The Extinction of the Middle Class? Part II

I wrote about Business Insider’s claim that the middle class is being exterminated here.

Again, I’m not totally refuting this — I just think a lot of theirr points and data are really sloppy and or questionable.  I think what’s happening is the ability to move from the lowest earning percentile to middle class or from middle class to top earning elite is becoming increasingly difficult.

And with that here is Part II of my response to Business Insider.

BI Point #4: 36% of Americans say that they don’t contribute anything to retirement savings.

36 percent of Americans say that they don't contribute anything to retirement savings.

Okay, first of all the source for this piece of data is a CareerBuilder.com poll — DUH.  Who is on CareerBuilder in 2010?  Un(and under)employed people, who don’t have incomes that allow them to put money away!  Seriously, this is the best savings rate poll BI can find?  There is no sort of historical context for comparison.

  • What was the percent of people who said they were saving in the 1960s?
  • Again, like the paycheck-to-paycheck  question – is this an effect of the “adult adolescence” generation?
  • 36% say they don’t save for retirement–is this taking into account 401ks and paying into social security, or just folks who say they aren’t saving?

BI Point #5: A staggering 43 % of Americans have less than $10,000 saved up for retirement.

Again, please, some historical context for comparison! Also, why are all the sources CNN or CNBC via some other source (i.e. Source: Employment Benefit Research Institute via CNN)? It is like they told some intern to go Google 22 bullet points to crib for a story.

The other problem with this is that not every American is supposed to have $10k saved up, how much did you have saved in your 20s? Now, if this said a staggering 43% of folks over 55 had less than $10k saved, that would be a little more alarming.  Be weary of data bullet points that contain hyperbolic adjectives and adverbs (read: staggering?).

BI Point 6: 24% of American workers say that they have postponed their planned retirement age in the past year.

This seems like a low number given the recession.

BI Point 7: Over 1.4 million Americans filed for personal bankruptcy in 2009, which represented a 32% increase over 2008.

Over 1.4 million Americans filed for personal bankruptcy in 2009, which represented a 32 percent increase over 2008.Finally, a graph!  Who the heck is mybudget360.com?

Anyway, you would think that given the worst recession since the great depression that bankruptcies would be up, wouldn’t you? And look at the data, 2005 was the worst year on the chart with 2006-2008, being the best. You need to go back more than 10 years to find numbers like 2009 — and there are more people in 2009 than there were in 1997, right?

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2 Responses

  1. There was a “rush” to file for bankruptcy in 2004 because of highly publicized changes to bankruptcy law slated to begin in 2005, which may account for decreased number of bankruptcy filings for next few years after that.

  2. website for previous comment is http://money.cnn.com/2005/10/17/pf/debt/bankruptcy law/

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