Pulitzer-Prize Winning Reporter: Americans Bounced Back Faster After the Great DEPRESSION than the Great RECESSION

Underneath the Propaganda, Americans Are In BAD SHAPE …

Pulitzer prize-winning reporter David Cay Johnston has researched economics, wages, taxes and related issues for many years. He’s written numerous books on those subjects.

Writing for the San Jose Mercury News, then serving as a columnist for Reuters, Johnston won his Pulitzer writing on economics and tax issues for the New York Times.

President of Investigative Reporters and Editors, Johnson now holds titles such as Distinguished Visiting Lecturer at Syracuse University College of Law and Whitman School of Management.

In other words, Johnston is a highlycredible reporter on economic issues.

Last week, Johnston headlined at Al Jazeera – the mainstream American press apparently wouldn’t touch the story – “Americans fared better after Great Depression than today“:

Coming out of the Great Depression eight decades ago, the vast majority fared vastly better than most people have coming out of the Great Recession, which officially ended on June 30 six years ago.

It may be jarring to hear that the vast majority of Americans, the 90 percent, enjoyed bigger income gains in the 1930s than in recent years, but that is what the data show.

The data also indicate tandem increases in both want and wealth, with the vast majority worse off in 2013 than in 2009, while those at the apex of the economy are enjoying a much larger — and growing — share of national income.

***

The news will be filled with stories about a record high number of jobs ….

But such stories will be misleading because in the last six years America’s population grew by about 14 million people. With population growth taken into account, America needs more than 145 million jobs to surpass 2008’s employment percentage. [Background.]

Furthermore, the share of working-age people who have work or are looking for a job —the civilian labor force participation rate — has declined. In January 2008 it stood at 66.2 percent but was down to 62.8 percent this April. Bringing the participation rate back up would require a few million more jobs.

***

the average hourly pay of $20.13 last year was smaller than in 1972 and 1973. Back then, the inflation-adjusted hourly average was about 6 percent higher. In other words, people in 2013 worked 52 weeks to make what they would have made in 49 weeks back in 1972 and 1973.

Wait, it gets worse.

The presidential report shows that in 1972 and 1973 the average private sector worker was paid for 36.9 hours of work per week, but in 2013 this was down to 33.7 hours because a growing share of people can find only part-time jobs.

Combine lower pay with fewer hours, and the average weekly gross pay in the private sector dropped by 14 percent in four decades. That’s the equivalent of working 52 weeks in 2013 to earn 45 weeks’ worth of wages in 1972 and 1973.

***

The most eye-opening measure of how poorly the vast majority are faring these days comes from comparing the periods after the Great Recession and the Great Depression.

The 90 percent, the vast majority, saw their income decline in 2012 compared with 2009, the year the Great Recession officially ended. Average annual income was down $556, or almost 2 percent, adjusted for inflation, to $30,997.

But in 1936, three years after the Great Depression ended, the vast majority enjoyed 31 percent more income than in 1933. The average increase, in today’s dollars, was $2,146 per household.

Background.

Why have the vast majority of Americans fared worse in the last couple of years than after the Great Depression?

Simple:

Postscript: Notwithstanding the soaring stock market and happy talk about jobs, we’re arguably in a Depression right now … caused by horrible government policy by both the Bush and Obama administrations.

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  • mmckinl

    There will be no real recovery …

    Time to see the forest for the trees … The ECB and the Fed would gladly pump their economies up … but they can’t because peak oil is here.

    Any serious uptick in economic activity would send oil prices through the roof and guarantee yet another financial crisis worse than 2008.

    And this is why they are stuffing the banks with cash through QE programs … to weather the upcoming financial crisis.

    Currently they are practicing demand suppression to keep oil prices in check. War, destabilization, austerity are being used to take the pressure off of oil prices.

    In fact “conventional oil production” has been flat since 2005. Due to the demand destruction of austerity, war and destabilization Brent is still below $110.

    The Central Bankers and their political minions are keeping the Ponzi Scheme balls in the air as long as possible as everyday the .01% get even wealthier through QE.

    It is only a matter of time before the entire world economy crashes and the banksters will blame anything and everything except peak oil because peak oil is game over for banksters.

    Their next move will probably be war to hide the real reason behind the crisis. Without cheap oil their entire empire is in a death spiral.

  • Dee

    I think everybody has figured out that times are hard, there are a lot of articles that make that point, as if anybody actually living it can’t figure it out for themselves..
    I think we should be discussing what would help. We talk a lot about what hasn’t been working. We talk a lot about getting justice / revenge on the ones we say caused the problem. And we occasionally mention things we say we think the government should do that we think could help.
    Seems to me that central planning, and TPTB setting policy, no matter the spin , always works out in their self interest and in favor of the interests that they have.
    Might want to start thinking about what can be done locally, at the individual , family, community level. Despite all our hope and wish for change, the leopard is not going to change his spots.. the Deus ex machina is broke, nobody is coming to save your ass. If you wait for “The Powers That Be” to fix it, strangely enough, I expect it will get “fixed” in their favor.
    We are going to have to save ourselves, individually, or as families, or as neighborhoods, or communities.
    But it is going to have to be saving ourselves..
    Doesn’t mean we should stop trying to change the world from the top down.. but it does mean we need to start saving the world we personally live in, from the bottom up.
    I think we need to quit pretending and extending in our personal lives and if we can’t afford to be middle class, to quit playing the game and going further into debt to pretend we can still afford what we clearly cannot. The system counts on folks to borrow and go into debt to keep the system’s wheels on and spinning. Community self entertainment, gardens, farmers markets, pot luck parties, neighborhood movie nights, family meals. watching each others kids, and brown bag lunches, learning to cook from scratch using much cheaper basic staple foods, car pooling, coupons, roommates, staycations .. get out of debt, try to build a little cash reserve, swap meets, free lance work on the side, turn hobbies/ personal skills into a little extra cash flow and while working for some great change from above coming down from on high to save everybody.. start acting like the leopard isn’t going to change his spots.

  • mitchie124

    The only real recovery would require three steps. 1) Impeach Obama. 2) Reinstate Glass-Steagall.
    3) Incrementally phase out and end the “fed.”

    • Synapstro

      Ya, I disagree with the hill-billy above.

      The only way to recover is to embrace the types of reforms the Roosevelt administration pursued. Glass-steagal was only one of many reforms Roosevelt and his congress innovated that we should be embracing again.

      Other types of reform his administration established helped as well: progressive taxation (restoring a healthy economic GINI), huge economic stimuli (larger than our stimulus), and financial regulations galore. None of which you would get with a right-learning president.

      The closest political embodiment of the spirit of Roosevelt’s financial regulation is Liz Warren. Obama actually tried to set her up as the head the Consumer Financial Protection Bureau (which she helped design and create!) to fight financial fraud and predatory lending. But Wall Street ultimately teamed up with its Republican cronies to block the appointment. The Right fought to protect the very financial fuckers who made the mess. They castrated the Consumer Financial Protection Bureau and stripped it of its powers to reign in the Banking and Credit Card industries. If there’s anyone that needs to be thrown out of office, it’s the free-market, small government, laissez-faire dip shits who put us here.

  • Guest

    Ya, I disagree with the hill-billy above.

    The only way to recover is to embrace the types of reforms the Roosevelt administration pursued. Glass-steagal was only one of many reforms Roosevelt and his congress innovated that we should be embracing again.

    Other types of reform his administration established helped as well: progressive taxation (restoring a healthy economic GINI number), huge economic stimuli (larger than our stimulus), and financial regulations galore. None of which you would get with a right-learning president.

    The closest political embodiment of the spirit of Roosevelt’s financial regulation is Liz Warren. Obama actually tried to set her up as the head the Consumer Financial Protection Bureau (which she helped design and create!) to fight financial fraud and predatory lending. But Wall Street ultimately teamed up its Republican cronies to block the appointment. The Right fought to protect the very financial fuckers who made the mess. They castrated the Consumer Financial Protection Bureau and stripped it of its powers to reign in the Banking and Credit Card industries. If there’s anyone that needs to be thrown out of office, it’s the free-market, small government, laissez-faire dip shits who put us here.

  • Notfooled

    There is no recovery and the desired result is to tank the economy and ruin the military so that America cannot pose a challenge to the NWO. Rampant illegal immigration i increasing and not by accident. Dun confiscation will be next. Then more jobs will be mandated for the illegals and Americans will be on their knees. This is all part of the plan.
    Americans will not change the plan. They will not revolt. Americans are sheep and it is evident every day.
    You want justice, you have to make it for yourself. There is no justice, no rule of law, and nothing you can do about it. It takes courage and determination to fight this kind of infiltration of your life and America is fresh out of both. So do not cry about the guns being taken, you never did anything with them and the hoaxes are ramping up to justify taking them. If these shooting were real some of the targets that need shooting would be targeted instead of schools which are an emotional ploy to get the Americans to accept being disarmed.
    Enjoy the next few months, because it is coming and no one is going to save you, not even yourselves. But in the future you will wish you had done something to stop it, oh well.