For the middle class, expenses grow faster than paychecks

[cubby1223]

No such thing as a free lunch.

Unless you're in a group a political party wants as a solid voting block. Free lunch. Free cell phones. Free rent. Free Obamacare. Free job training.

 

[DucatiMonster696]

Unless you're poor and in a group a political party wants as a solid voting block. Free lunch. Free cell phones. Free rent. Free Obamacare. Free job training.

Even this comes at a cost if you are poor and receiving handouts from government.

I.e. loss of motivation to uplift yourself and lost opportunities for others to of instead used that money taken from them to produce real and productive economic activity in the private sector.

 

[DucatiMonster696]

The House passed a jobs bill in a few years ago that would have included both targeted tax cuts and hiring of workers to improve the national infrastructure. Presidents can't change the economy without the help of congress.

The Senate has not been very helpful at all.

Yeah, I do because the line for trickle down (aka voodoo economics as President Bush Sr. put it once) is that the tax cuts will allow the wealthy to hire more...

So what happened to those jobs?

I see you've bought into the myth that government can someone how take from others to "Fix the economy" while increasing its debt burden and devaluing it currency.

 

[stlc8tr]

That said, two people with real jobs shouldn't really be facing the end of the world over the difference between 3 and 3.50 for milk. I'd be curious to see what other expenses they have.

Especially when they make ~$162K/year.

 

[cubby1223]

Even this comes at a cost if you are a poor and receiving handouts from government.

I.e. loss of motivation to uplift yourself and lost opportunities for others to of instead used that money taken from them to produce real and productive economic activity in the private sector.

Just because some other schmuck can't figure out how to motivate himself doesn't mean I don't want free stuff!

But to the other point, I believe the free handouts to the poor is a big reason why the middle class has it rougher these days.

 

[Hayabusa Rider]

This is true and I think it's reasonable to expect wages to follow that; they'll start to do better (unless the economy tanks again). I am also aware that since Reagan's time the middle and lower class have basically been stagnant, though. Essentially all of the increasing wealth in the country is going to the top 10-20% IIRC.

I was being facetious. Unless outsourcing reverses and manufacturing jobs return in quantity then we'll see bumps. Which is this? We'll see, but I haven't been made aware of improving working conditions.

 

[OverVolt]

You know if you are poor it becomes harder to get a job because everyone you know is also poor.

 

[blankslate]

I see you've bought into the myth that government can someone how take from others to "Fix the economy" while increasing its debt burden and devaluing it currency.

Why don't you try reading... how does targeted tax cuts and increased maintenance (and improvements) equal taking from others? Those people who would have been employed in fixing the infrastructure would contribute to the economy.

Oddly enough the top marginal rates were very high (and even with the loopholes it's a pretty safe bet that the very rich paid at least around 40% of their incomes after the 1st couple $100k in taxes) during the periods of mostly high growth in the late 40's, 50's and 60's.

It's not as if there isn't a lot to be done to get the highways and roads portion of the U.S. infrastructure to a level that is competitive either.

http://www.asce.org/PPLContent.aspx?id=2147484137

ASCE’s Infrastructure Report Card Gives Nation a D, Estimates Cost at $2.2 Trillion

http://www.asce.org/uploadedFiles/Publications/ASCE_News/2009/02_February/0209ReportCard.pdf

 

[DucatiMonster696]

Why don't you try reading... how does targeted tax cuts and increased maintenance (and improvements) equal taking from others? Those people who would have been employed in fixing the infrastructure would contribute to the economy.

You're talking about a fraction of those individuals who are unemployed. Furthermore taking money out of those who are engaged in productive activities in the economy to prop up a government plan to rebuild roads is not going to address our serious economic problems in this nation which stem from our government's own need to prop up its debt woes.

You are not going to create wealth that is independent and self-generating via any economically legitimate means which does not involve further government intervention in the form of government tax, borrowing and spending. All we would be would be to transfer wealth to government and its favored son's (government contractors, lobbyists, etc) to prop up a false illusion of growth and when the money runs out it so does the illusion.

Oddly enough the top marginal rates were very high (and even with the loopholes it's a pretty safe bet that the very rich paid at least around 40% of their incomes after the 1st couple $100k in taxes) during the periods of mostly high growth in the late 40's, 50's and 60's.

I would sure like to see where you pulled that 40% as the tax loop holes were far greater than today and far more in use back in those days. Furthermore the 40's, 50's and 60's where decades in which government regulation and involvement in the economy was significantly scaled back than the 30's and less than what is seen today.

So thank you for conceding the point that the decades in which we saw the biggest growth were the decades in which government's involvement and middling in the private sector was the smallest compared to the 30's or today. Of which those aforementioned decades were decades in which this nation was also still on a gold standard.

It's not as if there isn't a lot to be done to get the highways and roads portion of the U.S. infrastructure to a level that is competitive either.

http://www.asce.org/PPLContent.aspx?id=2147484137



http://www.asce.org/uploadedFiles/Publications/ASCE_News/2009/02_February/0209ReportCard.pdf

Again none of this will solve of very serious and very ingrained structural problems in this nation in which our economy has become hooked on easy credit or the looming debt issues which will not be helped by government further borrowing money or taxing productive sectors of the economy to boost some false image of sustainable growth.

 

[rudder]

When Debbie Bruister buys a gallon of milk at her local Kroger supermarket, she pays $3.69, up 70 cents from what she paid last year.


Getting to the store costs more, too. Gas in Corinth, Miss., her hometown, costs $3.51 a gallon now, compared to less than three bucks in 2012. That really hurts, considering her husband's 112-mile daily round-trip commute to his job as a pharmacist.


Bruister, a mother of four, received a $1,160 raise this school year at her job as an eighth-grade computer teacher. The extra cash -- about $97 a month, before taxes and other deductions -- isn't enough for her and her husband to keep up with their rising costs, especially after the elimination of the payroll tax break. Its loss shrunk their paychecks by more than $270 a month.


"If you look at how much prices are going up, you get in the hole really quick," Bruister said. "It's a constant squeeze."


Bruister now has an $1,800 deductible, compared to $500 a few years ago. When she goes to the doctor, the bill typically tops $100 -- so she tries to avoid going.


In the wake of the Great Recession, millions of middle-class people are being pinched by stagnating incomes and the increased cost of living. America's median household income has dropped by more than $4,000 since 2000, after adjusting for inflation, and the typical trappings of middle-class life are slipping out of financial reach for many families.

Average size house in the 1950's was 1200 sq ft. Now its over 2400 sq ft. I bet the ones in this article live in a McMansion. Downsize and save money. And what the hell.. two incomes.. a teacher and a pharmacist.. and they are struggling. I think the article left a lot of shit out.

If it is that bad, do like their parents... don't pay $100+ month for TV. Don't pay $50+ month for a phone so you can surf the internet on a 3" screen. Don't buy $40,000 automobiles which quickly depreciate dring that 112 mile daily roundtrip commute.

People made in through the depression so surely people can survive in this economic climate.

 

[OverVolt]

Average house in 1950's was also made better. I would take one anyday over a McMansion honestly.

 

[ShawnD1]

Average house in 1950's was also made better. I would take one anyday over a McMansion honestly.

-wiring was piss poor
-lots of things were never grounded
-some houses still used fuses back then
-lead pipes
-asbestos was used for certain types of insulation
-piss poor wall insulation
-piss poor attic insulation
-windows were never sealed properly
-extremely high heating costs due to the above
-fire codes were terrible back then

Buying an old house is like buying an old car. It's basically a giant money pit. Some companies won't even sell fire insurance until the wiring in the house is completely redone.

 

[dmcowen674]

3-11-2013

http://news.yahoo.com/many-left-behind-silicon-valley-191020089.html

Many left behind as Silicon Valley rebounds



Gap between wealthy and poor expands as Silicon Valley tech rebounds



On a morning the stock market was sailing to a record high and a chilly storm was blowing into Silicon Valley, Wendy Carle stuck her head out of the tent she calls home to find city workers duct taping an eviction notice to her flimsy, flapping shelter walls.


"I have no idea where I'm going to go," she said, tugging on her black sweatshirt over her brown curls and scooping up Hero, an albino dog.


She glanced at the glimmering windows on a cluster of high-tech office buildings just blocks away and shook her head.


"Did you know Google shares hit $840 each this morning?" she asked. "I just heard that on the radio."

The Silicon Valley is adding jobs faster than it has in more than a decade as the tech industry roars back. Stocks are soaring and fortunes are once again on the rise.

But a bleaker record is also being set this year: Food stamp participation just hit a 10-year high, homelessness rose 20 percent in two years, and the average income for Hispanics, who make up one in four Silicon Valley residents, fell to a new low of about $19,000 a year— capping a steady 14 percent drop over the past five years, according to the annual Silicon Valley Index released by Joint Venture Silicon Valley, representing businesses, and the philanthropic Silicon Valley Community Foundation.


Simply put, while the ultra-rich are getting even richer, record numbers of Silicon Valley residents are slipping into poverty.

"In the midst of a national economic recovery led by Silicon Valley's resurgence, as measured by corporate profits and record stock prices, something strange is going on in the Valley itself. Most people are getting poorer," said Cindy Chavez, executive director of San Jose-based Working Partnerships USA, a nonprofit advocating for affordable housing, higher minimum wages and access to health care.

"The fact is that we have an economy now that's working well only for those at the very top," said Lawrence Mishel at the Economic Policy Institute in Washington D.C. "Unless we adopt a new approach to economic policy, we're going to continue going down this path, which means growth that does not really benefit the great majority of people in this country."

The causes for the growing disparity are complex, but largely come down to one thing: a very high cost of living. The median home price is $550,000, and rents average just under $2,000 a month for a two-bedroom apartment in this region that is home to many of the nation's wealthiest companies including Facebook, Apple Inc., Hewlett-Packard Co. and Google. For a family of four, just covering basic needs like rent, food, childcare and transportation comes to almost $90,000 a year, according to the nonprofit Insight Center for Community Economic Development.

Silicon Valley's top tech magnates inched up the Forbes annual list of the richest people on the planet released this week: Oracle Corp. CEO Larry Ellison had a reported net worth of $43 billion, Google co-founders Larry Page and Sergey Brin had about $23 billion each, Facebook CEO Mark Zuckerberg, was worth an estimated $13.3 billion, and Laurene Powell Jobs, widow of Apple Inc. co-founder Steve Jobs, had an estimated worth of $10.7 billion.


"The wealth numbers are staggering, they are absolutely staggering," said Alf Nucifora, who chairs the Luxury Marketing Council of San Francisco


One in five ultra-wealthy Americans, defined by having a net worth above $30 million, lives in California, stoked by the "wealth-generating cluster" of the Silicon Valley, according to WealthX, a company that tracks the super-rich. Stanford University, in Palo Alto, boasts 1,173 alumni with a net worth of more than $30 million — only Harvard University and the University of Pennsylvania have more.

But many residents, even those with college educations, are finding it tougher than ever to make it in the Silicon Valley.

Before the Great Recession, about 10 percent of people seeking food had at least some college education. Today, one in four who line up at food pantries for bags of free food have been to college.

"There are millionaires, even billionaires, who sit in their sunrooms watching me work in their gardens and they have no clue what's going on,"

 

[Exterous]

Average house in 1950's was also made better. I would take one anyday over a McMansion honestly.

That is so wrong its not even funny. In addition to what ShawnD1 mentioned:
-Building codes were much less restrictive back then leading to a larger variance in buildings. This is important as it has introduced a survivor-ship bias. The ones still standing are either extensively renovated or were built unusually well.
-The biggest difference is in foundation quality and water proofing. If you think 1950s houses were built better I would suggest you look into typical foundation construction (cinder block +mortar), how they waterproofed the foundation (they usually didn't) and the effect that moisture has on un-waterproofed cinder block foundations.
-Don't forget galvanized steel pipes used for plumbing that like to rust.
-Cast iron pipes for drainage/sewer hookup
-lead paint
-extremely undersized electrical panel/wiring
-Upgrades done to electrical are often not up to current code and pose dangers
-Clay weeping tile (if it was even installed) prone to breakages
-They loved asbestos. In addition to insulation it is often found in tiles and plaster walls as well.

Even if the house has been upgraded I would be extremely skeptical on the quality of the upgrade. I have seen far too many 'nicely updated' houses where the owners/rennovators cut corners especially with the electrical system

 

[Matt1970]

-wiring was piss poor
-lots of things were never grounded
-some houses still used fuses back then
-lead pipes
-asbestos was used for certain types of insulation
-piss poor wall insulation
-piss poor attic insulation
-windows were never sealed properly
-extremely high heating costs due to the above
-fire codes were terrible back then

Buying an old house is like buying an old car. It's basically a giant money pit. Some companies won't even sell fire insurance until the wiring in the house is completely redone.

That was the technology of the time.

 

[jackstar7]

But to the other point, I believe the free handouts to the poor is a big reason why the middle class has it rougher these days.

Do you mind elaborating on how you arrive at that conclusion?

 

[1prophet]

I would sure like to see where you pulled that 40% as the tax loop holes were far greater than today and far more in use back in those days. Furthermore the 40's, 50's and 60's where decades in which government regulation and involvement in the economy was significantly scaled back than the 30's and less than what is seen today.

So thank you for conceding the point that the decades in which we saw the biggest growth were the decades in which government's involvement and middling in the private sector was the smallest compared to the 30's or today. Of which those aforementioned decades were decades in which this nation was also still on a gold standard.

The bolded is true, the alternative minimum tax started in the late 60's because of the top 1% of the time paying little to no taxes, even though the tax rates were much higher.

So much for the BS myth that the rich paid more in taxes in the golden age,

the real rich not the middle class that so many have been brainwashed to call rich on our constant downward spiral to the poor house.

A predecessor Minimum Tax was enacted by the Tax Reform Act of 1969[16] and went into effect in 1970. Treasury Secretary Joseph Barr prompted the enactment action with an announcement that 155 high-income households had not paid a dime of federal income taxes.[17] The households had taken advantage of so many tax benefits and deductions that reduced their tax liabilities to zero.[18] Congress responded by creating an add-on tax on high-income households, equal to 10% of the sum of tax preferences in excess of $30,000 plus the taxpayer's regular tax liability.[19]


The explanation of the 1969 Act prepared by Congress's Staff of the Joint Committee on Internal Revenue Taxation described the reason for the AMT as follows:


"The prior treatment imposed no limit on the amount of income which an individual or corporation could exclude from tax as the result of various tax preferences. As a result, there were large variations in the tax burdens placed on individuals or corporations with similar economic incomes, depending upon the size of their preference income.

In general, those individual or corporate taxpayers who received the bulk of their income from personal services or manufacturing were taxed at relatively higher tax rates than others.

On the other hand, individuals or corporations which received the bulk of their income from such sources as capital gains or were in a position to benefit from net lease arrangements, from accelerated depreciation on real estate, from percentage depletion, or from other tax-preferred activities tended to pay relatively low rates of tax. In fact, many individuals with high incomes who could benefit from these provisions paid lower effective rates of tax than many individuals with modest incomes.

In extreme cases, individuals enjoyed large economic incomes without paying any tax at all. This was true for example in the case of 154 returns in 1966 with adjusted gross incomes of $200,000 a year (apart from those with income exclusions which do not show on the returns filed). Similarly, a number of large corporations paid either no tax at all or taxes which represented very low effective rates