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"Sorry" Doesn't Pay the Rent: The Murder of the American Middle Class

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"Sorry, we're cutting hours this week." These words are heard often in the retail industry, most often by those who already get less hours than are needed to be able to pay rent and eat. When you're only scheduled for 18 hours, losing 5 hours can, and often does, mean there won't be any groceries that week. Is it any wonder that the middle class is shrinking, and that more and more people are slipping into poverty? The murder of the middle class is continuing, and it has to stop.

Murder is a strong word, but in this case it's also an accurate one. The middle class isn't dying by accident, it's dying because of the greed of American corporations. It's being murdered by the greed that caused the collapse of the housing market and threw the country into a recession, the greed that outsources well-paying American jobs to countries where companies can pay workers a fraction of what a US worker would earn, the greed that replaces full-time jobs with part-time jobs, and the greed that pays a CEO hundreds of times what the lowest paid worker in the company earns.

Even worse, a corrupt Congress has become an accessory to that murder; refusing to pass jobs bills and pandering to the corporations that have stolen the American Dream. Bills that would encourage job creation are blocked, bills that would increase penalties for violations of H-1B visa rules die, and bills that would eliminate tax breaks for companies that offshore jobs and eliminate American workers are quietly killed; while bills to bail out the banks that destroyed the economy pass with little trouble.

In 2010, according to the Census Bureau, 6.7% of Americans were living on incomes equaling half of poverty level, a jump of 1.5% from the beginning of the housing collapse, and an increase of 3.4% over the low in 1976.  When you include everyone living at poverty level or below, the picture looks even worse, with 33.3% of all Americans living in poverty in 2010, increasing from 26.1% only 3 years earlier. How did we go from a quarter of Americans living in poverty to a third of Americans living in poverty? Where did all those extra poor people come from? They came from the middle class, and they got there because of corporate greed and partisan politics.

Too Big to Fail/Too Big to Jail -- The collapse of the housing market destroyed a huge percentage of the wealth of the middle class. Practically overnight, a family's net worth could drop by 50% or more, because most of a family's net worth was held in the form of their home. For those in underwater mortgages, the situation was even worse. The job losses and foreclosures that followed the crash left many families homeless and destitute, forced to move in with family members or live on the street.

On the other hand, those who caused the collapse were provided with government money to prevent the failure of their businesses. In addition, the government has refused to prosecute anyone for the violations of SEC rules, the predatory lending practices, or the illegal foreclosures that played such a large part in the recession.

Off-shoring, H-1B visas, and replacing full-time workers -- Off-shoring has moved thousands of jobs to other countries, where employees earn a fraction of what an American worker would be paid. In addition to these savings, companies are given a tax deduction to cover a portion of the cost of moving the jobs and equipment overseas.

The H-1B visa program provides even more profits for companies, allowing them to bring in foreign workers to fill high-tech positions in the US and displace even more US employees. These H-1B workers are paid less than American workers with the same skills, and are unable to change jobs because their visa is tied to the company they work for, turning them into no more than indentured servants who must do what they're told or risk being forced to return home when the company cancels their sponsorship. Abuses are rampant in the program, with companies claiming they can't find qualified Americans to fill the positions, while those Americans who are qualified desperately look for work in their field.

Lower unemployment rates and increasing job creation numbers make it appear that the economy is recovering, but that "recovery" is driven by part-time, low-wage jobs that have replaced the full-time jobs lost during the recession. In addition, those who are no longer actively looking for work aren't counted as unemployed, nor are the underemployed (those who want to work full-time, but have been forced to take part-time jobs to survive. This group includes approximately 8 million additional people, according to Jared Bernstein in this article.) The retail sector is one of the few areas that is adding jobs, and many of those companies have a policy of only hiring part-time employees to avoid the additional expense of providing the benefits required for full-time workers.

CEO Salaries -- CEO salaries have climbed, with an average increase of 13.9% in 2011 for CEOs of companies in the S&P 500; while the median income, relative to inflation, was lower in 2012 than it was in 1995. With CEO salaries averaging 380 times that of the average worker, and corporate profits higher (as a percentage of GDP) than at any time since records have been kept; company claims that they can't afford to add jobs or increase wages seem less than truthful.

As middle class Americans struggle or slide into poverty, Congress spends its time bickering over partisan issues and blocking bills that could lead to real economic recovery. The Stop Outsourcing and Create American Jobs Act of 2010 (H.R. 5622) was allowed to die in committee, and when reintroduced in 2011 as H.R. 3338, it met the same fate. The American Jobs Act of 2011 (S. 1549) has had no action taken since the second reading in September of 2011, and the Bring Jobs Home Act (S.2884) was referred to committee in May of 2012, with no further action taken.

Instead of encouraging job creation and retention; Congressional focus is on cutting government expenses by eliminating federal jobs and cutting Social Security, Medicare, and Food Stamps. Although this will reduce government spending in the short term, it will also reduce incomes even further and increase the unemployment rate again. Reduced income leads to less demand for products and services; reduced demand causes lower profits, even more job losses, lower tax revenues, and increased deficits; triggering another round of cuts and throwing the economy into a never-ending spiral of increasing poverty and unemployment.

It's time for Congress to stop playing politics with the lives of the people they're supposed to be serving. It's time for them to  do something that will create jobs and increase incomes before it's too late to save the middle class. If they don't, and soon, they will destroy this country.

Wendy is a writer, blogger, and health activist with interests in health, politics, women's issues, and all the areas where these topics intersect.

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While a polarized Congress plays politics with peo... by Wendy Burnett on Saturday, Nov 9, 2013 at 8:35:36 AM
Great article.  The Middle Class was purposef... by Mark Adams JD/MBA on Saturday, Nov 9, 2013 at 2:09:56 PM
Thanks Mark,Your comment points up the "blame the ... by Wendy Burnett on Sunday, Nov 10, 2013 at 9:21:38 AM
While our rulers decided to pay banksters to ... by Mark Adams JD/MBA on Sunday, Nov 10, 2013 at 1:45:50 PM
Furthermore, the "Affordable" "Care" Act is the ne... by Mark Adams JD/MBA on Saturday, Nov 9, 2013 at 2:32:40 PM
I'm reserving judgment on the ACA, since I haven't... by Wendy Burnett on Sunday, Nov 10, 2013 at 9:41:10 AM
Passing a law prohibiting denial of coverage for p... by Mark Adams JD/MBA on Sunday, Nov 10, 2013 at 1:23:46 PM
I think that biggest positive impact of the ACA wi... by Mark Adams JD/MBA on Sunday, Nov 10, 2013 at 1:31:56 PM
"I think that biggest positive impact of the ACA ... by Amy Schreiner on Saturday, Feb 1, 2014 at 12:32:57 PM
I've done the research..... and the monitoring of ... by MadAngel on Sunday, Nov 10, 2013 at 2:33:23 PM
A mixed economy with plenty of state-owned-enterpr... by Ernie Messerschmidt on Saturday, Nov 9, 2013 at 9:58:45 AM
Oh dear, not SOCIALISM!? (sarcasm)Seriously though... by Wendy Burnett on Saturday, Nov 9, 2013 at 10:13:21 AM
Corruption in Congress is the basic foundation for... by Patricia Gray on Saturday, Nov 9, 2013 at 10:08:02 AM
A corrupt Congress could not exist without greedy ... by Wendy Burnett on Sunday, Nov 10, 2013 at 10:51:56 AM
This is just making Big Government more rele... by Tony N on Saturday, Nov 9, 2013 at 10:28:28 AM
"... The effects of the 2007 depression are ... by Lance Brofman on Saturday, Nov 9, 2013 at 12:37:21 PM
Lance -"depression with benefits." I love this lin... by Wendy Burnett on Sunday, Nov 10, 2013 at 10:58:17 AM
Although, I'm against violence, "murder" of the mi... by Ed Lytwak on Saturday, Nov 9, 2013 at 10:37:35 AM
Class divisions were never a healthy situation in ... by Paul Repstock on Saturday, Nov 9, 2013 at 12:19:54 PM
A puzzling comment. A growing and vibrant middle c... by K V Ramani on Sunday, Nov 10, 2013 at 8:54:28 AM
Lets just say the middle class is less of a parasi... by Ed Lytwak on Sunday, Nov 10, 2013 at 10:00:00 AM
How would you know whether I accept the narrative ... by K V Ramani on Sunday, Nov 10, 2013 at 10:26:25 AM
I only you know what you say.   Sadly, i... by Ed Lytwak on Sunday, Nov 10, 2013 at 11:51:41 AM
KV; consider who it is that now comprizes the "Mid... by Paul Repstock on Sunday, Nov 10, 2013 at 2:44:21 PM
I take your point. But I said 'healthy' and 'vibr... by K V Ramani on Monday, Nov 11, 2013 at 7:45:24 AM
Well said! I suspect we can even expand upon Mr. ... by Paul Repstock on Tuesday, Nov 12, 2013 at 3:10:38 PM
Ed - Great point! Like the editor who flagged this... by Wendy Burnett on Sunday, Nov 10, 2013 at 11:07:15 AM
"... It is not just a coincidence that tax c... by Lance Brofman on Saturday, Nov 9, 2013 at 12:35:49 PM
Since all governments have the inherent power to c... by Mark Adams JD/MBA on Saturday, Nov 9, 2013 at 2:00:14 PM
The profits that companies made during the boom ye... by anna kakol on Sunday, Nov 10, 2013 at 3:24:42 AM
Exactly right Wendy,I would also include NAFTA, GA... by Mark Whittington on Saturday, Nov 9, 2013 at 1:06:57 PM
We could vote out the two major corporate politica... by Timothy Gatto on Saturday, Nov 9, 2013 at 2:15:13 PM
Since you are considering running for office in So... by Mark Adams JD/MBA on Saturday, Nov 9, 2013 at 2:39:20 PM
Thanks Mark -You make an excellent point about NAF... by Wendy Burnett on Sunday, Nov 10, 2013 at 12:14:44 PM
Wendy, succinctly put, accurate and poignant artic... by Paul from Potomac on Saturday, Nov 9, 2013 at 5:42:34 PM
Thanks so much Paul . . . The cries of the oppress... by Wendy Burnett on Sunday, Nov 10, 2013 at 12:54:41 PM
I just wanted to say "thank you" for all the comme... by Wendy Burnett on Tuesday, Nov 12, 2013 at 1:34:54 PM