LEANING RIGHT - We know that: A home in Los Angeles sold for 3.5 mil in 2008 is now selling for 2.6 mil …The number of food stamp recipients has increased from 28 mil in 2008 to 44 mil now … Unemployment has increased from 5% in 2008 to 8+% now – real unemployment is double digit … The cost of gasoline between 2008 and now is through the ceiling … The government has failed to balance a budget since 2008.
The Federal Reserve has said that 39% of the net wealth of American families is down the toilette.
Both the Washington Post and New York Times are included in the 14 million sources reporting that the median net worth of American families plunged by 39 percent in just three years, from $126,400 in 2007 to $77,300 in 2010. That puts Americans roughly on par with where they were in 1992.
The Washington Post and New York Times are traditionally sympathetic to and defensive of the current administration but facts are facts – even though they are painful. The data represents one of the most detailed looks at how the economic downward spiral altered the financial landscape of the American family.
Over a span of three years, Americans watched the progress that took almost a generation to accumulate disappear. The promise of retirement built on the rise of stock and assets proved unreachable. Homeownership became an albatross.
The disclosures underscore the depth of the financial pain and how far many families remain from healing. If the recession set Americans back years, economists say the road forward is sure to be a long one.
“It’s hard to overstate how serious the collapse of the economy was,” said Mark Zandi, chief economist for Moody. “We were in a free fall.”
Not only were Americans still facing significant debts, but they were making less money. Median income fell nearly 8 percent, to $45,800, in 2010. The median value of stock-market-based retirement accounts declined 7 percent, to $44,000.
But it was the implosion of the housing market that inflicted much of the pain. The median value of Americans’ stake in their homes fell by 42 percent between 2007 and 2010, to $55,000, according to the Fed.
The New York Times reports that, while the numbers are already 18 months old, the Federal Reserve survey illuminates problems that continue to slow the pace of the economic recovery. The Fed found that middle-class families had sustained the largest percentage losses in both wealth and income during the crisis, limiting their ability and willingness to spend.
“It fills in details to a picture that we already knew was quite ugly, and these details very much underscore that,” said Jared Bernstein, an economist at the Center on Budget and Policy Priorities who served as an advisor to Vice President Joseph Biden. “It makes clear how devastating this has been for the middle-class.”
The President recently compounded the drab unemployment picture by using an act of executive fiat to add 800,000 to the unemployment rolls. What a cheesy overture considering that for the Hispanic community:
- unemployment has increased from 7% to 11% during his administration
- 75% are rated financially poor
- 38% have been forced to skip a meal recently
- PEW says that childhood Hispanic poverty has hit records.
Finally there is more than $2 trillion corporate US money stashed overseas because of the tax policy of the current administration. The administration is attempting to perpetuate and augment this policy. This leads to continued outsourcing of both jobs and money.
Some will interpret the above as political partisanship. It can also be interpreted as 39% down the toilette.
(Kay Martin is a writer and a contributor to CityWatch. His years of travel and work included tours in Russia, Europe, the Middle East, Africa, Asia, Australia, Hawaii, Latin America, and the Pacific. His new book “Along for the Ride” will be out and available shortly. He can be contacted at [email protected].) –cw
Tags: Kay Martin, politics
CityWatch
Vol 10 Issue 51
Pub: June 2