Bush hollows out the middle class:
Americans' net worth falls, report says
Tuesday, August 29, 2006Alison Grant
Plain Dealer Reporter
The net worth of many U.S. households has fallen as Americans cope with rising debt, flattening real estate values and stagnant wages, according to a report today from the Economic Policy Institute.
The study says the accumulation of stocks, bonds, bank savings or other assets aside from equity in their homes has eluded many Americans. In fact, about 30 percent of households have a net worth of less than $10,000.
The institute's report refutes the notion that most people have invested in the stock market through 401(k) retirement plans at work, mutual funds or other means. Less than half of households own stock in any form, and of those who own stock, just one-third have holdings in excess of $5,000.
The study by the Washington-based liberal think tank also noted a racial divide almost unchanged from 20 years ago.
The median wealth of white households was $118,300 in 2004. Black families' median wealth was one-tenth as much, $11,800.
As the wealthiest Americans benefited from the market's recovery from its 2000-03 collapse, middle-class households treaded water. Average wealth for the middle 20 percent of households grew by just 0.8 percent annually between 2001 and 2004.
This is with rapidly rising home prices. Without that, middle class net worth would, I assume, have fallen and with a 10-20% correction in the housing market, will fall. And all this during the Bush boom.