The Cainite Repubicans say no, they say the bottom 47 percent are all a bunch of victim whiners.
But the bottom 20 percent is doing worse than I imagined, according to the BLS. And many of us are only a job loss or two away from joining them. There will be a need for low cost [ware-] housing for the Americans frozen out of the economy as more of them lose their houses and can’t afford market rents. I’ve often said my retirement will probably be in a single-wide mobile home in the desert.
By: David Dayen Thursday September 27, 2012 11:38 am
A new study from the Bureau of Labor Statistics out today probably won’t get as much notice as their other report showing the US gained 386,000 jobs more than expected. However, this one shows a persistent problem in America, that it’s actually expensive to be poor.
The average individual in the lowest 20% of the income ladder had take-home pay of $10,074 and average expenses of $22,011. That’s more than double, and it makes being poor nearly impossible to manage. The story for the second and third quintiles weren’t much better, with their expenses roughly commensurate to their income, meaning they live paycheck-to-paycheck and save next to nothing. But the expenses-versus-income report for the poorest Americans is almost unreal.
The Huffington Post puts some of these numbers in context:
This percentage of households includes many retirees, who are presumably living off savings.
Many of these households may be spending more than they earn through some combination of loans from family and friends, credit cards, savings, and payday loans. The government helps a bit with an income tax credit: The average bottom-fifth household’s after-tax income is $269 higher than its before-tax income. The income accounted for includes welfare and Social Security benefits.
Many are also taking on debt. In 2010, roughly one-quarter of the poorest fifth of households held a high debt burden, or had debt service payments exceeding 40 percent of their income, according to the Economic Policy Institute.
These households mainly are spending on necessities such as food, shelter, utilities, clothing and transportation. The average bottom-fifth household spent 87 percent of its after-tax income on housing alone last year.