Wednesday, January 16, 2013

The Decline of America

Today, corporate profits as a percentage of U.S. GDP are at an all-time high, but wages as a percentage of U.S. GDP are near an all-time low. The top 20 percent of Americans received 48 percent of all income while those in the bottom 20 percent got less than 5 percent. A new report by Working Poor Families Project says that over 200,000 families fell into poverty in 2011 even with both parents working. The report said.
"Although many people are returning to work, they are often taking jobs with lower wages and less job security, compared with the middle-class jobs they held before the economic downturn. This means that nearly a third of all working families ... may not have enough money to meet basic needs."
Median household income in the United States has fallen for four years in a row.  Overall, it has fallen by more than $4000 during that time period.  The number of Americans on food stamps rose from about17 million in the year 2000 to more than 47 million today. Back in the 1970s, about one out of every 50 Americans was on food stamps. Today, about one out of every 6.5 Americans is on food stamps. Back in the year 2000, there were more than 17 million Americans working in manufacturing, but now there are less than 12 million.

Thousands of people applied for 200 new jobs at Target over the last three days in Northeast Albuquerque with only a one in 35 chance in getting a job. The odds of getting into Harvard are actually better than that.

Gary, Indiana, like Flint, Detroit, Cleveland, Akron and many hundreds of cities and towns across the once-industrial Midwest, Gary is emblematic of the new American poverty. The city is half the size it was in 1970, its population reduced from 170,000 then to 80,000 today. Its poverty rate is 28 percent. A fifth of its houses, churches, school buildings, and other structures are vacant and boarded-up. 30 miles east of Chicago, Gary was founded in 1906 by U.S. Steel for one purpose: to make steel. The five steel mills of Northwest Indiana—including the largest, the U.S. Steel mill in Gary—used to have a combined workforce of up to 100,000. They now employ roughly 20,000 people yet are still producing as much steel as ever. "There are a significant number of people here in Gary who have never held jobs, who never started looking for jobs, or who have stopped looking for jobs a long time ago. I would estimate our unemployment rate is at least 20 percent.” says Karen Freeman-Wilson, Gary’s mayor. The city’s main downtown public library has been closed. The school district is currently laying off 169 of the city’s 732 teachers to make ends meet. A dozen schools have been shut. Gary has 57 public parks but only enough money to maintain six of them. Freeman-Wilson put out a call asking church groups, high-school students, and social clubs to volunteer to clean the parks. Gary’s police chief, Wade Ingram, explains "Poor, uneducated, lacking economic opportunities—it’s a deadly mix. I think jobs will make a big difference. But around here there aren’t any.” The food bank at First African Methodist Episcopal Church is busier than ever. “Before, the food bank for most people was a supplement,” says Maurice Preston, who oversees the food-bank. “Now it’s a necessity. Nobody’s working. Everybody is laid off.” There is no movie theater in Gary. No Gap or Apple Store. No Starbucks

In the late 1970s, some 20,000 people worked for Ford and General Motors in Ypsilanti, Michigan. Today, only a few hundred work in the auto industry here. The mayor says he’s considering combining fire and police into one department. The parks and recreation department has a budget of $0.

Meanwhile, Chrysler recently announced plans to build new manufacturing facilities in China and Russia. Capital moves to where the profit is.

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