For most of the past 70 years, the U.S. economy has grown at a steady clip, generating perpetually higher incomes and wealth for American households. But since 2000, the story is starkly different. The past decade was the worst for the U.S. economy in modern times, a sharp reversal from a long period of prosperity that is leading economists and policymakers to fundamentally rethink the underpinnings of the nation’s growth.
It was, according to a wide range of data, a lost decade for American workers. The decade began in a moment of triumphalism – there was a current of thought among economists in 1999 that recessions were a thing of the past. By the end, there were two, bookends to a debt-driven expansion that was neither robust nor sustainable. There has been zero net job creation since December 1999. No previous decade going back to the 1940s had job growth of less than 20 percent. Economic output rose at its slowest rate of any decade since the 1930s as well.
Middle-income households made less in 2008, when adjusted for inflation, than they did in 1999 — and the number is sure to have declined further during a difficult 2009. The Aughts were the first decade of falling median incomes since figures were first compiled in the 1960s. And the net worth of American households – the value of their houses, retirement funds and other assets minus debts – has also declined when adjusted for inflation, compared with sharp gains in every previous decade since data were initially collected in the 1950s.
"This was the first business cycle where a working-age household ended up worse at the end of it than the beginning, and this in spite of substantial growth in productivity, which should have been able to improve everyone’s well-being," said Lawrence Mishel, president of the Economic Policy Institute, a liberal think tank…
Rather than trot out my endless series of graphs, I’ll just say it in words. Our frontline issues are job creation, population control, and reduced energy consumption. If we have to socialize temporarily in the service of any one of them, so be it. The free market economy model thas been out of hand and the excesses of the so-called financial industry have painted us into a corner for the moment. Abortion and birth control have moved from the realm of "reproductive freedom" into the area of "economic and environmental necessity." Reducing energy consumption is no longer a tree-hugger, granola set issue, it too has become "economic and environmental necessity." And job creation trumps any political principles or theory. Without jobs – we return to the early 1930’s world of hardship and depression.
It is so frustrating that all this is known, backed by clear facts, and yet it falls mostly on deaf ears. Where are the bold journalists and pundits who will keep shouting about this until people start to listen?
I’m sure Obama is aware of this. But he’s focused on getting the essentials done with the slim majority we gave him to pass legislation.
We need someone who will not shut up until people listen. Just as we have needed Barbara Jordan on the Judiciary Committee to thunder in god’s tones about the Constitution, we need Edward R. Murrow and Walter Cronkite to speak the truth on the airwaves.
Thanks for doing your part, Mickey.
[…] January 2, 2010 For most of the past 70 years, the U.S. economy has grown at a steady clip, generating perpetually higher incomes and wealth for American households. But since 2000, the story is starkly different. The past decade was the worst for the U.S. economy in modern times, a sharp reversal from a long period of prosperity that is leading economists and policymakers to fundamentally rethink the underpinnings of the nation’s growth. Thanks Bush-Cheney. 1 Boring Old Man » the 00’s… […]
I just read crooksandliars blog and I see 1boringoldman.com. You’re famous.
Good post, but I take exception to Neil Irwin’s first statement. For most of the past 70 years, productivity has increased, yes, but the majority of American households’ income and wealth has not – the gains have largely been profit to the corporate and investment class. See Elizabeth Warren’s “America without a Middle-Class” http://www.huffingtonpost.com/elizabeth-warren/america-without-a-middle_b_377829.html and Richard Wolff’s “Capitalism Hits the Fan” http://www.youtube.com/watch?v=7ojkoBB07ps
We are indeed in deep trouble, so why have we not taken to the streets in protest?
“we return to the early 1930’s world of hardship and depression”
that’s exactly what the powers that be want. we are being driven into dark ages poverty. and to think that we all are gonna have some wonderful epiphany where we all realize the error of our ways is foolish and to think that someone like Obama is gonna be that savior is foolish as well. Usually, throughout human history the only way real change happened was through some dramatic world changing event; i.e. a war, meteor strike, tidal wave. that explains too why those movies are so popular right now.
[…] Posted by odanny Thanks Bush-Cheney. 1 Boring Old Man » the 00’s… Yeah, this could possibly have been impacted by Bill Clinton passing NAFTA now could it? Or the […]
We did not get to have the 00’s without having set it up for us. In 1996, personal income for the 99% fell below personal consumption for the first time since 1941.
I give you my charts: http://angrybear.blogspot.com/2007/12/its-big-one-honey-i-know-it.html
During Clinton’s terms, the share of income to the top 1% rose 6 points. It only rose 4 points for the 12 years of Reagan/Bush. Prior to 1976, GDP rose before any sector’s income doubled. GDP doubled 5 times, 99%’ers doubled 4 times, 1%er’s doubled 3 times. Since 1976, the top 1% has doubled 4 times, the GDP doubled 3 times and the 99%’ers doubled twice. The rich have taken money out faster than the economy has created it.
http://angrybear.blogspot.com/2008/12/income-distribution-and-gdp-it-matters.html
The 80’s were the beginning. The 90’s were the acceleration. The 00’s were the explosion.
What we got for the 00’s began around 1976 and accelerated once Reagan came in.
The statements by Sally D and Dan are accurate. A big source of the stagnation is the continued dismemberment of the industrial/manufacturing sector, shipping of jobs overseas to countries that look the other way on human rights, facilitated by an elite ideology that wants to dismantle the working (middle) class.
Coffee Milk Toast Jam
10 years ago, I would have dismissed your comment. Now, I think it’s dead on, particularly – “facilitated by an elite ideology that wants to dismantle the working (middle) class.”
How did that happen?