If you listen to leftists and big-government stooges, the middle class is evaporating because of low minimum wage, greedy corporations, and tax-breaks for the rich. Which would indicate that, in order to grow the middle class, the civil government needs to get more involved. No one argues with the fact that the middle class drives economic growth, and is therefore a crucial component of economic recovery, but what is the real problem here? I think it can be boiled down to a few things:
- Crony Captitalism: the civil government needs to stop making laws on the basis of lobbying concerns and kickbacks. The civil government protects businesses from competition. This is bad for the middle class. It means that some banks, corporations, and other firms are able to treat customers and employees badly, yet continue to grow and amass wealth for a small percentage of owners. These owners are basically using government protection to screw the middle class out of money. No good.
- Inflation: There wouldn’t even be talk of a higher minimum wage if we had some fixed monetary standard. The minimum wage in 1964 (when silver was still in the currency) was $1.15. That amount of silver is worth more than $20 in today’s money. $15/hour minimum wage? How about boot the Federal Reserve! You’d be making more than $20/hour.
- Racial Welfare: There is no question that the biggest demographic to be booted from the middle class is the black community. Their median incomes have stagnated. That’s because you get more of what you subsidize, and the civil government has been subsidizing African-American joblessness and poverty. Remove all the freebies (being paid for by the other middle class members, by the way), and the middle class returns in all demographics.
These may not be all the reasons for the evaporating middle class, but it would be a start to fix them. And notice that in all three cases, the problem is too much government, not too little. So the one big destroyer of the middle class: big government. Go figure.