Actual median income has been rising, but when inflation is considered, many lost purchasing power.
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Advocate
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Sat 10 Mar, 2007 07:30 pm
The well-coordinated rant of the Republicans these days is that the Dems are trying to micromanage the war. Well, isn't it about time someone did this?
The war has been, and continues, to be a disaster under he Reps. The current lull, if you will, in the insurgency is a classic tactic. The insurgence will soon resume stronger than ever.
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cicerone imposter
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Sat 10 Mar, 2007 07:49 pm
From the Economic Policy Institute:
October 21, 2004 | EPI Briefing Paper #154
Less Cash in Their Pockets
Trends in Incomes, Wages, Taxes, and Health Spending of Middle-Income Families, 2000-03
by Lawrence Mishel, Michael Ettlinger, and Elise Gould
The economic well-being of middle-income families has changed significantly over the last few years, largely as a result of three important dynamics. First, the recession that started in March 2001 was followed by an unusually long period?-two and a half years?-of job losses, despite an increase in output of goods and services. Although employment has grown since September 2003, it has not done so at a sufficient rate to diminish the substantial labor slack generated by the downturn in 2001 (Mishel et al. 2004). Consequently, pre-tax incomes fell for three years in a row, leaving the typical household with $1,535 less income in 2003 than in 2000, a drop of 3.4%. This decline in income was primarily the result of lost work opportunities from fewer family members working and fewer hours worked per worker (fewer weeks per year and fewer hours per week). A second dynamic influencing family economic well-being is the income tax reductions legislated at the federal level, primarily those of 2001 and 2003. It is important to assess the degree to which shifts in taxation have offset the recession-induced income losses. Finally, the health care costs facing families have surged as insurance premiums and out-of-pocket costs have grown rapidly over the past few years (Families USA, September 2004).
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cicerone imposter
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Sat 10 Mar, 2007 07:52 pm
From the NYTimes:
November 28, 2006 '04 Income in U.S. Was Below 2000 Level
By DAVID CAY JOHNSTON
Correction Appended
Despite significant gains in 2004, the total income Americans reported to the tax collector that year, adjusted for inflation, was still below its peak in 2000, new government data shows.
Reported income totaled $7.044 trillion in 2004, the latest year for which data is available, down from more than $7.143 trillion in 2000, new Internal Revenue Service data shows.
Total reported income, in 2004 dollars, fell 1.4 percent, but because the population grew during that period average real incomes declined more than twice as much, falling $1,641, or 3 percent, to $53,974.
Since 2004, the Census Bureau has found, the income of the typical American household has grown along with the rise in average incomes but at a slow pace that, until recent months, had barely kept ahead of inflation.
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cicerone imposter
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Sat 10 Mar, 2007 07:58 pm
In addition to the obvious loss of purchasing power, consumers are increasing their debt to levels unheard of before Bush took over the white house.
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cicerone imposter
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Sat 10 Mar, 2007 09:36 pm
From the NY Times:
March 11, 2007
News Analysis Crisis Looms in Mortgages
By GRETCHEN MORGENSON
On March 1, a Wall Street analyst at Bear Stearns wrote an upbeat report on a company that specializes in making mortgages to cash-poor homebuyers. The company, New Century Financial, had already disclosed that a growing number of borrowers were defaulting, and its stock, at around $15, had lost half its value in three weeks.
What happened next seems all too familiar to investors who bought technology stocks in 2000 at the breathless urging of Wall Street analysts. Last week, New Century said it would stop making loans and needed emergency financing to survive. The stock collapsed to $3.21.
The analyst's untimely call, coupled with a failure among other Wall Street institutions to identify problems in the home mortgage market, isn't the only familiar ring to investors who watched the technology stock bubble burst precisely seven years ago.
Now, as then, Wall Street firms and entrepreneurs made fortunes issuing questionable securities, in this case pools of home loans taken out by risky borrowers. Now, as then, bullish stock and credit analysts for some of those same Wall Street firms, which profited in the underwriting and rating of those investments, lulled investors with upbeat pronouncements even as loan defaults ballooned. Now, as then, regulators stood by as the mania churned, fed by lax standards and anything-goes lending.
Investment manias are nothing new, of course. But the demise of this one has been broadly viewed as troubling, as it involves the nation's $6.5 trillion mortgage securities market, which is larger even than the United States treasury market.
Hanging in the balance is the nation's housing market, which has been a big driver of the economy. Fewer lenders means many potential homebuyers will find it more difficult to get credit, while hundreds of thousands of homes will go up for sale as borrowers default, further swamping a stalled market.
"The regulators are trying to figure out how to work around it, but the Hill is going to be in for one big surprise," said Josh Rosner, a managing director at Graham-Fisher & Company, an independent investment research firm in New York, and an expert on mortgage securities. "This is far more dramatic than what led to Sarbanes-Oxley," he added, referring to the legislation that followed the WorldCom and Enron scandals, "both in conflicts and in terms of absolute economic impact."
While real estate prices were rising, the market for home loans operated like a well-oiled machine, providing ready money to borrowers and high returns to investors like pension funds, insurance companies, hedge funds and other institutions. Now this enormous and important machine is sputtering, and the effects are reverberating throughout Main Street, Wall Street and Washington.
Already, more than two dozen mortgage lenders have failed or closed their doors, and shares of big companies in the mortgage industry have declined significantly. Delinquencies on loans made to less creditworthy borrowers ?- known as subprime mortgages ?-recently reached 12.6 percent. Some banks have reported rising problems among borrowers that were deemed more creditworthy as well.
Great economy, heh?
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revel
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Sat 10 Mar, 2007 09:51 pm
To be perfectly honest, most of this is over my head. All I know is that it seems we had more money when clinton was office than we do now and times were easier all the way around. I am not saying I am poor, I am just saying it seems that middle income people seem to have it more rough (after you factor in the rising cost of health care, higher gas prices and the natural growth of the price of products) than they did when clinton was office regardless of charts and graphs. When I talk to people I know they all seem to say about the same thing. That is not gloom or doom or even evidence of anything since it is ancedotal (spell?), but just me being honest, take or leave it. I really don't care.
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Foxfyre
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Sat 10 Mar, 2007 10:53 pm
I don't doubt at all that you feel that way Revel and for you it might even be true. I'm far better off now than I was during a lot of the Clinton years; however, I know perfectly well that that my personal downturn was not Clinton's fault nor can Bush get all the credit for things being good now except that the business climate right now is very good which helps me and other self employed types to prosper. The GOP generally pushes lower taxes and tend to be pro small business which I think history will show has at least contributed to the current very good economy.
But the fact is that a rising tide lifts most boats and some boats are going to take on water and/or sink no matter who is in office or how good things are. That is the way it has always been and I have no reason to believe that it will not always be that way.
And because no economy can progress without intermittent recession, such recession could occur just about any time. When it does, there will certainly be accusing fingers pointed at Bush or at the next president if its on his or her watch. And it is probable that it won't be the president's fault at all unless he signed off on some insidious piece of legislation that was a factor in that. Bush 41 did that. It cost him re-election.
The recession at the beginning of Bush 43's administration was a Clinton recession, however, as we were still running on Clinton budgets and economic policy at that time. Was it Clinton's fault? No. Did the Bush tax cuts help pull us out of it despite 9/11? They didn't do it all, no. But they helped.
Bottom line, the most important factor in most things getting better is for us to want them to get better and to trust that they will. That's true re the economy. That's true re Iraq. That's true in just about all major things overall.
But the unscrupulous politican and/or partisan and/or drive by media and/or opportunist will always try to make the other side look bad no matter how much good is being done. The worst of these are more than willing to lie and to hurt people in the process.
_________________
--Foxfyre
I shall be telling this with a sigh
Somewhere ages and ages hence:
Two roads diverged in a wood, and I?-
I took the one less traveled by,
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McTag
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Sun 11 Mar, 2007 01:35 pm
From the Glasgow Herald:
The fall guy
By Trevor Royle, Diplomatic Editor
After taking the rap for lying about the betrayal of a CIA agent, former vice-presidential aide Scooter Libby has a new nickname in Washington DC ...
HEARD THE one about Lewis Libby's change of nickname? If the wags in Washington are right; he's no longerknown as Scooter, the moniker that's been with him since infancy (apparently his father saw him "scooting" around his crib). Instead he's now known as Patsy. Like the original, that too tells you a lot about the man and his proclivities. No sooner had vice-president Dick Cheney's former chief of staff and adviser been convicted on four counts of perjury, obstruction of justice and making false statements to the FBI than Washington was agog with tittle-tattle that Libby was a patsy, a fall guy who had taken the rap for others.
Even one of the jurors, Denis Collins, was heard to ask where was Cheney and where was the influential White House political theorist and speechwriter Karl Rove? The implication was obvious: why were these big hitters not in the dock, and why was Libby being forced to take the blame for revealing that Valerie Plame, wife of US ambassador Joseph C Wilson IV, was a CIA agent and then lying about it? He could have added a similar question about Richard Armitage, the senior State Department official who is suspected of being the source of the leak, but the fact remains that Libby was found guilty of lying and then covering up. On June 5, he will know how long his sentence will be.
..........
Libby-Cheney-Rove-Bush
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cicerone imposter
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Sun 11 Mar, 2007 02:39 pm
Unless Bush pardons Patsy before the sentencing takes place.
We all know by now that the Bush cabal are all above the laws of this country; whatever they do supersedes all past laws. A pardon is already in the books before Bush tells the public.
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cicerone imposter
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Sun 11 Mar, 2007 03:13 pm
Interesting side info.
Schumer calls on Gonzales to step down By HOPE YEN, Associated Press Writer
41 minutes ago
WASHINGTON - The Senate's No. 3 Democrat said Sunday that Attorney General Alberto Gonzales should resign because he is putting politics above the law. Sen. Charles Schumer (news, bio, voting record) cited the FBI's illegal snooping into people's private lives and the Justice Department's firing of federal prosecutors.
Schumer, D-N.Y., said Gonzales repeatedly has shown more allegiance to President Bush than to citizens' legal rights since taking his job in early 2005.
He branded Gonzales, a former White House counsel, as one of the most political attorney generals in recent history.
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Advocate
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Sun 11 Mar, 2007 05:08 pm
Patsy Libby -- it has a ring to it. Of course, that could be a very appropriate name for him in the cellblock. I'm sure he will find a nice sweetheart there.
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cicerone imposter
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Sun 11 Mar, 2007 06:50 pm
If Patsy doesn't find somebody in prison, I'm sure many of those "men" of good will will find him.
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cicerone imposter
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Sun 11 Mar, 2007 09:08 pm
March 12, 2007 Citizens Who Lack Papers Lose Medicaid
By ROBERT PEAR
WASHINGTON, March 11 ?- A new federal rule intended to keep illegal immigrants from receiving Medicaid has instead shut out tens of thousands of United States citizens who have had difficulty complying with requirements to show birth certificates and other documents proving their citizenship, state officials say.
Florida, Iowa, Kansas, Louisiana, New Mexico, Ohio and Virginia have all reported declines in enrollment and traced them to the new federal requirement, which comes just as state officials around the country are striving to expand coverage through Medicaid and other means.
Under a 2006 federal law, the Deficit Reduction Act, most people who say they are United States citizens and want Medicaid must provide "satisfactory documentary evidence of citizenship," which could include a passport or the combination of a birth certificate and a driver's license.
Some state officials say the Bush administration went beyond the law in some ways, for example, by requiring people to submit original documents or copies certified by the issuing agency.
"The largest adverse effect of this policy has been on people who are American citizens," said Kevin W. Concannon, director of the Department of Human Services in Iowa, where the number of Medicaid recipients dropped by 5,700 in the second half of 2006, to 92,880, after rising for five years. "We have not turned up many undocumented immigrants receiving Medicaid in Waterloo, Dubuque or anywhere else in Iowa," Mr. Concannon said.
Jeff Nelligan, a spokesman for the federal Centers for Medicare and Medicaid Services, said the new rule was "intended to ensure that Medicaid beneficiaries are citizens without imposing undue burdens on them" or on states. "We are not aware of any data that shows there are significant barriers to enrollment," he said. "But if states are experiencing difficulties, they should bring them to our attention."
In Florida, the number of children on Medicaid declined by 63,000, to 1.2 million, from July 2006 to January of this year.
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nimh
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Mon 12 Mar, 2007 10:08 am
On tax-cuts and revenues
I happened upon some quotes..
George Bush..
Quote:
Bush hailed the dwindling deficit as a direct result of "pro-growth economic policies," particularly huge tax cuts enacted during his first term. "Tax relief fuels economic growth. And growth -- when the economy grows, more tax revenues come to Washington. And that's what's happened," Bush said.
..and John McCain..
Quote:
McCain was recently interviewed by National Review's Ramesh Ponnuru and asked if there were any circumstances, including the guarantee of spending cuts, under which he'd consider repealing the tax cuts he denounced and voted against. He replied: "No. None. None. Tax cuts, starting with Kennedy, as we all know, increase revenues."
..versus Alan D. Viard, a former Bush White House economist now at the conservative American Enterprise Institute..
Quote:
We all know that? In fact, economists know that this is not true. Conservative economists know this isn't true. Even conservative economists who work in the Bush administration have admitted this isn't true. As former Bush economist Alan Viard, now at the conservative American Enterprise Institute, said: "Federal revenue is lower today than it would have been without the tax cuts. There's really no dispute among economists about that."
Quote:
"Federal revenue is lower today than it would have been without the tax cuts. There's really no dispute among economists about that," said Alan D. Viard, a former Bush White House economist now at the nonpartisan American Enterprise Institute. "It's logically possible" that a tax cut could spur sufficient economic growth to pay for itself, Viard said. "But there's no evidence that these tax cuts would come anywhere close to that."
..and the (pre-November 2006) Congressional Research Service:
Quote:
Economists at the nonpartisan Congressional Budget Office and in the Treasury Department have reached the same conclusion. An analysis of Treasury data prepared last month by the Congressional Research Service estimates that economic growth fueled by the cuts is likely to generate revenue worth about 7 percent of the total cost of the cuts, a broad package of rate reductions and tax credits that has returned an estimated $1.1 trillion to taxpayers since 2001.
Robert Carroll, deputy assistant Treasury secretary for tax analysis, said neither the president nor anyone else in the administration is claiming that tax cuts alone produced the unexpected surge in revenue. "As a matter of principle, we do not think tax cuts pay for themselves," Carroll said.
"Without question, the deficit is receding. [..] If growth induced by Bush's cuts doesn't explain the surge, where did all those extra tax dollars come from? The short answer is spectacularly high corporate profits and the advancing fortunes of wealthy Americans, economists said."
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Foxfyre
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Mon 12 Mar, 2007 10:36 am
I didn't check out all the quotes as attributed to people. But I do wonder if Alan Viard actually did say what is attributed to him by the LA Times and on the blogs especially if we could see the quote in context. Viard is really big on the theory that higher taxes change people's behavior and while higher taxes can result in short term revenue surges, that may not hold true in the long term.
Viard recently said this.
Quote:
I would like to make four points:
The federal tax system is highly progressive.
The 2001 and 2003 tax cuts are not "tax cuts for the rich.
Attempting to promote progressivity by taxing saving and investment is harmful and counter-productive.
Well-designed policies can increase progressivity while strengthening the economy.
I shall be telling this with a sigh
Somewhere ages and ages hence:
Two roads diverged in a wood, and I?-
I took the one less traveled by,
And that has made all the difference.
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cicerone imposter
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Mon 12 Mar, 2007 10:47 am
Quote: "Well-designed policies can increase progressivity while strengthening the economy."
Herein lies the problem; our productivity increased at 2 to 3 percent every year for the past five or six years, but that didn't translate into those increases being reflected in workers pay/wages. According to government statistics, most middle class and the poor lost buying power when considered after inflation and tax cuts. The fact of the matter is, consumer debt increased to maintain our economy during the same period, and more homeowners are now defaulting on their mortgage loans. The future does not look too bright.
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Walter Hinteler
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Mon 12 Mar, 2007 11:05 am
Foxfyre wrote:
I didn't check out all the quotes as attributed to people. But I do wonder if Alan Viard actually did say what is attributed to him by the LA Times and on the blogs especially if we could see the quote in context. Viard is really big on the theory that higher taxes change people's behavior and while higher taxes can result in short term revenue surges, that may not hold true in the long term.
Probably you should have checked those links.
It was actually only reprinted by the LA Times how he was quoted by the WaPo on Tuesday, October 17, 2006, page D01.
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Foxfyre
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Mon 12 Mar, 2007 11:09 am
Walter Hinteler wrote:
Foxfyre wrote:
I didn't check out all the quotes as attributed to people. But I do wonder if Alan Viard actually did say what is attributed to him by the LA Times and on the blogs especially if we could see the quote in context. Viard is really big on the theory that higher taxes change people's behavior and while higher taxes can result in short term revenue surges, that may not hold true in the long term.
Probably you should have checked those links.
It was actually only reprinted by the LA Times how he was quoted by the WaPo on Tuesday, October 17, 2006, page D01.
I only commented on the quote attributed to Viard.
I know it was reported by the LA Times and it is also has been requoted on lots of different blogs. I would like to see the quote in context with the other accompanying remarks. Maybe Viard did mean it as it is being made to look, but I think there is room to think there could be more to the story since he is an AEI Fellow.
Neither the LATimes nor the WaPo get points from me re being meticulous about making sure that an accurate impression is presented.
_________________
--Foxfyre
I shall be telling this with a sigh
Somewhere ages and ages hence:
Two roads diverged in a wood, and I?-
I took the one less traveled by,
And that has made all the difference.
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nimh
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Mon 12 Mar, 2007 11:30 am
Foxfyre wrote:
I didn't check out all the quotes as attributed to people. But I do wonder if Alan Viard actually did say what is attributed to him by the LA Times and on the blogs
LA Times and blogs? What are you talking about?
The first article is from the Washington Post, the second is from an article in The New Republic. I included the links.
Foxfyre wrote:
especially if we could see the quote in context.
This is the quote in context in the WaPo's article:
Quote:
Bush hailed the dwindling deficit as a direct result of "pro-growth economic policies," particularly huge tax cuts enacted during his first term. "Tax relief fuels economic growth. And growth -- when the economy grows, more tax revenues come to Washington. And that's what's happened," Bush said.
Economists said Bush was claiming credit where little is due. The economy has grown and tax receipts have risen at historic rates over the past two years, but the Bush tax cuts played a small role in that process, they said, and cost the Treasury more in lost taxes than it gained from the resulting economic stimulus.
"Federal revenue is lower today than it would have been without the tax cuts. There's really no dispute among economists about that," said Alan D. Viard, a former Bush White House economist now at the nonpartisan American Enterprise Institute. "It's logically possible" that a tax cut could spur sufficient economic growth to pay for itself, Viard said. "But there's no evidence that these tax cuts would come anywhere close to that."
After that the article moves on to the findings of the Congressional Research Service.
In fact, that's the take I'd pay greater attention to than to Viard's in the first place - we're talking about economists at the nonpartisan Congressional Budget Office and in the Treasury Department doing an analysis of Treasury data here. And finding that "economic growth fueled by the cuts is likely to generate revenue worth about 7 percent of the total cost of the cuts".
