#8 - Analysis of CQ Researcher Pro/Con argument

Pro/Con: Is the American middle class in permanent decline?

“Pro” thesis: The American middle class is in permanent decline.

Argument (by Alan Nasser, Professor Emeritus of Political Economy, The Evergreen State College. Written for CQ Researcher, April 2016):

1. The middle class has never been in good shape, since it has always had a high household debt-to-disposable income ratio, and this ratio has been steadily worsening since the 1950's.
2. There is no reason to think that the economy will turn around to significantly reduce the household debt-to-disposable income ratio.
3. So, the middle class is in permanent decline.   

Nasser supports #1 by noting that even at the height of the middle class right after World War II, there was a significant rate of household debt to disposable income, and this rate has been increasing: 1950, 38%; 1955, 53%; 1960, 62%.  Nasser notes, “the median wage began, in 1974, a long-term decline persisting to this day. By the mid-1980s, the ratio began a dangerous ascent, from 80 percent in 1985 to 88 percent in 1990 to 95 percent in 1995 to more than 100 percent in 2000 and 138 percent in 2007.”  He supports #2 by noting, due to automation replacing human labor, which is always increasing, the economy for the middle class will decline even further.  Nasser also supports #2 by referring to a number of economists (Paul Krugman, Lawrence Summers, and Robert Gordon) who forecast chronic stagnation in the U.S. economy.  

Nasser quotes a number of statistics about the ratio of household debt to disposable income; in a formal paper or a book, the source (or sources) of these figures would need to be cited.  He should also provide citations for where the three noted economists forecast chronic stagnation in the economy.