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WHICH SIDE ARE YOU ON?
How U.S. workers got left behind

By Sharon Smith | September 8, 2006 | Page 7

WHILE ACCOMPLISHING little else in this election year, the House of Representatives voted in June, for the eighth consecutive year, to award all members of Congress raises in their annual salaries to a hefty $168,500.

Washington's policymakers have not, however, managed to muster a similar bipartisan resolve to raise the federal minimum wage of $5.15 per hour, unchanged since 1997, leaving a family of three $6,000 below the federal poverty line--now at its lowest proportion of the median annual wage since the years following the Second World War.

The human toll of this heartless government policy was illustrated on this Labor Day weekend, when six Chicago siblings, aged three to fourteen, perished in an apartment fire. The source of the fire proved to be the candles this poor family was using for light because they had been without electricity since May.

This image should shatter media depictions of the U.S. as a predominantly "consumer society." Those in upper income levels have certainly engaged in a "consumer spending spree" over the last several years. But those in the lower echelons have been struggling to survive. Class stratification has not been this pronounced since the late 1920s.

Since 1997, the last year in which the minimum wage rose, the cost of gasoline has risen by 140 percent, and home heating oil by 120 percent. Since 2000, health care premiums have gone up by 73 percent.

But all workers' wages have been falling in the current economic expansion--declining roughly $2,000 per household since 2000. This marks the first recovery since the Second World War that has not raised workers' wages.

New York Times reporters Steven Greenhouse and David Leonhardt commented on August 28, "[W]ages and salaries now make up the lowest share of the nation's gross domestic product since the government began recording the data in 1947, while corporate profits have climbed to their highest share since the 1960s. UBS, the investment bank, recently described the current period as 'the golden era of profitability.'"

Between 2000 and 2005, the real median income of households headed by persons under age 65 fell by 5.4 percent. Roughly one-fourth of all low-income families with a full-time worker was unable to pay the rent or mortgage at least once during the past year, and the same number reported being unable to put enough food on the table.

In 2005, the number of Americans without health insurance rose to 46.6 million in 2005, to 15.9 percent from 14.2 percent in 2000.

Economists at Goldman Sachs noted, "The most important contributor to higher profit margins over the past five years has been a decline in labor's share of national income."

But gaping class inequality cannot be blamed on the Bush administration, for it has widened virtually without interruption since the mid-1970s.

As Ezra Klein noted in February's American Prospect, "while electoral defeats help explain why Democrats couldn't implement a comprehensive antipoverty strategy, they don't account for why they couldn't propose one.

"The Democratic National Committee's issues page never mentions the word 'poverty.' Nor does Harry Reid's, Nancy Pelosi's, the House Democratic Caucus, nor the Senate Democratic Caucus."

Indeed, Democratic President Bill Clinton ended "welfare as we know it" in 1996, dismantling 60 years of New Deal legislation obliging the government to assist the poor. No government agency bothered to follow the subsequent (mis)fortunes of the poorest Americans suddenly released from their "cycle of dependency."

More than likely, former welfare families make up a substantial proportion of the 43 percent of poor American households now surviving on less than half the official poverty level in 2005--just $7,800 for a family of three.

Workers have not shared in the current economic prosperity that has sent corporate profits soaring in recent years. When the economy flat-lines in the coming months as the housing bubble bursts, the silent depression experienced by working families might finally enter the mainstream of public discourse. And the "golden era of profitability" could well meet the same fate as the "Roaring Twenties"--in an explosion of class struggle.

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