Is America in decline?

[Joker Poker]

Americans have a long history of predicting the demise of their nation, only to be proven wrong. However, with a gridlocked government and the rise of China, some observers believe the United States may actually be entering a period of long-term decline...

...‘America still boasts powerhouse universities ... it still has the technological smarts of Silicon Valley. It still has the financial acumen of Wall Street.’...

Wall St? That would be the guys who gave us the GFC and should be in prison, not to mention the banksters in BOA, Goldman Sachs etc that should be incarcerated for market manipulation. These guys will go down in history as the ones who defeated their own people/country.

Full story:

http://www.abc.net.au/radionational/pro ... ne/5882898

[StroppyChops]

I wonder at what point it was decided that the Roman Empire was done and dusted. It's not like there'd be a single significant event, but at some point a Brit would have said, "I say, chaps, remember that old empire lot?" for the first time. I guess the difference is that the US has geographically defined borders that are less likely to be challenged, short of WWIII.

[OrangeDragon]

GDP up 1.2 Trillion in 2013 from 2012. Almost neck and neck with the Chinese growth of 1.02 Trillion in the same timespan.

I find it interesting however that so many people see it as a US "or" China situation, when much of China's growth depends on their exports to the US (20% of their 2013 total) consumer market, and how much of their currency stabilization depends on their purchase of US T-bills to fight deflation of the Yen.

Both countries are tied to one another, and aside from some minor push and pull benefit pretty equally. As one grows it will only lead to the other growing as well. An example, as more people in China become wealthy there's an increased demand for foods that have to exported from the US... which is why we've seen pork (just one of our major US/China export products) exports to China soar. This creates agriculture jobs in the US, ups production levels, increases wages by decreasing the workforce supply, etc. They grow, we grow.

We have more people working, for more money, we buy more consumer goods... many of which are imported from China. This creates manufacturing jobs in China, ups production levels, increases wages by decreasing the workforce supply, etc. We grow, they grow.

Marginal changes over short terms aren't nearly as critical as media likes to make them out to be.

-------------

And Wall St. didn't 'give' us the GFC no matter how many times people say it. It was a group effort. They gave the people what they wanted... they let populist control win and put the wealth of the nation in the hands of the middle class. Turns out, the middle class couldn't handle that much responsibility and started defaulting hand over fist (but never get any of the blame when it comes to "who caused it" despite going out and buying $500,000 homes on a $30,000 a year salary).

Which still would have been manageable if Clinton hadn't pushed investment brokers to buy mortgage securities from F&F to back their funds instead of T-bills. Had he not "balanced the budget" and cut off the sale of treasury bonds, investors wouldn't have turned to the mortgage securities (which they were told by the administration/fed were as solid of an investment as T-bills) creating the higher demand for them (and so the increase in ease for handing them out).

Clinton (and his administration) WANTED to make it easy for everyone to go into debt and own a home... he even put out a letter to lending agencies telling them to "be creative" in getting people approved and past that difficult down payment intended to show you were serious about your purchase. He (they) knew that doing so would shift the US trade deficit onto the shoulders of the private citizens instead of the government, meaning it would be possible to run without a deficit for a while. What they didn't think through was the fact that the private sector was in no position to shoulder that debt, which is why the government under Bush had to come along and clean it all up by taking it back on in the form of bailouts and QE.

So we have Clinton at the top pulling strings, wallstreet and the fed dancing on them, and the population watching a show they knew they couldn't afford to bar tab for. All equally guilty.

(And kudo's on making a good bait thread that would pull me back into regular posting )

[wackyjacky]

Well it's certainly not a democracy anymore. 'The Land of the Free' has become 'The Land of the Fee'. It's an out & out corporatocracy w/the big banks holding the reigns. Legislators used to at least pretend that they worked for the electorate. This charade is no longer necessary. The Supreme Court's ruling on 'dark money' in political campaigns & propositions has killed any chance for fair elections anymore. These unregistered groups can air untrue libelous attack ads with no consequences. The economic demographic is getting more stratified towards the poles & the middle class is disappearing fast. If you don't work for Google or Chase, you work for Taco Bell or Home Depot. Many corporations will soon find that there's no market for their products in the US. Most folks won't be able to afford them. Healthy economy's have a strong middle class. I expect that at some point the clueless populace will wake up, realize that there's a big dick in their ass, & start voting - but that seems decades away. On the economic side, in addition to Tech & agriculture, the US is now swimming in oil and gas. Things look pretty good on that front IMO.

[OrangeDragon]

Well it's certainly not a democracy anymore.

Never was... always a Representative Republic.

'The Land of the Free' has become 'The Land of the Fee'.

Not even sure what that's supposed to mean.

It's an out & out corporatocracy w/the big banks holding the reigns. Legislators used to at least pretend that they worked for the electorate. This charade is no longer necessary.

In a consumer based capitalist economy, there's not much separation. Bankrupting the nation by stifling the corporations that provide it's wealth and employment until they implode is no way to serve the people.

The Supreme Court's ruling on 'dark money' in political campaigns & propositions has killed any chance for fair elections anymore. These unregistered groups can air untrue libelous attack ads with no consequences.

I wonder why when it comes to internet usage, phone usage, etc everyone is screaming for privacy... but when it's a matter of political support privacy goes out the window. Aside from that, it doesn't give them permission to commit illegal acts of libel, nor does it protect them from lawsuit if they do. There's always a legal paper trail that a court can follow back to the ones pushing out the advertisements.

The economic demographic is getting more stratified towards the poles & the middle class is disappearing fast. If you don't work for Google or Chase, you work for Taco Bell or Home Depot.

This is a drastic exaggeration. There are new startups launching and finding success every month/week/etc. Ones making lots of cash, and lots of people making lots of cash working for them. Currently there is an abnormally high amount of money going into the top percentile, however they are also the ones who will be impacted the hardest when QE is phased out. At the moment it's a "brace for impact" strategy that will leave all of them a significant amount less wealthy than they currently are. They are also the ones able to make their wealth "work" by reinvesting it (as the market rebound has shown). The higher and faster this happens, the sooner we can kick them off the QE teat.

Many corporations will soon find that there's no market for their products in the US. Most folks won't be able to afford them.

Then the price will go down and the currency will deflate. Though it's unlikely to happen, personal wealth statistics are still showing a per month growth rate averaging around .5%.

Healthy economy's have a strong middle class.

It's steadily (though slowly) recovering... despite the doom and gloomers screaming the sky is falling.

I expect that at some point the clueless populace will wake up, realize that there's a big dick in their ass, & start voting - but that seems decades away.

The whole "wake up" thing is rubbish... reality is the guy who can't get my Taco order right at the drive thru window is probably better off NOT voting. Educated decisions/votes are what matter... not "everyone should vote", but "everyone who understands what their voting choices really mean" should vote. We've had way too much of the former... and too much of people preaching it like it's the gospel.

On the economic side, in addition to Tech & agriculture, the US is now swimming in oil and gas. Things look pretty good on that front IMO.

Doesn't this sort of contradict your whole position on a weakening middle class since 90% of the workers in these fields will be middle class workers? A lot of the confusion always seems to be that people look at middle class laborers, which until home prices rebound fully will still be a neglected demographic, and call that the middle class. It's a much wider class, and only looking at the worst sector or two of it will give you a skewed perception. Most agricultural workers are middle class, most tech workers are middle class, most oil field workers/truck drivers/etc are middle class (or higher, as demand for that specific class of laborer has skyrocketed). These fields are surging both in job availability and workers wages as the supply/demand balance shifts. It's only a narrow band that's still really struggling to find work in their fields (and college graduates who majored in shit like philosophy), however they're the ones advertised on the front of the activism campaigns and they do bring the overall average numbers down significantly.

Soon the manufacturing generation of baby boomers will hit social security age, and we'll see a sharp decrease in the unemployment complaints along with an increase in middle class averages as they nearly return to their previous income levels.

[OrangeDragon]

From census data it looks like what's happening more than middle classers falling under is them climbing up... until the 2008 fall where more upper classers ended up dropping into the middle class:


A huge impact on this might be a need to redefine our "middle class" earnings ranges... which would really be a strengthening middle class if the number we use to identify them as such has to be raised.

[wackyjacky]

OD, go watch some more Fox Channel. Let me refer you to Bill Moyers : http://billmoyers.com/2013/09/20/by-the ... e-class/By the Numbers: The Incredibly Shrinking American Middle Class
September 20, 2013
by Karin Kamp
A typical American household made about $51,017 in 2012, according to new figures out from the Census Bureau this week. That number may sound familiar to anyone who remembers George H. W. Bush’s first year as president or Michael Jackson in his prime. That’s because household income in 2012 is similar to what it was in 1989 (but back then it was actually higher: you had an extra $600 or so to spend compared to today).

That sobering statistic gives an indication of where the American middle class appears to be headed. Take a look below at a snapshot of where the middle class is now, the problems they face and what our Facebook audience has to say about squeaking out a living these days.

A note on the term “middle class”: There is no single, universal definition so we turned to economic analyst Robert Reich – who spoke to us this week – for some direction. Reich suggested defining middle class as those with income levels 50 percent above and below the median income. Median is a term that means the “middle of the middle.” Median earnings are a key indicator of how the middle class is doing.

A Snapshot



The income range to be considered middle class:$25,500 – $76,500

The median middle class household income in 2012: $51,017
and in 1989: $51,681

Year inflation-adjusted median household income peaked at $56,080: 1999

Income needed in a two parent, two child home in St. Louis for an adequate living standard: $64,673
and in New York City: $94,676

The Problem

Share of self-described middle-class adults who say it’s more difficult now than a decade ago for middle-class people to maintain their standard of living: 85

Percentage of Americans that consider themselves to be “lower class” (the highest percentage ever): 8.4

Percentage increase in salary growth for the median worker from 1979 to 2012: 5

Percentage drop in average real income per family since 2007: 8.3

The median net worth of a family in 2010: $77,300
and in 2007: $126,400

Percentage of Americans that are unemployed/underemployed rate: 14

Number of states in which poverty rates rose between 2007 and 2010: 46

Approximate poverty rate from 2009 to 2012: 15

The last time it remained at or above 15 percent for three years running: 1965

The Work

Average number of hours U.S. workers put in annually: 1,790
what the Norwegians work: 1,420
and the French: 1,479

Percent increase in productivity from 1979 to 2012: 75

What the median middle-class income ($51,017) would be if wages grew at the same rate: $77,131
(Check out this handy tool from EPI to see what your income would be if it had kept up with productivity.)

Number of guaranteed days of paid vacation given to U.S. workers: 0

Number of vacation days U.S. workers are entitled to, but don’t take, in a typical year: 175 million

Number of paid maternity days in Germany: 98 (100% pay)
Number of paid maternity days in France: 112 (100% pay)
Number of paid maternity days in U.S.: 0

Number of industrialized countries that do not mandate paid maternity leave: 1
(yes, the U.S. is the only one that does not require paid leave.)

The Costs

Average out-of-pocket health care expenses per household in 2012: $3,600
and in 2011: $3,280
and in 2005: $2,035

Average amount needed to send a child to an in-state college for the 2012-13 academic year: $22,261
and for a private college: $43,289

Percentage of Americans near retirement with less than $30,000 in their retirement accounts: 75

Percentage increase in housing prices since 1990: 56

Share of Americans that do not have enough money saved to pay their bills for six months: 3/4

The Inequality



Percentage of income gains captured by the top 1 percent in the first three years of the economic recovery: 95

Percentage income growth since 1967 for the top 5 percent of earners: 88
and for the top 20 percent of earners: 70
and for middle-income households: 20

Average income of top 1 percent: $1.2 million

Average net worth of the top 1 percent: $16.4 million

The share of wealth held by the richest 400 Americans: 1/2

The median household net worth in 2010: $57,000
and in 1983: $73,000

Percentage of the 1 percenters who said they were “middle class at heart”: 76

The total number of Americans living in poverty — with incomes of $23,492 for a family of four or $11,720 for an individual: 46.5 million

[OrangeDragon]

(Brace yourselves... this got pretty long winded pretty fast.)

Despite the common suggestion, I don't watch fox news... never have. I am just a fiscal concervative who undestands how to build economic models without political bias attached to them. Lets see if this guy is the same.

Lets start with his first statement...

"A typical American household made about $51,017 in 2012, according to new figures out from the Census Bureau this week. That number may sound familiar to anyone who remembers George H. W. Bush’s first year as president or Michael Jackson in his prime. That’s because household income in 2012 is similar to what it was in 1989 (but back then it was actually higher: you had an extra $600 or so to spend compared to today)."

The last US census was in 2010... so I'd be curious on how they calculate that. But even presuming it's accurate there the last bit of that regarding 1989. From the same source, the census bureau, I find it showing the median wage at $30,056. And I consider $20,000 a fairly far cry from "similar". When you adjust it for current dollars it comes very close, but then... that's what it's supposed to do. The median income should adjust for inflation (amusing considering how many are saying it isn't). Yes, it's slightly under adjusted... though a little flux is to be expected on a system that complex, especially only a few years after a major financial crisis.

Census Source: https://www.census.gov/hhes/www/income/ ... tate1.html
BLS Inflation Calculator:
http://www.bls.gov/data/inflation_calculator.htm

------------------------------------

As we move on from there, we'll ignore his "buy my book" fear mongering in the second paragraph and move right into:

"A note on the term “middle class”: There is no single, universal definition so we turned to economic analyst Robert Reich – who spoke to us this week – for some direction. Reich suggested defining middle class as those with income levels 50 percent above and below the median income. Median is a term that means the “middle of the middle.” Median earnings are a key indicator of how the middle class is doing."

That's a significantly narrow view of the middle class. He's right about the lack of a universal definition... which unfortunately makes the whole thing about "I'll massage the definition to fit what I need it to show." I could toss you another definition for the same effect, making it all persons under $150,000 a year and at some arbitrary low point that confirms my models. You'd go for it about as much as I'll go for cutting it off at $80,000. I'll save us both the trouble.

Honestly my $150k is much more realistic. The concept of a middle class isn't really even about what they make... it's just a lazy index. It's about what they do with it once they make it. They spend most of it, but save some of it and invest a little of it. This is what makes them so important to an economy. Significant short term goods/services spending, long term large item spending, and doubled investment... both managed and self managed. And the biggest factor... they are the ones taking out home/car loans. If we look at that definition, those living in the $150k/y range are still well within it. In fact, we could probably extend that number up even a little further.

You get too high and the spending slows down, because they have the things they wanted/needed and have paid off their mortages and car loans. To say that households making over $80k have reached that point is pretty absurd.

You get too low and they're just trying to make ends meet, so aren't saving/investing/buying large ticket things like cars and houses. Personally I wouldn't cut that off so low. I'd set it closer to $35k nationwide.

-----------------------------

Looking at his first set of numbers... he does a really cool slight of hand trick that would make David Copperfield proud. He starts off quoting you nationwide earnings, then follows up with region specific costs. Very clever. Nevermind that a few states well above the cost of living median create an unbalanced offset that makes that kind of comparison rediculous, New York among them. New York CITY especially. (Also never mind that the median household income includes many single households skewing it lower than the averages if you ONLY averaged households of married/cohabiatating couples.)

This is just a dirty numbers game for him.

------------------------------

His second set (ignoring the "consider themselves" straw poll crap... because polling like that is complete unreliable crap and often respondants are baited/led into providing the desired answers) is interesting.

I'd be curious to see where his "Percentage increase in salary growth" numbers come from... because looking at the Social Security Administration numbers I see growth every year except a 1.5% drop in 2009... which was followed by a 2.4% growth the following year. If we just take the SSA's level for 2012 (44,321.67) and compare it with 1979 (11,479.46) we see almost a 300% increase. If we go ahead and inflation adjust 79 up to 2012 (36,301.78) we still get a 22% increase. Did he just make that up?

SSA Source for wage info:
http://www.ssa.gov/oact/cola/awidevelop.html

In fact, from that point I'm pretty over fact checking his statistics... from plain dirty data manipulation, to unrealistic class boundries, to data that just looks fabricated... I'm not very sold on this guys outlook.

Looking at his bio on Wikipedia now... I regret putting in as much effort as I did. He's not an economist... he's a liberal political commentator and journalist. His whole job revolves around making any fiscal concervative decision look bad while getting people to watch his TV show. He was also Lindon Johnson's press secratary... he's part of the team that tried to sell America the Vietnam war as a good idea. Clearly an honest journalist.

Where are the economist, of which the US has plenty, all banding together to warn everyone of this supposed impending doom!? Not reporters, not political parties, not politcal commentators... people who's whole job is to spot shit like this supposed end of days coming and warn everyone.

[Joker Poker]

Hook, line and sinker!

[OrangeDragon]

Hook, line and sinker!