In other words, not only is the middle class being squeezed by skyrocketing prices; the middle class is actually shrinking and poverty is increasing.
Meanwhile, the wealthiest people in our society have not had it so good since the 1920s.
Income inequality is on the rise. According to the latest figures from the IRS, the top 1 percent earned more income in 2005 than the bottom 50 percent, and the national share of income going to the wealthiest Americans is higher than at any time since 1929.
According to Forbes magazine, the collective net worth of the wealthiest 400 Americans increased by $290 billion last year to $1.54 trillion. In addition, the top one percent now owns more wealth than the bottom 90 percent.
What are the super-wealthy doing with their money?
As Robert Frank of The Wall Street Journal has pointed out in his book Richistan, the super wealthy, those worth between $100 million to $1 billion, spent an average of $182,000 on wrist watches; $311,000 on automobiles; $397,000 on jewelry; and $169,000 on spa services last year alone.
The middle class is shrinking, poverty is increasing, and the wealthiest Americans have not had it so good since the 1920s. That is the state of our economy.
I order to protect the interests of the sinking middle class the federal government needs a change in direction in almost every area of public policy.
We must start by passing an economic stimulus package as soon as possible.
Now, I am pleased that the leadership in the House was able to negotiate an economic stimulus package with the White House. I am also pleased that the Senate Finance Committee will be marking-up a different economic stimulus bill that improves the House version by including unemployment insurance; tax rebates to senior citizens; and equal rebates for Americans paying payroll taxes.
These are all good and important steps to be taking. I commend Majority Leader Reid, Finance Chairman Baucus and Speaker Pelosi for their outstanding work on this issue.
But, this package could and should be improved even more.
In my opinion, for an economic stimulus package to be most successful, we must do three things:
1) We must provide help to those most in need, particularly senior citizens on fixed incomes, low-income families with children and persons with disabilities;
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