Bush, Republicans Find Strong Economy Doesn't Win Middle Class

[OhioChick]

By Brendan Murray

Oct. 30 (Bloomberg) -- Republican Representative Gil Gutknecht is talking up the strong economy in the closing days of a tight re-election campaign. The problem: Middle-class voters in his southern Minnesota district aren't inclined to celebrate upbeat economic statistics.

Gutknecht, a six-term House member, isn't alone. Republicans who planned to use low unemployment, cheaper gasoline and a surging stock market as a shield against discontent over the Iraq war and congressional scandals are discovering that there's little protection to be had.

The reason, some analysts say, is the gap between a statistically strong five-year expansion and strapped family budgets. Middle-class households' finances are getting stretched as workers struggle with higher costs for health care, education, home heating and property taxes.

``The story used to be a rising tide raises all boats, and now it just raises all yachts,'' says Edward Tufte, a political scientist at Yale University in New Haven, Connecticut. ``The benefits of a good economy are much more narrowly focused now on the top 20 percent.''

http://www.bloomberg.com/apps/news?pid=20601087&sid=aBlgJNUaeQic&refer=home

[Binka]

1. It Cost Poppy Now It Will Cost W & Congress

These out of touch shitdustbags are about to find out what it feels like to be dumped on.

[sendero]

2. People are seeing..

... the disconnect between the obviously and blatantly cooked Federal statistics and the reality of their lives and their friends' and familys' lives.

Keep going GOP, soon nobody will believe you when you say the sun will come up tomorrow :)

[rfranklin]

8. Hey, they kept unemployment low....by not counting the unemployed!

And they keep forgetting about the fact that virtually no one has increased their buying power in the past six years, except for the country club elite.

[YOY]

22. and the 'New Jobs Created" are mostly shitty retail jobs

That barely pay the rent and offer no health coverage.

Part of me thinks that they're trying to recreate serfdom/indentured servitude.

[liberal N proud]

3. They still don't get it!

The economy is only strong for the wealthiest Americans, the rest are getting squeezed.

[anotherdrew]

37. agree. I'm so sick of hearing about this mythical strong economy, it's total BS!

[FormerOstrich]

45. It's not mythical....

there is a strong economy....for some....

Just today:

Luxury-home sales soar
Increasingly, buyers seeking houses upward of $3 million

Glen Creno
The Arizona Republic
Oct. 30, 2006 12:00 AM

One part of the Valley's housing market is thriving while the rest of it stumbles.

Luxury homes, the elite properties spread across Paradise Valley, Scottsdale and certain pockets of the metropolitan area, are selling well and at higher prices. There's been a sharp spike in the number of million-dollar properties sold since 2000, but the bigger story is the increasing prevalence of deals for $3 million, $5 million and much higher, a clear sign that the Valley is moving into the big leagues of luxury homes.

"We're really getting very sophisticated tastes now," said Walt Danley of Coldwell Banker. "We're getting great architecture, not just getting big tract mansions

Read more:

http://www.azcentral.com/arizonarepublic/news/articles/1030luxury1030.html

[bronxiteforever]

4. Good article, rings true as well.

"now the (economic policy of the rethugs) just raises all yachts."
The amazing thing is how the middle and working classes have been made fools by voting for GOP "values" when the GOP only really wanted to pick their pocket and have them die in wars to protect their oil business.

[Vinca]

5. I knew this would backfire on them. When 1 out of 6 Americans

cannot afford health insurance, the economy is not "strong."

[Eurobabe]

7. Exactly, the GOP is SO screwed they don't even know it yet...

they will come November 8th. :hi:

[Deja Q]

6. Exactly. The middle class is being trickled on.

They voted for Republicans because they felt the Republicans would do a better job for them and in good faith.

This has proven not to be the case.

They want a future.

And with Republicans seemingly doing nothing about it, what are people left to think??

[Anakin Skywalker]

41. Trickled On? Pissed On is More Like It!

[Magleetis]

9. Strong economy???

For the rich and privileged only.

[Lorien]

46. My reaction as well. I'm unemployed, as are most of my friends

I know a lot of people in the film and graphic design markets. We're being outsourced at a frightening rate. My job was outsourced in early August, and I can't find a damn thing out there-nobody is looking for anyone with my skills because there's such a glut of the unemployed! It's starting to look bloody hopeless.....:-(

[flyingfysh]

10. who is it strong for?

It benefits the super-rich, but not ordinary people, who are finding things tougher all the time.

[Hav]

11. .

That's interesting but shouldn't be surprising. I guess for most people it is no difference if the Dow is at 8000 or 12000. If the large majority of those who don't get paid well have financial problems, then it doesn't matter if the Dow is at 20k and all the politicians praise the economy. It doesn't change the fact that they still have problems feeding the family or pay their bills.
All the politicians can try to campaign on a supposed strong economy but reality paints another picture.

[sendero]

44. The DOW..

... average his little to do with the health of the economy anyway.

It is a basket of merely 30 stocks. The S&P 500 is a better indicator, other indexes even better.

Wall Street goes gaga when interest rates fall. Interest rates fall when the economy is slowing down. Wall Street and Main Street are at odds a lot of the time.

Plus, the DOW should have been where it is now in 2003. It's hard to get excited when an investment makes essentially nothing for 5 years.

[0007]

12. Ah yes! A strong economy for the people who hire those

from south of the border and hide their profits in off shore banking schemes to avoid paying too much in taxes. Ah yes!! A strong economy for those who want to keep the wage earner down and the unions out and refuse to pay health insurance for their workers.

....and all for the price of feeling safe?

[pretzel4gore]

18. they so demonised taxes, the only ones who forced to pay

are the powerless, and ....well the powerless are too poor!
a ridiculous dilemma, eh?

[C_U_L8R]

13. Show me a strong economy

it's not in my wallet.... so it must be someone else's strong economy.

The fact that Halliburton and ExxonMobil are reporting record numbers
has nothing to do with economy and everything to do with cronyism,
corruption and profit TAKING on a horrific scale,

[w4rma]

14. The decline of the middle class and election fraud are my top two priority issues. (nt)

[texpatriot2004]

15. There is NO strong economy nm

[amandabeech]

16. The Dems must actually DO something now.

We're going to have to dump the same globalism-for-the-elite policies and find something new.

Aren't Samuelson and Krugman both waking up to the fact that a rising tide doesn't lift the rowboat?

What we need is a new economic paradigm for regular folks.

Otherwise, the voters will stay home in 2008 or turn to a third party that we may not like.

[MissMillie]

17. middle class? what middle class?

as is usual for the tax policy of the republicans, the middle class has been squeezed dry.

[GeorgeGist]

19. Duh...

only the rich class is benefiting from the so called strong economy!

[LynnTheDem]

20. "strong economy"...with the GAO chief warning "economic disaster looms"

"It's time to steer the nation off the path to financial ruin."

http://news.yahoo.com/s/ap/20061028/ap_on_go_ot/america_the_bankrupt

Take a look at the end of the URL. That says it all in more ways than one.

America_the_bankrupt

[progressoid]

21. Well it only took a couple decades, but the middle class is starting to figure it out

The Repukes economic policies are built for the wealthy, not them.

[E-Z-B]

23. Apparently the economy wasn't a factor in 2002 and 2004

Why should it be now?

[sutz12]

24. The American Dream is dead....

The Repubs won, basically because they fooled the middle class that they had a chance to join the upper crust. Every one could get rich in America just by working hard. Yeah, right.

The truth is that the biggest indicator of where in the social/economic class structure one dies is where one was born. Upward mobility has pretty much frozen. Work no longer gets anyone out of poverty.

When the only chance one has of improving one's social/economic status is winning the lottery, something smells rotten in Denmark, or America, that is.

[raccoon]

27. You know that's right,

"The truth is that the biggest indicator of where in the social/economic class structure one dies is where one was born."

You have the few who were poor but get rich, such as sports stars, rock stars, etc. but they are WAY in the minority. And you have a few of those in just about any country.

"Upward mobility has pretty much frozen."

But downward mobility is very much alive and well.


"Work no longer gets anyone out of poverty."

No, it doesn't. Might if you live with a houseful of other people, and never have any health care, dental care, vision care expenses. And don't need any prescription drugs.

[Cass]

25. This is a very informative article...thank you for posting it.

I've been baffled lately when I hear republicans and their enablers in the media touting the economy as being so strong. This article does a great job explaining what's going on and its not pretty picture for a lot of folks right now.

This part caught my eye:

U.S. employers are paying less of their profits in the form of wages and salaries than at any time since the Great Depression, according to Commerce Department data. Wages earned by private-sector workers fell to 51 percent of gross profits in the second quarter of this year, down from 55.5 percent at the start of Bush's presidency.

At the same time, corporate profits reached a record $1.62 trillion in the second quarter, or 13.8 percent of national income at an annual rate. That's up from 9.9 percent in 2000, according to Federal Reserve figures. During the same period, total compensation of workers, which includes wages and benefits, fell to 64.2 percent, compared with 71.7 percent in 2000.

I don't have enough posts to recommend yet - I surely would recommend this one if I could.

[NorthernSpy]

26. for most Americans, the economy is in a state of stagflation...

Wages aren't rising to meet increased costs -- not even close.

So no, we're not inclined to agree with the Bush apologists on how "wonderful" everything is nowadays.

It's wonderful for them, maybe. But not for most of us.

[moondust]

28. Well duh.

The middle class are the big losers in the Republican scheme of things. The filthy rich have to get much, much richer off somebody and it ain't the poor folk who have nuthin to hand over.

[davekriss]

29. "now it just raises all yachts"

Trickle down economics has ALWAYS just raised the yachts. Look at this century. Democratic administrations with higher marginal tax rates on the highest incomes have left the economy better off at than what they found (with one exception), and Republicans have left if worse off than they found it (without exception). (Facts are facts, freepers!)

Supply side "voodoo" economics has always been cover propoganda for class war. After 25 years of conservative-republican ascendency, we've seen the productivity of the individual worker grow by more than 2.5x, yet wages for the bottom 80% have stagnated or declined. What happened to all that increased value creation? It went into the purses and wallets of the top 0.5% of our population, GWB's "base", who gladly flow a sliver of their ill-founded rewards to politicians and think-tanks that make the case for yet more removal of democratically determined policy and regulation that would ensure the greater good for the greatest number. It's theivery masquerading as ideology.

And what is our reward for not rising up in class-conscious revolt? The insult of offshoring. Jobs fly to low-cost countries, abandoning vast swathes of our citizenry to declining quality of life and gut-wrenching insecurity. Meanwhile the top tiers make out like bandits selling goods and services we can decreasingly afford to the rising "middle-classes" in the Asian rim, China, the Phillipines, and eslewhere.

It doesn't matter if they sell a flat-panel LCD screen, made in China, to a Japanese consumer -- what matters to the capiltalist is that he or she siphons off a portion of surplus value. The fact that the U.S. citizenry is left out of this mix is not the capitalist's concern. But that is a proper concern of democratic goverment -- our representatives should be creating policiy and regulation that force concern for our public good, that create rules of the game where all win, albeit the capitalist may win less than under current arrangements. But this notion, use of our democratic institutions to protect and advance the public good, has been eroded by 25 years of virulent "compassionate conservativism", made possible by buying politicians and consolidating the media around a handful of self-interested mega-corporations very protective of their own agenda.

[Avalon Sparks]

42. Absolutely Awesome Post!!

That is such a great post about supply side!!! It's absolutely true, too!

[area51]

30. Strong economy

Where is this strong economy? I certainly don't see it, nor do people I know. Apparently it's in a parallel universe.

[NOLADEM]

31. Hack journalists will find a bloated stock market does not mean a healthy economy

[Megahurtz]

32. You mean it took them this long

to figure that one out?:eyes:

[SoCalDem]

33. Why?

Because the "strong" economy is only strong for the upper-crusties.
The folks with two breadwinners, daycare, car payments, mortgages, health care premiums, gasoline/heating fuel bills, college tuition, and credit card debt are NOT "strong".

Most of them a a few paychecks from bankruptcy (and the congress ruined that option for them too :(..)

[Yavin4]

34. Job Growth = Economic Growth

I measure growth by job creation and rising wages. Unless you're born rich, you have to work for somebody, somewhere, and if there aren't any jobs, then wages won't rise, and there's no growth. The DOW could be at 50,000, but if there aren't jobs, then there's no growth.

When the private sector is creating jobs at a healthy pace, 175,000 on avg/month, then that signals growth because wages will rise accordingly and everyone wins because those increased wages will be spent on goods and services which will in turn create more jobs. That's how growth happens.

What we've seen since 2000 is debt growth which mimics my theory. Instead of earning $40K on a job, millions of people borrowed $40K through equity loans.

[leftofthedial]

35. there is NO strong economy

it's a lie

[pinniped]

36. As usual, * is full of shit.

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2006/10/25/BUGR8LV99C1.DTL&hw=jobs+created&sn=032&sc=315

Since September 2004, average hourly wages have increased 6.8 percent and consumer prices have climbed 7 percent, according to the Labor Department. This means real wages over the period have declined 0.2 percent.

In other words, and contrary to the president's sunny appraisal of U.S. workers' fortunes, many people's paychecks in reality are continuing to fall behind the cost of living.

The job slump that plagued the administration after Bush took office in January 2001 hit bottom in August 2003. That's perhaps why the president chose this as the starting point to highlight his administration's performance in job creation.

About 6.6 million jobs may have come into being since that time, but that ignores the roughly 2.7 million jobs that previously were lost under Bush's watch.

[kestrel91316]

38. This should read:

Bush, Republicans Find There IS No More Middle Class To Win

There's only the Have Lots and the Have Littles.

[NotGivingUp]

39. yep..doesnt convince anybody who is not brainwashed by the

BULLSHIT!@!!!!

[Bullshot]

40. What's this "cheaper gas" bullshit?

It may be cheaper than it was when it hit all-time records last summer, but it's still at least 20% higher than it ever was under Clinton.

That librul media again, playing the Republican smoke and mirror word games for the elections.

[PurityOfEssence]

43. If the economy was strong for the middle class, it would win the middle class

Record highs for the stock market and gluttonous feedings for CEOs and investors doesn't mean that "the economy" is doing well. It means that those who are doing well are doing better.

Hidden inflation, offshoring of lucrative jobs and diminishing opportunity haunts the middle- and working-classes. The sheer ugliness of such a statement is disgusting: why aren't you rejoicing in the prosperity of your betters?

Real wages are falling. Prices are rising. Competition is increasing. The functioning weak (those of the working- and middle-class) are getting their asses kicked. Add to this the squeeze of the Alternative Minimum Tax not having been raised for oh so many years, and you've got a true recipe for social disaster.

Talk of eliminating deductions for mortgage interest just exasperates the situation.