Middle Class Death Watch: The Median Household Is Now Poorer Than in 1984

By Jordan Weissmann | Slate | July 31, 2014
Excerpts:

"You're probably aware that a great chunk of America is poorer today than before the housing crash. But recently, the Russel Sage Foundation delivered a reminder that middle-class wealth is in fact still lower than it was a generation ago. As shown on the graph below, the median household in 2013 was worth about 20 percent less than in 1984.

As Allison Schrager writes over at Bloomberg Businessweek, middle class families are poorer today than in the Reagan days for two main reasons. For starters, housing collapsed - and for most Americans, their home is their biggest source of savings by far. Second, household debt has risen significantly over time. Because wealth is just the value of what we own minus what we owe, the typical family is now worth less than 30 years ago.

Or is it closer to 45 years ago? In case the chart didn't make you depressed enough, consider this: New York University professor Edward Wolff has calculated that, by 2010, median net worth in the U.S. had plummeted to its lowest level since at least 1969. Now, Wolff's research and the Russell Sage report were based different data sets.

But the newer numbers still suggest that middle-class wealth has declined a bit in the last four years. So when it comes to their financial health, many American households might well be stuck back in the age of Aquarius."

see graph::
http://www.slate.com/blogs/moneybox/...has_risen.html
......

IMO: As the graph shows:the median household in 2013 was worth about 20 percent less than in 1984. The typical family is worth less tan 30 years ago, much of due to the housing collapse. Because wealth is just the value of what we own minus what we owe, a median family's only large investment is their home plus what they owe, the housing collapse hit the average family more.

Meanwhile, we see the wealthy profits rise continuously albeit the few burps on the way to over 125 percent in 2007 with no losses as the median family did in the steep minus 75 percentile downward to 2009 (new president inaugurated)where it is now inching upward slowly for the median family.

The wealthy never lost their steady growth except for the few burps and their wealth increased by 125% from 1984 through much of G.W. Bush Administration until 2007 when America was almost broke from the 2 Bush Wars.

 

That's the one thing I took from Robert Kiyosaki's books: If you are part of the middle class, you are either going up or down...
There was also another very interesting article on the Start-up Bros blog which was quite relevant for this, but I can't find it now.
I'll try to dig it up later.

 

That means the margin gap between the wealthy and middle class is growing wider and wider by the day....question, is such a situation reversible/rectifiable or from here on, its a worst slip off for the middle class household?

 

The other scary thing is the fact that households are working many more hours than they were in 1984! It's not looking good for future generations where no parents spend adequate time raising their kids.

 

...and that's why we are having children behaving in such queer manners in the social setting because parents are out there toiling from sun up to sun down...the upbringing of a child is cut short...no wonder we got so many delinquents running up and down in the social arena

 

The wealthy keep getting wealthier because they have understood how to capitalize on what they have. They form groups that help each other rise in case they fall from their position; they are willing to do almost anything to maintain their status. Most middle class families operate as individuals and may not get any help to rise. They remain in the same category unless a lucky break comes their way.

 

This is one sad reality and all colors of politics are to blame, rich are simply getting richer and poor getting poorer...

 

I think the big problem with middle class incomes is the disappearance of the manufacturing base which one made up a big portion of the solid, reliable middle class jobs that were present in our country. I think we really need to focus on bringing those jobs back to American shores, by lowering our corporate taxes and making this country more business friendly. We have to get more solid paying jobs for our citizens. It'll help wages rise and lift people out of poverty. We have to unleash capitalism on our society once again. Government programs and wealth redistribution isn't going to do it.