Wednesday, 27 August 2008

Whilst the US economy isn't broken, there are some disturbing figures


Median Household income has actually fallen since 2000 in the US. Whilst economic growth has been nearly ever present in the last 8 years in America, incomes for a lot of Americans has fallen. There is something behind the "rebuild the middle class" shtick that I dislike so. This means that there has been an effective transfer of wealth from the middle and the bottom to the top. I'm not talking about inequality, I'm not talking about decile share of GDP, I'm talking about absolute income. The average American earns less now. The richest certainly earn more. This fails liberal governance criteria. The solution? It is not more state interference but ending corporate welfare and the many corporatist structures still in place in the US economy. Imbalances caused by government meddling in subsidies, trade barriers, bank bail outs, and oil company tax benefits must cease. Windfall taxes and the like are not the solution. Unfortunately the old leftist "solutions" will win out because they were the first to recognize this problem. The likely result? The median and the rather well placed winning out over the bottom quartile and the poorly placed.

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