Monday, December 21, 2015

USA Falls Behind Brazil?

In Soccer (Football) yes, but in economic performance??

A recent Pew study in the USA found that the middle class is now in the minority, 49.9% of the population.  Meanwhile, in Brazil, the middle class is around 50%+.  What the F happened?!

Of course the easy thing to do is blame Obama.  He is responsible for everything including the poor record of the New York Giants.  However, it is pretty clear that this started under President Ford, and continued under Carter, Reagan, H Bush, Clinton, W Bush, and Obama.  So what are my theories?
  1. The USA has a poor record on education, and typically ranks below average on the performance of its students versus other countries.  This means a less educated less skilled work force.  Why?  Governments in the US do not organize or fund education properly and the culture does not value education.
  2. Corporations figured out how to send most low-medium skill manufacturing work offshore to Mexico, China..  This means fewer middle-class-pay jobs available to the poorly trained workforce.  The only low skill jobs left are those that cannot be offshored, like serving at McDonalds or mopping the floor at the office.  Illegal immigration has contributed to keeping the wages of these jobs at the poverty level.
  3. Taxes became less progressive over time, allowing the rich to keep more of their wealth, squeezing the middle class.  Health care is expensive and is not provided by the government, so the middle class must pay these high costs themselves.
  4. No safety net is available in the US.  If you are middle class and run into problems, like the loss of a job, a serious illness, or an accident, you are on your own.  Unemployment insurance is very low, there is no help with medical costs until you are impoverished, and there are few government programs to help.  Often, people never recover from the setback and remain in poverty for the rest of their lives.

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