The theme at the Democratic Convention in Denver yesterday was “RenewingAmerica’s Promise”–the Democrats’ plan to grow the economy andrestore fairness so that it works for all of us. The 2007 Censusdata on poverty, income and health insurance was also released yesterdayand it showed just how tall an order Senator Obama and the Democratsface in reversing eight years of failed Bush economic policies -policies we will continue to pay a price for in 2008 and beyond.
While the 2007 numbers don’t even include the devastation wrought by thehousing and credit crisis, and high energy costs, they neverthelesspaint a bleak picture with poverty on the rise and working people’s paystagnating despite increased productivity.
Robert Greenstein, Executive Director of the Center for Budget andPolicy Priorities said, “Though 2007was the sixth (and likely the final) year of an economicexpansion, 4.4 million more Americans were poor, the median income ofnon-elderly households was $1,100 lower, and nearly six million moreAmericans were uninsured than in 2001 – even though the economy was inrecession that year…. Never before on record has poverty been higherand median income for working-age households lower at the end of amulti-year economic expansion than at the beginning. The new data add tothe mounting evidence that the gains from the 2001-2007 expansion wereconcentrated among high-income Americans.”
“We have the biggest gap between the rich and everybody else since theGreat Depression,” saidIndependent Senator Bernie Sanders on VermontPublic Radio.
Jared Bernstein, Director of the Living Standards program at theEconomic Policy Institute, agreed with Sanders. He suggested that we havethe greatest concentration of wealth in the richest 1 percent of the countrythan we’ve had since 1928. Bernstein noted that the economic expansionfailed to lift working people’s incomes despite that fact that “outputper hour, or productivity, rose 2.5 percent per year during the 2000 to 2007cycle, compared to 2 percent in the 1990s, when family incomes fared muchbetter…. The economy… expanded in the 2000s, but that growth clearlyfailed to reach most households, a dynamic that implicates growingincome inequality…. The fact that these disappointing income, poverty,and earnings trends occurred in thecontext of strong productivity growth is a reminder that in today’seconomy, productivity growth creates only the potential for higherliving standards. As long as most workers lack the bargainingpowerto claim their share of the growth they have helped to generate, thatpotential will not be realized.”