You could almost hear the collective groan in deep-red Alabama when President Barack Obama, in his State of the Union address, reminded Americans of what he has long said was one of the nation’s most pressing challenges.
“Today, after four years of economic growth, corporate profits and stock prices have rarely been higher, and those at the top have never done better,” Obama said. “But average wages have barely budged. Inequality has deepened. … Too many Americans are working more than ever just to get by; let alone to get ahead.”
The Alabama groans were expected. For six years, our elected officials have force-fed us a political diet that lacks any substance but the certainty that everything Obama says or does is wrong, and maybe evil.
Alabama’s groans at Obama’s words on the collapsing middle class, however, were misplaced. More than almost any other state, we feel the consequences of a four-decade trend in which the rich — blessed with capital and opportunity — have gotten richer and everyone else has struggled. Like him or not, Obama is fighting for Alabamians when he fights against inequality.
Obama’s description of growing income polarization is accurate. Corporations get it, and many are struggling to cope with it. In Decatur, we recently have lost two retailers that depended on the middle class: Sears and JC Penney. The disposable income of the companies’ traditional customer base is dwindling.
Some retailers, however, are doing great. Never better, thank you. High-end stores like Nordstrom and hotels like Four Seasons are powering ahead, reports the New York Times. The most nimble companies, like G.E. Appliances and Darden restaurants, are pushing high-end brands that appeal to the wealthy customers who still have disposable income.
Forty percent of all personal consumption expenditures in 2012 — up from 27 percent in 1992 — came from the top 5 percent of earners. The bottom 80 percent of earners accounted for only 39 percent of personal consumption expenditures in 2012, down from 47 percent in 1992.
Alabama — with more than one in five living in poverty and with a per capita income that is 42nd in the nation — should be especially disturbed by this trend. In a nation that has the greatest income inequality in the industrialized West, Alabama’s income disparity — its gap between the haves and have-nots — is greater than all but four states. And even corporate America should worry, as it is forced to market its products to an ever-smaller percentage of the population.
If our politicians have new ideas on how to reverse a trend that is undermining our economy and depriving Alabamians of access to capital and opportunity, they should speak up. If all they have to offer is attacks on Obama, they need to get out of the way.