich Boomer relative haggle on price for some piddly trinket in a foreign country, thereby robbing the poor even more. Meanwhile, I have visions of this piece of shit trash relative as he was poor and begging back in the 70's.
Sorry, did I mention he practically pioneered "positive thinking" into main stream?
Angus, that is an entertaining example. But really, he's not the norm. All of the boomer/hippies I know are absolutely destitute, and a lot of the boomer/neverhippies, too. You may be seeing more of it than is representative, since the ones that are rich, move to the same towns.
True, MarsinScorpio, but incomplete. A high I.Q. is necessary, but not sufficient, to do well in the world as it is now ordered.
Doing well in this environment requires a certain non-intellectual way of relating to the world, too. A kind of rootless detachment from the people around you is very helpful. An emotional attachment to people or places, is not a plus.
I have high school friends who scored well over 130, but because they don't want to leave their community, they have done very, very badly economically, and will continue to do so. In the old days they would have done just as badly economically, perhaps, but at least they wouldn't be scorned.
Also, of course, anyone who is inclined to "tend" other creatures, human or nonhuman, is likely to remain very poor, not matter what his or her I.Q. is. You see that all the time.
We sure are selecting for some nasty stuff.
"this kind of disparity does not happen under free markets with rules and regulations applied equally to all."
Karl Denninger noted that several Tea Party members elected as republixans, climbed into the pockets of the bankers. There is no free market, just frauds who pretend there is. Thus the free market is attacked as being at fault, by the opposite wing.
"Karl Denninger noted that several Tea Party members elected as republixans, climbed into the pockets of the bankers.There is no free market, just frauds who pretend there is."
And therein lies the rub.
Re-rub-lick-cans?
Did Karl note which ones, exactly...you know, by name?
That would be helpful ;-)
Helpful to whom?
Helpful to those who would purge them, perhaps? If Karl didn't, its just an accusation or more properly, slander isn't it?
all the banking traitors will be lined up and executed then dumped in a ditch. it will all be filmed in HD and even 3d for history.
this will happen around the world and in many towns, with many citizens groups trying and executing bankers in there own areas
'this kind of disparity does not happen under free markets with rules and regulations applied equally to all." I disagree, it is inherent in competition.
In the past social unrest was the result of real poverty, where people did not have enough to eat. Today so many are on food stamps , govt. housing, free medical care, free phones, disability, do nothing govt. jobs and other govt. social support that the only ones complaining are not the financial industry millionaires and dot com billionaires, but the middle class that work long hard hours every day and pay out most of what they earn in groceries, house payments, income, property, sales, social security and excise taxes along with their non discounted utilities, home owners insurance and if they have medical insurance, co-pays. A good life still maybe,but they earn it. When their kids get ready for college they might get loans but not full ride scholarships and not be able to get into many schools because of affirmative action set asides.
Excellent analysis! dunce.
"Federal government spending now amounts to $31,679 per non-government employee, annually. This is a spending problem, not a revenue problem." -- Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Funny how the stagnation started about the time of the "Great Society" and explosion in government spending/regulation.
Sooooo, 90% of wage earners have seen austerity imposed upon them for that long? We've been in stagflation for way more time than anyone officially admits to.
Time for the workers of the world to demand a humungous% wage increase, to bring them back in line, and yet plenty of guys here argue that even the minimum wage is too high! Back at ya, SOBs.
$59 since 1966? Wow!
Where do I sign-up for this Land Of Milk & Honey?
And that ain't all - no Siree!!!
Fr'instance, if you stuck that $59.00 in a JPM CD for 10years you'd have $59.89 - close on sixty bucks!!!!!!!
Only in America folks! Only In America!
I would also point out that the inflation targets the fed stands by have raped the lower income earners just as much as wage depression. The producers, top 1 percent, can no longer pass on higher expenses but they can control what they pay for labor. Now throw in the fact that the upper management has in fact become too greedy and have decided to take much more of the pie than they rightly deserve and so here we are. Simply put, the Fed needs to be closed down!
I wish my father were still alive to see this. I always used to tell him that it was easier to make a good living back in his peak earning years - 1955-1975 - than mine - 1985-2005 - but he never wanted to believe that the America he fought for in WWII was any different now than then.
He stubbornly stuck to his preferred line of reasoning, all the while watching single-earner households evolve into double-earner debt traps, inflation, stagflation, recession, government regulation and bungling, even as it got harder and harder for him to make decent money in his later years.
Now I know why my general acceptance of prices has been stuck somewhere around a 1974 level, when a new car cost $3500-6000, a two bedroom apartment was $400 and a steak dinner ran about $6-8. Because my income has been stuck there thanks to inflation. Back in 1975, I was making about $350 a week and had plenty of money left over after regular expenses. Guess what? I'm making a little more than that now - about $500 - but it's a struggle to get by. Taxes went way up since then, along with gas, food, rent and just about everything else.
Now, greed and loopholes may be great for the .001%, but inflation has truly wrecked our middle class and society.
And the wreckage continues.
The article totally misses the biggest point: The deindustrialization of America has destroyed incomes across the country. Back in 1978 I started working for a foundry at today's equivalent of $20 an hour. There were a number of paper mills hiring in our area. If you didn't like one place you could go to work for another. As soon as I put in my application at the foundry I talked to the lady in personnel and I was hired on the spot.
Wasnt life great under Americanism?
Too bad the commies took over.
Signed: an American.
Wasn't Chinese life great under the "Great Leap Forward (into Starvation)"?
Too bad tens of millions of Chinese were starved to death by the commies.
Signed: ghost of a former Chinese citizenism citizen