The Shift In The Economy
Many of the jobs in President Bush's "recovery" are low-wage, low-benefit service and retail jobs. The overall growth in jobs masks a harsher reality for families trying to maintain or build a middle class standard of living. Key among them: debt coupled with paycheck paralysis. Most people coming out of college with or without a degree are starting life off with about $20,000 in debt trying to get a degree. Then they try to support themselves on low wages after getting out of school. A generation ago finishing high school was what was needed to get a job and to have a reasonable amount of security.
Now what is needed is a university degree and not just any degree, look at all people working in low class jobs with an arts degree. In the last 30 years compensation for somebody with a university degree has actually decreased when adjusted for inflation. Personal bankruptcy filings nationwide last year exceeded 2 million, the highest annual level on record. There were significant increases in consumer bankruptcy filings in every region. The total of 2,043,535 was up 32 percent over the 1,552,967 filed in 2004.
That translates to one in every 53 households filing bankruptcy petitions. So are these 2 million people Scofflaws? Credit counselors say the debtors coming to their offices can’t afford to pay basic living expenses or make even minimal payments toward their debts. Corporate profits have reached record highs. People are working longer for the same or a lesser amount of money. During the period from November 2003 to March 2004 - when job growth was increasing - average hourly real wages actually fell by 1 percent. Companies are reducing health care benefits and are declaring bankruptcy to get rid of pension liabilities to their employees. Yes, but there are Tax Cuts. Tax Cuts have to be paid for by somebody at some point in time. If the tax cuts were financed largely or entirely through spending cuts or: if the tax cuts were financed through a combination of spending cuts and progressive tax increases this is what is projected by experts: The net result seems to be net tax cuts for about 20-25 percent of households, financed by net tax increases or benefit reductions for the remaining 75-80 percent of the population. So 75% to 80 % of Taxpayers are going to be worse off with tax cuts.
The "losers" are going to be low- and middle-income wage earners. The trade deficit for last year is estimated to have swollen to another record high, above $700 billion, increasing America's indebtedness to foreigners. At some point in time these foreigners are going to want their money back. Then what?.
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