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US Standard Of Living Drop Worst In History

From a careful not to blame anyone Christian Science Monitor:

A long, steep drop for Americans’ standard of living

By Ron Scherer, Staff writer   
October 19, 2011

Think life is not as good as it used to be, at least in terms of your wallet? You’d be right about that. The standard of living for Americans has fallen longer and more steeply over the past three years than at any time since the US government began recording it five decades ago.

Bottom line: The average individual now has $1,315 less in disposable income than he or she did three years ago at the onset of the Great Recession – even though the recession ended, technically speaking, in mid-2009. That means less money to spend at the spa or the movies, less for vacations, new carpeting for the house, or dinner at a restaurant.

In short, it means a less vibrant economy, with more Americans spending primarily on necessities. The diminished standard of living, moreover, is squeezing the middle class, whose restlessness and discontent are evident in grass-roots movements such as the tea party and "Occupy Wall Street" and who may take out their frustrations on incumbent politicians in next year’s election

Note that the Christian Science Monitor pretends that the Tea Party and the OWS crowd have similar complaints. And that the OWS protests are grass-roots and middle class.

Also, notice how the Occupy Wall Street movement is honored with capital letters, while the TEA Party is not.

What has led to the most dramatic drop in the US standard of living since at least 1960? One factor is stagnant incomes

This is what passes for journalism in the 21st century. Stagnant incomes led to a drop in the US standard of living. Sheesh.

Another is falling net worth – think about the value of your home and, if you have one, your retirement portfolio. A third is rising consumer prices, with inflation eroding people’s buying power by 3.25 percent since mid-2008

And none of this had to do with government policies or government interference.

Incomes just stagnated. (It had nothing to do with taxes, regulation, or Obama-Care.) Houses just fell in value. (It had nothing to do with the government making banks give out bad mortgages.) And inflation just happens. (It has nothing to do with the government borrowing 40% of its spending.)

Per capita disposal personal income – a key indicator of the standard of living – peaked in the spring of 2008, at $33,794 (measured as after-tax income). As of the second quarter of 2011, it was $32,479 – almost a 4 percent drop. If per capita disposable income had continued to grow at its normal pace, it would have been more than $34,000 a year by now

What stopped income from growing? Those evil Wall Street bankers?

The bulk of that decline is in real estate, which has lost $4.7 trillion in value, or 22 percent, since 2007

Again, even given the fact that Wall Street bankers are evil, why would they want the housing market to decline?

Stock investments aren’t any better. Since 1999, the Standard & Poor’s index, on a price basis, is off 17 percent. It’s up 3.2 percent when dividends are included, but that’s a small return for that length of time

Once more, why would Wall Street want this? Stocks are their bread and butter.

But this Christian Science Monitor article never once mentions the role of government in all of this.

It doesn’t even blame Bush.

This article was posted by Steve on Thursday, October 20th, 2011. Comments are currently closed.

4 Responses to “US Standard Of Living Drop Worst In History”

  1. Alternative headline: “Are You Better Off Now Than You Were 2 & 1/2 Years Ago?”

  2. tranquil.night says:

    “Bottom line: The average individual now has $1,315 less in disposable income than he or she did three years ago at the onset of the Great Recession – even though the recession ended, technically speaking, in mid-2009.”

    As Steve says, that’s without even factoring how that disposable income is worth less dollar for dollar than at the onset of the multi-trillion dollar statist spending sprees too.


  3. proreason says:

    I can’t quite put my finger on it, but somehow I think there has been something in the last three years that is responsible for this historic decline. Something has “changed”.

  4. Not so fast says:

    One economist nailed it succinctly. The Greater Depression.

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