I thought this was interesting.

2005 Incomes, on Average, Still Below 2000 Peak, NY Times, Aug. 21, 2007:

And the Administration's response?

Cute.

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Curly

The people can always be brought to the bidding of the leaders. That is easy. All you have to do is to tell them they are being attacked, and denounce the pacifists for lack of patriotism and exposing the country to danger. It works the same in every country.

- Hermann Goering

Ok, what has caused this?

Is it your claim that is is tax cuts for the rich? If so, why has this caused people to make less money?

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"Sometimes it is said that man cannot be trusted with the government of himself. Can he, then, be trusted with the government of others? Or have we found angels in the form of kings to govern him? Let history answer this question."
-Thomas Jefferson in his first inauguration address

Well, they're right about that whole bubble thing aren't they? I mean, I was just going into online software in 2000 and the wages for technology workers were just ridiculously, stupidly excessive. It was great if you were on the right side of things, but you knew it couldn't last. Which was really a shame for some of us...
The wages in 2000 were simply unsustainable, hence the "burst". They were evidence of overly-excited venture capitalists who were doing foolish things with their money, not of the state of the economy more generally.

What's the problem, the poorer they are, the richer I feel. Good old schadenfreude.

My initial reaction in reading what the Administration had to say was, that's typical - blame the previous administration.

I find it shocking that for five straight years, the average income went down. All you hear from the current Administration is how great the economy is, and they're right, it's great ... if you're rich.

Hell, I'm doing better, significantly better, than I was doing in 2000. But on average, Americans aren't doing better - they're doing worse. And I guess I'm just old-fashioned enough to be concerned about the other guy.

Well, when you look at the growing disparity between the "haves" and "have nots", absolutely the tax cuts for the rich was a major contributing factor. As the article says:

But it's not just the tax cuts for the rich. Ordinary people - the shrinking middle class - are getting squeezed by stagnant wages, increased energy costs, increased health care costs, and fewer good paying jobs. Companies have reduced benefits - retirement, health, etc. - and have shipped jobs overseas.

The American Dream is alive and well for those who already have money. But for ordinary people? For those who are willing to work hard - even for those who are already working hard - the American Dream is more difficult to achieve now that it was in 2000 ... and 2001 ... and 2002 ... and 2003 ..... That ain't progress.

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Curly

The people can always be brought to the bidding of the leaders. That is easy. All you have to do is to tell them they are being attacked, and denounce the pacifists for lack of patriotism and exposing the country to danger. It works the same in every country.

- Hermann Goering

Whatever the cause, this could be problematic. Not immidiately, perhaps, but the destruction of the middle class is a great concern. It could destroy what democracy we have, and from observation, countries without a functioning middle class are inherently more violent...

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"Jesus said: I have cast fire upon the world, and behold I guard it until it is ablaze."
Gospel of Thomas

Yes, but how does allowing rich people to keep more money take money from the poor (or middle class_ people?

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"Sometimes it is said that man cannot be trusted with the government of himself. Can he, then, be trusted with the government of others? Or have we found angels in the form of kings to govern him? Let history answer this question."
-Thomas Jefferson in his first inauguration address

Assuming there is an initial calculation of how much tax moey is needed and the tax table "Buckets" adjusted accordingly and used for instance last year, If one adjustes the "top bucket" to take less tax the lower buckets will have to be raised (one way or another) to make up the difference. Or we simply run a deficit and sell the paper to the Chinese

What is wrong with this. If the claim is that people are getting poorer it is intellectually dishonest to look at what is perhaps the highest period in recent years. If you compare a boom to a bust you would expect people to be doing much better even if their incomes were trending at a constant level. If you want to claim that the rich are receiving most of the gains from growth then you would be in a decent position to make such a claim, however the implications of such a claim are not as strong.