Tuesday, December 04, 2007

The thirty five year slowdown

In the past 35 years America has become vastly more wealthy.

Krugman, DeLong and Reich tell us that wealth has not gone to the middle class:
Robert Reich's Blog: It's the Economy, Stupid -- But Not Just the Slowdown

... middle-class families have exhausted the coping mechanisms they've used for over three decades to get by on median wages that are barely higher than they were in 1970, adjusted for inflation. Male wages today are actually lower than they were then; the income of a young man in his 30s is now 12 percent below that of a man his age three decades ago.

The first coping mechanism was moving more women into paid work. The percent of working mothers with school-age children has almost doubled since 1970 -- from 38 percent to about 70 percent. Some parents are now even doing 24-hour shifts, one on child duty while the other works...

When families couldn't paddle any harder, we started paddling longer. The typical American now works two weeks more each year than 30 years ago...

As the tide of economic necessity continued to rise, we turned to the third coping mechanism. We began taking equity out of our homes, big time....

...The fact is, most Americans are still not prospering in the high-tech, global economy that emerged three decades ago. Almost all the benefits of economic growth since then have gone to a relatively small number of people at the very top. The candidate who acknowledges this and comes up with ways to truly spread prosperity will have a good chance of winning over America's large and largely-anxious middle class.
The polls I know of don't show any sign that America's middle class recognizes their dilemma. Until I see that I can't share Reich's faith that there's a winning progressive political strategy in their discontent.

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