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Forum Post: The Great Recession, Six Years Later

Posted 2 years ago on Dec. 26, 2014, 5:40 p.m. EST by flip (7101)
This content is user submitted and not an official statement

this is excerpted from an article by Colin Jenkins called The Great Recession, Six Years Later

"The ever-increasing gap between corporate profit and workers income has also served as a death knell to the DJIA indicator. “In the postwar boom of the 1950s, the economy was growing so fast, and the benefits were so widely shared (throughout the socioeconomic ladder), that following 30 large American companies was a solid measure of most everyone’s personal economy,” Davidson adds. Back then, “what was good for GM really was good for the country.” In a modern economic environment that rewards CEOs 331 times more than the average worker, and 774 times more than minimum wage workers, this is no longer the case. (In 1983, this ratio was 46 to 1.) ………………………..

Despite recent and steady job growth, there are still 1.4 million fewer full-time jobs in the U.S. today than there was in 2008. A recent survey conducted at Rutgers University reports that more than 20 percent of all workers that have been laid off in the past five years still have not found a new job. When considering workers who have given up on job searches, the unemployment rate is estimated at more than 12 percent. A more accurate indicator than the unemployment rate may be the actual employment rate. When looking at this, we see that roughly 80 percent of “prime-age workers” (those between 25 and 54) had jobs in 2007. “That bottomed out at around 75 percent during the worst of the downturn, but has risen to only 76.7 percent since.”

New jobs simply do not stack up to the jobs that were lost. In sectors that experienced severe job losses due to the recession, workers are earning 23 percent less today. The average annual salary in the manufacturing and construction sectors—a particularly hard hit area—was $61,637 in 2008. It has now plummeted to $47,171 in 2014. Similar adjustments to income levels imply that $93 billion in lower wage income has been created during the recovery—meaning workers, across the board, are receiving a much smaller share than they were before 2009. A report by the United States Conference of Mayors (USCM) also showed that “the majority of metro areas—73 percent—had households earning salaries of less than $35,000 a year,” hardly a living wage for families facing ever-rising commodity prices.

Despite increased productivity and corporate profits, most workers’ wages have actually fallen. Biven reports, “From the first half of 2013 to the first half of 2014, real hourly wages fell for all deciles, except for a miniscule two-cent increase at the 10th percentile. Underlying this exception to the general trend at the 10th percentile is a set of state-level minimum-wage increases in the first half of 2014 in states where 40 percent of U.S. workers reside.” “As a percentage of national income, corporate profits stood at 14.2 percent in the third quarter of 2012, the largest share at any time since 1950, while the portion of income that went to employees was 61.7 percent, near its lowest point since 1966,” reported Nelson Schwartz in 2013. Dean Maki, chief U.S. economist at Barclay’s reports that “corporate earnings have risen at an annualized rate of 20.1 percent since the end of 2008, but disposable income inched ahead by 1.4 percent annually over the same period, after adjusting for inflation,” adding that “there hasn’t been a period in the last 50 years where these trends have been so pronounced.”…………………..

Between 2008 and 2013, the number of U.S. households with a net worth of $1 million or more increased dramatically, from 6.7 million to 9.6 million. Households with a net worth of $5 million and $25 million respectively also increased. “There were 1.24 million households with a net worth of $5 million or more last year, up from 840,000 in 2008. Those with $25 million and above climbed to 132,000 in 2013, up from 84,000 in 2008.” The U.S. government, or more specifically, the Federal Reserve, has been instrumental in this uneven recovery that has been characterized by massive corporate profits and booming millionaires on one side (a small minority), and falling wages, increased poverty, and frequent reliance on food stamps on the other side (a large majority). According to a September 2014 study by the Harvard Business School, the widening gap between America’s wealthiest and its middle and lower classes is “unsustainable,” and “is unlikely to improve any time soon.” The nature of this latest recovery suggests that the final nail in the working-class coffin, whose construction has been underway since the birth of neoliberalism, has been secured into place. Despite desperate measures used to pump massive amounts of currency into the economy through QE, virtually none has trickled down to the 99 percent. It’s like déjà vu, all over again…and again…and again.

6 Comments

6 Comments


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[-] 7 points by elf3 (3721) 2 years ago

The economic deniers are rampant...Cheney is frequently still out there denying the reality most of us live in. How is he still alive anyway? Did monsanto figure out how to regenerate him...genetically modified heart? It is disgusting so many liars just plain gaslighting us all...we know the truth...we know they know the truth...they just want to keep their extreme wealth and will do anything to bury fact. Amazing how the public has been tamed and subdued for so long. It's about time we bite the cruel lion tamer and eat off the arm he whips us with.

[-] 2 points by flip (7101) 2 years ago

I like that idea. Biting the hand that whips us

[-] 4 points by turbocharger (1756) 2 years ago

Should of let those fuckin banks fail. That will be the tipping point that we look at in history as the moment when we officially became a fascist country.

9/11 set the stage, TBTF blew it up. Fuck.

[-] 5 points by flip (7101) 2 years ago

we should have nationalized the banks - obama was elected to make real change and fanned on it - as chomsky and nader predicted. he put the foxes in charge of the hen house

[-] 4 points by turbocharger (1756) 2 years ago

Im glad that the Bush regime got me involved in organizing, etc. If not, I would have never really had a reason to look deeper, and seen what a truly fucked up system this is.

Now I can live my life accordingly, knowing what is coming down the road and not getting caught up in all the nonsense. I still do some stuff with groups and some minor parties, but Im not looking to the government to make my life any easier.

[-] 2 points by flip (7101) 2 years ago

sometimes the gop is good for bringing the people to their senses. they helped get a black man elected president - a man who promised change we can believe in. and both houses of congress and then nothing! we bought a house in western ny. for the time when the shit comes down - what are you doing?