Middle Class Pinch

With the election season in full swing, the plight of the middle class America has taken center stage. The past decade has not been a great for the middle class in America with the continued loss of jobs, the technology stock crash, the mortgage bubble popping, inflation, lack of affordable health care and stagnant wages.

The American worker's salary has not kept up with the rising cost of living. Between 2000 and 2006, the average family's income dropped 4.0%, while inflation increased by 17%. What cost a dollar in 2000, would now cost $1.17. However if you look at the cost of some basic items that a family uses on a daily basis, these prices increased at a faster rate than the overall inflation rate. A pound of ground beef has increased in price by almost 40% while a gallon of gasoline has increased by almost 80%.

Below is a graphic from an article in the WSJ about the middle class, and specifically about their roll in deciding the Pennsylvania Democratic primary. This is an issue not just isolated to Pennsylvania, but across the states. 'In a recent Pew Research Center survey, 41% of respondents rated their lives as better than five years ago, and 31% said they were worse. That response is even glummer than in 1979, when, amid rising economic malaise, 25% of respondents to a similar survey rated their lives as worse.'

Expect to the politicos to focus on this through November.

Source:
'Trapped in the Middle', by Justin Lanhart and Kelly Evans, WSJ {$$$}