I've posting for a long time: "Where do you think the shrinking middle class is going?" They are going into the poor class. No one wants to talk about the poor except Bernie Sanders. It seems as though "poor" is a four-letter word to politicians.

SusanMerc -- Obviously, Thom also speaks about it.

It is not that people do not wish to talk about the poor. It is that the solution cannot be handouts.

When the majority of a workforce is younger and traditional, you have a burgeoning middle class and can should read more viable social systems. When that majority is retiring, and the population has less viable workers, and more homes are broken up and headed by singles, you have decreased incomes, more poverty and as people retire, or divorce the incomes drop drastically.

Government assistance is not the answer because that assistance has to rely on worker incomes and a large portion of incomes are retirees.

My income will be reduced drastically in 3 years to almost 1/10 of what we have now (if I count savings being spent also)

The dominant population (including those of European descent in Europe) have a fertility problem. The Europeans entered a human pop decline in the 1990s, this has shut down entire villages and industries as the "workers " that the next generation relies on does not exist.

Ergo, less workers to take care of and finance elderly and handicapped subsistence.

When a person retires, most experience a huge shift in income as do those who divorce.

We can't afford to take care of, or handle huge amounts of the population needing government care and Europe and England (where I was born) know the socialism Americans want to embrace is in the long term, a FAILED model.

This is why many Nationalized services have become privatized now, including more private health insurance schemes.

Most Americans look to European socialist models and actually have NO IDEA of what they are trying to emulate or how it can be achieved.

1. You cannot have large socialist programs, and still have the adjunct industries to that program be private.

2. OBAMAS Healthcare program will fail. You cannot have private hospitals, surgeries and no regulated caps on Healthcare services and education expenditures and private education and capitalists Healthcare programs.

For socialism to work, top to bottom the programmes must be government controlled and regulated.

Bernie Sanders, idea of discussing the shrinkage was taxing more, then spending it on capitalistic ventures.

For instance, he wants free college education but the federal government does not cap the costs of universities, colleges or private schools.

With no cap, who will pay the 150k per year bill to go to Harvard? How does the Fed government enforce caps when it is each STATE that dispenses scholarships and the private sector who control costs.

Put another wsy..we are getting older, more dysfunctional, and our coffers are almost empty. CHOOSE 1: either we address the environment, bring in more labor like Europe to increase the payers of taxes and foot the bills for social security and helping the special needs....., federalize all education and cap salaries for ALL jobs as well as mandate a living wage and promotion/salary system, Police the world and have a lot of military presence, Control most industry, Fix the social programs in lieu of economic growth, or nah.

JUST 1...we cannot afford to do more than 1 and the 1 we choose might make all the rest impossible.

My husband is Dutch, so we used to live in Holland. We were required by LAW (even in the 1980s) to buy Rivage insurance for health as well as pay into the public one based on our income.

There is no free lunch, not even in socialism, and Bernie is an old time politician, offering bottomless handouts..but that purse has been almost empty since the Bush days.

QueenB -- I searched the site of Gary H. I could not find anything relating to what Thom says. However, I only spent about 20 minutes. In the numbers I looked at Gary was quoting average incomes. How can a real economist not use medians?

The median wage of male workers has dropped (inflation adjusted) by $726 since 1973. The median wage of female workers has dropped $1154 since 2007.

It seems those numbers are why the middle class is losing members -- not single headed households or retiring.

If you think the middle class is struggling now, just hope and pray that the Democratic platform endorsed $ 15.00 and hour minimum wage does not become a reality. The inflationary effects would be devastating to middle and upper middle class families, and would destroy the lives of seniors living on fixed incomes. Eight years of Obama have not been kind to the middle class. The Affordable Care act hurts middle/upper middle class workers who make too much for subsidies, and will hurt them even more if the Cadillac Tax on existing health care goes into effect. Obama turned his back on workers who wanted to unionize by not pushing for Card Check when he had a Democratic House and Senate. He pushed for fast track trade agreements that will harm US workers, and is willing to sacrifice coal and oil workers for the sake of windmills and other energy pipe dreams. If O'Bamas executive order allowing illegal immigrants to get work permits had not been put on hold, American workers in construction, manufacturing, transportation and other good paying jobs throughout the country would be further impacted by the wage reducing/displacement impact of illegal immigrants who could now work any job in the country (with a few exceptions), with the blessing of the government and the elimination of any stigma attached to hiring illegals. Our political leaders should focus on strategies that help the middle class, not further burden them downward redistribution of wealth schemes. While the "compassion" of a nation may be measured by the naive by how it treats its poor, the survival and well-being of a nation clearly depends on how well its middle class does. The last 16 years have harmed the middle class immensely, abetted by the absolute negligence of the last two administrations.

Cost of housing is going up much faster than income in Denver.

Pat Paine -- You have ignored a few non-linear effects. Giving $3.9 trillion to people, who would spend it, would greatly increase our GDP. Currently, it has been computed that for each dollar given to welfare returns $1.67 of economic activity (GDP). Before all our trade "agreements", that dollar returned $3 to $4.

TOM D -- It seems if the min wage is raised less than the productivity rate would demand there would be very little detrimental effect due to inflation. Also, remember soc security has a cpi adjustment. If one was trying to sell supply side economics, one of the benefits would be low inflation. Of course, supply side economics has been shown to destroy economies, but the inflation is low.

Do you know what percentage increases the previous min wage raises were? The current plan for minimum wage is to raise it over several years (at least that is the plan in CA).

My Pay

In the early 2000s, I worked a job I had done in 1984. The pay had gone down on that job by just shy of 50%. Does that tell you anything? By the way, it was a psychotherapy job working for a non-profit that had decided to pocket more of the alloted county pay per contract (which had risen) to pay their administrators. I then took out a contract directly from the county (rarely the government admits individual contractors) and got a 600% raise. Hmmmm.

Rising 'Values'

My bungalow house, charming old 1800s farmhouse in Seattle, for which I paid $139.5 in 1990 is in a neighborhood where the houses are now selling at upwards of $800. It's valued around $600, but multiple bids drive it upwards. Hundreds of thousands of increased 'value', in a little less than 3 decades is uncontained economics. Period. (Also, the rent I get for it is about $1000 more than I should be getting, in my estimation. This is un-controlled, or Over-Controlled, i.e. manipulated growth, in my humble opinion.

So, Thom, your book on the crash? ... I think so; I am just waiting.

Tom D -- Do you know of any real world examples that support what you say?

One dynamic you have not mentioned, is that a $15 wage would make companies, e.g.. Walmart, pay their employees rather than the welfare system supporting their employees.

Also, a significant indicator of the economy is the inflation rate. An inflation rate less than 4% (Robert Reich in Aftershock) means the economy is weak. Janet Yeltsin refuses to adjust the fed rate until the inflation rate is at least 2%. She is starting to weaken her stance and say she might adjust it if it could just get near 2%.

Tom D -- I still think the point at which the wage increase is too much is when the increase is greater than the increase in the productivity rate.