One-Third Of All Americans Don’t Make Enough Money To Even Cover The Basic Necessities

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Sad Child - Public DomainDo you remember the days when it seemed like almost everyone in America was middle class?  Unfortunately, those days are long gone and the grinding down of the middle class in the United States appears to be accelerating.  According to a brand new study that was just released by Pew Charitable Trusts, household spending increased by 14 percent between 2004 and 2014, but median household income decreased by 13 percent during that same time period.  Both of those figures were adjusted for inflation.  What this means is that the cost of living has steadily gone up, but our incomes have gone down.  In fact, as you will see below approximately one-third of all Americans don’t even make enough money to pay for the basic necessities at this point.  The middle class is being squeezed like never before, and very few of our leaders seem to care.

 

It isn’t because we are buying a lot of luxuries that our expenses are going up.  According to Pew, U.S. families are now spending a larger percentage of their budgets on the basics such as housing, food, health care and transportation than they were a decade ago.  In fact, it has gotten to the point where approximately one-third of all Americans don’t bring home enough money to cover the core necessities.  The following comes from Zero Hedge

However, according to a striking new Pew study while household spending has returned to pre-recession levels (the average household spent $36,800 in 2014) incomes have not.

Specifically, while the median income had fallen by 13% from 2004 levels over the next decade, expenditures had increased by nearly 14%. But nobody was more impacted than the one-third of households which the study defines as “low-income.” Pew finds that while all households had less slack in their budgets in 2014 than in 2004, lower-income households went into the red by over $2,300.

In other words, approximately one third of American households were no longer able to cover the core necessities – food, housing and transportation – with average income.

A decade ago, U.S. households in the bottom third of the income scale still had an average of $1,500 left over each year after paying for the basic necessities of life.

But today, those same households are $2,300 in the red after paying for the basic necessities of life.  Perhaps this is one reason why credit card debt in this country has hit a new all-time high.

Families in the middle third of the income scale are being squeezed as well.  A decade ago those households had $17,000 left over each year after paying for the basic necessities, but now that number has fallen to just $6,000.

And of course most of that “discretionary income” is rapidly spent on other things such as entertainment.  As a result, most American families find themselves living on the financial edge

Previous Pew research found that one in three American families overall have no savings. And even among households with incomes of over $100,000, 1 in 10 say they are in that situation.

At this point, the typical U.S. household “cannot replace even one month of income with liquid savings”.

So what is going to happen when things get really tough in this country?

What are people going to fall back on?

And already the job losses are starting.  The energy industry has lost more than 100,000 good paying middle class jobs since the start of last year, and just today we learned that Boeing could be laying off as many as 8,000 workers.  The following comes from the Seattle Times

Since Boeing Commercial Airplanes CEO Ray Conner announced a drive to cut the workforce six weeks ago, his team has taken steps expected to eliminate 4,000 jobs by June — and that may be only halfway towards the total cuts this year.

An internal Boeing document obtained by the Seattle Times reveals that at least one company unit is targeting a 10 percent workforce reduction overall.

And people with knowledge of what’s planned say that’s roughly the percentage of jobs expected to be cut statewide. That would translate to as many as 8,000 jobs being eliminated.

Sadly, this is probably just the very small tip of a very large iceberg.

Just look at the following chart from Zero Hedge.  Employment levels almost always follow changes in corporate profits, and right now corporate profits are falling dramatically…

Employment Year Over Year - Zero Hedge

America is heading for much harder times, and this is something that I discuss in my new book.  Just like last time around, large numbers of workers with little to no cushion to fall back on are going to find themselves in desperate situations when they lose their jobs.  Millions of Americans will go from living comfortable middle class lifestyles to facing an existence of poverty and despair very, very rapidly.

All of this is just the acceleration of a trend that has been playing out over the past several decades.  The middle class in America is being systematically destroyed, and I want to share with you once again some key numbers that prove this point that come from one of my previous articles

#1 For the first time ever recorded, middle class Americans make up a minority of the population. But back in 1971, 61 percent of all Americans lived in middle class households.

#2 According to the Pew Research Center, the median income of middle class households declined by 4 percent from 2000 to 2014.

#3 The Pew Research Center has also found that median wealth for middle class households dropped by an astounding 28 percent between 2001 and 2013.

#4 In 1970, the middle class took home approximately 62 percent of all income. Today, that number has plummeted to just 43 percent.

#5 There are still 900,000 fewer middle class jobs in America than there were when the last recession began, but our population has gotten significantly larger since that time.

#6 According to the Social Security Administration, 51 percent of all American workers make less than $30,000 a year.

#7 For the poorest 20 percent of all Americans, median household wealth declined from negative 905 dollars in 2000 to negative 6,029 dollars in 2011.

#8 A recent nationwide survey discovered that 48 percent of all U.S. adults under the age of 30 believe that “the American Dream is dead”.

#9 At this point, the U.S. only ranks 19th in the world when it comes to median wealth per adult.

#10 Traditionally, entrepreneurship has been one of the engines that has fueled the growth of the middle class in the United States, but today the level of entrepreneurship in this country is sitting at an all-time low.

#11 If you can believe it, the 20 wealthiest people in this country now have more money than the poorest 152 million Americans combined.

#12 The top 0.1 percent of all American families have about as much wealth as the bottom 90 percent of all American families combined.

#13 If you have no debt and you also have ten dollars in your pocket, that gives you a greater net worth than about 25 percent of all Americans.

#14 The number of Americans that are living in concentrated areas of high poverty has doubled since the year 2000.

#15 An astounding 48.8 percent of all 25-year-old Americans still live at home with their parents.

#16 According to the U.S. Census Bureau, 49 percent of all Americans now live in a home that receives money from the government each month, and nearly 47 million Americans are living in poverty right now.

#17 In 2007, about one out of every eight children in America was on food stamps. Today, that number is one out of every five.

#18 According to Kathryn J. Edin and H. Luke Shaefer, the authors of a new book entitled “$2.00 a Day: Living on Almost Nothing in America“, there are 1.5 million “ultrapoor” households in the United States that live on less than two dollars a day. That number has doubled since 1996.

#19 46 million Americans use food banks each year, and lines start forming at some U.S. food banks as early as 6:30 in the morning because people want to get something before the food supplies run out.

#20 The number of homeless children in the U.S. has increased by 60 percent over the past six years.

#21 According to Poverty USA, 1.6 million American children slept in a homeless shelter or some other form of emergency housing last year.

#22 The median net worth of families in the United States was $137, 955 in 2007. Today, it is just $82,756.

So is there any hope for the middle class in America?

Please feel free to share what you think by leaving a comment below…

*About the author: Michael Snyder is the founder and publisher of End Of The American Dream. Michael’s controversial new book about Bible prophecy entitled “The Rapture Verdict” is available in paperback and for the Kindle on Amazon.com.*

 
  • K

    Michael, I know this article to be accurate. I am living it. Retired for 13 years. I started off firmly in the middle class. But with the utter nonsensical cost of living adjustments. I slipped into the upper level of the poor 3 years ago. This is not a complaint, just a statement of fact. I am still in far better shape, than many around me.

    • sre

      I am retired, too. I think retirement income is like working all month and getting paid for half a month.

      • Jim Davis

        If you are retired, then you aren’t working at all. If you are struggling maybe you should have saved more or else not quit working!

        • batel12

          Guessing you’re under 30 and still believe the lie?

          • Jim Davis

            No. I’m not under 30. What lie?

          • batel12

            The lie is that if
            we simply take personal responsibility we can control our destinies into our twilight years. We only have partial control over outcomes early in life, it peaks and then falls quickly as we age. We can only take personal responsibility for those things under our control.

            I have talked to too many young people that have been convinced that their education, their commitment to healthy lifestyles, their 401k contributions, etc. will somehow prevent them from falling
            victim to the pitfalls that are causing the current generation to stumble in retirement.

            I have three friends that were convinced they would not retire before 70. All three were forced into
            early retirement, 62, 63 and 65, either by their companies or a
            relatively minor health issue. Excepting some of the professional and creative fields it is rare that a company wants anyone to stay past
            60. And they have ways to prevent it.

            Instead of pitying the early retired early among us it would pay young people to talk to some of these people. Many are educated, many had health, many had 401k’s. It is a brutal world we live in, many are retired not because they wanted to or could afford to but because they had no choice. I was forced into early retirement 10 years ago. I became a pastor in a small church, making 20 percent of what I once did, but the education in worldview I’ve received is priceless and as they
            say, the retirement package is out of this world.

          • Jim Davis

            Anyone who thinks they can get a job and just coast until age 60 thinking that corporate America will provide them a comfortable retirement hasn’t been paying attention.

          • batel12

            Jim, none of us were coasting. All four of us in our widely varying jobs had maintained our competency’s and for three of the four, our health issues did not directly diminish our performance. The long view is that we had better start a dialogue outside of obscure corners of academia about what a post labor economy will look like.

          • Jim Davis

            If you’re speaking about the future and the effects of automation, I can agree we are not prepared for this. This is my main concern over illegal and legal immigration. We do not have enough jobs for the people already here. There will be less need for human labor as time passes. To favor mass immigration, one must have a desire to destroy the wealth of the middle class. It is thoroughly destructive.

    • Mickey Mouse

      @K:

      American Free Press with Pat Buchanan and Dr. Craig Roberts and the investigative independent Journalist THORN (about Hillary Clinton)

      http://www.americanfreepress.net

      The LaRouche Movement

      http://www.larouchepac.com see international EIR NEWS Agency

      Daily Peak Oil Blog beyond postmodern neoliberal globalist Mainstream Media of the Globalists (Neoliberals and Neocons)

      http://www.fromthewilderness.com Peak Oil and 9.11.

      Foreign Policy and Geopolitics beyond postmodern neoliberal mainstream media!

      http://www.german-foreign-policy.com

      Also see the older articles in the archives!

      • I got paid 104 thousand bucks in 2016 by freelancing online a­­n­­d I did that by wor­king part-time f­o­r few hours daily. I followed work opportunity I stumbled upon from company that i found online and I am so amazed that i made so much money on the side. It’s really newbie-friendly a­n­d I’m just so grateful that i found this. This is what i did… GOBIG92.COM

    • Dominick Perez

      I know people on welfare who drive brand new cars, get Section 8 housing vouchers, lifeline credit on the monthly utility bill, food stamps, SSI, free Obama phones and hit three or four of these food pantries ever month crying poverty. Trust me they eat better than you do and have a nicer cell phone lol keep working like a sucker and voting for Hillary jerkoffs

  • Jim Davis

    This site is a lot better when it covers stories like this, rather than blood moons and blood sacrifices and Temples of Baal.

    • Lazarovic

      My thoughts exactly.

      • Lucky Luke

        Lazarovic

        American Free Press with Pat Buchanan and Dr. Craig Roberts and the investigative independent Journalist THORN (about Hillary Clinton)

        http://www.americanfreepress.net

        The LaRouche Movement

        http://www.larouchepac.com see international EIR NEWS Agency

        Daily Peak Oil Blog beyond postmodern neoliberal globalist Mainstream Media of the Globalists (Neoliberals and Neocons)

        http://www.fromthewilderness.com Peak Oil and 9.11.

        Foreign Policy and Geopolitics beyond postmodern neoliberal mainstream media!

        http://www.german-foreign-policy.com

        Also see the older articles in the archives!

        • L. A. McDonough

          Larouche movement has done nothing since they started out decades ago, ditto the John Birch soc., Eagle forum and others. I have kept up with these groups for decades, refusing to support any org. Never are any results with much info put out. Patriot movements in last sixty years have produced nothing that would turn this country back to real values and constitutional gov. Total flops. Peak oil is a bunch of BS, I have heard this since the 70’s and oil is available all over. I don’t join anything. We must be in a survival mode now with family and like minded friends. America’s future is zeeero! Get house in order folks.

    • Gay Veteran

      yep

  • Purple Wings

    I suppose my husband and I are somewhere in that middle third…we can afford necessities and afford to have a little fun. However, we have a lot of debt that we are working hard to pay off right now because we know that it’s important. I’ve been cutting what we spend as much as possible and doing things like making my own bread and growing our own vegetables. I’m also working on saving some emergency cash, but most of our “extra” (the Mr. is working a lot of overtime this year) goes to pay off debt. I worry about those folks who can’t even afford necessities and I pray that they can find some way to get by. It’s going to be interesting in the years to come, that’s for sure.

  • Lazarovic

    Good article Michael. I like when you just stick to facts and help readers prepare. I hate when you blame everything on President Obama or inject your particular brand of fundamentalist prophecy notions into the conversation. Keep it normal man.

  • leslie green

    It could be very easy to adopt the attitude of “what’s the use”…. nothing we do, believe in, or care for matters. That is a very defeatist position that has until recently been unpopular amongst middle America, now however it seems to be the norm. But, the pendulum swings in both directions and we need to realize that it will swing towards liberty again soon. When the populous gets angry enough, watch out Mr. Soros et al…. you’ll be their first target for revenge… and you won’t be able to stop them or escape.

  • Mistanick

    Things to consider in the mix as stats don’t tell the full story.

    Where do people live and is it the best place for them given their income? California? Forget about it. Housing way too high. Alabama? Rent about one-fourth that of Cali. How about a 2 bedrm apartment in Birmingham for $600 per month and pets ok. Cali? $2200 and no pets just for a cracker box.

    No sympathy for most middle class. They spent way too much on trivial things. Yes, income is shrinking. How many of those middle class vote for tax and spend liberals (dems and repubs) each year after year locally and nationally. We get what we vote for and deserve. Low information voters? Most people.

    Retirement? What is that and why do we think we deserve it? Live without work? Some can’t work, but many so called “retired” folks can work at something and their lives would be more meaningfull for it. After 70, you can make as much as you want to and still get your full SS check each month. Nice gig. No reason to complain . 60 and want to retire? Spoiled brats probably voted for Obama and will vote for another tax and spend liberal this year who voted to allow corporations to move off shore and take big tax breaks to do it.

    We get what we deserve pretty much.

  • Adjusted for inflation, our current minimum wage is a FRACTION of what it used to be. But those in power are unable to raise it to where inflation should have had it (and people, just like myself, don’t WANT the minwage to go higher either). We don’t want to pay even more than we do for our precious “stuff”.

    Many middle class jobs have gone the way of the dinosaur. “Brainless jobs” like machine work, assembly, welding, construction, heavy lifting, driving, and security guard work have been/are being given to automation — meaning all of the men who used to earn their livings doing grunt work have become unemployable.

    People today pay for a panoply of things that we didn’t pay for in our parents’ generation: satellite/cable, [multiple] cell phones (one for everyone in the fam!), multiple computers plus monthly Internet fees, gym memberships because we are mouse potatoes, more than one car per household (we got by just fine with only one car per home in the past), paying extra for wholesome/non-GMO foods (when ALL foods used to be non-GMO), and maybe too the unbelievable amount of taxes we spend to support the prisons full of hardcore, unrepentant criminals. The taxes we spend on ONE murderer is 15 to 20 times what we pay for one welfare mother.

    I say grow your own food, as much as you can, and then grow more than you originally thought you could. Make your own Topsy-turvies (look them up) and grow tomatoes, strawberries, cucumbers/zucchini, etc., from your living room window. Melons grow GREAT with indoor trellising too. Plant dwarf trees in pots for your patio. If you have an actual home with actual dirt of your own, EVEN BETTER, GROW MORE!

    Dump your cable, get free cell service (not just Obamaphones offer free cell service, try FreedomPop). Walk, don’t drive. Eat at home. Earn a degree for a job which utilizes “empathy”, “character”, and “warmth”, which is where jobs of the future are in most need of, and automation can’t replace those human features.

    • Donald Duck

      @Carrie:

      American Free Press with Pat Buchanan and Dr. Craig Roberts and the investigative independent Journalist THORN (about Hillary Clinton)

      http://www.americanfreepress.net

      The LaRouche Movement

      http://www.larouchepac.com see international EIR NEWS Agency

      Daily Peak Oil Blog beyond postmodern neoliberal globalist Mainstream Media of the Globalists (Neoliberals and Neocons)

      http://www.fromthewilderness.com Peak Oil and 9.11.

      Foreign Policy and Geopolitics beyond postmodern neoliberal mainstream media!

      http://www.german-foreign-policy.com

      Also see the older articles in the archives!

      • Um, thanks for the nonsensical links which have nothing to do with the topic at hand, ergo will not be reading them. They look like the links which Snopes and Politifact have debunked anyway.

      • L. A. McDonough

        These so called patriot groups are now useless, producing nil.

  • Mistanick

    Good links I guess (I haven’t looked at all of them yet) but what is your comment to the article?

    Michael asked: So is there any hope for the middle class in America?

  • Ginger

    This is why we have the “angry voter” this year. People living in the real world know that these figures are true and are feeling that financial pinch. Time for us to get the crooks out of Washington and help save the middle class and small businesses.

    • L. A. McDonough

      Congressmen and women are bought, this is why Muslims are invading because the politician scum low life are getting grant money to allow these settlements in their communities. The so called crooks will never leave incl local gov. and state. Scum of the earth politicians are about the lowest form of humanity, one step above Islam.

  • ThereIsNoFuture

    Sadly, many don’t care. God Bless.

  • L. A. McDonough

    These groups produce nil. Total flops over many decades.

  • L. A. McDonough

    John: these groups are too little too late, utter failures in 2016. May have worked circa 1958?

  • Dominick Perez

    I know people on welfare who drive brand new cars, get Section 8 housing vouchers, lifeline credit on the monthly utility bill, food stamps, SSI, free Obama phones and hit three or four of these food pantries ever month crying poverty. Trust me they eat better than you do and have a nicer cell phone lol keep working like a sucker and voting for Hillary jerkoffs lmfao.