Global Economy

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[size="6"]THE MIDDLE CLASS IS FINISHED, OVER, KUPUT!

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In the history of the world, a large middle class was a freak post WW2 phenomenon and the world is regressing to the norm. There are many reasons for the start of the middle class bubble and at least one good reason for its demise.



For the first 30 years after WW2 the working class, mostly through union contracts, received about 80% of the net increase from increased productivity. In the last 30 years our owners aka employers aka international corporations have kept 80% of the net increase.



Why should the international corporations resume giving profits to their employees without world wide labor union pressure? Why can't world wide unemployment stabilize at 10% or worse?



Does anyone think that Henry Ford's claim that he paid high wages so that his employees could buy cars still hold water? Rolls Royce/Bentley cars have been built for close to 100 years. What do their employees drive?



http://www.alternet.org/economy/147113/w...oney_again



The recession was a carefully orchestrated plan with the same objectives as the one from the 1930's. Which is to bring the middle class to their knees, cause small/medium sized banks and companies to go bankrupt, then buy out everything for a penny on a dollar and concentrate wealth in the hands of fewer and fewer international bankers. They did it in the past, and will continue doing it as long as the fractional banking system and the Federal Reserve exist. The reduction of the middle class is a desired result of recession.



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We Won't Climb Out of the Great Recession Until the Middle Class Has Money Again

We need a new New Deal that will bolster America’s floundering middle class.[/size]

June 4, 2010 |

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We’re falling into a double-dip recession.



The Labor Department reports this morning that the private sector added a measly 41,000 net new jobs in May. (The vast bulk of new jobs in May were temporary government Census workers.) But at least 100,000 new jobs are needed every month just to keep up with population growth.



In other words, the labor market continues to deteriorate.



The average length of unemployment continues to rise – now up to 34.4 weeks (up from 33 weeks in April). That’s another record.



More Americans are too discouraged to look for a job than last year at this time (1.1 million in May, an increase of 291,000 from a year earlier.)



Of the small number of jobs created by the private sector in May, many came from temporary help services.



Which is one reason why the median wage continues to drop.



Why are we having such a hard time getting free of the Great Recession? Because consumers, who constitute 70 percent of the economy, don’t have the dough. They can’t any longer treat their homes as ATMs, as they did before the Great Recession.



Businesses won’t rehire if there’s not enough demand for their goods and services.



The only reason the economy isn’t in a double-dip recession already is because of three temporary boosts: the federal stimulus (of which 75 percent has been spent), near-zero interest rates (which can’t continue much longer without igniting speculative bubbles), and replacements (consumers have had to replace worn-out cars and appliances, and businesses had to replace worn-down inventories). Oh, and, yes, all those Census workers (who will be out on their ears in a month or so).



But all these boosts will end soon. Then we’re in the dip.



Retail sales are already down.



So what’s the answer? In the short term, more stimulus – especially extended unemployment benefits and aid to state and local governments that are whacking schools and social services because they can’t run deficits.



But the deficit crazies in the Senate, who can’t seem to differentiate between short-term stimulus (necessary) and long-term debt (bad) last week shot it down.



In the longer term, we need a new New Deal that will bolster America’s floundering middle class.