The income of a household considered to be at the statistical middle fell 2.3% to an inflation-adjusted $49,445 in 2010, which is 7.1% below its 1999 peak, the Census Bureau said.
The poverty rate clicked up again this year. WSJ's David Wessel, DJ Newswires' Neal Lipschutz and MarketWatch's David Callaway discuss on The News Hub whether the government needs to intervene to the rising number of Americans affected. The Census Bureau's annual snapshot of living standards offered a new set of statistics to show how devastating the recession was and how disappointing the recovery has been. For a huge swath of American families, the gains of the boom of the 2000s have been wiped out.
Earnings of the typical man who works full-time year round fell, and are lower adjusted for inflation than in 1978. Earnings for women, meanwhile, are a relative bright spot: Median incomes have been rising in recent years and rose again last year, though women still make 77 cents for every dollar earned by comparably employed men. The fraction of Americans living in poverty clicked up to 15.1% of the population, and 22% of children are now living below the poverty line, the biggest percentage since 1993.
To be sure, there are other measures of American financial health that are more positive. The nation's per capita net worth, for instance, hit $169,691 at the end of 2010, according to the Federal Reserve, up from $147,889 in 2007. Much of that gain is in the form of stocks, retirement accounts and other investments. The biggest asset of most American families is their homes, and those have declined in value in recent years. And there are those who argue the Census report offers a flawed gauge of living standards. For example, the Census Bureau adjusts for inflation using government measures that attempt to reflect the improving quality as well as price of goods. But these inflation adjustments are imperfect and don't reflect advances in medicine, the wonders of the Internet or the improvements in air quality.
Deborah Bagoy-Skinner and her husband, Chester, are among the faces behind the numbers. Four years ago, the Tucson, Ariz., couple owned their home and had a combined income of around $100,000, much of which came from Mr. Skinner's job conducting safety training classes for a heavy-equipment maker. They lost their three-bedroom home in 2007 during a two-year spell of unemployment, and have since downgraded to a two-bedroom rental. Through 2008 and 2009, the darkest days of the recession, they sold everything from golf clubs to antique nickels to pay rent and bills. Today the couple is well above the poverty line: Mr. Skinner makes about $65,000 a year doing contract safety classes. But with their savings wiped out it will be a long road back, and likely they won't own another home or ever make as much as they once did. "We've pretty much accepted that that probably won't happen," she says.
The Census report, viewed as a key gauge of American prosperity, comes at a time of growing anxiety about the health of the U.S. economy and is likely to play into the political dialog this election year. With more than 14 million unemployed, many of them out of jobs for extended periods, the recovery is faltering and the administration and Congress are debating how to respond. Consumers account for some 70% of demand, so thinner pay checks are a major problem for anyone trying to boost growth and get the unemployed back into jobs.
The Census report was studded with data that underscore the economic strains across society in the aftermath of the worst recession in more than half a century. Poverty rates among people younger than 18 grew to 22%, compared with 20.7% the year before, while the percentage of Americans lacking health insurance edged up to 16.3%. Echoing a longer-term trend that is in part a reflection of an aging population, the share of people covered by private insurance fell last year, while the share of people on government programs such as Medicare and Medicaid increased. As families struggle to make ends meet and young workers navigate the moribund labor market, many have turned to each other. According to the Census report, 5.9 million Americans between 25 and 34, or 14.2% of that group, lived with their parents in spring 2011, compared with 4.7 million before the recession, or 11.8%. Meanwhile, the gap between the best-off and worst-off Americans remained largely unchanged. The top fifth of households accounted for 50.2% of all pre-tax income; the bottom two-fifths got 11.8%. In 1999, the top fifth claimed 49.4% and the bottom got 12.5% of the income.
The Census Bureau said 15.1% of Americans were living below the poverty line, set at $22,314 for a family of four in 2010. That's up from 14.3% last year and from 12.5% in 2007, before the recession. The official poverty rate overestimates the number of people living in poverty because it doesn't count many government anti-poverty programs, such as subsidized housing, food stamps and the Earned Income Tax Credit.
5 most shocking Census facts about growing poverty in the U.S. - The Raw Story - Kase Wickman - September 13, 2011 -
1. The number of those living in poverty is the highest in Census history - the poverty rate rose for the third consecutive year, to 15.1 percent.
2. We were richer last millennium - Average income took a dramatic hit, declining 6.4 percent since 2007
3. Women still earn a fraction of what men make - a woman working full-time for a full year earned approximately 77 percent of what a man working the same amount of time in the same job was paid
4. There's no safety in numbers - About 9.2 million families (11.7 percent) were under the poverty line, up from 2009's 8.8 million families (11.1 percent).
5. Everything's bigger in the South — including the poverty rate - the South experienced an increase in poverty. In 2009, 17.6 million (15.7 percent) were under the poverty line. By 2010, they had added 1.5 million to that number, sending the poverty rate to 16.9 percent.
Payrolls Decreased in 30 States in August While Jobless Rate Climbed in 26 - Bloomberg - Bob Willis and Shobhana Chandra - Sep 16, 2011 - Payrolls fell in 30 U.S. states in August, led by New York and Georgia, while the jobless rate increased in 26, showing the slump in hiring is broad-based... Employers cut staff by 22,700 workers in New York last month, and by 18,200 in Georgia, figures from the Labor Department showed today in Washington. Nevada continued to lead the nation in unemployment with a rate of 13.4, up from 12.9 percent in July... The economy needs to generate more jobs to spur income growth after consumer spending stagnated in the second quarter, raising concerns of another recession. A Labor Department report on Sept. 2 showed employers added no workers to payrolls last month, the weakest reading since September 2010, and the jobless rate held at 9.1 percent.
US Real Unemployment Rises To 22.8% - Before It's News - Infowars.com - Kurt Nimmo - September 16, 2011 -The Census Bureau’s annual report released Tuesday offers a snapshot of the economic well-being of U.S. households for 2010, when joblessness hovered above 9 percent for a second year. It comes at a politically sensitive time for President Barack Obama, who has acknowledged in the midst of a re-election fight that the unemployment rate could persist at high levels through next year…. Measured by total numbers, the 46 million now living in poverty is the largest on record dating back to when the census began tracking poverty in 1959. Based on percentages, it tied the poverty level in 1993 and was the highest since 1983... In fact, the real unemployment figure is 22.8%, according to John Williams’ Shadow Stats. During the last Great Depression, the unemployment rate peaked at 25 percent in 1933.
“During Great Inflations, Societies Turn On Themselves” And Prosecute Minorities … And We’ve Got A LOT Of Hidden Inflation - Washington Blog - September 15, 2011 -
Inflation Is A TaxThe father of the theory that government stimulus is the way to fight severe downturns – John Maynard Keynes – famously said about inflation:
By this means government may secretly and unobserved, confiscate the wealth of the people, and not one man in a million will detect the theft.Fed chairman Ben Bernanke also admits that inflation is a tax on the American people:
Money printing creates inflation.
But quantitative easing doesn’t help anyone but the biggest Wall Street companies (and see this, this and this). We can’t inflate our way out of our debt crisis, and without prosecution of Wall Street, all of the stimulus in the world won’t work. Indeed, Bernanke knew in 1988 that quantitative easing doesn’t work.
(War also causes inflation, and we’ve been on an endless series of wars over the past 10 years.)
Stimulus Versus Austerity: A False Debate
And as I’ve repeatedly noted, the never-ending fight between Keynesian stimulus and debt-cutting is a false debate. It is really a debate between helping the American people or continuing policies which simply redistribute wealth upwards to the richest .1%.
Stimulus could work … if it went to the American people and Main Street, instead of the Wall Street fatcats. And the Fed could easily deploy trillions into the economy if it simply stopped paying banks to park their excess reserves at the Fed.
Obama Team Backed $535 Million Solyndra Aid as Auditor Warned on Finances - Bloomberg - Jim Snyder and Christopher Martin - Sep 12, 2011 - Two months before Obama’s visit, accounting firm PricewaterhouseCoopers LLP warned that Solyndra, the recipient of $535 million in federal loan guarantees, had financial troubles deep enough to “raise substantial doubt about its ability to continue as a going concern.”... The Obama administration stood by Solyndra through the auditor’s warning, the abandonment of a planned initial public offering and a last-ditch refinancing where taxpayers took a back seat to new investors. That unwavering commitment has come under increasing scrutiny since the company’s travails culminated in its filing for bankruptcy protection on Sept. 6 and a raid on its headquarters by the Federal Bureau of Investigation two days later... “People including our government put blinders on and did not want to believe in the obvious,” Jonathan Dorsheimer, an analyst in Boston for Canaccord Genuity Inc. of Vancouver, said in an interview with Bloomberg Government. “The fact that the government chose Solyndra as their white horse is mind- boggling.”
Gerald Celente - Yahoo! Finance - 15 September 2011 : whoever have ever seen a summer like this ?1 Gold fluctuating a $200 a month , no the world is becoming very very wary and concerned that there is no way out of this mess if you take the United States for example yes there is ( a way out of this mess) cut military spending says trends master Gerald Celente , but there is nobody who seems to want to talk about it except Ron Paul cut military spending what we are talking about 1.5 trillion a year ! and how about taxing the billionaires , that makes sense to me , and stop the free trade , this is what got us into this says Gerald Celente exporting our manufacturing plants into slave labor countries and bringing back the finished products , probably October will see the big crash says Gerald Celente , it usually happens when people come back from the summer holidays and start facing reality , they are talking about double dip recession it is not a double dip recession this is a Depression