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Wednesday, June 15, 2016

Robin Hood in reverse

Why American Voters Are Angry

Chart revealing why voters are angry: Most Americans' median net worth has declined.The rise of Bernie Sanders and Donald Trump has left the mainstream media and leaders of both parties stunned as they ponder why voters are angry. 

You’d think that with all that brain power and all those Ivy League college degrees, Washington, D.C.’s elites would be able to scrounge up something resembling a clue.

Instead, it remains unclear as to whether any of the folks who lead our nation even know that voters are angry, let alone wonder why voters are angry.

Instead, House Speaker Paul Ryan and other GOP leaders reluctantly endorse Donald Trump while wringing their hands over his racist remarks.

Meanwhile, Hillary Clinton and her camp celebrate “making history” by putting a woman at the top of the Democratic ticket without bothering to wonder how someone so well-known, powerful and long-serving in US politics nearly lost the nomination to Bernie Sanders, an obscure, 74-year-old Democratic Socialist from Vermont.

But the folks from NerdWallet found a chart with data from the Federal Reserve’s Survey of Consumer Finances that explains why voters are angry in a nutshell.

The median net worth for most Americans has sharply declined in recent years, while the median net worth for our top 10 percent has dramatically increased.

And sure, voters also have a lot of other things to feel angry about, including gridlock in Congress, our government’s lack of responsiveness to voters, social injustice, war and aggression abroad, our lack of response to climate change, failure to bring Wall Street to justice, and our crumbling infrastructure.

But the chart shows how hard we’ve been hit from an economic standpoint.

America’s median net worth declined over the 15-year period from 1998-2013 — the last year for which this data is available.

Our median net worth has dropped from $102,500 in 1998 to $81,200 in 2013.

When you break down the numbers by income bracket, the numbers get even more grim – unless you happen to be in America’s top 10 percent: their median net worth has increased by a whopping 74.9 percent.

This huge transfer of wealth from the lower and middle classes to the wealthiest Americans goes a long way toward explaining why voters are angry.

If you look at America’s average net worth — a seemingly ample $301,000 — you’d never suspect that so many of us are having a hard time.

That’s because the “average” is heavily weighted and brought up by the top ten percent’s out-sized earnings, which have outpaced everyone else’s.

The median net worth provides a more accurate snapshot, because exactly half of our net worth is above that amount, and half falls below.

And here are some more numbers that explain why voters are angry. Instead of burying their heads in the sand, our nation’s leaders should be alarmed.

The middle class hasn’t had a raise in 15 years: In 2014, FiveThirtyEight covered a then-newly released US government report on Income and Poverty in the United States 2013 that revealed the middle class hasn’t gotten a raise in 15 years. In other words, incomes began to stall well before the 2008 crash.

Declining net worth: CNN Money reports the 2008 recession slashed nearly 40 percent of our median net worth, and our sluggish recovery has not enabled us to us rebuild our wealth. Since 2007 — just before the crash of 2008 — median net worth dropped 26.3 percent for white households, 41.9 percent for Hispanic households, and 41.9 percent for black households.

Declining home ownership: Our middle class has long held the bulk of wealth in their homes. In the first quarter of 2016, the US rate of home ownership dropped to 63.5 percent — the lowest since the last quarter of 1967. And it’s not just because of millennials with student debt and low-paying jobs not being on the market. Forbes explains stagnant wages and tight credit have also made it hard for those who got caught underwater and lost their homes in the 2008 crash to recover and buy again.
Unfortunately, the folks in Washington cannot come to terms with why voters are angry without taking a long hard look in the mirror.

The leaders of both the Democratic and the Republican parties have embraced economic policies that steal from the poor (and the middle class) and give to the rich for decades. 

The Republican Party is in far worse shape: Their “Southern Strategy” of exploiting racism to get white people to vote against their economic interests has created a monster.

But if the Democratic Party continues to ignore the fact that a healthy democracy requires robust economic rights as well as civil ones, they’ll continue to be under threat by angry voters as well.