Despite Barack Obama’s claims that he was a president of the people, with plans to create a new America for the working man that would no longer offer benefits to corporations and the ultra-rich, critics claim that for most of his presidency results have been slow and uneven. To be fair, the dysfunction in the government cannot all be blamed on him- Congress is also partly to blame- but either way, the recovery is anything but a raving success story.
So how has the economy faired over the last five years? According to a recent report from CNN today, there are seven set-backs that those in the middle class have suffered over the last few years.
First, although the economy has improved and corporate profits have risen, the worker is taking home the smallest amount they have ever. Next, the inequality gap for the richest families, those making more than $394,000 a year, has risen substantially, while the other 99% of American, including the middle class, has barely budged. This means that most of the income gains, a whopping 95%, have gone to the top 1% of income earners.
Job losses remain high for the middle class
Next, CNN points out that the job market, which is up substantially from 2010, still has not gained enough jobs to replace the estimated 8.7 million jobs which were lost from 2008 to 2010. Experts note we are well below the 7.9 million jobs needed to get up back to the 2008 levels when unemployment was under 5%. How long will it take for us to get there? No one knows for sure, but some job experts estimate it will take the U.S. at least five years with strong hiring.
Part of the issue is the continued flight of workers from the job force. Experts note that although the administration touts a jobless rate of 6.7%, if the workers who have left the job market were considered into the equation the percentage would be closer to 10% unemployment rate.
Additionally, the poverty rate also remains very high, despite years of increasing welfare benefits and food stamps. In fact, the poverty rate has remained high the entire Obama presidency. Estimates put the poverty rate at 46.5 million, which is 15% of the entire U.S. population.
Critics of the Obama presidency also note that more Americans, including some in the middle class, are on food stamps than ever before, with an estimated 48 million currently receiving help. Congress is now considering reducing benefits, but as of now, the average food stamp recipient receives close to $150 per month.
Bottom Line for the middle class
The president came to power when the country was entering a difficult financial period. But his critics note that he has not taken the right steps to increase productivity in America, especially for the middle class. The first step is to bring back manufacturing jobs to America. Cutting taxes could also stimulate the economy. Democrats propose raising the minimum wage and increasing welfare benefits, but these measures do little to create jobs. The bottom line is it’s the wealthy who start businesses and hire workers. We need to improve incentives for that to happen by making our economic climate more hospitable to businesses and easier for the entrepreneur to follow their dreams.
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