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You would think this would be front page news every day until the problem is fixed. Not only is that a huge amount of money for a huge portion of the country, but you would expect our left leaning media to be all over this. There is no better evidence that capitalism, at least in its current state, is failing. If the left actually cared about the working class, if the wave of cultural Marxism that has spread through academia and the media was actually about the plight of workers oppressed by a distant and uncaring elite, no fact would be repeated more often than this.
And yet, aside from a handful of articles - such as one from the New York Times in 2011, and another from The Atlantic in 2015 - the issue hardly gets mentioned by the media. And even when it is mentioned, it is often editorialized in a way that distorts the problem and hides its root cause, if not outright lied about by a media with an agenda that has little to do with helping actual workers.
The evidence for the theft of 1/3 of the working class' pay comes primarily from a left wing think tank called the Economic Policy Institute, and comes from a comparison of productivity growth in the economy vs the average hourly pay of non-management workers. Their graph shows that worker pay increased steadily at basically the same rate at productivity from the 1948 until 1972. In 1972, productivity was up 92.2% from where it was in 1948 while the average worker's hourly compensation was up 91.3%. From 1972-3, productivity rose to 97.0% higher than its 1948 value while pay fell to only 91.0% higher than it was in 1948. Productivity and pay both fell from 1973-4, but productivity rose again from 1974-5 while pay declined for another year, widening the gap between productivity and pay growth to over 10% for the first time since 1948, a gap which would never close again.
However, for some reason, both the Economic Policy Institute's current graph and the New York Times graph put a line through 1979 to divide the era of regular pay growth and pay stagnation, despite the gap having grown to about 15% by then. It would seem that 1972-3, when pay growth stagnated and then fell for the first time in decades, would be a better place to put the line - and indeed, that is where The Atlantic's graph (and some older versions of EPI's graph) put it. Is there a reason for this obfuscation?
There is, of course, some disagreement over EPI's findings. Right wing sources like the Heritage Foundation claim that worker pay is actually rising at about the same rate as productivity. Their main disagreement with EPI's findings is due to the fact that EPI doesn't include management workers and self-employed professionals in their estimate of worker pay. When those groups are included, pay did in fact increase at almost the same rate as productivity - however, as the Heritage Foundation notes, only the top 20% of earners saw their earnings rise at a faster rate than productivity since the 70s, while the middle 60% saw far lower growth in their pay, so their findings are of little comfort to a majority of American workers, particularly the shrinking middle class.
The left blames this problem on a variety of factors that have little relationship to the actual wage data, such as declining union membership and minimum wage laws that don't keep up with inflation. Union membership has been declining since the early 1950s, so workers continued to get raises for the first two decades of declining union membership. And while minimum wage laws haven't kept up with inflation since about the same time worker pay began to stagnate, that's likely a symptom of the same problem rather than the cause. Nor can this be blamed on lower taxes on the rich, since this data looks at pre-tax income and 1/3 of your pay is being stolen before a single dollar of taxes is taken out.
The establishment right mostly tries to dismiss the existence of the gap, despite a variety of sources pointing to its existence and the Heritage Foundation's admission that middle class has indeed seen their pay stagnate even as their productivity rose. It might be tempting for some on the right to blame the problem on immigration, and changes in immigration policy in the 1960s did allow for an increase in the number of immigrants entering the country, but growth in immigration was slow until the late 80s and early 90s. By that time pay had already been stagnant for a while, so immigration doesn't seem to be the driving force keeping wages down, even if it may be a small factor. This doesn't negate the many other reasons many Americans want more control over immigration, such as preventing criminals from entering our country and protecting our cultural values by making sure immigrants share those values before letting them in, but we must look elsewhere to explain why worker pay is stagnant.
Other theories include the rise of automation, increased female participation in the workforce, and corporate greed. Blaming automation implies that automation was not happening from the 1940s through the early 1970s, or was at least not significant enough to affect worker pay until then, and that it has happened much faster since the 70s. There's no objective way to measure automation to test that theory, but as automation is one of the driving factors behind increased worker productivity, it seems like automation should be increasing the availability of goods and services to each worker. Shouldn't automation result in an economy where most people can get more stuff for less work, rather than the same amount of stuff for more work? There's no good explanation for why automation would result in stagnating worker pay, especially as jobs become more high tech and require a more educated middle class that should be able to demand higher wages relative to poorly educated and low skill workers.
Instead, it is precisely that highly educated middle class who have taken the biggest hit to their wages. As for women in the workforce, much like the stagnant minimum wage, this appears to be more a symptom of a greater problem than the cause - the rise of second wave feminism in the 70s occurred as pay was stagnating, and was likely driven at least in part by women needing to work outside the home more to make up for their husbands' stagnant pay. And considering the significant increases in productivity and automation, workers ought to be able to provide for their families without needing their wives to work as there should be more resources available per worker today than there were a few decades ago when fewer women worked outside the home. As for corporate greed, corporations were just as greedy from the 1940s until the early 70s as they are today, and simply blaming greed does nothing to explain how the elite are able to siphon more money out of the economy today than they did decades ago. A better explanation is needed.
There was a major change in the way our economy is run that occurred in the early 1970s, just before worker pay stopped growing. That change occurred in 1971, just before pay stagnated from 1972-3. From 1944-1971, an international monetary agreement called Bretton Woods tied the value of the dollar (and many other currencies around the globe) to the value of gold, limiting the Federal Reserve and banking industry's ability to manipulate the money supply. During the Bretton Woods years, changes in the money supply and value of the dollar were primarily driven by market forces rather than by the decisions of bankers and economic elites. The Bretton Woods years overlap so perfectly with the period when worker pay kept up with productivity growth that the glaring lack of any mention of it by any of the think tanks and media outlets - left, right, or center - that have written about the gap between pay and productivity says a lot about the dishonesty of our media and academics.
Is Federal Reserve policy really capable of causing such a major economic shift? It certainly seems to be. Consider a recent study from economist Brian Barnier of FedDashboard.com that found that over 90% of stock market price fluctuation since 2008 has been due to Fed policy. If the Fed can cause that much of a shift in the market, it's likely that the Fed can cause a lot of other changes too. That same study found that from the end of WWII until the early 70s, GDP growth caused most of the change in the stock market - as it would normally be expected to. Then, in the mid 70s, the growth of debt based spending - enabled by the end of Bretton Woods which gave the bankers much greater ability to expand the money supply through loans - became the biggest factor in the stock market's movement, causing a solid majority of stock market movement over the next few decades, first through the expansion of consumer debt and credit cards, then by business loans and mortgages. Fiscal policy, primarily set by the Fed, has been the driving cause of stock market movement since shortly after the end of Bretton Woods, rather than market forces which were the driving cause of market changes under Bretton Woods. And the worst drop in worker pay came during the 1980s when Paul Volcker, who said that helping end Bretton Woods while he worked in Nixon's Treasury department was the most important decision of his career, was chairman of the Federal Reserve.
It's clear that Bretton Woods and the era when supply and demand ruled the market coincided with the steady rise of worker pay, while the era of Federal Reserve policy dominating the market has coincided with stagnant worker pay and wealth redistribution to the rich. Whether this is due to inflation, as workers who aren't as economically savvy as management and owners won't always realize that a raise that's equal to or less than inflation is not actually a raise at all, or due to the direct creation of wealth within the banking industry and by members of the investor class through fractional reserve banking and other tools enabled by the Fed, or a combination of those and other factors is not entirely clear, but it is certainly clear that there is a strong correlation between central bank meddling in the economy and stagnating worker pay. This justifies far more investigation, and we may not have all the answers to how the rich are gaming the system and screwing the working class without a full audit of the Federal Reserve. But there are two more questions we can ask now without waiting for that audit that may help shed light on who's responsible for the problem: who has been in charge of Federal Reserve policy for the past few decades, and where is the money going?
Remember that it was Paul Volcker who was both instrumental in ending Bretton Woods, enabling the rise of the Fed's dominance of the economy and redistribution of wealth, and who oversaw the largest decrease in worker pay in the past half century. There's one other thing you need to know about Paul Volcker, something that will help answer the question of who controls Fed policy and where the money is going. Paul Volcker shares something in common with four other recent Federal Reserve chairs during the period of wage stagnation and with an extremely disproportionate number of billionaires - Volcker was hereditarily (though not religiously) Jewish.
Arthur Burns, who became chairman of the Federal reserve in 1970, the year before Volcker convinced Nixon to end Bretton Woods, was the first Jewish Federal Reserve chairman since World War 2 and ran the Fed through most of the 70s. Volcker took over the Fed in 1979 and was followed by three more Jews in a row: Alan Greenspan, Ben Bernanke, and Janet Yellen. While it may be tempting to blame ties to corporate or banking interests instead, only Volcker and Greenspan had any history of working in corporate banking prior to working at the Fed; Burns, Bernanke, and Yellen had mostly academic and government advisory experience before their appointments to Federal Reserve chair. Last year, Trump appointed the first non-Jewish Fed chair since the 1970s, and that year was one of the best years for wage growth since the 1970s.
Just how wealthy have the Jews become while controlling our central bank, the most powerful financial regulatory agency in the country? Most estimates of Jewish wealth (including Jewish sources) find that over 1/3 of American billionaires are Jewish in a country that is less than 2% Jewish, meaning you're roughly 20 times as likely to be a billionaire if you're Jewish than if you're not. That overrepresentation is even greater at the top, where 5 of the 10 richest Americans are Jewish according to the Times of Israel. Coincidentally, Jews are overrepresented among the billionaire class by about the same amount as the portion of the working class' pay that's missing from their checks. And according to one estimate, Jews were 23% of the billionaire class in 1987; that year, workers were losing about 20% of what they should have been getting paid based on their productivity according to EPI, about the same percent as Jewish overrepresentation among the billionaire class. As the rich have gotten richer while the working class have gotten robbed, the rich have also gotten more Jewish.
Of course, not all Jews benefit from the Fed's theft of the working class. Rather, it's more likely that there is a Jewish financial cartel in much the same way there are Mexican drug cartels, an Italian mafia, Islamic sex slave grooming gangs and terror networks, and many other gangs whose identity is based partly on ethnic and religious affiliation. Volcker, as someone who both was and was not Jewish, was the perfect patsy - he was ethnically Jewish enough to be part of the tribe, but any backlash against him for his role in ending Bretton Woods and reducing worker pay could be deflected away from the Jewish financial cartel because he was a practicing Christian. Not all Jews have to be a part of this financial cartel for the people responsible for stealing 1/3 of the American working class' pay to be Jewish, and those that aren't should be just as upset about the actions of those that are as anyone else. While the idea of a Jewish financial cartel may come off as conspiratorial to some, two of the biggest news stories of the past year - Jeffrey Epstein and NXIVM - have been about Jewish billionaires (the Bronfmans in the case of NXIVM) running pedophilic sex slave trading networks which they used to blackmail and manipulate the rich, famous, and powerful. It's not much of a stretch to assume that part of the reason why they needed those criminal networks was to help cover up an even bigger ongoing crime.
But it is possible, if unlikely, that there is no Jewish financial cartel. In that case, however, the resulting assumption seems much worse for the Jewish people - that five different Jewish Federal Reserve chairs simply happened to accidentally oversee the stagnation of the American working class' pay as Jewish investment bankers capitalized on their fiscal policies after more than two decades of solid worker pay growth under non-Jewish Fed chairs. If that's the case, a five for five record of screwing over the working class is more than enough evidence that Jews should never be allowed near the halls of financial power in the United States ever again. But, as many lower and middle class Jews are hurt just as much by the financial theft that's been going on for decades, it would be far better to investigate the possible existence of the Jewish financial cartel and focus our attention on the people directly responsible for robbing a majority of Americans first, rather than directing our ire at all Jews.
Regardless of whether or not this Jewish financial cartel exists, a few things should be clear. First, the Federal Reserve needs a full audit and investigation to determine how corrupt the institution has become and whether they are directly enriching particular members of the billionaire class or just accidentally creating the kind of economy where rich and often Jewish investment bankers profit while the rest of us stagnate. Second, we need to seriously consider changing our monetary system, whether that means returning to a gold standard, a pseudo-gold standard such as Bretton Woods, or some other form of stable currency that limits the inflationary and wealth redistribution power of the banking industry. Third, Jewish control of our financial (not to mention political) institutions must be dismantled in much the same way our Jewish media and academics talk about dismantling white privilege, regardless of whether the problem turns out to be a specific criminal cartel comprised mostly of wealthy and powerful Jews or whether the problem turns out to be that the nature of the Jewish people is to manage the economy for the good of investment bankers and upper management, rather than for the good of the workers who produce and distribute the things we all rely on to survive and thrive. Americans deserve an economy that works for us as much as we work for it.
Reader Comments
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I have lived much of the era they discuss though and can say with certainty that we, the working people, are being screwed. In the early 1970's my immediate family consisted of myself, my mother and father. Only my father worked and he was an electrician. Not an engineer (at that time), just a regular electrician. Working for a local company he earned enough so we owned a house in a fairly nice neighborhood, with a lawyer and an exec of an insurance company as neighbors. We had a new car and from what I saw, had everything we needed. Fast forward to the mid 80's (when I began working) and wages had declined to the point where a normal hourly worker earned enough to rent a house in a sketchy part of town, driving a used 8 year old car that was in poor shape when I bought it. Things only declined from then through the 90's and continued to get worse past 2000. Despite my making more money because I had the experience and knowledge to get either skilled positions or management jobs.
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I believe that when women began to work in greater numbers, "they" increased the price of goods and services across the board so that with both husband and wife working a household brought home less value of money then a single worker did previously. Certainly the cost of goods like vehicles, houses, clothing and food all increased and continues to increase.
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Nixon has turned out to be a monster in so many ways! Starting the horror that is the DEA as well as the ATF, getting us off the gold standard, warping the way America handles and produces food. So many things turned out badly for the 99%!! I agree that the central bank, the privately owned Federal Reserve has played a big part in creating and maintaining the imbalance between wages and productivity. IMO, the Fed needs to be abolished! We need to create The Jackson Act. An act that abolishes the fed and prevents any central bank from operating in the US. Maybe the Jews do play a part in this mire of corrupt financial mess, I honestly haven't looked into it. But appointing a "goy" as head of the Fed seems like a good idea.
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The decline in both Union membership and union effectiveness isn't some anomalous event though. The 1% both hate and fear unions. They worked hard to get corrupt people running unions to blacken the reputation of unions in general and to cause workers to distrust and even reject the concept of unions. Government too played a big part in unions influence being lessened in the workplace. So there are valid reasons for what's happened to unions today.
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The author mentioned the media.. The media cannot be trusted! They will always uphold the government's policies, always push government approved propaganda and even censor or lie about things that make the official story portray the government or corporations in a bad light. The media cannot be trusted!
There are definitely more and other complex factors but this I believe is by far the greatest contributor to the 'death of the middle class'.