Flat incomes raise doubts about economic recovery

Source: AP

WASHINGTON – Household income in the U.S. is essentially stagnant, raising doubts about whether consumers already hurt by job losses can sustain an economic recovery.

The now-ended Cash for Clunkers program helped lift consumer spending last month and is expected to provide an even bigger boost in August. But any rebound could falter if shoppers don't boost their buying, which makes up about 70 percent of U.S. economic activity.

"Consumers just don't have the financial firepower to go out and spend more," said Mark Zandi, chief economist at Moody's Economy.com. "Unless businesses curtail their job cuts, the recovery could very well peter out."

Stronger consumer spending is the key to a sustained recovery. For spending to rise, analysts said, income growth has to resume.


Read more: http://news.yahoo.com/s/ap/20090828/ap_on_bi_go_ec_fi/us_economy_53

And the debt was being paid down. We may never see either of those 2 things happen again in our lifetimes, if we don't make the right choices.

Like taxing the ever-living shit out of the fuckers who made this happen.

Now we're maxed out and the banks aren't lending.
We were able to limp along for 20 years on plastic
but now that's over. What are they going to come
up with next to avoid facing the truth: WAGES
MUST RISE.

must begin with ourselves. The political fast class publicly just panders to the lies that we choose to believe and deceive ourselves with. Just let them, let the politicians do what they do, lie - we can stop believing and listening.

Facing the truth begin from the fact that energy consumption per capita peaked 1979, a fact which certainly is not unrelated to the fact of stagnation of purchasing power since the same date. It is very simple really, what we consume is energy in form of various consumables, and once the energy ceiling has been hit per capita, individual consumption cannot go higher - or can go higher only at the expense of others consuming less.

So, regardless of how much US consumers yell with capitals that "WAGES MUST RISE", their purchasing power of consumables cannot exceed natural limits, the energy ceiling of available net energy. With the exception of increasing the effectiveness of foreign policy of global piracy, of course, which the Bushistas and neocons allready tried with not so good results, leading to severe cracks in US global hegemony.

Now, the quarter century of undulating plateau of stagnant energy resources per capita seems to be coming to end and next phase of civilization is diminishing energy resources per capita. Not more but less consumption, especially per capita. Adaptation to era of growing scarcity and... collapse of system founded on continued growth with all kinds of imaginable and unimaginable social upheavals included.

Facing the truth is often hard but also liberating and empowering, the truth that adaptation to this reality can start only with each of us, that we cannot expect or demand others (such as lying political leaders and other talking heads on the telly) do the adaptation for us. Each of us is responsible, for themselves and of each other, and we have no other possibility than accept our responsibility of adaptation or perish.

company. the last few years only the top performers got raises -- 1%. no social security increase for the next 2 years. oh well. i can't complain. we're doing okay.

when dividend/investment income is flat- THAT'S a problem.

This ain't exactly a new phenomenon.

x 30 years of this crap = boom Bubble CRASH! boom Bubble CRASH!
boom Bubble CRASH!

Every seven years. We never, ever, EVER learn - don't let a Republican NEAR the White House. EVER. You will be screwn over EVERY DAMNED TIME.

She works for a major hotel chain (H Day Inn).

Her hours have been cut from 40 to 32, and after 6 years on the job she is only making 50 cents above minimum wage.

She took her job because I became disabled in an auto accident, now not only has her pay shrunk due to reduced hours there will be no increases from either her job or my disability.

Were screwed.

i like when they announce there will be no raises.
talk about motivation!

i hope you'll get along okay...

Worker salaries have dropped since the early 1970s. To compensate, the government started reporting family income instead of individual income - as more people needed to work in each household, it made things look better.

than males -- they just decided to let male salaries fall --

as more and more women came into the work force to help support those families!

expects consumers to "boost their buying" belongs in the nut house. When citizens are losing their income, can no longer get credit, have a deflating house, face offshoring, get pay/hour cuts, etc., how on earth can they spend money? They can't.

The best way to have saved the economy would have been to help the CONSUMER first, not the banks.

Until we entered into free trade. Great for companies not so great for workers,now they may have killed the golden goose. Bring back restrictive tariffs and the problem MAY be solved.

and the Democrats don't start getting it and GET OFF THE FREE TRADE BANDWAGON, the middle class' goose in this country is cooked.

Bye bye to most of us. Our communities are all going to start looking like Detroit. See you in the bread line.

We have been without jobs for nearly a year, unemployment has ran out and now my 81 year old mother is paying our bills out of her earnings and savings. She works full time as Wal Mart and has for 10 years. When she quits, if she quits since she knows the possibility of us getting jobs is pretty slim in this economy, they will either not replace her at all or replace her with several part time people. Of course, theft has gone up dramatically becasue WM has cut down the number of employees which in turn raises costs to the consumers which in turn causes consumers to cut back on spending and so forth and the cycle goes on and on. I don't know what the answer is at this point.

How many years have we been saying

WHO IS GOING TO BUY YOUR STUFF IF NO ONE CAN AFFORD IT????



Many, many years, over and over again.

Too bad the all-knowing oligarchy is as stupid as a box of rocks.

The MEMO has gone out from The Powers That Be.
The recession is OVER!
There were several PARADES started on DU by the True Believers.
Must be true.

Which is precisely why there will be no recovery any time soon. Not only are consumers over-leveraged and hence tapped out, credit lines have been fouled by increased interest rates forcing consumers, myself among them, to close credit accounts rather than "opt-in" and take a massive rate increase.

With no house for an ATM, and no credit, and no job, just exactly what is it that consumers are supposed to use to buy things?


There is no recovery at this point, IMO.

Demand-side economics could get us out of this - slowly. But every politician since Reagan has bought the lie that giving billionaires more tax breaks is the answer.

My question - when are us working stiff going to take to the streets, instead of cyber-commiserating with each other? Why hasn't there been a general strike?

... as if there WAS a recovery. There is no recovery other than in the halls of government and media cheerleading and the minds of people who are "tired" of the recession.

There is no recovery today, there won't be one next month and there won't be one next year.

I have argued with a with a rightwing nut about his very subject. He claims that US wages are stagnant or falling because the US worker demands health care benefits.. I shit you not that is his argument..

would resolve this.

When companies see their health care premiums go up 8%, 10% or higher yearly, there goes the money for wages. I do think that outrageous increases in health care premiums have something to do with flat wages.

How will the economic recovery get its spin at the end of the year ?


oh wait;

"Unemployment drops dramatically"

apple cart business booming so.... don't upset the apple-cart



spinning sows ears into silk purses ?

Our economy was built on a house of credit cards.

The recovery may not be there, but a recovery is showing.

I think it could be a whole lot worse.

You are correct.

It takes both sides.

And of course consumers don't have the financial firepower, with news sites saying "The new good job: $12/hr" becoming standard, one needn't have a degree to figure some of this out.

http://cnnmoneytalkback.blogs.cnnmoney.cnn.com/2009/06/04/the-new-good-job-12-an-hour/