Historians will one day call it the reign of the Middle Class. That period stretching from the end of WWII to the beginning of 2001, will probably be hailed as America’s evolutionary peak. Those living in 2111 who look back, will mark 2001 as the turning point where this nation began its long decline.

Today someone will probably comment that the US is not dead yet. That is true, but then again, neither is the United Kingdom; but few would say the UK still has the clout it did in international politics during these same numbered years, a hundred years ago (1911)….

Alas, the UK never recovered from WWI… The USA, it appears, may never recover from the Republican Party.

To fully appreciate what is happening today, you really need to be familiar with American history from 1870 up to the first world war… That time frame wasn’t very nice to the middle class; in fact, during those times, the wealthy and government together conspired to do everything they could to prevent the middle class from growing (see Mr. Potters argument in “It’s a Wonderful Life“.)

…What’d you say just a minute ago?…They had to wait and save their money before they even ought to think of a decent home. Wait! Wait for what? Until their children grow up and leave them? Until they’re so old and broken-down that they…Do you know how long it takes a working man to save five thousand dollars? Just remember this, Mr. Potter, that this rabble you’re talking about…they do most of the working and paying and living and dying in this community. Well, is it too much to have them work and pay and live and die in a couple of decent rooms and a bath?

Labor unions are the vehicle on which middle class arrived… . Prior to their inception, a worker had no option but to work for nothing if he wished to stay alive.

Basically, somewhere back in the 1890’s, the question began to be raised: why should the wealthy be gambling for sport and playing around with money needed by others for basic food and shelter? And, to any impartial observer, that is a compelling question.. Why should they?

Now if they used that excess money to insure the creation of jobs, to give merit raises to good workers, or in other words, provide something back that has at least some remote worth to the economy, then I would say more power to them.

But, they don’t. They don’t. They simply gamble it away. “Let’s buy this company, hoping we can sell it later at a higher price. Sorry, you’re jobs are gone.

No, the middle class thrives on having money rise through them to the top, then, circulate back to the bottom to rise again.

The Reagan model actually preached this.. The “trickle down theory” was supposed to work. It was supposed to happen like this. As the rich got richer, they were “supposed” to build new plants, “supposed” to invest in great works that would create jobs…

The Bush years were the republican party’s glorious attempt at making that happen. Everything they preached for, they got…

America waited for the results. …. and waited…… and waited……

When the results came in, it became rather obvious that facts and reality, don’t fit in with the Republican model hypothesis: that wealth trickles down benefiting all. It doesn’t.

For Republicans, it’s a shock.

It’s like stating that God created earth in 6 days, then finding geological evidence that it took 5 billion years………. But just like the creationists that support them, these republicans keep harping their obsolete values, simply because they have nothing left. Facts have proved them wrong, so the only thing left, ….. is chutzpa.

The eight years of Republican politics, cost this economy a net loss of American jobs. Now, at the end of those 8 years, the top 1% of America’s population, currently holds 43% of this nation’s wealth; the next 19% holds 50% of this nations wealth (combined 93% in the top 20%), the next two 20%, or what should be called the middle class, holds a paltry 6% of the wealth, which dwarfs the bottom 40%, who combined barely total 1%…..

Wealth Distrubution in the USA
Chart courtesy of The Big Picture

or for those not used to being behind bars, or in honor of the upcoming Pi day (3.14) , … a pi chart……

American Wealth Distribution
Courtesy of G. William Dumhoff

Obviously reality hasn’t come to most Americans yet. We saw that during the mid-term elections.

“A number of people I know consider themselves middle-class based on their substantial income–but they own very few financial/liquid assets, and if they lose their jobs then their health coverage vanishes.

It is time our hick population faces reality. The middle class of China, fares much better than us. The middle class of France (despite our changing the name for their fries), are fairing better than us. The middle class of Norway, are faring better than us. The middle class of Dubai, are fairing better than us. Holy shit! The middle class in Brazil, even fares better than us.

Wake up!

In fact, you have to go to Africa to find another country other than the United States, where losing one’s job can kill you, if you simply have the misfortune to get sick and have no free United Nation’s health clinic in your town to save your butt…….

” There’s no way I’m worse off than some Arab!… ” blabs Joe the Plumber. ” I got my Ford. It’s sticker is almost $40,000…. I got my house; it’s a mansion worth $120,000 on the Ohio market…. No way am I worse off than some commie socialist..”

“Hey Joe! How much would you get for that car if you traded it in right now?”

“Uhh,… Blue book says its worth $18,000 retail right now…”

“Hey, Joe! How much is wholesale?”

“Uhh, …. Somewhere between $13,000 and $14,000…..

“How much do you still have on the 7 year loan you took out?”

“Uhh, ….. $16,574 as of March 15th… ”

“Ha, Ha, Joe….. You realize if someone wreaked into your car, your insurance would cover only $13,000 of that? You’re in the hole $3574….. You don’t own that car. Your loan company does! Same with your house…. So Joe, what do you own, that you are not making payments on?”

“Uhh, …… this shovel…..”

“Hey Joe, … better dig your own grave, before they figure out how to charge you for that, ha, ha….”

I can remember back when a union scale coal miner could buy a Datsun 240Z and pay for it with cash.

In the 1950’s over one third of all cars in America, were paid for with cash….

“So Joe, … is the middle class better off than we were 60 years ago?

Truth in Graphs: Americanism vrs Capitalism
Courtesy of CBO

I call this chart: Before Reagan; After Reagan.

It shows the growth per quintile during a period of “Big Government” (green), high taxation, and lower spending, versus the era of Republicans who are to blame for “Big Deficits (red), lower taxation, and higher spending”

During the post world war period, when the top marginal rate of taxes WERE quite high, we see the rich get richer! And we also see the poor getting richer too…. Hallelujah!

But, the idea that wealth trickles down on its own, we see, is really nothing but an illusion. It sure didn’t in Pottersville….

If you want to get angry, just look at the graph above and see the red graph at the top 1%: imagine if that money were instead, evenly split between all five quintiles?….

It’s no wonder our nation is in crises. What we have done economically, is the equivalent of having a father, the head of household, eat all the family’s food and whatever else he couldn’t stomach, he then allows to be ingested by his starving wife and children!

We would be aghast if such a household story were to rise from the projects and hit the local news. Likewise, we should equally be aghast that this is exactly what is happening to our economy, involving the middle class as we speak!

So……. when America’s most notorious bank robber was once asked why he robbed banks…… He allegedly replied, … “That’s where the money is…”

Likewise, if you want to balance state budgets, you should be doing so by robbing (it is essentially what taxation is) “where the money is….”

Currently Delaware’s top marginal tax rate is 6.95% on incomes over $60,000... If your income is between $40,000 and $60,000, your rate is only…. only 5.5%…. Compare that to the Red State of Georgia.. where you’re top rate of 6%…. starts and applies to all incomes over $7000! Everyone in Georgia, a state that brags it is a low tax state, pays a hell of a lot more in state income taxes than Delaware, up to the $60,000 level….

For 63% of Delawareans, our state taxes are lower than Georgia’s……

More random facts: Delaware’s 6.95% starts at $60,000. South Carolina’s 7% starts at $13,800…

Our neighbors: A person at $60,000 pays 3.07% in PA, 5.5% in NJ, and 4.75% in Maryland… all under Delaware’s rate for that income level… However those making over $500,000 pay a rate of 8.97% in New Jersey, 3.07 in PA, (they legislated a flat rate), and 5.5% in Maryland. Putting Delaware near the top in of the Mid Atlantic states.

Hawaii has a top rate of 11% that starts at $200,000. Oregon has a top rate of 11% that starts at $250,000…. California has a top rate of 10.3% that starts at $1 million…. Next is Iowa… Iowa? Yes, Iowa has an 8.98% starting at $64,755… Then New Jersey and New York tie at 8.95% but that doesn’t start until $500,000…..

So in real terms, Delaware has the option of at least tying Iowa… In percent that is an additional 2.3% to the top echelon. Now, it makes sense not to do as Iowans do and start our top rate at the level of $65,000… Rather it makes sense to put in a tax increase that will be sunset in two years, for a top rate of 8%, starting at incomes of over $1 million dollars…

Delaware has 16,763 households worth more than $1 million this year, representing 4.93 percent of all households. In 2008, Delaware ranked 11th with 18,322 millionaire households, or 5.47 percent. Delaware was No. 7 in 2007 with 20,274 millionaire households, or 6.08 percent.

As a minimal base line, if we raised the rate 2%, and assuming these are annual income figures and not statements of worth, 16,763 times $1,000,000, times 2% …. yields a gain of revenues amounting $335,260,000…..

Obviously we don’t have to go as far as Iowa to balance our budget. We can tweak those rates downward as necessary. Just this theoretical teeny tiny increase, putting us on the same level as another agriculture state, Iowa, and levying it only against 4.93% of Delaware’s households, all of which are pulling in over 1 million a year, can almost completely fund the entire health and benefit plan for the entire state of Delaware ($358 million) for an entire year!

“Today a $30,000 per year State of Delaware employee pays 7.4% of his gross pay ($2216.00) toward his family health care plan, not counting deductibles and co-pays (eg. $25.00 for specialist visits-hope the kids stay healthy) and an additional $810.00 toward his/her pension, (that is over 10% of his/her gross)”

So if you have to rob someone, who’s it going to be? The poor? or those motherf’ers with all the money?

Duh…

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