The Death of the Virtual Economy and the Middle Class

[No Exit]

Down the Rabbit Hole of Supply Side Economics:
The Death of the Virtual Economy and the Middle Class

by John M. Kelley

www.dissidentvoice.org

October 11, 2005

While politicians on both sides of the aisle refuse to talk about the war on the working class by the Bush administration, the increasing cliff edge disparity of wealth distribution in America is creeping precariously closer for the middle class. The grinding suffocation of poverty, always clear to the people on the bottom of our economy, is coming into view for a lot of folks who never suspected it would happen to them. Long sold a bill of goods that the poor were victims of their own bad judgment, middle class whites displaced by economic policies will soon be acutely aware of the personal impact of economic policy. Changes in several measurements reveal what many poor people have known for a long time: that there are severe class divides with high fences in between.

Rapper Kanye West was wrong when he said this President doesn’t care about black people. Bush doesn’t care about the poor or middle class of any color. This is not a matter of being overlooked; it is a purposeful policy. The administration’s policy in dealing with Hurricane Katrina is a perfect example. First Bush puts incompetent contributor cronies in charge of a vital government agency, robs its budget to expand its police state controls and then fails miserably at execution of its mission. After the disaster, they blames others, exploits the tragedy by giving no-bid, high profit handouts to campaign contributors, erasing regulations, cutting requirements to pay the prevailing wage and allowing contractors a free hand to hire illegal aliens. To pay for what has become the Katrina Campaign Payback Machine, he sends the bill to poor people by proposing cutting food stamps, Medicaid, Medicare, higher education and teacher preparation.

(snip)

After middle class citizens fall from grace they will discover the feeling a lot of poor people already have: the boot on the neck that keeps you down. It costs a lot of money to be poor. Paying to get your check cashed or your bills paid, buying in small quantities at higher prices, living in drafty houses, having a beater car if you have one at all, getting stopped and fined by the cops more often, having to rent to own at 450% interest, being forced to take out a payday loan at 750% interest, not being able to afford a dentist or doctor and missing more work, if you can find a job, because of it. The poor pay more for just about everything.

(snip)

The promise of Jude Wanniski’s supply side economics is producing the destruction of the middle class and the grinding down of the poor in America. The theory is that if you cut taxes and give more money to the rich they will invest it creating more jobs. The problem is that is exactly what they are doing, but the jobs are in Honduras, Bangladesh, China and India where that capital will produce a bigger profit margin by exploiting even poorer people.


http://www.dissidentvoice.org/Oct05/Kelley1011.htm

[raccoon]

1. Good article.

… 5.4 million working class families fell below the poverty level of $19,000 for a family of four in the last four years. That standard hasn’t been adjusted in so long that it is estimated to be only half of what is needed to meet basic needs.

This standard for poverty is so ridiculously low. I don’t see how four people could even SCRAPE BY, even in a relatively low-cost area. Unless they were living in a house that belonged to a family member or something similar.

After middle class citizens fall from grace they will discover the feeling a lot of poor people already have: the boot on the neck that keeps you down. It costs a lot of money to be poor. Paying to get your check cashed or your bills paid, buying in small quantities at higher prices, living in drafty houses, having a beater car if you have one at all, getting stopped and fined by the cops more often… The poor pay more for just about everything.

Yes, and having a “beater car” costs you more money too. The car breaks down on the interstate when you’re going to visit a relative 100 miles away. You have to get it towed to the nearest garage, wherever that is. You have to pay for getting it fixed. You missed a day or so of work because of this, and since you only get paid for hours actually worked (no leave time), that comes out of your pocket. And so on…

Once down most people stay there. The American myth of lifting one’s own bootstraps is a lie….Class mobility is another myth.

UPWARD class mobility is a myth. DOWNWARD class mobility is doing quite well, thank you.

[tk2kewl]

2. k&r

[applegrove]

3. Thanks for posting. The whole site & links is something I will bookmark.

Yes - it does seem that price falls belong only to the poor & middle class. The rich sacrifice nothing to fight the inflation of oil. For sure the prices of civil goods are coming down a bit due to China and that helps a bit to offset the lower wages workers face. For sure - world competition means that we must expect less luxury in middle class. But why is it only the middle class and the poor that pay that price.

How come the rich in the USA are richer than they have ever been. And how can we wake these people up to the harm their 'perpetual markets/perpetual war' policies are doing to everyone.