By now Conservatives are who are working so hard to stop discussion of rising economic inequality are clearly trying to hold back the tide. Every few weeks new evidence is published not only showing that inequality in our economy is at record levels, but that it's severely damaging to the long term prospects of American economic success. That's because the prospect of damage caused by 35 years of a Trickle Down, deregulatory, privatization agenda aren't merely hypothetical...it's something which is now historically documented.
The American middle class, long the most affluent in the world, has lost that distinction.
While the wealthiest Americans are outpacing many of their global peers, a New York Times analysis shows that across the lower- and middle-income tiers, citizens of other advanced countries have received considerably larger raises over the last three decades.
After-tax middle-class incomes in Canada — substantially behind in 2000 — now appear to be higher than in the United States. The poor in much of Europe earn more than poor Americans.
The differing, stronger results exhibited in Australia, Canada, and much of Europe backstop the danger of not implementing different policies. We are at risk of becoming a second rate economy, one with our best days behind us. The fact that other industrialized economies aren't seeing these same negative effects illustrates something basic that the Free Market Zealots don't want us to realize. The free market, contrary to their protestations, is not some inviolable thing with laws as strict and unalterable as Newtons Laws of Motion. The free market is nothing more than a framework of rules and laws within which the Capitalist economy operates. When it isn't working for the vast majority of us we have a right to change the rules.
“The idea that the median American has so much more income than the middle class in all other parts of the world is not true these days,” said Lawrence Katz, a Harvard economist who is not associated with LIS. “In 1960, we were massively richer than anyone else. In 1980, we were richer. In the 1990s, we were still richer.”
That is no longer the case, Professor Katz added.
Median per capita income was $18,700 in the United States in 2010 (which translates to about $75,000 for a family of four after taxes), up 20 percent since 1980 but virtually unchanged since 2000, after adjusting for inflation. The same measure, by comparison, rose about 20 percent in Britain between 2000 and 2010 and 14 percent in the Netherlands. Median income also rose 20 percent in Canada between 2000 and 2010, to the equivalent of $18,700.
The most recent year in the LIS analysis is 2010. But other income surveys, conducted by government agencies, suggest that since 2010 pay in Canada has risen faster than pay in the United States and is now most likely higher. Pay in several European countries has also risen faster since 2010 than it has in the United States.