News Release

Middle Class Wealth Plummets

The New York Times reports: “The recent financial crisis left the median American family in 2010 with no more wealth than they had in the early 1990s, erasing almost two decades of accumulated prosperity, the Federal Reserve said Monday. The median family, richer than half of the nation’s families and poorer than the other half, had a net worth of $77,300 in 2010, down from $126,400 in 2007, the Fed said. The crash of housing prices explained three-quarters of the loss.”

WILLIAM K. BLACK, blackw at umkc.edu
Available for a limited number of interviews, Black is now an associate professor of economics and law at the University of Missouri, Kansas City and the author of The Best Way to Rob a Bank is to Own One. He was the deputy staff director of the national commission that investigated the cause of the savings and loan debacle. He said today: “The facts are in, and we now know that the ongoing crisis represents by far the most expensive epidemic of fraud in history. It was an epidemic of fraud that the FBI first warned of in 2004 — and predicted that it would cause a financial ‘crisis.’ It was an epidemic that Chairmen Greenspan and Bernanke could have ended with a stroke of their pens by heeding the pleas to ban liars’ loans. And it is an epidemic led by elite bankers with total impunity. A staggering percentage of homeowner wealth was stolen and destroyed by the elite frauds. Attorney General Holder, Chairman Bernanke, and Secretary Geithner should resign and be replaced by those who will insure that no man is above the law.”

CHUCK COLLINS, Bob Keener, bob at wealthforcommongood.org
Collins, a senior scholar at the Institute for Policy Studies and long-time inequality activist. He was born into the 1 percent. His brand new book is called, 99 to 1: How Wealth Inequality is Wrecking the World and What We Can Do About It. Collins said today: “The economic meltdown, triggered by reckless financial speculation and extreme wealth inequality, has cost the middle class two decades of economic prosperity. Reducing wealth and income disparities is key toward rebuilding an economy that works for the 100 percent.”

See Collins’ recent piece: “99 to 1: How Wealth Inequality is Wrecking the World and What We Can Do About It.”

MATTEA KRAMER, mattea at nationalpriorities.org
Kramer is a research analyst for the National Priorities Project, which is just releasing a book A People’s Guide to the Federal Budget.

Kramer said today: “This is compounded by a federal income-tax system riddled with tax breaks that largely benefit wealthy Americans. Thus, even as middle-class wealth has eroded in recent years, the federal government handed a $4.4 billion housing subsidy to the top 1 percent of Americans in 2011. That diverted tax dollars away from long-term investment in the middle class, such as tuition support for higher education.”