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America’s Descent into Poverty
Paul Craig Roberts
The United States has collapsed economically, socially, politically, legally, constitutionally, and environmentally. The country that exists today is not even a shell of the country into which I was born. In this article I will deal with America’s economic collapse. In subsequent articles, i will deal with other aspects of American collapse. Economically, America has descended into poverty. As Peter Edelman says, “Low-wage work is pandemic.” Today in “freedom and democracy” America, “the world’s only superpower,” one fourth of the work force is employed in jobs that pay less than $22,000, the poverty line for a family of four. Some of these lowly-paid persons are young college graduates, burdened by education loans, who share housing with three or four others in the same desperate situation. Other of these persons are single parents only one medical problem or lost job away from homelessness. Others might be Ph.D.s teaching at universities as adjunct professors for $10,000 per year or less. Education is still touted as the way out of poverty, but increasingly is a path into poverty or into enlistments into the military services. Edelman, who studies these issues, reports that 20.5 million Americans have incomes less than $9,500 per year, which is half of the poverty definition for a family of three. There are six million Americans whose only income is food stamps. That means that there are six million Americans who live on the streets or under bridges or in the homes of relatives or friends. Hard-hearted Republicans continue to rail at welfare, but Edelman says, “basically welfare is gone.” In my opinion as an economist, the official poverty line is long out of date. The prospect of three people living on $19,000 per year is farfetched. Considering the prices of rent, electricity, water, bread and fast food, one person cannot live in the US on $6,333.33 per year. In Thailand, perhaps, until the dollar collapses, it might be done, but not in the US. As Dan Ariely (Duke University) and Mike Norton (Harvard University) have shown empirically, 40% of the US population, the 40% less well off, own 0.3%, that is, three-tenths of one percent, of America’s personal wealth. Who owns the other 99.7%? The top 20% have 84% of the country’s wealth. Those Americans in the third and fourth quintiles–essentially America’s middle class–have only 15.7% of the nation’s wealth. Such an unequal distribution of income is unprecedented in the economically developed world. In my day, confronted with such disparity in the distribution of income and wealth, a disparity that obviously poses a dramatic problem for economic policy, political stability, and the macro management of the economy, Democrats would have demanded corrections, and Republicans would have reluctantly agreed. But not today. Both political parties whore for money. The Republicans believe that the suffering of poor Americans is not helping the rich enough. Paul Ryan and Mitt Romney are committed to abolishing every program that addresses needs of what Republicans deride as “useless eaters.” The “useless eaters” are the working poor and the former middle class whose jobs were offshored so that corporate executives could receive multi-millions of dollars in performance pay compensation and their shareholders could make millions of dollars on capital gains. While a handful of executives enjoy yachts and Playboy playmates, tens of millions of Americans barely get by. In political propaganda, the “useless eaters” are not merely a burden on society and the rich. They are leeches who force honest taxpayers to pay for their many hours of comfortable leisure enjoying life, watching sports events, and fishing in trout streams, while they push around their belongings in grocery baskets or sell their bodies for the next MacDonald burger. The concentration of wealth and power in the US today is far beyond anything my graduate economic professors could image in the 1960s. At four of the world’s best universities that I attended, the opinion was that competition in the free market would prevent great disparities in the distribution of income and wealth. As I was to learn, this belief was based on an ideology, not on reality. Congress, acting on this erroneous belief in free market perfection, deregulated the US economy in order to create a free market. The immediate consequence was resort to every previous illegal action to monopolize, to commit financial and other fraud, to destroy the productive basis of American consumer incomes, and to redirect income and wealth to the one percent. The “democratic” Clinton administration, like the Bush and Obama administrations, was suborned by free market ideology. The Clinton sell-outs to Big Money essentially abolished Aid to Families with Dependent Children. But this sell-out of struggling Americans was not enough to satisfy the Republican Party. Mitt Romney and Paul Ryan want to cut or abolish every program that cushions poverty-stricken Americans from starvation and homelessness. Republicans claim that the only reason Americans are in need is because the government uses taxpayers’ money to subsidize Americans who are unwilling to work. As Republicans see it, while we hard-workers sacrifice our leisure and time with our families, the welfare rabble enjoy the leisure that our tax dollars provide them. This cock-eyed belief, on top of corporate CEOs maximizing their incomes by offshoring the middle class jobs of millions of Americans, has left Americans in poverty and cities, counties, states, and the federal government without a tax base, resulting in bankruptcies at the state and local level and massive budget deficits at the federal level that threaten the value of the dollar and its role as reserve currency. The economic destruction of America benefitted the mega-rich with multi-billions of dollars with which to enjoy life and its high-priced accompaniments wherever the mega-rich wish. Meanwhile, away from the French Rivera, Homeland Security is collecting sufficient ammunition to keep dispossessed Americans under control. Delivered by The Daily Sheeple Contributed by Paul Craig Roberts of Institute for Political Economy. About Dr. Paul Craig Roberts Paul Craig Roberts was Assistant Secretary of the Treasury for Economic Policy and associate editor of the Wall Street Journal. He was columnist for Business Week, Scripps Howard News Service, and Creators Syndicate. He has had many university appointments. His internet columns have attracted a worldwide following. Visit his web site at the Institute for Political Economy. This article has been posted with permission from Dr. Paul Craig Roberts. Copyright Paul Craig Roberts 2012. Please share: Spread the word to sheeple far and wide
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v.8
Sir
I have enjoyed your opinions before and respect your credentials but…
How can you write an article like this without even mentioning the current administration?
The Obama administration is allowing lawlessness in the financial markets, open borders with Mexico, bank fraud, Uncontrolled spending, and somehow they get a pass?
Obama’s unconstitutional executive orders and billion rounds of ammo are far more likely to impact the lives of the “useless eaters” than the current republican candidate and his vp choice.
ROGER THAT Montana Rancher. Seems everyone gives the sacred Person of Color a pass no matter how egregious his assaults on our constitution and way of life are.
Romney-Ryan do not think they are “useless eaters” as you so put it. They very well know what a bunch of lazy, no good group of people that are out there living off of welfare just because they can. Osamabama has created a welfare state that needs to be cut off so they will get off their lazy arses and get a job. There “are” signs in lots of windows seeking employees but when you dont have to work what is the point. There is also a generation of parents out there setting a very bad example for their children who will in turn fell its their “right” to live off of the government. We have a president who is nothing more than a community organizer that shows people how to live off the government. They have no honor, no integrity, therefore they are.
You should try to support your family on some of the jobs with hep wanted signs. Most are shams to collect data or they will hire you for 5, 10 hours a week. How much spending or growth will the jobs provide the economy.
The problem is not lack of menial jobs, but low wages and low hours.
I see the same.help wanted signs for years, corporations who want to scan your data to see if they can make a buck or 2 off of a tax break.
You are more likely to get the job if you are on a gov. Welfare. It will not lower the welfare or the medicaid paid to the candidate.
Standing in the lobby of a local ‘Quikie-Lube’ waiting on my vehicle, I had to listen to a loud black woman on her cell phone. She was telling the person she was conversing with on her phone that her roommate had just kicked her out of her apartment and she did not want to have to get a job because she would “lose her entitlements”. Yes, that is the exact words she used – entitlements. I couldn’t believe she would even say something like that out loud for everyone to hear. But I guess that was nothing unusual to her. Blows me away how some people think they are ‘entitled’ to live off of those who work for a living, but unfortunately, they are all around us. What a shameful society we’ve become. Work here in Texas is plentiful. If you’re of working age and don’t have a job in this state, it’s because you are a worthless lazy-ass !!
This conduct/conversation is in fact NORMAL for black people. When questioning a Somali black muslim at the immigration offices (according to http://www.refugeeresettlementwatch.com) when asked why he wanted to come to American, his reply was, “I want to live where poor people are fat” and that just about sums up Po blacks in America don’t ya think? They always seem to have $5 to $7 dollar a pack of cigarettes too on the console of their Escalades.
Wonder why if this person did not want to work she didnt just look for a place to live. Yep heard plenty of low wage jobs in the right to slave states. No regulations, no health benefits. No state taxes so where does the welfare money come from?
One way or the other tax dollars are squandered. The people would be ashamed if jobs paid well. No moron would take welfare if they made more working. Are corporations ashamed they call themselves free market and take it. Somehow I do not see them losing sleep.
I’ll try to put it in perspective why this woman didn’t want to have to get a job – because here in West Texas, there is an oil boom going on. Rent here is not cheap because of the massive shortage of housing. The woman would have to get a job in order to pay her rent/utilities/groceries because here the “intitlements” aren’t enough to go around. It was clear to me that because she had a nice newer model car, an iPhone, and could afford a $50 oil change, that she had been “sponging” off of her roommate (probably the reason she was kicked out). Skip’s comments nailed it right on the head. I see too many Escolades, Hummers, and Beemers driven by people who can barely afford to pay for the gas that goes in them. As for jobs Evie, you have it all wrong in this geographic (Texas). Very good paying jobs with benefits are plentiful. So plentiful, that we cannot find enough people to fill the lower waged jobs at restaurants, retail, etc. . . In fact, the so called lower paying jobs as mentioned above pay very very well, because the places these people work have to pay them well to keep them from taking a higher paying oil field job. So Evie, I’ll say it once again. If you’re of working age and don’t have a job in this great state of Texas, it’s because you are a worthless lazy-ass!!