The New Economic Recovery

The corporate mass media is full of positive stories about the so-called economic recovery underway in the United States. Look at this chart and tell US Person you still believe it:

Yes, there is an upturn at the end of the line, but compare that to the drop in real median income since 2008. The truth is that the recent increase in retail sales (8.2%), led by vehicle sales (9.2%), is once again fueled by consumer debt. $24billion in new car loans were made in the 2011/Q4. A whopping 45% of auto loans went to subprime borrowers. Not that the federal government is doing any better than households. February saw the biggest deficit ever in US history. No other government could get away with this kind of debt overload because only it can issue the world's reserve currency:

The economic reality of the Obama administration has been a massive shift of wealth from the middle class to corporations and the wealthy. Even the much touted bailouts of the auto industry came at a huge cost to unionized labor. The bailout was predicated on the United Auto Workers agreeing to a 50% wage cut and reduced pension and benefits for all new workers. The wage cutting and layoff frenzy proceeded to public sector workers, a popular target of corporatists since the PATCO strike. Wisconsin public employees are still fighting to remove their boss, the governor, because he stripped them of collective bargaining rights. The unfairness of the so-called recovery is seen in this stark statistic: in 2011/Q3 the share of GDP going to corporate profits was the largest at 10.3% since the 1960s while the share going to wages, 45.3%, the lowest on record. According to Reuters in 2010 the income of the super rich rose by 21.5% over the previous year, while the bottom 90% fell by 0.4%. National income did rise in 2010, but 37% of it was pocketed by just 15,600 families. More people are working, but as Ben Bernanke admitted recently at a business conference in DC, the improvement is due mostly to a decline in layoffs. This last chart shows where a lot of that GDP is going: