Monday, November 14, 2011

Middle Class Demise : The Progressive's Agenda

Interesting idea - what if there wasn't a middle class to pay all the bills? It's true the richest pay the lions share of the taxes, over 37% given they represent only 1% of the population, but the lower 47% don't pay anything.

So if the middles class melds into a lower class and pays no taxes and the upper classes send all there money over seas along with the high paying jobs, what or who's left to pay for all of the cool socialist programs the progressive Democrats have demanded in our country?

With no one to pay the bills, it doesn't take a rocket scientist to figure out the future of our country. And when all has failed, the Democrats will flee the scene blaming the Republicans for the mess, Democrats will be voted out of office, see this as 'taking the money and running', the Republicans will be left to fix the problems left behind as usual.

But this time, the damage is so great we might not be able to save our country from disaster.


What If Middle Class Jobs Disappear?
Source: Arnold Kling, "What If Middle-Class Jobs Disappear?" The American, November 3, 2011.

The economy is in a state of transition similar to its transformation in the 1930s. However, while the Great Depression was instrumental in the rise of the middle class, the current downturn has hit that class harder than most, says Arnold Kling, a member of the Financial Markets Working Group at the Mercatus Center of George Mason University.

Between 1930 and 1950, demand fell for human effort such as lifting, squeezing and hammering. Demand increased for workers who could read and follow directions. The evolutionary process eventually changed us from a nation of laborers to a nation of clerks.
The proportion of employment classified as "clerical and kindred workers" grew from 5.2 percent in 1910 to a peak of 19.3 percent in 1980.

Workers classified as laborers, other than farm or mine, peaked at 11.4 percent of the labor force in 1920 but were barely 6 percent by 1950 and less than 4 percent by 2000.
Farmers and farm laborers fell from 33 percent of the labor force in 1910 to less than 15 percent by 1950 and only 1.2 percent in 2000.

This sort of transformation is similar to what the American economy is undergoing now, as unprecedented gains in automated machines, information technology and personal computers have again revolutionized the needs of the economy. These trends serve to limit the availability of well-defined jobs. If a job can be characterized by a precise set of instructions, then that job is a candidate to be automated or outsourced to modestly educated workers in developing countries.

The result is the polarization of the American job market, under which wage and employment growth have both been lowest at the middle segment of the skill distribution. Wage improvements have tended to be concentrated at the high end, and employment gains have tended to be largest at the low end of the skill distribution.

In the United States, this polarization was exacerbated by the economic downturn, hitting mid-skilled workers the hardest. For example: Growth in employment in sales was 54 percent from 1979 to 1989 and 14 percent from 1989 to 1999. But it was just 4 percent from 1999 to 2007, and -7 percent from 2007 to 2009.

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