More on the Economy
Unless you're among the wealthiest Americans, chances are this week's headlines don't square with your reality. Wall Street is faring far better than Main Street, where the middle class is losing ground and hope.
Despite signs of a durable economic recovery, a recent Allstate/National Journal Heartland Monitor Poll shows that middle-class Americans fear they're falling behind. Of all Americans, 59 percent say they're concerned about slipping out of their economic class in the next few years.
Meanwhile, Washington dithers.
The GOP-controlled House is fixated on President Obama rather than the economy, with one-third of the chamber's committees investigating White House controversies.
The president's economic agenda is designed to ease the middle-class squeeze, but he has failed to translate a populist reelection campaign message into legislative success.
Obama said Friday that the recovery can't be measured in stock prices alone, "it's about how much progress ordinary families are making. Are we creating ladders of economic opportunity for everybody who works hard?"
The answer is no.
Nearly two-thirds of jobs lost during the recession paid middle-class wages, according to the National Employment Law Project. Yet only 22 percent of jobs created under Obama are mid-wage occupations. That disparity is what Obama had in mind when he declared in his Inaugural Address, "We know that America thrives when every person can find independence and pride in their work, when the wages of honest labor liberate families from the brink of hardship."
In the same speech, Obama also promised to address income inequality. "We, the people, understand that our country cannot succeed when a shrinking few do very well and a growing many barely make it," the president said.
The gap between middle-class and wealthy Americans has grown steadily since the 1970s. The Brookings Institution recently said that income inequality is reducing the ability of Americans to climb from one class to another, and documented evidence of "permanent inequality"—wealthier Americans becoming permanently better-off at the same time that the disadvantaged are becoming permanently worse-off.
A 2011 CBO study found that between 1979 and 2007 the top 1 percent of American wage-earners saw their after-tax income grow by a whopping 275 percent. The next 19 percent experienced 65 percent growth.
The rest were left with table scraps: No more than 40 percent growth for anybody else—and only 18 percent growth for the bottom fifth.
While no GOP leader has broken through with a populist message appealing to Americans whose voting behaviors are motivated by these economic trends, Democrats are likely to follow Obama's rhetorical path.
Maryland Gov. Martin O'Malley, a likely Democratic presidential candidate in 2016, told liberal activists Thursday that "America's middle class hasn't had a raise in 13 years."
Now, that's a headline that might resonate.