Prices and corporate profits are up as wages stagnate and Americans are forced ever deeper into debt.


CNN Money

In other words, we're headed towards becoming a third-world nation.

A symptom of slavery is what you are observing. You know the routine; walks like a duck, squaks like a duck, is a duck.

What slave society has a large and prosperous middle class? None; rather you see a large and poverty sticken underclass, a small middle class, and a small ruling class with most of the wealth.

I need CNN to tell me this?

pfft...

Perhaps next they will announce that water's wet?

Don't need no CNN, the national savings rate is negative. When you consider there are a fair amount of people who are actually saving money, this means that a majority of Americans are further down the toilet every month. Albeit this does not include the appreciation - or depreciation - of one's home value (if they have one).

st peter dont you call me cause i cant go
i owe my soul to the company store

My family is experiencing this as a gradual squeeze: insurance goes up, utilities increase, food costs rise, school fees higher than last year.

My most recent raise: 0.17/hour.

Good article. I have an objection to the idea that anyone is "forced" into debt though. If you don't want to borrow....don't. If you are living beyond your means...stop. If you are unhappy with your paycheck from macdonalds, go LEARN something of value, the knowing of which someone will pay you more than macdonalds does. I don't know about anyone else, but my time digging ditches and cleaning toilets in college taught me more about why I wanted to not be at the bottom of the economic foodchain better than anything else in my life.

Sounds like personal responsibility for ones actions is being discounted as to WHY people are in debt. I realize keeping up with the Jones's is important, but we aren't FORCED to do so, we are ignorant and silly and run out and just DO it. Shame on us, but lets not try and pretend that peer pressure and what society wants to advertise us into doing is a substitute for clear thinking about what we can, and can not, afford.

Anyway, I can agree that as Americans standards of living are forced downward, what we see happening in relation to debt is hardly a surprise.

Most serious debts are caused by unfortunate life events such as illness/injury, divorce, or death in the family. See bankruptcy statistics.

ClubOfRomeII,

I certainly agree with a lot of your post. Some people take on too much debt. Some could use further education to increase their earning power. It is very tempting to live beyond one's means, and many of us have had to learn a lesson or two in this regard.

However, I believe a lot of people are teetering on the high cost of living. My family could be a case study. My husband has a well-paying job and mine's not bad, and we have a moderate amount of debt. We're raising three kids. We don't keep up with the Joneses - we're not even in the running! But the value of our income is steadily declining with rising costs of basic needs. We're living quite modestly and don't have any expensive habits.

Honestly, I hear the same lament from most of the people I know, who are, on average, lower middle class to middle class people.

I don't deny that individual effort is very important. But our energy based economy is adjusting to the tightening energy supply/demand situation even before the arrival of the true peak in oil. Some acheivers still may come out ahead, but there are going to be mostly losers.

Keep in mind that commonly used GDP figures include vast amounts for military spending in the ME, which doesn't go back into the hands of ordinary Americans. The Fed already has stated that the average per capita, inflation adjusted wage since 2000 is going down - albeit slowly. Whether that is a sign of approaching PO or economic weakness, it makes you wonder exactly how bad things will get after PO.

See, considering the length of time that the American standard of living has been decreasing, I have a very difficult time wrapping PO into America shipping manufacturing jobs as fast as possible overseas. I understand the more RECENT effects of inflation being energy pricing related to some extent, but I think the fundamentals of an American declining standard of living has been going on alot longer than the entire PO tie in, which appears to be more of a recent event.

Good point, inflation adjusted average wages per capita peaked long ago - but occasionally struggled to recover some.

You may think it's coincidental that US peak oil, peak average inflation adjusted wages per capita, and the collapse of the US based Bretton Woods all ocurred about the same time - 1972 to 1974. But I don't.

Hmmmm... Most interesting, indeed.

While I am as wildly interested in coincidences as the next guy, I find it a bit of a stretch to connect peak oil in the US 35 years ago with per capita income any more than I would connect peak oil in Ohio in 1903 or so with the inability of the Wright brothers to fly further than 900 feet on Dec 17th of that year.

Look, I'm quite certain, if I quickly consume a fifth of vodka, have the wife whack me in the head with a hammer, and drop just a wee' bit'o acid, I can imitate Ruppert in both assembling random facts inaccurately to prove that 9-11 was directly caused by some coincidental string of events stretching back to Dick Cheney as a junior staffer in the Nixon administration.

But I've got to draw a line somewhere...plus it would hurt to have the wife whack me in the head, so I'll just venture that coincidences do not a proof make.