Jobs Will Follow a Strengthening of the Middle Class

[RyanPsych]

THE 5 percent of Americans with the highest incomes now account for 37 percent of all consumer purchases, according to the latest research from Moody’s Analytics. That should come as no surprise. Our society has become more and more unequal.

When so much income goes to the top, the middle class doesn’t have enough purchasing power to keep the economy going without sinking ever more deeply into debt — which, as we’ve seen, ends badly. An economy so dependent on the spending of a few is also prone to great booms and busts. The rich splurge and speculate when their savings are doing well. But when the values of their assets tumble, they pull back. That can lead to wild gyrations. Sound familiar?

The economy won’t really bounce back until America’s surge toward inequality is reversed. Even if by some miracle President Obama gets support for a second big stimulus while Ben S. Bernanke’s Fed keeps interest rates near zero, neither will do the trick without a middle class capable of spending. Pump-priming works only when a well contains enough water.

Look back over the last hundred years and you’ll see the pattern. During periods when the very rich took home a much smaller proportion of total income — as in the Great Prosperity between 1947 and 1977 — the nation as a whole grew faster and median wages surged. We created a virtuous cycle in which an ever growing middle class had the ability to consume more goods and services, which created more and better jobs, thereby stoking demand. The rising tide did in fact lift all boats.

read on at: http://www.nytimes.com/2011/09/04/opinion/sunday/jobs-will-follow-a-strengthening-of-the-middle-class.html?_r=1&1=1

[bemildred]

1. Yep, no consumers, no consumer economy. nt

[Sarah Ibarruri]

2. Which disproves the never-ending right wing myth that when the rich get a lot, they trickle it down

That myth is bs, and yet it's been spun around by right wingers in countless ways and continues to be spun. In fact, economists whose ideology is right wing say that letting the rich have the lion's share will benefit the rest of the country. They say this, despite the absence of statistics. Statistics clearly show the opposite. Right wingers, whether economists, plumbers, or out of work right wing fools, continue to spin this.

[bluerum]

3. More like a baldfaced lie than a myth. Repeat it long enough and the feeble minded believe it.

[Sarah Ibarruri]

5. Yup. It shocks me that poor people suffering the effects of this ideology believe this crap

But they do. Are they just incredibly stupid, or do they believe they belong to a very elite group (GOP), and it's worth it even if they're starving?

[w0nderer]

4. looking even further back

it's a trend
thriving working and middle class == thriving economy

that whole
those unwilling to learn from history are forced to relearn from it
is a pain