Report: Americans getting poorer - MSN Money

Middle Class Squeeze

I'm a little fearful of the current state of our middle class. Anyone who is middle class like myself has been under a squeeze for the past few years. I know the inflation index is something like 3% per year, but that index doesn't take into account all of the costs the pile up on the middle class. Our tax burdens have increased, health care costs go up 5% on a good year, more on every other year. Gas has taken a heavy toll. Even granny on social security thinks long and hard every time she gets behind the wheel to go to the store. Wages don't seem to be able to go up enough to compensate. Companies are transferring health care insurance increases onto their workers. I can't blame them as they can't absorb the increases either.

My father was a union pipefitter during the booming 80's. Everything was going great as the ecomomy was going gang busters. I remember when the union voted down a $5 pay raise because it wasn't enough. And this was 1980 dollars. Then Reagon ordered them back to work with a pay freeze. Oops.

It was feasible for families to have only one bread winner and a stay at home parent. Our standard of living continued to go up. And it kept going up into the 90's. It wasn't necessarily a gang buster economy that kept the standard on the rise, it was the introduction of the 2 parent income. Mom and dad both worked and their combined income was better than 1 80's income. Our houses got bigger, our cars got bigger.

And so here we are now. We don't have a third worker to give our middle class families that boost in income. In fact, that two parent income under the pressures of inflation is only doing what 1 income did in the 80's.

People have been predicting the death of the consumer for a long time and again and again the consumer has risen on their plastic. I'm afraid this time the consumer is tapped.

This article talks a little bit about the topic. It is inconsistant and shows how difficult it is to track how our wages compare to other places. It is an interesting read though and worth browsing through.

http://articles.moneycentral.msn.com/Investing/Extra/ReportSaysAmericansGettingPoorer.aspx