This entry was written by Heist Co-Producer and Co-Director Frances Causey.
A recent report that the economy contracted the last quarter is no surprise. Despite the recent numbers, we consistently get rosy reports from the mainstream media that the economy is generally improving. But the reality is that tens of millions of Americans have never been less secure financially because the current economy leaves them out in the cold. The numbers never lie.
From 2007 to 2010, the median net worth of each middle class American family dropped by nearly 40%, wiping out 18 years of accumulated wealth. The housing crash contributed to most of the losses. In that same period, middle-class families went from having on average $126,400 to $77,300. Median income for middle class families is now about where it was in the mid-1990’s. These are stunning losses (not JUST a number) and not without severe consequences, particularly when one considers the psychosocial impact to families. The 1% had big losses too during the crash but they were significantly less impacted because their assets were more diversified. Yet consider this. The earnings of the top 1.0 percent grew a staggering 134% between 1979 and 2007 while those in the bottom 90% grew just 15%.
So where are working Americans suppose to make up for their losses? Apparently not by working. Most of the jobs lost in the economic collapse were replaced by low paying jobs with no benefits. One of the most astonishing numbers consistently left out of the national debate is how 40 million good jobs with benefits were lost well before 2007. These also were replaced with low paying, low-skill service jobs. And yet somehow we continue to think this restructuring of the American economy that began in the late 1970’s when Democrats and Republicans alike began to worship at the altar of free market utopianism is good for us.
Since the late 1970’s average workers have faced historic obstacles in the search for decent employment. Current forecasts suggest there will be protracted unemployment for years to come. To put it bluntly, there is little doubt (and Washington knows this) that the living standards of a majority of working Americans will continue to decline over the next decade.
Even many relatively high tech manufacturing jobs today are paying just $10-12 an hour. In a recent 60 Minutes/CBS News story the reporter filed a piece on the subject of how American manufacturing cannot find enough skilled workers to run their factories. The piece profiled several workers who went back to school to get the necessary training. And guess how the worker is being rewarded for her initiative? She is being paid $12 per hour! Yet the reporter never questioned the employer about the low wages he pays for his “skilled” workers. And American employers wonder why there is a dearth of candidates applying for these positions? These are not living wages when a gallon of milk costs $5. Workers simply can’t afford to take these jobs and support their families.
Yet, without rebuke from the people who elected them, politicians on both sides of the aisle continue to cry about a worker “skills gap”. Just recently, a bi-partisan group of Senators, guided by an addiction to the belief that the market always knows best, just sided 100% with multinational corporations against American high-tech workers by proposing a bill that would overhaul the high-skilled worker visa program. The bill would immediately increase the cap on temporary H-1B from 65,000 to 115,000 a year, giving guest workers an advantage of American workers. How are American workers of any skill level ever able to compete again with the deck so stacked against them?
We hear everywhere that we are in a “recovery” citing the fact that our economy is “growing”. But since the economic collapse, our Gross Domestic Product is consistently averaging around 2.5%. But that number is not high enough to create enough jobs for those job seekers entering the market for the first time much less the millions who need jobs but cannot find them.
Which brings me to another narrative waffling out there. A favorite mantra of the corporate and Wall Street class, and Tea Party is that America is a “welfare state”. Out of work Americans are taking too many handouts and after all “enough is enough.” A closer look at the numbers bearing reality reveals a much different truth. If readers will recall, President Clinton “reformed” welfare in 1996. To receive cash assistance or Temporary Assistance to nearly enough to meet even the most basic of needs. TANF’s role in providing income support to families has declined dramatically since 1996 yet the need has never been greater. For instance in 2011, only 27 families received TANF for every 100 families in poverty.
If the working poor are on Medicaid its because employers like Wal-Mart don’t offer health care. If the working poor participate in SNAP or the food stamp program its because they are not paid enough by employers like Wal-Mart to feed their families. Since 2007, over 12 million families have lost their homes to foreclosure. As of January 2013, another 11 million are underwater on their mortgages and in serious jeopardy of default. Yet, there are currently 1.2 million people in public housing, hardly a huge number given the number of families displaced by the housing crisis. But yet we hear the constant refrain from those who have never wondered where their next meal was coming from complain that our working poor are consistently “on the take”. Corporate or white collar welfare in the form of subsidies, low tax rates for corporations and wealthy individuals, and the auctioning of public resources like oil, timber and the public airwaves for pennies on the dollar costs taxpayers ten times what blue-collar welfare does.
So what is the solution? Profits are not the problem. Blind, relentless pursuit of them at any cost by any business small or large is. American style Democracy has always been grounded in the fact that a majority of America’s citizens worked hard and shared in her prosperity. American worker productivity has never been higher yet American workers are not seeing any return. So we have to make “work” pay again in this country. But how do we do that? If we truly grasp and follow the current numbers, we need a revolutionary change in what’s left of our Democracy.
Through organizing and grassroots efforts, we must rally those left behind in this economy and acting in unison, reconstruct our economy by rebuilding from the bottom up and pressuring those at the top to change policy. This means strengthening the power of workers wherever we can, through workplace laws, policy and unions, which remain the only institutional hedge against the power of Wall Street. Moreover, we must realize that our problems are not just about electing the next politician. Perhaps we even need to redefine the American Dream into one that is more inclusive of all.
This entry is also available at firedoglake.