Labor Day Question: Are you Better off than You were in 1970?

Thoughts for a Labor Day in 2012:

The real question isn’t whether we are better off than we were four years ago. It takes a long time to recover from burst bubbles and near-depressions (the Japanese have still not recovered from their burst bubble of the early 1990s). The real question is whether the working and middle classes of the United States will go on allowing themselves to be taken advantage of by our super-rich, who are gathering to themselves more and more of the national income. The top 1% owned 25% of the privately held national wealth in the United States in the 1950s, but have 38% of it today.

In contrast, real wages per hour for the average worker in the United States, adjusted for inflation, peaked in 1970. We’re now down from that, with a generation and a half blocked from meaningful economic advancement.

h/t Faustian urGe.

But, you will say, the US is a much wealthier society now than it was in 1970 or 1990. Where has all the extra money generated by American labor and investment gone?

It has gone to the rich. Yes, folks, the rich are taking home a fifth of everything we make as a country each year, up from ten percent in 1970. We are 310 million people. About 3 million get a fifth of the annual income. Those 3 million people are 3 million Mitt Romneys. They want low taxes and they want to get rid of social security, medicare and Obamacare.

h/t Adviser Perspectives

See, in general, Who Rules America?.

The rich in this country now see an opportunity to take us back to the age of the robber barons– and get rid of all government programs for the middle classes and the workers and make us wait to age 70 (when most people will be more decrepit than they expect) to retire. Because the more of the national income they take home every year, the more politicians they can buy, and the more they can cut their taxes and shift the burden of road-building and other government services to the middle classes and workers.

It is a ratcheting process that is leaving the US an increasingly unequal society, and one in which hopes of upward mobility for ordinary people are increasingly crushed. Indeed, Europe (the “Old World”) now offers more opportunities for upward mobility and getting ahead than the United States.

The way to reverse this crisis of income stagnation is to restore rights to unionize and collectively bargain and to make the rich pay their fare share for government-provided infrastructure and for educating the work force they exploit.

Guess who will do the opposite if they win in November?