The Middle Class, "Arrivederci"

This past week, the Fed released its latest Survey of Consumer Finances.

The report included a lot of depressing data about the financial situation of average Americans. But nothing was so shocking and depressing as this:

The median net worth of American families dropped nearly 40% from 2007 to 2010.

Wow.

(Yes, the situation has improved in the 18 months since 2010, but only modestly. House prices are about where they were back then.)

Most of this decline came from the collapse of the housing market. But we can't just write this one off to the housing bubble. The median net worth of households has now fallen to the same level as it was two decades ago, in 1992.

What does that mean?

It means America just isn't working right now.

Not just Americans. America itself, a country whose economy once worked for almost everyone.

In the old America, if you worked hard, you had a good chance of moving up.

In the old America, the fruits of people's labors accrued to the whole country, not just the top.

In the old America, there was a strong middle class, and their immense collective purchasing power drove the economy for decades.

No longer.

Over the past couple of decades, the American economy has increasingly mostly worked for the richest Americans, at the expense of everyone else. As a result, the disparity between "the 1%" and "the 99%" has hit a level not seen since the 1920s. And there is a widespread and growing sense that life here is not fair or right.

The middle class--the average American families--drive most of the spending in this country. Thus, when the middle class suffers, the whole economy suffers. And, right now, America just isn't working for the middle class.

DEFICIT TO APPROACH $1 TRILLION (AGAIN) - "The federal budget deficit is approaching $1 trillion for a fourth straight year even though the government is collecting more tax revenue than last year. ... Treasury ... said ... that the deficit grew by $124.6 billion in May. That put the deficit through the first eight months of the budget year at $844.5 billion, or 8.9 percent below last year's imbalance for the same period. Still, the Congressional Budget office forecasts that the deficit for the entire 2012 budget year, which ends Sept. 30, will total $1.17 trillion. That's only a slight improvement from the $1.3 trillion deficit recorded in fiscal 2011. And it is certain to keep the federal budget near the center of the presidential campaign. So far this year, government receipts are running 5.3 percent higher than a year ago. A better job market and modest economic growth have led to higher tax revenue"

KEY DATES IN PRESIDENTIAL RACE -

--Aug. 27-30 - Republican National Convention in Tampa, Florida

--Sept. 4-6 - Democratic National Convention in Charlotte, North Carolina

--Oct. 3 - Presidential debate at University of Denver in Denver

--Oct. 11 - Vice presidential debate at Centre College in Danville, Kentucky

--Oct. 16 - Presidential debate at Hofstra University in Hempstead, New York

--Oct. 22 - Presidential debate at Lynn University in Boca Raton, Florida

--Nov. 6 - Election Day

INTERESTING READ – David Davis, who writes about sports for the Los Angeles Marathon, the LA Times and other publications – has a new ebook published this week about a fairly unknown chapter in American sports history. It happened in Los Angeles in 1963.

It’s the story of Merry Lepper, who had to disguise herself to compete with her fellow runners in the 1963 Western Hemisphere Marathon in Culver City, no women were allowed to participate. This event was an important race in its day. Lepper was a student then at San Bernardino Valley College.

History tried to forget Lepper. No retrospective stories have been done about her. No tributes, Davis tracked her down in the Arizona desert and offered her the chance to talk about the race, which she finished. In this excerpt from “Marathon Crasher: The life and Times of Merry Lepper, the First American Woman to Run a Marathon,” they meet at the Tucson airport.

“Put another way; Women could legally vote in presidential elections long before they could officially enter a marathon. Merry Lepper sips her tea and begins to speak softly, conjuring a moment in time when running was both a revolutionary blow against the powers-that-were and a lark to be shared with her pal Lyn: two women in their athletic prime, out for a weekend run on a sun-blanched afternoon almost a half-century ago.”

Twenty one years later, Joan Benoit won the first women’s Olympic marathon, in Los Angeles in 1984.

BIRTHDAYS THIS WEEK – Birthday wishes and thoughts this week to: Beth Elmore …famous for scarfs, Mick Fleetwood (65), Nicole Kidman (45), Juli Inkster (51), Paul McCartney (70), Meryl Streep (63), Kathleen Turner (58), Prince William (30), Brian Wilson (70).

WALL STREET WEEK - The Greek election results are in, and although a pro-bailout party victory provided some relief to the financial markets, U.S. stock index futures are now pointing to a slightly lower open. U.S. stocks did have some positive momentum going into the weekend, with the Dow having chalked up triple-digit gains in three of the past four sessions and the S&P 500 and Nasdaq rising in seven of the past 10 trading days.

RINK RATS TMZ.COM – After watching the HBO documentary “41” a local lifelong Republican is now seriously considering changing to the Democratic Party. This local resident is dissatisfied that the party of Gerald Ford, Nelson Rockefeller, and George H.W. Bush is now the party of Mitt Romney, Sarah Palin, and Mr. Thirty Hour Work Week. History is at a crossroad.

SUMMER GARDENING: TOP WEED – Puncture vine (Tribulus terrestris) 

With its sharp, thorny burs that poke into tires, paws, and bare feet, puncture vine is painfully familiar to gardeners in much of the country. An annual weed often found in dry areas, it forms a dense, low mat 5 to 15 feet in diameter.

For best control of small infestations, hoe or dig plants before they can set seed, cutting below the crown to prevent regrowth. Once you've removed puncture vine growing in lawns, improve the soil with compost and sow grass seed in bare spots to prevent the weeds from reestablishing.

For chemical control, preemergence herbicides containing trifluralin may be used on some lawn grasses and ornamentals in late winter or early spring. For postemergence control in lawns, use a selective herbicide.

Word of the Month:

lummox \LUHM-uhks\, noun:
A clumsy, stupid person.

“Today I told myself that in actual fact anyone who takes an innocuous and random delight in his work is an absolute lummox.”

Spanish Word of the Month:

fuerte, adjective
strong; loud

Fuerte is very common in Spanish. The commonest words in any language tend to have very many meanings, and fuerte is no exception. Today we’re looking at two of its major meanings, strong and loud.

“Es una bebida muy fuerte.”
It’s a very strong drink.

ASK REGGIE – The rules of golf:

Q. Dear Reggie:

Two weeks ago, our foursome had an unusual thing happen and none of us knew quite what to do. In the fairway, I took my second stroke and my ball hit someone else’s ball that was in the fairway, resulting in the other person’s ball landing in the rough, and mine in the fairway. Do I get penalized and do we just leave the balls where they landed or does the other person move their ball back where it was?

Sincerely,

Hacker from Claremont, CA.

Dear Hacker from Claremont, CA.:

There is no penalty to anyone. The player whose ball struck the other player’s ball will play her own ball as it lies. The player whose ball was moved must replace it. [Rule 18-5]. I’m sure you will agree that it would be unfair for a player to have to hit from the rough when their original shot landed in the fairway.

Sincerely,

Reggie Dunlop

N.H.L. OFF SEASON – After 1,316 regular season and playoff games, the coronation of the Los Angeles Kings may well be the last N.H.L. action hockey fans will see for some time – perhaps until Christmas.

The owners have informed the players’ association that they will not renew the collective bargaining agreement when it expires Sept. 15, and the likelihood of a lockout is high. If they go the lockout route, the owners goal would be to reduce the players’ share of revenue to about 50 percent from 57 percent, as N.B.A. and N.F.L. owners succeeded in doing with lockouts last year.

Under the strong leadership of Donald Fehr, the union says it has no intention of reducing its slice of the pie to make the owners’ slice bigger. Stay tuned.

DRIVING THE WEEK - President Obama traveled to Los Cabos last night for his sixth G20 as president. Today, he begins at 9:00 a.m. with a bilateral meeting with President Calderón of Mexico ... Later in the morning, Obama has a bilateral with President Putin of Russia ... Obama remains at the G20 on Tuesday and has a bilateral at around 3:30 p.m. with President Hu Jintao of China. He will also meet with German President Angela Merkel, among others ... He returns to the White House on Tuesday evening ... Obama is in Orlando on Friday to speak at the NALEO annual meeting ... Mitt Romney continues his bus tour today with a stop at 4:00 p.m. in Davenport, Iowa ... Possible we could get health care decision from SCOTUS today which would blow everything else off the top of the news. But the expert money seems to be on June 25th or June 28th.

House Financial Services gets its crack at JPMorganChase CEO Jamie Dimon on Tuesday at 9:30 a.m. Top regulators will also appear at the hearing on a separate panel ... Senate Finance on Tuesday at 10:00 a.m. has a hearing on the fiscal cliff ... On Wednesday at 9:00 a.m., House Financial Services has a hearing on market structure ... Senate Banking at 9:30 a.m. on Wednesday has a hearing on the IPO process ... Senate Banking has a money market reform hearing on Thursday at 10:00 a.m. ... Fed on Tuesday begins a two-day policy meeting ... Euro zone finance ministers meet Thursday in Luxembourg.

Next week, Jack Ass of the Month and summer travel.

Until Next Monday, Adios.

Claremont, CA

June 18, 2012

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