Monday, April 1, 2013

America's Economic Depression In 5 Charts

Seth Mason Charleston SC blog 29This is not what economic recovery looks like. This is, however, what an economic depression looks like:

First, the American workforce is far smaller than it was before the 2008 economic collapse, even though the number of Americans of working age has increased by several million:

America's Economic Depression In 5 Charts - Labor Force Participation Rate

 Second, the people who are lucky enough to be gainfully employed are earning less, adjusted for inflation:

America's Economic Depression In 5 Charts - Real Household Income

Third, with far fewer people employed, those who are employed earning less, and the long-term unemployed and underemployed depleting their savings, the number of Americans living in poverty continues to grow:

America's Economic Depression In 5 Charts - US Households In Poverty

Fourth, with the employed earning less, millions of unemployed and underemployed depleting their savings, and interest rates at record lows, Americans are saving less:

America's Economic Depression In 5 Charts - US Personal Savings Rate

Finally, the number of Americans dependent on the government for basic survival has grown by tens of millions:

America's Economic Depression In 5 Charts - Number Of Americans On Food Stamps

Only 2 words adequately describe the past 5 years: economic depression. 

Seth Mason, Charleston SC


  1. Great charts, if I could add one more it would be People on Disability in the last 10 years or so.

  2. Isn't contraction something this economy needs though? I'd rather it contract than be propped up with funny money.

    1. Study the Weimar Republic for what will eventually happen here if this madness isn't stopped.

  3. Old Timer 88224 (Newsvine) says:

    The food stamp chart is meaningless. Food stamp eligibility was greatly relaxed since 2008 by President Obama and the Democrats in Congress, after eligibility was tightened by GW Bush and the Republican Party earlier in the last decade. Sure there are a lot of Americans on food stamps but the main reason is the GW Bush recession and the relaxed eligibility standards since GW Bush left office.

    The percentage of Households in Poverty fell by more than half from 1965 when Great Society became law and when President Bill Clinton left office in January of 2001. By the end of January of 2009 the poverty rate had increased by 50%. Just during GW's Presidency the average African American family net worth fell by 90%, and we certainly can't blame that on President Obama or on the Democrats.

    Why not go back to 1980 with the Real Income chart, to show that real income has fallen by 40% since Jimmy Carter left office, with the Republican Party in control of the White House for 20 of those 32 years, with the only partial recovery coming during Clinton’s Presidency? As for the Personal Savings rate, why save when savings returns are lower than the inflation rate?

    How would you show a single free trade law signed by Bill Clinton under a certain veto override threat, then 30 different free trade bills signed by GW Bush including most-favored nation trading status with China and India, and then only a single small free trade bill with Panama signed by President Obama in exchange for Republicans signing-off on legislation important to the Democrats? That chart would look like Mt. Everest. How do you show the number of US job losses to offshoring?

    Just during GW's eight years in office 8 million US middle-class jobs were offshored, plus a couple of million more ended through increasing technology. Those 10 million lost middle-class jobs translate to a total of 25 million lost jobs when economic spinoff is included. Sure offshoring production creates a few jobs, like for dock crane operators, but including spinoff we have lost 15 million jobs at least.

    President Obama took office during the height of the worst economic crash since the Great Depression, even worse than the 1981-83 recession when regional unemployment rates as high as 25%. It is a miracle that the increase in the poverty rate since 2007 was trimmed to almost nil by 2010 considering how much capital was destroyed in the 2008 crash.

    I think that maybe some of the problem is that a lot of folks don't remember how lousy the economy was from 1980 through early in the Clinton Presidency and they think 4% unemployment is normal, when it is very low on a historical basis. In 1972 the unemployment rate was over 5% then and the economy was pretty good.

    Just like every recession since the 1800s some areas of the country have done better in recovery and some have not done as well. It took the US until World War II to recover from the 1929 Crash, a total of 13 years. Sure we would all like to see an average amount of economic performance return to America ASAP but radicalism is going to make things worse. We don't need to again destroy America to repair the damage, as we are already well on our way to recovery.

    I'll agree that we have a long way to go to get out of the woods with the Great Recession yet, but I don't agree that we need to bankrupt large segments of America now through austerity in order to save us either. If we increase our unemployment rate by double laying-off most of government how are we going to pay ongoing debt service, as for every government job lost another 1.5 civilian jobs in service, supply, retail, and the vacation industry will be lost too?

    If in another 3 & 1/2 years if we are still struggling to recover at that point we will get another chance to vote for different national leadership. Until that time we need to support the President that a majority of us voted for and work as hard as we can toward our common good.

    1. Do you get dizzy when you spin so much....???

    2. I'm not supporting this President. That's the dumbest thing I've ever heard. He's a liar, a killer and a thief. He also knows about as much about economic matters as a bag of hammers.

      Quit drinking the cool aid and take off the rose colored glasses. He sucks as a President. The worst we've ever had. We won't last another year going in this direction much less another 3.5.

      If over regulation, deficit spending, central banking, inflating the money supply, perpetual war, and bailout economics got us in this mess under Bush - then what in the world makes you think that more regulation, deficit spending, central banking, inflating the money supply, perpetual war, and bailout economics will get us out of this mess under Obama?

      It's the same people dude. The same ones who created this problem either out of incompetence or due to a plan based in the playbook of national suicide, are the same idiots trying to get us out. But they have not changed the methodology. It's the identical economic policy. IDENTICAL.

  4. I resent the notion of "the common good", I prefer the rights of the individual, the common good is an emotional appeal leading to existence at the least common denominator.

  5. If you are of the few who are benefiting by this economy and happen to own most of the media, you can distract enough people to keep things going your way. More control helps you get more resources while we fight for crumbs and blame your chosen scapegoats. Who owns most of the media? Who can hide behind corporate "personhood" while buying your politicians? And why can the media lie to us? The republican majority supreme court has made this possible. But again remember: The mainstream media will distract us and throw it all in Obama's lap. So much for the balance of powers in the US government.


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