Were Democrats complicit in destroying the US middle class?

[PurpleTree]

Here’s what gpt said.

This is a complex question with political, economic, and historical dimensions. To give a balanced and honest answer:

 

 

Short Answer:

 

 

Yes, some policies supported by Democrats (as well as Republicans) have contributed to the weakening of the middle class in the U.S. over the past several decades. However, attributing the decline solely or primarily to Democrats would be historically inaccurate. Both parties have played roles—sometimes collaboratively—in shaping the economic conditions that have eroded middle-class stability.

 

 

 

 

Long Answer:

 

 

 

📉 

What Happened to the Middle Class?

 

 

Since the 1970s, the U.S. middle class has faced:

 

Wage stagnation despite rising productivity.

Outsourcing and deindustrialization, leading to job losses.

Weaker unions, reducing bargaining power.

Skyrocketing costs for housing, healthcare, and education.

Tax policy changes that favor wealthier individuals and corporations.

Automation and globalization, which disrupted traditional middle-income jobs.

 

 

 

 

 

🟦 Democratic Complicity: In What Ways?

 

 

 

1. 

Trade Policy

 

 

NAFTA (1994) – championed by President Bill Clinton and supported by many Democrats – accelerated the loss of manufacturing jobs. Though it increased overall trade, it hurt certain working-class communities.

 

 

 

2. 

Financial Deregulation

 

 

Clinton-era Democrats repealed Glass-Steagall (1999), a Depression-era law that separated commercial and investment banking. This deregulation contributed to risky financial practices that led to the 2008 crash, devastating middle-class wealth (especially home equity).

 

 

 

3. 

Education and Student Debt

 

 

Support for privatized student lending and the expansion of for-profit colleges under Democratic administrations helped fuel the student debt crisis, burdening younger generations of the middle class.

 

 

 

4. 

Welfare Reform

 

 

The 1996 Welfare Reform Act, signed by Clinton, cut social safety nets and led to long-term hardships for poor and working-class Americans. It reduced poverty assistance without adequately addressing structural job shortages.

 

 

 

 

 

🟥 Republican Complicity: Just as Significant

 

 

To be clear, many Republican-led policies also hurt the middle class:

 

Union-busting laws, especially in right-to-work states.

Massive tax cuts for the wealthy (e.g., Reagan’s and Trump’s tax reforms).

Opposition to minimum wage increases and universal healthcare.

Deregulation that favored corporations over workers.

Blocking efforts to expand affordable housing or regulate Wall Street.

 

🤝 Bipartisan Failures

 

 

Some of the worst trends (like corporate consolidation, campaign finance loopholes, and underinvestment in public infrastructure) happened under both parties, often with bipartisan support. Many politicians, regardless of party, prioritized corporate donors and neoliberal economic models over the economic health of everyday Americans.

 

🧭 In Summary:

 

 

Yes, Democrats have been complicit, especially during the Clinton and Obama eras, in enacting or supporting policies that contributed to middle-class erosion.

But, to focus blame solely on Democrats ignores the larger bipartisan embrace of neoliberal economics from the 1980s onward.

 

 

 

[Daniel Balan]

Any tax hike on the properties or income of middle class or lower class puts money and properties in the hands of those who hoard endless obscene wealth. 

If I were a dictator I would never increase any taxes on the lower and middle class. But I would hellishly increase taxes on the millionaires and bilionaires. All properties should be taxed based on the owners income not the property's value. Taxing on property value is the most evil act that dems have done to the working class. Property value can be manipulated by the wealthy. Imagine a village with low property value today, but if bill gates wants to create a giant factory of robots on the outskirts of that village, all the villagers will have to sell their property because of a devil that decided to create a factory thus increasing the value of the land 1000 fold. 

I've became extremely disappointed in politics lately. Everyone, every side consists of corrupt, hypocrite devils. Rarely we find a sane not greedy politician. 

[Daniel Balan]

Democracy is bullshit. People are gullible, all the sociopaths can fool the masses into voting for devilry. Political campaigns rely only on deceit and false promises. In the end money is what dictates it all. If you can befriend rich devils you can rule the masses via endless propaganda financed by those rich dudes. 

Society should be ruled by a selfless intelectual dictator and a government composed of the finest and best intelectuals. 

The best of the best, the finest of intelectuals and phylosophers should rule with an iron fist. 

And by the finest I don't mean Elon Musk. A key requirement for my proposal is that the government should have no businessman in it. Government is not a business. 

People like Marcus Aurelius, like Claire Graves, Peter Ralston, Ken Wilber, Leo Gura, Daniel Schmachtenberger. I would like to live in a society where the constitution is Daniel Schmachtenberger's will. 

Edited 17 hours ago by Daniel Balan

[enchanted]

Short answer yes. This is what Cenk Uygur argues in the latest surrounded Jubilee video might be with checking out. 

 

 

[Elliott]

The middle class isn't destroyed, they're in the best place they've ever been. Much better living standards, working standards, ability to attain upper class, more ability in general.

Prices have increased, real wage has stagnated but not declined all while living standards have improved. All while the rest of the developing world have made amazing gains due to trade with the u.s..

https://www.pewresearch.org/race-and-ethnicity/2024/05/31/the-state-of-the-american-middle-class/
From 1971 to 2023, the share of Americans who live in lower-income households increased from 27% to 30%, and the share in upper-income households increased from 11% to 19%

 

Just look at what boomers and Gen X blow their money on.

 

 

ChatGPT

The U.S. middle class hasn’t been destroyed, but it has been eroded and reshaped over the past few decades due to several economic, political, and social forces. Here's a breakdown of what's happened:

📉 What's Happening to the Middle Class?

Shrinking Share of the Population
According to Pew Research, the share of American adults in the middle class has declined from 61% in 1971 to around 50% in recent years.

Stagnant Wages, Rising Costs
While productivity has risen, real wages for many middle-class workers have stagnated since the 1970s. Meanwhile, costs for essentials like housing, healthcare, childcare, and education have increased sharply.

Job Polarization
Many middle-income jobs (especially in manufacturing or clerical work) have been replaced by:

Low-wage service jobs

High-skill, high-paying tech or financial jobs
This leaves fewer opportunities for stable, mid-income work without a college degree.

Wealth & Income Inequality
The top 10% of earners have taken a growing share of national income and wealth. Meanwhile, the middle class holds a shrinking share of total U.S. wealth.

Housing and Regional Displacement
In many cities, the middle class is priced out of homeownership. Suburban sprawl and gentrification have also shifted where the middle class can afford to live.

📈 But It's Not All Doom:

Some middle-class families have moved up into upper-income brackets due to higher education, two-income households, or entrepreneurial success.

The U.S. still has a large and diverse middle class, just under more strain than in previous generations.

🔍 Summary:

Destroyed? No.

Shrinking and under pressure? Yes.
The American middle class still exists but is facing major stressors and is more economically insecure than in past decades

Edited 15 hours ago by Elliott

[BlueOak]

Everyone was complicit in destroying the middle class because they believed that hard work was the metric everything should be judged by.

They still do.

It isn't BTW, its results. 
 

[sholomar]

The economy has suffered from something called financialization, a term I learned by asking Gemini and Chat GPT about the decreasing purchasing power of the middle class. It has to do with quantitative easing, too big to fail, and wanting to bail everyone out rather than allowing a normal, healthy liquidation cycle in the economy.  This wealth tends not to trickle down as much as it's used by the the top 10%, who own more than 90% of the combined stock market wealth, to buy more assets and drive asset bubbles (home price to income ratios rising globally as an example, from wealthy investors buying homes and real estate whether in their own country or others) 

"Financialization is the increasing influence of financial markets, motives, institutions, and actors on a country's economy. It represents a shift in how wealth is created, moving away from an emphasis on producing goods and services and toward generating profits through financial activities.

This process has led to a growing share of the economy being dedicated to the financial sector, and it affects everything from corporate decision-making to the daily lives of individuals.

Key Aspects and Causes

Financialization isn't a single event but a complex process that began to accelerate in the latter part of the 20th century. Key factors that have contributed to it include:

Deregulation: The loosening of regulations on the financial industry, which allowed for the creation of new, complex financial instruments and increased cross-border capital flows.

Shareholder Primacy: A shift in corporate governance where the primary goal of a company's management became maximizing shareholder value. This often means prioritizing short-term profits and stock prices over long-term investment, employee wages, or product innovation.

Effects of Financialization

The rise of financialization has had significant impacts on the economy and society.

Corporate Behavior: Companies may focus more on financial engineering, such as stock buybacks and mergers and acquisitions, rather than reinvesting profits in research and development or new equipment. This can lead to less innovation and long-term growth. To better understand this phenomenon, imagine a manufacturing company that, instead of building a new factory, uses its profits to buy back its own shares to increase their value.

Income Inequality: Financialization is often linked to a widening gap between the rich and the poor. Those at the top of the income scale, who typically hold a large portion of financial assets like stocks and bonds, benefit most from rising asset prices. Meanwhile, the wages of many workers have stagnated as companies prioritize capital over labor.

Increased Instability: The expanded role of credit, derivatives, and other complex financial products can create greater systemic risk. The 2008 global financial crisis is a prime example of how an over-financialized economy can become fragile and prone to collapse.

The link between QE and financialization lies in how and where the new money enters the economy.

The money created through QE is injected directly into the financial system, primarily through the purchase of financial assets. While the intention is for banks to lend this money to businesses and households to spur economic activity, this isn't always what happens.

Here's how QE can contribute to financialization:

Asset Price Inflation: By creating a massive new buyer (the central bank) for assets like government bonds and mortgage-backed securities, QE drives up their prices. This can create a "wealth effect" where those who own these assets feel wealthier and spend more. However, the biggest beneficiaries of rising asset prices are often the wealthiest individuals and corporations, which can increase income and wealth inequality.

Portfolio Rebalancing: When central banks buy bonds, investors who sold them have a surplus of cash. They often reinvest this cash into other financial assets, such as stocks and corporate bonds, to seek higher returns. This increased demand can push up the prices of those assets as well. This process can lead to asset bubbles and a greater focus on financial speculation over productive investment in the "real economy."

Corporate Behavior: Low borrowing costs make it cheap for companies to take on debt, but instead of using this capital for new factories or research and development, some companies use it for financial activities like stock buybacks and mergers and acquisitions. These actions can artificially inflate stock prices and benefit shareholders, which aligns with the principle of shareholder primacy at the core of financialization.

In short, while central banks use QE with the goal of stimulating the broader economy, the mechanism by which it operates—by channeling liquidity through financial markets—can disproportionately benefit the financial sector and asset owners, thus intensifying the trends of financialization."

Edited 1 hour ago by sholomar