A study done by Northeastern University's Center for Labor Studies broke the unemployment rate down by income. Unemployment among those making $150,000 a year was only 3% in Q4 2009. What unemployment problem, right?
The unemployment rate for those in the middle income range was 9%, about average for the nation.
But here’s the kicker. The unemployment rate for those in the bottom 10 percent of income came in at a whopping 31%.
With only 3% unemployed at the top end, should we be surprised to see the infrastructure repair program (“Let’s Rebuild America”) of the Obama Administration never got off the ground. Wall Street and Larry Summer didn’t like it. No one polled or asked those in the bottom 10% and they didn’t bother to tell us. Or, what about Obama’s $33 billion bone toss to the unemployed, paying that sum to all employers for hiring and pay raise incentives – mere cosmetic tokenism so the Administration can look like it’s is doing something when it isn’t. As Summers candidly explained, we will just have to wait for the economy to pick up before unemployment drops.
What if by some numerical fluke, the situation were reversed so that those making $150k or better a year had the 31% unemployment figure and the bottom 10% came in at 3% unemployed? Would Washington’s attitude and actions be the same?
You can safely bet the farm not. We would have programs coming out of our ears. Arianna Huffington describes what the situation would be very well: “If one-third of television news producers, pundits, bankers, and lobbyists were unemployed, would the measures being proposed by the White House and Congress still be this pathetic? Of course not -- the sense of national emergency would be so great you'd practically be hearing air raid sirens howling.”
So tell me. Do we have a government of the people by the people and for the people? Or do we have a government of the wealthy by the wealthy and for the wealthy? No guessing here. In fact, if we want to keep the percentages equal in this analysis for the top and the bottom, unemployment in the top 10% came in at a staggering 1.6%! Staggering, because it is so small a figure! This is better by far than full employment for that group.
As the authors of the Report noted:
“These stark findings clearly reveal the economics costs of underemployment in the current U.S. economy are disproportionately born by workers at the lower end of the income distribution. . . Thus underemployment contributes in an important way to the high and rising degree of income inequality in the U.S. . . There was no labor market recession for the nation’s affluent.”
Again, we are not seeing “trickle down” economics working. It is more like trickle up economics, where the lower classes are losing income to the upper classes. But we know that and I have written on it before, at length here. It is part of economics' dirty little secret everyone is trying to ignore. This report really comes as no surprise at all.
We should be ashamed of ourselves. Our government, with its professed ideals, is fast becoming a bad joke, at the expense of too many and a rapidly growing number of people.
Disclosure: none relevant