Originally Posted by
PlanoFuji
Apparently you are no more versed in history than you are in business. The very concept of a large (key word there) middle class is a modern invention that resulted from the wealth produced in industrialist societies. Prior to that advent, societies were typically pyramidal shaped, with a the bulk of the population being poor, a merchant class that was somewhat larger than the upper class of the society.
That said, there is no indication that the middle class is loosing viability in this country. What they are loosing is the ability to spend beyond their means. It is no longer as viable to live on credit, which is how much of what you seem to be describing as a middle class lifestyle was supported. However, the ones who would suffer most from such a reversion to traditional economic structure would be what you call the middle class... They are the ones who most benefit from the uptick in wealth.
We live in a modern world, so citing statistics from the dawn of the industrial age is no longer relevant. Secondly, and I don't mean to sound like a jerk here, but it's
losing, not loosing. I've seen so many people get this wrong and I just don't see how people confuse the two.
The U.S. is virtually the only country on earth that decided to create an economy where 2/3s of aggregate GDP is consumer spending. That decision decades ago, along with policy decisions -- some good, some bad -- set in motion the situation we have now. I sincerely doubt we will be able to perpetuate the type of economy we have now unless serious changes are made. This focus has led to low savings rates at a time when we need high ones and high ones at a time when the economy needs consumer spending. We can't seem to get it right -- at least in the last 20 years. [/QUOTE]
Originally Posted by
PlanoFuji
Another point that is relevent is that the very concept of middle class is what is causing part of the issue you are citing. Over the years a number of researchers have performed surveys where two questions have been included. 1) Identify whether you are a) middle class, b) poor, or c) rich and 2) Identify you income bracket. The results have been amazingly consistent. Up to 90% of respondents have identified themselves as being in the 'middle class', while there income levels did not meet the mathematical definition (typically second and third quartiles)... So yes, those who have actually always been poor, may in fact be now realizing that...
There's a lot of truth to what you say, actually, but I'd add politicians convincing people who have lower skills than are needed to sustain today's job that they're government victims to this list. People who live in high-tax states are tired of whiners from lower income ones acting as if something's holding them back. These were the same people who slept through high school when I was there 30 years ago and never went to college. Now, they're surprised they can't compete? [/QUOTE]
Originally Posted by
PlanoFuji
While not strictly true (there are a few exceptions), it does sadly seem to be all to common. And I would suspect that at least recently Texas has been providing more net to the coffers than California...
California's fiscal problems at the state level don't mean the average income of Californians are declining. States like NY and California do a lot more for their residents on the local and state level than many other states. My roads in NY that traverse the state are paid for by tolls, not federal highway money. That said, there are systemic problems with the cost of living in both states that will have to be addressed if they want to maintain a viable middle class. And middle class here can mean an annual household income of $200K.