Joe Biden went to Costco to fight for them. Obama visited a toy factory to speak out in support of them and House Minority Whip Steny Hoyer referred to them as hostages, kidnapped by the Republicans’ demands.
Who am I talking about? The middle-classes.
It seems they can’t fight their own battles anymore and instead represent a much favored toy in this fiscal tug-of-war.
Why are they being fought over? Because they’re the 90% who will suffer if the Jan. 1 tax increases are allowed to go ahead. They’re the ones with the most to lose; too rich to sit in the governments’ cotton-wool cradle, but too poor to flee the country when it all goes kaput. They’re sitting ducks, who haven’t quite clicked onto who and what really caused the financial crisis.
They suffered the most in the financial crisis, thanks to the housing crisis and high levels of personal debt. Between 2001 and 2007, according to a study by Edward N. Wolff, the middle classes owed 61 cents for each dollar of their wealth, a 50% increase from 2001.
Yet they still believe in the American Dream, fed to them straight from Washington.
They’re following a dream sold to them long before they were born, believing they can better themselves and their democratic country and elected government will help them do it.
But this is rarely the case now.
A recent study, by Wolff, found between 2007 and 2010 the median net worth of US households fell by 47% i.e. their wealth went ‘poof!’ and disappeared. Even when incomes appear to be increasing, this is rarely the case in practice. Not only has the value of their possessions also gone AWOL but, as the most recent US census found real incomes remain the same as they were in the early 1970s.
When the middle classes do eventually realize that the American Dream has moved nowhere since the 1970s and how much the government have been creaming off them in the longest daylight robbery ever seen, will they revolt? The chances are pretty slim I suspect.
Every day I sit and discuss with people why more people aren’t getting really angry about what’s going on – the theft of savings, income and living standards declining. Is it because they haven’t realized yet or because they’re sheeple? Just following whoever’s barking the loudest and not making them think on their own. ..or worse, lying to them.
Here in the UK, a recent survey showed 94% of those polled believed the UK government was working hard to slash the debt. They’re not, they’re increasing it.
When it comes to the fiscal cliff in the US we all know what‘s going to happen – a compromise. Everyone will compromise. Everyone that is except the people who are actually affected by it. They’ll just continue taking the beating they’ve been getting for the past few years, and why not? As Bill Bonner explained the other day – the further governments go, the further the voters expect them to go. But what happens when the government can’t go any further, what then?
We can now see a near-global perspective when it comes to dealing with this crisis: fake it and print it. This is unlikely to change in the foreseeable future. In every election in the socialist Western world, the middle classes appear torn over the desire to protect themselves and the need to provide a safety net for those who have less than themselves and are really suffering right now.
Someone needs to remind everyone around today that the ability to look after oneself and your sovereignty is a precious commodity, and one which is being rapidly lost and devalued by those who no longer care for it.