Use of food stamps, sale of luxury goods – on the rise

I read some terrible news today. According to new data released by the IRS, it looks like the incomes of non-wealthy Americans fell dramatically in 2009, “with total income down 15.2 percent in real terms since 2007.” It wasn’t all bad news today, though. It was also reported that the sale of high-end luxury goods were up sharply.

Here’s a clip from the first article:

…The data showed an alarming drop in the number of taxpayers reporting any earnings from a job — down by nearly 4.2 million from 2007 — meaning every 33rd household that had work in 2007 had no work in 2009.

Average income in 2009 fell to $54,283, down $3,516, or 6.1 percent in real terms compared with 2008, the first Internal Revenue Service analysis of 2009 tax returns showed. Compared with 2007, average income was down $8,588 or 13.7 percent…

And, here, if you can stomach it, is a clip from the second article:

…The success luxury retailers are having in selling $250 Ermenegildo Zegna ties and $2,800 David Yurman pavé rings — the kind encircled with small precious stones — stands in stark contrast to the retailers who cater to more average Americans.

Apparel stores are holding near fire sales to get people to spend. Wal-Mart is selling smaller packages because some shoppers do not have enough cash on hand to afford multipacks of toilet paper. Retailers from Victoria’s Secret to the Children’s Place are nudging prices up by just pennies, worried they will lose customers if they do anything more.

While the free spending of the affluent may not be of much comfort to people who are out of jobs or out of cash, the rich may contribute disproportionately to the overall economic recovery.

“This group is key because the top 5 percent of income earners accounts for about one-third of spending, and the top 20 percent accounts for close to 60 percent of spending,” said Mark Zandi, chief economist of Moody’s Analytics. “That was key to why we suffered such a bad recession — their spending fell very sharply”…

In 2008, for example, the most expensive Louboutin item that Saks sold was a $1,575 pair of suede boots. Now, it is a $2,495 pair of suede boots that are thigh-high. Crème de la Mer, the facial cream, cost $1,350 for 16 ounces at Bergdorf Goodman in 2008; it now costs $1,650.

“I think that she’s willing to pay whatever price the manufacturer and the retailer deem appropriate, if she sees that there’s intrinsic value in it,” Ms. Katz said.

Part of the demand is also driven by the snob factor: at luxury stores, higher prices are often considered a mark of quality.

“You just can’t buy a pair of shoes for less than $1,000 in some of the luxury brands, and some of the price points have gone to $2,000,” said Jyothi Rao, general manager for the women’s business at Gilt Groupe, a Web site that sells designer brands at a discount. “There’s absolutely a customer for it.”

Jennifer Margolin, a personal shopper in San Francisco, said she had noticed changes in clients’ attitudes. They “pay full price if they absolutely love it,” she said. “Before it was almost completely shying away, where now it’s like, ‘O.K., I’m comfortable getting a Goyard bag,’ but they get it for the quality.”

Goyard bags, in addition to having a distinctive pattern, will usually run a few thousand dollars. And, yes, they are selling out quickly…

So, if you’re one of those 1 in 7 Americans currently receiving food stamps, cheer up. Good times are right around the corner, as dollars spent on Goyard bags and Ermenegildo Zegna ties begin to trickle down through the economy… If only we could cut the taxes of the rich just a little bit more, to hasten this recovery built on luxury ties and purses.

In all seriousness, why isn’t this growing wealth disparity in America more a subject of conversation? Why do so few Americans seem to know that our country’s wealth has been accumulating more and more rapidly in the hands of the very rich? It couldn’t perhaps be because it’s not mentioned in the popular media, could it?

Of course, I’m exaggerating. Some media outlets here in the U.S. are doing a great job of sharing the facts with the American people. Take for instance this incredible report by NBC news.

update: Actually, I was mistaken. That wasn’t a production NBC News. That was the work of Al Jazeera… Speaking of NBC News, though, they’ve got a great new piece up on their website about the antics of the Jersey Shore cast. You should really check it out.

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18 Comments

  1. Maria
    Posted August 4, 2011 at 9:17 pm | Permalink

    Mark, your cynicism is showing…

  2. josh
    Posted August 4, 2011 at 10:00 pm | Permalink

    I have plenty of bottles saved up, but the gasoline is just way too expensive.

  3. Paw Ingles
    Posted August 4, 2011 at 11:24 pm | Permalink

    As a free and self reliant American, I don’t care for the idea that I’m living off the riches’ wealth “trickling down” to me. It doesn’t seem much different than just bottling their wealth through taxes and passing it down the line. Either way, we’re sipping from someone else’s watering hole.

    First thing in the morning, I’m going to take all my savings and go buy myself a pair of those $2,495 thigh-high suede boots. If I’m going to drink any man’s trickle, it’ll be my own, earned by blood, sweat and the Homestead Act.

  4. Glen S.
    Posted August 5, 2011 at 7:07 am | Permalink

    Uh-oh! Looks like it’s time for more tax cuts for the rich (sorry, “job creators”) and “reforms” to entitlement programs …

  5. Posted August 5, 2011 at 7:38 am | Permalink

    I can’t wait for the riches to trickle down and help all those old ladies in Detroit who can’t pay their electric bills.

  6. Edward
    Posted August 5, 2011 at 7:43 am | Permalink

    New tag line for the site:

    “MARKMAYNARD.COM: Drinking Another Man’s Trickle”

  7. eDWeirD
    Posted August 5, 2011 at 8:50 am | Permalink

    Maybe it’s time to start knocking some jockies off some lawns…

  8. Glen S.
    Posted August 5, 2011 at 9:21 am | Permalink

    http://read.bi/apKPjW

  9. Edward
    Posted August 5, 2011 at 12:43 pm | Permalink

    As no one else has mentioned it, I really like the part about WalMart having to sell individual rolls of toilet paper. It’s a nice contrast to the $2000 shoes.

  10. TaterSalad
    Posted August 5, 2011 at 6:06 pm | Permalink

    Federal spending per citizen from 1980 until 2008.

    http://quinersdiner.com/2011/08/01/the-tea-party-vs-the-president/

  11. Posted August 5, 2011 at 6:30 pm | Permalink

    I wonder if Tater does a round of regular sites, where he just posts random links everywhere.

    Has anyone here ever gone on a right wing site and posted shit? I’m just curious, cause I know I haven’t.

  12. james
    Posted August 5, 2011 at 10:55 pm | Permalink

    “In all seriousness, why isn’t this growing wealth disparity in America more a subject of conversation? Why do so few Americans seem to know that our country’s wealth has been accumulating more and more rapidly in the hands of the very rich? ”

    For the most part, people tend to associate with other people within their own economic class. So most people in the lower three quintiles never see people in the top one, and have only a vague idea of how much personal wealth they control.

  13. Interrobang
    Posted August 7, 2011 at 1:52 pm | Permalink

    So most people in the lower three quintiles never see people in the top one, and have only a vague idea of how much personal wealth they control.

    Also, it doesn’t help that most Americans think they’re much, much richer than they actually are. Just about the whole top 20% thinks it’s in the top 1%, and almost everyone else is convinced they’re going to win a lottery someday.

    The neatest trick the class warriors ever pulled was convincing rank-and-file Americans that the US is a “classless society.” From the perspective of a non-American, it’d be funny if it weren’t so damn tragic, and didn’t have such horrible real-world consequenses for the rest of us (that most Americans can’t see past their myopic Americocentrism long enough to give even half a damn about).

  14. Posted August 7, 2011 at 3:03 pm | Permalink

    The neatest trick was getting poor ass Americans to fight tooth and nail for more tax breaks for rich people.

    It’s amazing hearing somebody that doesn’t make more than $20K lecture you on how morally wrong it is to take away the “hard earned” wealth of billionaires.

  15. Amiee Fillpot
    Posted September 6, 2011 at 10:49 am | Permalink

    I’m looking for a heavy gold stick of some sort with a designer insignia that I can use to push the poor out of my path as I make my way from my expensive car to my luxury apartment. Might you be abel to help me with that?

  16. Meta
    Posted September 20, 2013 at 8:44 am | Permalink

    From the New York Times:

    House Passes Bill Cutting $40 Billion From Food Stamps

    House Republicans narrowly pushed through a bill on Thursday that slashes billions of dollars from the food stamp program, over the objections of Democrats and a veto threat from President Obama. The vote set up what promised to be a contentious fight with the Senate and dashed hopes for passage this year of a new five-year farm bill.
    The vote was 217 to 210.

    The bill would cut $40 billion from the food stamp program over the next 10 years. It would also require adults between 18 and 50 without minor children to find a job or to enroll in a work training program in order to receive benefits. It would also limit the time those recipients could get benefits to three months.

  17. iRobert
    Posted July 24, 2019 at 3:54 pm | Permalink

    The Trump Administration is going to attempt to kick 3 million people off of food stamps. 8 of the 10 states with the highest percentage of people on food stamps voted for Trump (WV, KY, TN, LA, MS, AL, GA, FL).

  18. Anonymous
    Posted July 24, 2019 at 4:48 pm | Permalink

    He doesn’t realize that in absolute numbers white people are the largest recipients of SNAP benefits.

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