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Who is to blame for this alleged disappearance of the middle class?
Posted on 1/29/14 at 5:31 pm
Posted on 1/29/14 at 5:31 pm
Let's just say for the sake of argument that you accept the premise that the middle class is shrinking and we're being put into a 2 tier class system of rich and poor with a slowly diminishing middle class.
One school of thought is to blame the government since the middle class burdens a pretty large share of the tax revenue pie. Is there some truth to that? Perhaps.
But I do think that financial institutions are probably part of the problem as well. The practice of extending credit to people that aren't really credit worthy creates a cycle of "survival" style cost of living with the constant high interest debt payments that need to be made just to keep current. Let's face it, most college students don't know how to manage money well. Yet any of them can get a credit card as a freshman despite not having any proof of being credit worthy. A lot of these same people get burdened with student loan payments and the like. Then you have a class of educated people (although perhaps not the most financially savvy) that are stuck in a cycle of debt that they can never come out from unless they can achieve a high income to conquer that debt.
People blame the government for the financial collapse all the time. But it seems as if financial institutions had as much of an impact as the government if not more. The very nature of the banking industry is to hope for people to manage credit as poorly as possible so they can get the most out of them in terms of interest and penalties. An unchecked private banking industry is certainly not a good thing for the economy. They have a vested interest in the poor staying where they are IMO.
One school of thought is to blame the government since the middle class burdens a pretty large share of the tax revenue pie. Is there some truth to that? Perhaps.
But I do think that financial institutions are probably part of the problem as well. The practice of extending credit to people that aren't really credit worthy creates a cycle of "survival" style cost of living with the constant high interest debt payments that need to be made just to keep current. Let's face it, most college students don't know how to manage money well. Yet any of them can get a credit card as a freshman despite not having any proof of being credit worthy. A lot of these same people get burdened with student loan payments and the like. Then you have a class of educated people (although perhaps not the most financially savvy) that are stuck in a cycle of debt that they can never come out from unless they can achieve a high income to conquer that debt.
People blame the government for the financial collapse all the time. But it seems as if financial institutions had as much of an impact as the government if not more. The very nature of the banking industry is to hope for people to manage credit as poorly as possible so they can get the most out of them in terms of interest and penalties. An unchecked private banking industry is certainly not a good thing for the economy. They have a vested interest in the poor staying where they are IMO.
31
Posted on 1/29/14 at 5:33 pm to Powerman
Women
Or the men that passed the 19th amendmenrt to get votes.
Or the men that passed the 19th amendmenrt to get votes.
This post was edited on 1/29/14 at 5:34 pm
Posted on 1/29/14 at 5:34 pm to Powerman
Well said you crazy fricking conservative you!
Posted on 1/29/14 at 5:34 pm to Powerman
Is the middle FALLING to the low? Or, is the middle CLIMBING to the high?
But, to answer your question...where one is is the sum total of the decisions one has made (extended to succeeding generations). So, one is to blame for where one is.
But, to answer your question...where one is is the sum total of the decisions one has made (extended to succeeding generations). So, one is to blame for where one is.
Posted on 1/29/14 at 5:37 pm to Powerman
A multitude of factors including an enormous government liability burden on the middle class, changes in lending practices (both government induced and non-government induced), expansion of college education opportunities, and a culture of consumption and irresponsibility.
That said, it's still ridiculously easy to become a middle class citizen and move into the upper-middle class in this country.
That said, it's still ridiculously easy to become a middle class citizen and move into the upper-middle class in this country.
Posted on 1/29/14 at 5:37 pm to Powerman
Where does Government end and the banking industry begin, again? 
Posted on 1/29/14 at 5:41 pm to Powerman
I think it's a combination of the Governments anti business policies , tax burden, and the financial industry.
Posted on 1/29/14 at 5:43 pm to Powerman
quote:
But I do think that financial institutions are probably part of the problem as well. The practice of extending credit to people that aren't really credit worthy creates a cycle of "survival" style cost of living with the constant high interest debt payments that need to be made just to keep current. Let's face it, most college students don't know how to manage money well.
This.
As a stupid society, we spend too much damn money on stupid shite. I only partially blame the financial institutions.
Every person I know that claims to be broke and not able to make enough money still has a decent house, new car, and all of the toys that everyone thinks of as a right these days. And most of all, they eat out or pick up food and rarely cook.
Stupid lazy fooks!
Posted on 1/29/14 at 6:25 pm to Powerman
You have to be cautious with the credit argument. If you look at other developing countries, it is widely accepted the lack of credit available to the lower classes is a barrier to them having any upward mobility.
When you see them building a house brick by brick and then waiting a month to buy the next brick... you see credit is vital. Can it be abused and overextended? Sure.
When you see them building a house brick by brick and then waiting a month to buy the next brick... you see credit is vital. Can it be abused and overextended? Sure.
Posted on 1/29/14 at 6:34 pm to Powerman
Corporate America. There is no incentive to maintain a middle class in this country when you sell to a global market and employ overseas.
Posted on 1/29/14 at 6:40 pm to Powerman
quote:
But I do think that financial institutions are probably part of the problem as well. The practice of extending credit to people that aren't really credit worthy creates a cycle of "survival" style cost of living with the constant high interest debt payments that need to be made just to keep current. Let's face it, most college students don't know how to manage money well. Yet any of them can get a credit card as a freshman despite not having any proof of being credit worthy. A lot of these same people get burdened with student loan payments and the like. Then you have a class of educated people (although perhaps not the most financially savvy) that are stuck in a cycle of debt that they can never come out from unless they can achieve a high income to conquer that debt.
I agree with this. Just a quick general comment on getting into debt. I believe that for the most part debt accumulation is due to easy access to credit, undisciplined borrowers and people with a psychological addiction to spending. I don't know how you break out of this debt accumulation behavior. I've seen many of my friends go into severe financial trouble simply because they have to be the cool guy with the new phone, fancy jeans, buying everybody drinks at the bar, new car, fast boat, etc.
quote:
People blame the government for the financial collapse all the time.
I think that is fair accusation if you are talking about the 2008 financial crisis. If the government is going to back loans (remove risk) banks will get aggressive and predatory to loan money. It's called moral hazard. Take the risk off the tax payer and put it back on the bank and this problem of moral hazard goes away.
Posted on 1/29/14 at 6:47 pm to Powerman
quote:
Who is to blame for this alleged disappearance of the middle class?
the Federal Reserve Bank
Posted on 1/29/14 at 6:55 pm to Powerman
quote:the other side, clearly!
Who is to blame
Posted on 1/29/14 at 6:58 pm to Powerman
the human race and technology
we've advanced so far that luxury goods are now so cheap and accessible that the poor and rich enjoy the same goods
we're a victim of our own success, as this has eroded the true distinctions between the groups and the lower/middle classes have started to believe that luxury goods are necessities...which is where we run into problems with "the middle class"
the median income has hovered around $45-50k for a household for a good while now. that's seen as poor by many in the upper-middle class. that's also not far removed from the "welfare queen" level of "poverty"
we've advanced so far that luxury goods are now so cheap and accessible that the poor and rich enjoy the same goods
we're a victim of our own success, as this has eroded the true distinctions between the groups and the lower/middle classes have started to believe that luxury goods are necessities...which is where we run into problems with "the middle class"
the median income has hovered around $45-50k for a household for a good while now. that's seen as poor by many in the upper-middle class. that's also not far removed from the "welfare queen" level of "poverty"
Posted on 1/29/14 at 8:11 pm to Powerman
Academia and the idea that every person needs to go to college. Americans getting too good to learn a trade but not too good to accept government handouts. Poor leadership...baby boomers.
This post was edited on 1/29/14 at 8:14 pm
Posted on 1/29/14 at 8:47 pm to Powerman
I'm not going to read the other responses before giving my opinion so forgive me if I cover things that have been talked about.
First and foremost is the obliteration of manufacturing in the United States. These were good jobs in which people without secondary education could make a solid living. Unions destroyed manufacturing in the US and it was taken elsewhere.
The second is the internet. Small retail businesses cannot compete with the likes of Amazon.
The third is in the same vein. The consolidation of retail into corporate entities such as Target and Wal Mart decimated small business as well.
The fourth is the lack of people willing to learn a trade, even though these trades are lucrative once the trade is learned. Plumbers, electricians and the like make a killing but those that seek out these avenues are reduced because they require starting at the bottom and learning their craft before the money gets great.
First and foremost is the obliteration of manufacturing in the United States. These were good jobs in which people without secondary education could make a solid living. Unions destroyed manufacturing in the US and it was taken elsewhere.
The second is the internet. Small retail businesses cannot compete with the likes of Amazon.
The third is in the same vein. The consolidation of retail into corporate entities such as Target and Wal Mart decimated small business as well.
The fourth is the lack of people willing to learn a trade, even though these trades are lucrative once the trade is learned. Plumbers, electricians and the like make a killing but those that seek out these avenues are reduced because they require starting at the bottom and learning their craft before the money gets great.
Posted on 1/29/14 at 8:48 pm to Powerman
quote:
Who is to blame for this alleged disappearance of the middle class?
Obama
Posted on 1/29/14 at 9:03 pm to Powerman
quote:
Who is to blame for this alleged disappearance of the middle class?
Lobbyists. Regular people cannot buy votes on such a massive scale, and do not hold politicians accountable for it come election time.
Posted on 1/29/14 at 9:10 pm to Powerman
quote:
Who is to blame for this alleged disappearance of the middle class?
The failing education system, technology, and government. The education system is failing and that hurts the ability of the have nots to jump to haves. Technology is doing away or has done away with a lot of jobs that were once pretty good paying jobs. Finally government is sticking with an outdated income tax system that is not competitive in today's world economy. Governmnet is also holding the economy with regulations that don't allow use to take advantage of our resources.
quote:
But I do think that financial institutions are probably part of the problem as well. The practice of extending credit to people that aren't really credit worthy creates a cycle of "survival" style cost of living with the constant high interest debt payments that need to be made just to keep current. Let's face it, most college students don't know how to manage money well. Yet any of them can get a credit card as a freshman despite not having any proof of being credit worthy. A lot of these same people get burdened with student loan payments and the like. Then you have a class of educated people (although perhaps not the most financially savvy) that are stuck in a cycle of debt that they can never come out from unless they can achieve a high income to conquer that debt.
government backed loans make it too easy for young ppl that haven't had the life experiences to learn how to manage money to manage money.
quote:
People blame the government for the financial collapse all the time. But it seems as if financial institutions had as much of an impact as the government if not more.
The US government was encouraging banks to continue lending after the pool of good borrowers (ones that could afford it) was drying up, because there was a wealth gap and owning your own home is the best way to increase wealth, owning your own home increases children's self esteem, and then the typical American dream of 2 cars and a house bullshite line.
quote:
An unchecked private banking industry is certainly not a good thing for the economy.
no but the government has stepped in and is checking too much, there is a fine line that has to be walked.
quote:
Dems have a vested interest in the poor staying where they are IMO.
FIFY
Posted on 1/29/14 at 9:48 pm to Powerman
quote:Uh? There will ALWAYS be a middle class.
Who is to blame for this alleged disappearance of the middle class?
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