The “new normal”: More than one in five Americans at risk of destitution

More than one in five Americans in 2009 suffered a household income loss of 25 percent or more over the previous year, according to a new report sponsored by the Rockefeller Foundation and entitled “Economic Security at Risk.” The report documents a steady increase in economic insecurity since the 1960s, and concludes that annual income losses of 25 percent or greater increased by 49.9 percent between 1985 and 2009.

“Putting this tend in terms of population,” the report states, “approximately 46 million Americans were counted as insecure in 2007, up from 28 million in 1985.” The head of the research team that prepared the report, Yale University Professor Jacob Hacker, told an interviewer, “What we’re seeing, basically, is what we’re calling ‘the new normal.’ We’re slowly ratcheting up this level of economic insecurity.”

The research group has devised what it calls the Economic Security Index (ESI), which measures the share of Americans in a given year who experience at least a 25 percent decline in their available household income and who lack a financial safety net to replace the lost income. Such a sudden income drop—usually due to the loss of employment, high medical expenses, or a combination of the two—often leaves people facing destitution.

The report does not include 2010, when long-term joblessness has become endemic. The ESI for this year will doubtless be considerably higher than for 2009.

http://www.wsws.org/articles/2010/jul2010/econ-j29.shtml

I mean, there's no way that there could possibly be a systemic fault driving all of these people into destitution, right?

Obviously, if they've failed to thrive, it must be specifically and exclusively because of the bad decisions they've made, coupled with their wildly irresponsible spending, right?


I'm sure I've been hearing something to that effect in the MSM for the past decade or so. They can't be wrong, right?


Right?!?

A relative of mine has her paycheck spent before she gets it and has all her many credit cards maxed out while her husband is cashing in his 401k money to pay off her crazy spending. She's also a hoarder. Most of her wild spending is on clothes and purses. As soon as she gets home from work, she will put on the shopping channels.

A very high percentage of us have been dangling one paycheck away from disaster. We expected better from Obama and the Democrats, and many of us feel betrayed.