If you read the news often, you’ll notice there are some “heavy” weeks. You ever search for the fluff stories? The really nice stories they put toward the end of the news about a puppy fashion show, a little boy organizing a food drive or a funny video of an animal riding an animal? Yeah, heavy weeks don’t have those stories. This week in financial blunders we take a look at some important yet sobering stories about the economy and labor rights.
Being a middle- or lower-class American became a point of strife this week as two studies emerged, both showing some unsettling economic trends for those income brackets. One study from the New York Times was bluntly titled “The American Middle Class Is No Longer the World’s Richest,” and it proved just that. In an extremely detailed survey conducted over the past 35 years, the Times not only shows how many other western countries are surpassing the middle and lower class of the USA, but it reveals upsetting details about the current state of the American working class:
- Pay in Canada and “several European countries” has risen faster than that of the United States. Britain and Canada have seen their median middle class income increase by 19.7% since 2000; the United States has seen a 0.3% increase.
- There is more of an effort to redistribute income to the lower and middle class from Canadian and Western European governments.
- The American poor are taking the hardest hit from all of this. An American family in “the 20th percentile of the income distribution in this country makes significantly less money than a similar family in Canada, Sweden, Norway, Finland or the Netherlands. Thirty-five years ago, the reverse was true.”
Adding financial insult to injury, a study from Princeton University claims that the United States is no longer a democracy. The study, compiled by Martin Gilens and Benjamin I. Page, concludes that the United States is now very much an oligarchy. “Economic elites and organized groups representing business interests have substantial independent impacts on U.S. government policy,” and the influences of individuals or “mass-based interest groups” have very little, if any, influence.
The (Financial) Descent
If climbing Mount Everest was on your bucket list, it’s going to have to wait for a minute. In a horrible turn of events, at least 13 Sherpas, an ethnic group in Nepal known for their expertise in mountain climbing, were killed by an avalanche while climbing Mount Everest. This tragedy was the catalyst for a massive walkout by the Sherpas, who are essential for climbing the famous mountain. The Huffington Post reports many expedition companies have already canceled climbs during their money-making season in mid-May when the weather is clear enough to climb.
While the Nepalese government and expedition companies figure out how to compensate the families and deal with labor disputes, their financial losses are growing. Climbers have to give up the fees they’ve already paid to climb (which cost anywhere from $42,000 to $100,000), and the Nepalese government is sweating because they make $3–$4 million annually from fees and taxes on climbers. The families of those lost in the avalanche were offered 40,000 rupees (approximately $415), but the Sherpas demanded much more for those who are suffering: “More insurance money, more financial aid for the victims’ families and new regulations to ensure climbers rights.”
Those are the noteworthy financial blunders of this week, but if you have some more you’d like to discuss please comment below.