Obama’s Hope & Change is working!
Measured in median household net worth, Americans are the poorest we’ve been in 43 years. (Median is that number that divides a population into two halves.) For the first time since the end of World War II, average family incomes declined for Americans in all income tiers.
CBS-DC reports, Nov. 30, 2012, that a recent study by New York University economics professor Edward N. Wolff found that the median net worth of American households has dropped to a 43-year low of $57,000 (in 2010 dollars), as the lower and middle classes appear poorer and less stable than they have been since 1969.
Wolff’s focus on total wealth not only measures how much money a household brings in, but also the amount it accumulates. This latter number is very significant — economically secure households are generally more comfortable spending their disposable income, and are less likely to become a drag on the social safety net.
Between 1983 and 2010, the percentage of households with less than $10,000 in assets (using constant 1995 dollars) rose from 29.7% to 37.1%. The “less than $10,000″ figure includes the numerous households that have no assets at all, or “negative assets,” which is otherwise known as debt. Over that same period of time, the wealthiest 1% of American households increased their average wealth by 71%.
As noted by Daily Finance, from 1983 to 2010 the share of total wealth held by the richest 10% of American households increased from 68.2% to 76.7%. Meanwhile, all the rest of Americans lost financial ground.
An August Pew Research Center study found that many in the middle-class are divided on how they believe this gap had widened. Fully 85% of self-described middle-class adults say it is more difficult now than it was a decade ago for middle-class people to maintain their standard of living. Of those who feel this way, 62% say “a lot” of the blame lies with Congress; 54% say the same about banks and financial institutions; 47% about large corporations; 44% about the Bush administration; 39% about foreign competition; and 34% about the Obama administration.
Just 8% put “a lot” of blame on the middle class itself.
“This downbeat take on their economic situation comes at the end of a decade in which, for the first time since the end of World War II, mean family incomes declined for Americans in all income tiers,” the Pew Report stated. “But the middle-income tier—defined in this Pew Research analysis as all adults whose annual household income is two-thirds to double the national median —is the only one that also shrunk in size, a trend that has continued over the past four decades.”
I’ll bet you $5 that when Professor Wolff undertakes an update of his study in 2016, he will find that Americans’ median net worth will have plunged even further, with “the rich” who remain in the United States also experiencing a decrease in their net worth along with the middle and lower classes. Already, almost two-thirds of the United Kingdom’s millionaires (defined as those who make a million pounds or more in annual earnings) had disappeared from Britain after the introduction of the 50% top tax rate.
This is what the Left just refuse to recognize and accept:
The rich, like all human beings, exercise their free will. If their government imposes punitively high taxes on them, they will leave the country for more hospitable havens. The way to fix budget deficit and a crushing national debt is to grow the economy by —
- Increasing incentives to invest;
- Decreasing the disincentives to maintain and create businesses with a profusion of bureaucratic rules and red tape;
- Encouraging in the people the virtues of hard work, frugality, and responsibility;
- Discouraging in the people the vices of laziness, dependency, and an arrogant totally-unwarranted sense of entitlement to the fruits of others’ labor.
Needless to say, the Obama administration is not doing any of the above.