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Can the Middle Class Be Saved?

Mon, 01/09/2012 - 16:18 — Dave Culver
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Economics

The Great Recession has accelerated the hollowing-out of the American middle class. And it has illuminated the widening divide between most of America and the super-rich. Both developments herald grave consequences. Here is how we can bridge the gap between us.

Don Peck, Atlantic

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Andy Reynolds/Wonderful Machine

In October, 2005, three Citigroup analysts released a report describing the pattern of growth in the U.S. economy. To really understand the future of the economy and the stock market, they wrote, you first needed to recognize that there was “no such animal as the U.S. consumer,” and that concepts such as “average” consumer debt and “average” consumer spending were highly misleading.

In fact, they said, America was composed of two distinct groups: the rich and the rest. And for the purposes of investment decisions, the second group didn’t matter; tracking its spending habits or worrying over its savings rate was a waste of time. All the action in the American economy was at the top: the richest 1 percent of households earned as much each year as the bottom 60 percent put together; they possessed as much wealth as the bottom 90 percent; and with each passing year, a greater share of the nation’s treasure was flowing through their hands and into their pockets. It was this segment of the population, almost exclusively, that held the key to future growth and future returns. The analysts, Ajay Kapur, Niall Macleod, and Narendra Singh, had coined a term for this state of affairs: plutonomy.

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Comments

Mon, 01/16/2012 - 01:56 — Anya Achtenberg (not verified)

Regardless of the numbers, to make appeals for saving the "middle class" as if the "bottom" 90% are all the same is delusional and offensive. 

I understand why it is of value to "save" the middle class.

I am too busy being poor to put my efforts there, especially after being blamed by that same middle class for too long for my own poverty, which many of them seemed to feel perfectly justified in judging before they began to know hard times personally. 

Who is still invisible to them? That's where I'll be, that's where my efforts will go. To those who can ill afford one more drop of poverty, insecurity, lack of healthcare, inability to afford education, fear of deportation, homelessness...nor one more drop of judgment by the descending middle class. Perhaps we shall all come together to save the country, the planet. I'm willing. 

But one more appeal for the middle class and the middle class alone? 

I can't hear you at the moment.

 

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