Jun 25, 2015

June 25, 2015: Measuring the Middle Class, Race to the Bottom, Assault on the Republic

“Without a Middle Class, there can be no republic”
                                ----from “The Quotations of Chairman Joe”

Sam Becker, writing in an article published online, has given us a few of the emerging statistics cataloguing the decline of America’s Middle Class and, perhaps, the United States itself.  In an article entitled “5 States Where the Middle Class Is Being Destroyed”, Becker cites a study by the Pew Charitable Trusts published through its Stateline blog.  The study found that the middle class has, between 2000 and 2013, shrunk in every single state concluding “that there was truly nowhere to hide from the economic downturn that began in late 2008.” Additionally, the “fall in middle class ranks was also accompanied by drops in median income in most states as well” (1)

Measuring the “Middle Class” as being those households making “between 67% and 200% of the state’s median income” Becker reports that Nevada and Vermont lost 5% of its middle class; with North Dakota 5.1% and Ohio reporting a 5.2% decline of the middle class as a percentage of their populations.  The state hardest hit was Wisconsin losing 5.7% of its middle class, where median income had dropped by $9000.00 annually.   Nevada had been hit hard by mortgage foreclosures and the collapse of the real estate market; Vermont’s woes are attributed to the number of senior citizens that make up the population and their reliance on fixed incomes.  The oil boom in North Dakota has fueled inflation and the prosperity, such as it is, has not been shared.  In Ohio, the exporting of good paying manufacturing jobs has devastated the middle class with adjusted median incomes (adjusted for inflation) falling from $56,400 in 2000 to “only $48,000” by 2013. (1). 
In the ‘race to the bottom, Wisconsin, however, was our clear winner, losing 5.7% of its standing in the population and roughly $9,000.00 in annual household purchasing power.  The state’s response has been to ‘gut’ the unions and further erode wage and living standards portending a long recovery or, perhaps, no possible recovery at all.

The causes are many and varied and decades in the making.  To be sure the country has been hit unevenly, as is always the case during any upheaval.  Normally change brings with it a mixed result featuring pockets of prosperity and despair.  What has characterized this recession is the near universal experience now threatening the very existence of America’s middle class, portending not only a decline in purchasing power but in political power as well.  Nevada has seen its middle class decline from a majority of 53.6, to a minority of 48.8% of the population.  Vermont likewise has a minority Middle Class with 47.4% of the population, now so numbered.  North Dakota too now numbers its Middle Class in the minority at 47.5.  None of these developments are healthy for either the economy or the republic.

I have discussed, in these columns, the importance of a strong, vibrant, and all-encompassing middle class.(2)  A republic cannot function without such a Middle Class.  A Middle Class is a prerequisite for the very creation of a republic, the very foundation upon which it stands.  Without it the “republic” will either fail to come into being or it will degenerate into either an Oligopoly or a military dictatorship; a mere “Banana Republic”, a hollow mockery, a cruel hoax.  The Middle Class is under assault and so, by extension, is the foundation of the very republic itself. 
(1). http://www.cheatsheet.com/business/5-states-where-the-middle-class-is-being-bulldozed.html/?a=viewall

(2).  See January 13, 2008: Banana Republic, Transcendental Meditation







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