Disability Backlogs and a Bad Economy Looming
Yesterday, as I was driving about, I was listening to an NPR article that discussed the ramifications of a 20 percent dip in average U.S. home values. I can't remember the exact numbers, but the fallout would be that millions of American homeowners would suddenly have a negative equity situation. They would owe more on their homes than they are worth.
That's not an appetizing prospect for a country that places such a premium on home ownership and its not encouraging for an economy that runs on new home construction.
So what happens if this scenario comes to pass? Several things I can think of include hits on new home sales, new home construction, and problems for companies that would seek to transfer employees from one location in the U.S. to another (difficult to buy a new home if you can't sell your old one). A slow down in home construction, of course, means problems for retailers like Home Depot, Lowes, and even Sears.
Will we see a recession? According to recent statements from former Fed Chairman, Alan Greenspan, this may be likely.
Now, contrast all of this will a recent article appearing in the New York Times which stated the following statistics:
1. From 2003 to 2005, the top one percent of Americans had incomes greater than the bottom twenty percent.
2. The income of the top three million Americans was greater than the bottom 166 million Americans.
3. Incomes for the top one percent of Americans rose by $465,700 while the incomes of the bottom twenty percent rose by $200.
4. For this same group, the top one percent, their tax burden actually fell as their incomes rose substantially.
This is a trend, apparently, that has been going on for some years. But under the currrent administration, the trend has been particularly pronounced and enhanced by tax cuts that, by and large, do not benefit the majority of Americans, but rather the rich.
Contrast this to severe disability claim backlogs and the failure of an inept and unresponsive Congress to properly fund the social security administration so that hundreds of thousands of American families might avoid financial ruin...and you get a clear picture of what the political and socioeconomic priorities are these days.
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