Middle Class Destroyed: 50 Percent Of All American Workers Make Less Than $30,533 A Year

The middle class in America has been declining for decades, and we continue to get even more evidence of the catastrophic damage that has already been done.  According to the Social Security Administration, the median yearly wage in the United States is just $30,533 at this point.  That means 50 percent of all American workers make at least that much per year, but that also means that 50 percent of all American workers make that much or less per year.  When you divide $30,533 by 12, you get a median monthly wage of just over $2,500.  But of course nobody can provide a middle class standard of living for a family of four for just $2,500 a month, and we will discuss this further below.  So in most households at least two people are working, and in many cases multiple jobs are being taken on by a single individual in a desperate attempt to make ends meet.  The American people are working harder than ever, and yet the middle class just continues to erode.

The deeper we dig into the numbers provided by the Social Security Administration, the more depressing they become.  Here are just a few examples from their official website

-34 percent of all American workers made less than $20,000 last year.

-48 percent of all American workers made less than $30,000 last year.

-59 percent of all American workers made less than $40,000 last year.

-68 percent of all American workers made less than $50,000 last year.

At this moment, the federal poverty level for a family of five is $29,420, and yet about half the workers in the entire country don’t even make that much on a yearly basis.

So can someone please explain to me again why people are saying that the economy is “doing well”?

Many will point to how well the stock market has been doing, but the stock market has not been an accurate barometer for the overall economy in a very, very long time.

And the stock market has already fallen nearly 1,500 points since the beginning of the month.  The bull market appears to be over and the bears are licking their chops.

No matter who has been in the White House, and no matter which political party has controlled Congress, the U.S. middle class has been systematically eviscerated year after year.  Many that used to be thriving may still even call themselves “middle class”, but that doesn’t make it true.

You would think that someone making “the median income” in a country as wealthy as the United States would be doing quite well.  But the truth is that $2,500 a month won’t get you very far these days.

First of all, your family is going to need somewhere to live.  Especially on the east and west coasts, it is really hard to find something habitable for under $1,000 a month in 2018.  If you live in the middle of the country or in a rural area, housing prices are significantly cheaper.  But for the vast majority of us, let’s assume a minimum of $1,000 a month for housing costs.

Secondly, you will also need to pay your utility bills and other home-related expenses.  These costs include power, water, phone, television, Internet, etc.  I will be extremely conservative and estimate that this total will be about $300 a month.

Thirdly, each income earner will need a vehicle in order to get to work.  In this example we will assume one income earner and a car payment of just $200 a month.

So now we are already up to $1,500 a month.  The money is running out fast.

Next, insurance bills will have to be paid.  Health insurance premiums have gotten ridiculously expensive in recent years, and many family plans are now well over $1,000 a month.  But for this example let’s assume a health insurance payment of just $450 a month and a car insurance payment of just $50 a month.

Of course your family will have to eat, and I don’t know anyone that can feed a family of four for just $500 a month, but let’s go with that number.

So now we have already spent the entire $2,500, and we don’t have a single penny left over for anything else.

But wait, we didn’t even account for taxes yet.  When you deduct taxes, our fictional family of four is well into the red every month and will need plenty of government assistance.

This is life in America today, and it isn’t pretty.

In his most recent article, Charles Hugh Smith estimated that an income of at least $106,000 is required to maintain a middle class lifestyle in America today.  That estimate may be a bit high, but not by too much.

Yes, there is a very limited sliver of the population that has been doing well in recent years, but most of the country continues to barely scrape by from month to month.  Out in California, Silicon Valley has generated quite a few millionaires, but the state also has the highest poverty in the entire nation.  For every Silicon Valley millionaire, there are thousands upon thousands of poor people living in towns such as Huron, California

Nearly 40 percent of Huron residents — and almost half of all children — live below the poverty line, according to the U.S. Census Bureau. That’s more than double the statewide rate of 19 percent reported last month, which is the highest in the U.S. The national average is 12.3 percent.

“We’re in the Appalachians of the West,” Mayor Rey Leon said. “I don’t think enough urgency is being taken to resolve a problem that has existed for way too long.”

Multiple families and boarders pack rundown homes, only about a quarter of residents have high school diplomas and most lack adequate health care in an area plagued with diabetes and high asthma rates in one the nation’s most polluted air basins.

One recent study found that the gap between the wealthy and the poor is the largest that it has been since the 1920s, and America’s once thriving middle class is evaporating right in front of our eyes.

We could have made much different choices as a society, but we didn’t, and now we are going to have a great price to pay for our foolishness…

About the author: Michael Snyder is a nationally syndicated writer, media personality and political activist. He is publisher of The Most Important News and the author of four books including The Beginning Of The End and Living A Life That Really Matters.

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Living In A Van Down By The River – Time To Face The True State Of The Middle Class In America

van-public-domainDo you remember the old Saturday Night Live sketches in which comedian Chris Farley portrayed a motivational speaker that lived in a van down by the river?  Unfortunately, this is becoming a reality for way too many Americans.  As the middle class has shrunk and the cost of living has increased, a lot of people have decided to quite literally “live on the road”.  Whether it is a car, a truck, a van, a bus or an RV, an increasing number of Americans are using their vehicles as their homes.  Just recently, someone that I know took a trip down the west coast of the United States and stayed at a number of campgrounds along the way.  What she discovered was that a lot of people were actually living at these campgrounds.  Of course there are some that actually prefer that lifestyle, but many others are doing it out of necessity.

Earlier this week, Circa.com posted a story about “the van life”.  One of the individuals that they featured was a recent graduate of the University of Southern California named Stephen Hutchins.  Without much of an income at the moment, he decided that the best way to cut expenses was to live in his van

“The main expenses are insurance for the van, which is like $60 a month,” said Hutchins. “Then, I have a storage unit for like $60.”

That puts his monthly rent at $120. The van cost him just $125 at an auction.

Living in a van is certainly not the most comfortable way to go, and many of you are probably wondering how he performs basic tasks such as cooking and bathing.  Well, it turns out that he makes extensive use of public facilities

He showers at the gym, cooks on a portable stove on a sidewalk (he stores his butane at his friends’ place nearby) and uses wifi at nearby coffeeshops.

For a while such a lifestyle may seem like “an adventure”, but after a while it will start to get really old.  And not a lot of women are going to be excited about dating a man that lives in a van, and you certainly wouldn’t want to raise a family in a vehicle.

Sadly, just like during the last economic crisis many Americans are getting to the point where staying in their homes may not be an option.  Just check out the following excerpt from a recent New York Post article entitled “The terrifying signs of a looming housing crisis“…

The number of New Yorkers applying for emergency grants to stay in their homes is skyrocketing — as the number of people staying in homeless shelters reached an all-time high last weekend, records show.

There were 82,306 applications for one-time emergency grants to prevent evictions in fiscal 2016, up 26 percent from 65,138 requests the previous year, according to the Mayor’s Management Report.

I put a couple of phrases in that quote in bold because I really wanted you to notice a couple of things.

First of all, it is very alarming to hear that the number of New Yorkers staying in homeless shelters “reached an all-time high” last weekend.  I thought that we were supposed to be in an “economic recovery”, but apparently things in New York are rapidly getting worse.

Secondly, the fact that applications for emergency grants are up 26 percent compared to last year is another indication of how rough things are right now for average families in New York.  We all remember what happened when millions of families lost their homes to foreclosure across the nation during the last financial crisis, and nobody should want to see a repeat of that any time soon.

During this election season, Barack Obama and Hillary Clinton would like all of us to believe that the economy is doing just fine, but that is not true at all.  Even using the doctored numbers that the government gives us, Barack Obama is solidly on track to be the only president in all of U.S. history to never have a single year of 3 percent GDP growth, and he has had two terms to try to do that.

Gallup CEO Jim Clifton is also quite skeptical of this “economic recovery”, and he recently authored an article on this subject that is receiving a tremendous amount of attention.  The following is how that article begins

I’ve been reading a lot about a “recovering” economy. It was even trumpeted on Page 1 of The New York Times and Financial Times last week.

I don’t think it’s true.

The percentage of Americans who say they are in the middle or upper-middle class has fallen 10 percentage points, from a 61% average between 2000 and 2008 to 51% today.

Other surveys have found that it is even worse than that.

For example, a Pew Research Center study from the end of last year discovered that the middle class in America has now actually become a minority in this country.

Here are some other numbers that Clifton included in his article

  1. According to the U.S. Bureau of Labor Statistics, the percentage of the total U.S. adult population that has a full-time job has been hovering around 48% since 2010this is the lowest full-time employment level since 1983.
  2. The number of publicly listed companies trading on U.S. exchanges has been cut almost in half in the past 20 years — from about 7,300 to 3,700. Because firms can’t grow organically — that is, build more business from new and existing customers — they give up and pay high prices to acquire their competitors, thus drastically shrinking the number of U.S. public companies. This seriously contributes to the massive loss of U.S. middle-class jobs.
  3. New business startups are at historical lows. Americans have stopped starting businesses. And the businesses that do start are growing at historically slow rates.

Once upon a time, America was the land of opportunity.

We were the place where anything was possible and where entrepreneurship was greatly encouraged.

But today we strangle small businesses to death with rules, regulations, red tape and taxes.

If we want a stronger middle class, we need to create a much better environment for the creation of small businesses.  Small business ownership often lifts individuals into the middle class, and small businesses have traditionally been the primary engine for the growth of good jobs in this country.

If the middle class continues to shrink, poverty will continue to rise.  Previously I have written about how the number of homeless children in the United States has shot up by 60 percent since the last economic crisis, and Poverty USA claims that a staggering 1.6 million children slept either in a homeless shelter or in some other form of emergency housing during 2015.

If you will be sleeping in a warm bed in a comfortable home tonight, you should be thankful.  An increasing number of Americans are sleeping in tent cities, in their vehicles or on the streets.  These hurting people deserve our love, our compassion and our prayers.