[Congressional Record (Bound Edition), Volume 150 (2004), Part 12]
[House]
[Page 16260]
[From the U.S. Government Publishing Office, www.gpo.gov]




                          MIDDLE CLASS SQUEEZE

  Mr. EMANUEL. Mr. Speaker, the lead story in today's Wall Street 
Journal, ``So Far, Economic Recovery Tilts to Highest Income 
Americans,'' provides further evidence of a two-track economy and an 
economic squeeze on middle class families.
  While there has been a profits boom for corporations and a 16 percent 
increase in pay on Wall Street, there is a growing wage and benefits 
recession for the middle class of America. To those who say 
redistribution of wealth is wrong, I agree, whether it is to the top 1 
percent or to the bottom 25 percent.
  For America's workers, a new study by the Economic Policy Institute 
reports that weekly earnings have fallen for 6 of the last 7 months. 
When the recovery began in November of 2001, hourly wages were actually 
higher than what those same jobs pay today.
  Evidence of this two-track economy is evident throughout the country. 
As the article points out, while corporate profits have risen around 87 
percent and sales at BMW and Nieman Marcus are booming, sales at Wal-
Mart and Target are flat.
  But don't take my word for it, Today's Wall Street Journal quotes 
J.P. Morgan Chase and the former Federal Reserve economist Dean Maki: 
``To date, the recovery's primary beneficiaries have been the upper 
income. Two of the main factors supporting spending over the past year, 
tax cuts and increases in stock wealth, have sharply benefited upper 
income households relative to others.''
  David Rosenberg, chief economist at Merrill Lynch, ``The income from 
the recovery has been locked up in the corporate sector. We have had a 
redistribution of income to the corporate sector.''
  So if you sit in the board room, you are doing just right. For the 
rest of us, it is an economic squeeze.
  With working families' household incomes down nearly $1,500 over the 
last 2 years, people are working harder just to stay in the same place. 
And for the middle class, this has become a step master economy. All 
the while, the expense side of the ledger shows:
  According to the Kaiser Foundation, that health care costs for a 
family of four have gone up from $6,500 to $9,000, a 49 percent 
increase from 2000 to 2003. And as health care costs have risen, 
corporations have shifted the burden to employees.
  Millions of middle class families now carry, on average, the average 
American middle class family, $9,000 in credit card debt and $17,000 in 
overall household debt. The squeeze has resulted in 33 percent more 
bankruptcies for households.
  One hundred eighty billion dollars has been evaporated from 401(k)s 
and retirement security for middle class families. College tuition 
costs have gone up 26 percent in the last 2 years.
  With a record like this, only this admission could wave the banner 
``mission accomplished'' above the economy.
  The concentration of wealth and the two-track economy can be traced 
right back to President Bush's tax cuts. A study cited by The New York 
Times found that Americans are being taxed more than twice as heavy on 
earnings from work as they are on investment income, even though more 
than half of all investment goes to the wealthiest 5 percent of 
taxpayers.
  The shifting of the tax burden from wealth to work is the essence of 
class warfare. And as Warren Buffet, the legendary investor said, ``If 
class warfare is being waged in America, my class is clearly winning.''
  In the 1990s, we ended welfare as we know it because it was a failed 
system. Now this administration is bent on ending the middle class as 
we know it. This administration has two books, two sets of values, two 
sets of priorities, and a single economic strategy that divides this 
country along income.
  If you want to live in a country without class divisions, we cannot 
deny the middle class families the same dreams of affordable health 
care, higher education, and a retirement that is secure. We have to 
give that dream to every American, not just to the wealthiest 
Americans.
  Renowned Supreme Court Justice Louis Brandeis once said, ``We can 
either have a democracy in this country or we can have a great 
concentration of wealth in a few hands, but we cannot have both.''
  Today's economic policies have shifted this great economy and the 
benefits of this great country and this economy to the wealthiest 1 
percent, as today's Wall Street Journal notes. When I look at this and 
think about what has happened to the middle class family, with 
increasing health care costs, college costs, retirement that is less 
secure, and jobs that pay less than they did just 3 years ago, I'm 
reminded, especially as I look at communities across this country, with 
police officers and police departments and fire departments that are 
under stress, schools that are closing, teachers that are being laid 
off, and libraries that are cutting hours, I'm reminded of when George 
Bush declared in 2000 that he was opposed to nation-building. Who knew 
it was America he was talking about.
  Mr. Speaker, we have to return this economy and this country back to 
the people who built it and to the families and respect their values. 
The middle class and their values and their economic interests are 
under assault. It is time we turned this country around and focused our 
policies on the middle class and their families.

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