Why isn't the middle class too big to fail?

[Ah Xoc Kin]

October 13, 2008
Middle class is mired in debt

• The average household now holds more than $110,000 in mortgage and other debt, against annual personal savings of around $400, according to figures from the Federal Reserve Board and other government bodies that track the economy.

• American consumers today collectively owe $2.5 trillion on their credit cards and in car payments and similar loans. That's up 150% from 1994, an increase more than four times greater than inflation over the same time.

• New college graduates carry more student-loan debt than ever. The nonprofit Project on Student Debt reports that by the time they graduate, nearly two-thirds of students at four-year colleges and universities have student loan debt, compared with less than one-half of graduating students in 1993. Over the past decade, debt levels for graduating seniors with student loans more than doubled from $9,250 to $19,200 -- a 108% increase, or 58% after accounting for inflation -- the project reports.

http://www.freep.com/article/20081013/BUSINESS07/810130384

[cui bono]

1. Because Reaganomics shrunk it so much?

:shrug:

[brokensymmetry]

2. It already has.

Look at what it was a few decades ago. Look at what it is now.

Now consider where those who claim middle class status will be
when they retire.

The middle class died. Services are pending.

[chalky]

3. Excellent point. The middle-class consumers are a HUGE part of our economy.

Aren't WE a vital component in this machine? Wall Street businesses are considered so big that failure is such a dangerous option, but why aren't WE given more consideration?

[phantom power]

4. Because Reaganomics has dominated our politics since Reagan.

Focus aid, effort, tax-breaks, etc, on the business/employer side, without any balance given to the labor/consumer side.

[chalky]

5. Yes.

My questions were more rhetorical in nature, but thanks. :)