August 21, 2007

New Data Shows Middle-Class Americans Are Struggling Under the Bush Economy

While President Bush is in Canada, new data was released showing that average Americans are struggling under the Bush economy. In recent weeks, Bush has touted his Administration’s economic record, but the numbers show what most Americans are feeling: that it is harder to make ends meet.  Democrats in Congress are working to ease the middle-class squeeze by raising the minimum wage, making college more affordable, lowering the cost of prescription drugs and continuing to cut taxes on middle-class families. President Bush should put pragmatism before ideology and work with Democrats to enact the people’s business.

Average Americans are suffering under the Bush economy:

According to Recently Released Data, 2005 Marked the Fifth Consecutive Year Americans Had to Make Ends Meet with Less Money. According to recently released IRS data, the average income in 2005 was $55,238, nearly 1 percent less than the $55,714 in 2000. Total income listed on tax returns grew every year after World War II, with a single one-year exception, until 2001. After 2001, incomes have never exceeded the 2000 peak. [New York Times, 8/21/07]

* White House: Average Incomes Below Pre-2000 Levels “Should Not Surprise Anyone.” “The White House said the fact that average incomes were smaller five years after the Internet bubble burst ‘should not surprise anyone.’” [New York Times, 8/21/07]

Americans Are Working Longer, But Wages Are Lagging.  Americans have worked harder – and more productively – for their families, but are not receiving the proportionally increased rewards for their hard work. Real employment compensation has lagged behind productivity gains. In the business sector, real hourly compensation in the business sector has increased 8.1 percent between the first quarter of 2001 and the second quarter of 2007 while productivity increased 18.4 percent. [Bureau of Labor Statistics, Productivity and Cost Table]  

Real Median Family Income Is Falling. “Despite the fact that the most recent economic expansion began in late 2001, the real income of the median family fell each year through 2004, the most recent available data. Between 2000 and 2004, real median family income fell by 3%, or about $1,600 in 2004 dollars.” [EPI, State of Working America, 2006/2007]

37 Million Americans Live in Poverty. According to the U.S. Census Bureau, 37 million Americans lived in poverty in 2005, comprising 12.6% of the population. [U.S. Census Bureau, 8/29/06]

46.6 Million Americans Do Not Have Health Insurance. In 2005, an additional 1.3 million Americans became uninsured, increasing the total number of uninsured to 46.6 million, or 15.9% of the population. [U.S. Census Bureau, 8/29/06]

Meanwhile rich continue to get richer in Bush economny:

Growth in Total Income Was Concentrated Among Those Making More than $1 Million – Just One Quarter of One Percent of Taxpayers. Not surprising, actual growth in total incomes was concentrated among those making more than $1 million. The number of such taxpayers grew by more than 26 percent, to 303,817 in 2005, from 239,685 in 2000. These individuals, who constitute less than a quarter of 1 percent of all taxpayers, reaped almost 47 percent of the total income gains in 2005, compared with 2000. Data also showed that over one-quarter of the investment tax cut savings went to just 11,433 taxpayers, (those who made $10 million or more) saving them almost $1.9 million each. However, the nearly 90 percent of Americans who make less than $100,000 a year saved on average $318 each on their investments. Those individuals collected 5.3 percent of the total savings from reduced tax rates on investment income. [New York Times, 8/21/07]

Nearly Half of Americans Reported Incomes of Less than $30,000. “Nearly half of Americans reported incomes of less than $30,000, and two-thirds make less than $50,000.” [New York Times, 8/21/07]

*White House Spokesman: Income Growth Concentrated Amongst Wealthiest Americans “Is Not a Very Interesting Story.” “Mr. Fratto said the fact that nearly all of the growth in incomes was among those in the upper reaches of the income ladder and that the majority of investment tax breaks went to those making more than $1 million ‘is not a very interesting story.’” [New York Times, 8/21/07]

Bush tax cits on investment overwhelmingly benefited wealthiest Amercans:

Those Making Over $1 Million Received 62 Percent of Savings from Tax Cuts on Capital Gains and Dividends. “People with incomes of more than a million dollars also received 62 percent of the savings from the reduced tax rates on long-term capital gains and dividends that President Bush signed into law in 2003, according to a separate analysis by Citizens for Tax Justice, a group that points out policies that it says favor the rich.” [New York Times, 8/21/07]

Just 11,000 Taxpayers Making Over $10 Million Received 28 Percent of Savings from Tax Cuts on Investments. “The group’s calculations showed that 28 percent of the investment tax cut savings went to just 11,433 of the 134 million taxpayers, those who made $10 million or more, saving them almost $1.9 million each. Over all, this small number of wealthy Americans saved $21.7 billion in taxes on their investment income as a result of the tax-cut law.” [New York Times, 8/21/07]

90 Percent of Population Earning Less Than $100,000 Collected Just 5.3 Percent of Savings from Investment Tax Cuts. “The nearly 90 percent of Americans who make less than $100,000 a year saved on average $318 each on their investments. They collected 5.3 percent of the total savings from reduced tax rates on investment income.” [New York Times, 8/21/07] 

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