WATCH: Arianna Explains The Meaning Of 'Third World America'

Arianna's upcoming book, Third World America, unflinchingly details how our political and business leaders have abandoned the middle class and betrayed the American Dream.

In this new video, she explains why she wrote the book -- and why the United States is in danger of becoming a Third World nation.

She also talks about why, despite all the problems America is facing, writing the book ultimately left her feeling hopeful.

WATCH:

In Third World America, Arianna cites a number of alarming facts and figures that suggest America's middle class is on the decline. For example:

• 26 million Americans unemployed or underemployed (as of July 2010)

• 270,000 homes were repossessed by banks in the second quarter of 2010, up 38% from the year before

• 1.51 million people filed for personal bankruptcy during the 12 months ending June 30, 2010

• Meanwhile, spending on the wars in Afghanistan and Iraq topped $1 trillion in 2010. That's a cost of $136.5 billion just to California taxpayers alone.

• Forty years ago, top executives at S&P companies made an average of 30 times what their workers did; today they make 300 times what their workers make

• Between 1980 and 2005, over 80 percent of the total increase in income went to the top 1 percent.

• The percentage of all income taken home by the wealthiest 10 percent in 2007: 49.7 -- the highest share recorded since 1917

• The percentage of financial wealth that, by 2007, was owned by the top 20 percent of Americans: 93

• Income distribution in America is worse than in parts of Latin America, such as Guyana, Nicaragua, and Venezuela, according to the Central Intelligence Agency. It is roughly equivalent to that of Uruguay, Argentina, and Ecuador.

• As of July 2010, nearly 15 million people -- roughly one in 10 -- were out of work. But this figure excludes those who have given up looking for work altogether.

• The unemployment rate, by the end of 2009, for the bottom 10 percent of income earners: 31 (versus just 3 percent for those in the top 10 percent, earning $150,000 per year or more)

• Forty-six percent of the unemployed have been out of work for more than six months -- the highest rate of long-term unemployment since the government began keeping such records in 1948.

• One in five American households is financially insecure, meaning they've lost at least 25 percent of their income within a year due to a job loss and/or large out-of-pocket medical expenses, and don't have enough savings to replace those losses, according to Yale political scientist Jacob Hacker.

• The percentage by which the poverty rate grew in the suburbs of the largest metro areas in the United States between 2000 and 2008: 25 -- making the suburbs home to the country's biggest and most rapidly expanding segment of the poor

• The percentage of Americans born to parents in the bottom fifth of income who will climb to the top fifth as adults: 7

• Canada, Germany, Denmark, Norway, Finland, Sweden, and even the often reviled France have greater upward mobility than we do

• The financial industry's share of domestic corporate profits just before the financial crisis hit: 41 percent (versus 21-30 percent in the 1990s and no more than 16 percent from 1973 to1985)

• Percentage of workers who have borrowed against their 401(k) plans, according to Fidelity Investments: 22

• The percentage of Americans who have less than $10K saved for retirement: 43

How have you been impacted by the financial crisis -- and how are you bouncing back? What are you doing to help prevent America from ever becoming a Third World nation?

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Comments

[awake108]

07:53 PM on 09/29/2010

Too late parts of this country are already third world. They the rural south and parts of the west. Factory jobs are gone, education and small towns are crumbling and the religious rignt has managed to confince these low information voters to vote against their best interest. Citizen united is the nail in the coffin. We are already seeing drugs and gang inroads. Combine that with right wing fringe and we have a real problem. Social chaos to follow.

[Teri Szucs]

04:28 AM on 09/29/2010

You can follow the history of our downfall by following the history of the marginal tax rate, from 94% during Truman to 28% during Reagan. http://pitchforkpress.blogspot.com/p/historical-rates-married-couples-filing.html

[TonkaTruck]

11:28 PM on 09/23/2010

I love you Arianna and thank you for doing this!

Outsourcing and free trade has also ruined it for the middle class.

[flossophy]

08:35 PM on 09/23/2010

Why would we want to repeat the same policies that brought down Greece?

[Fremon]

06:15 PM on 09/23/2010

America has basically been on a downward arc since Reagan who tripled plus his inherited debt, over spent on the military, started manufacturing jobs overseas, allowed the banking/financial industry to issue easy credit so that people would live on it to make up for shrinking wages and losing jobs. It was the Republican plan all along to increase the wealth of the rich and decrease living standards for the middle and lower classes (the powerless) to provide a basic serfdom class where people would be happy to have jobs in a low wage service economy. The plan was carried through by cries as "class warfare" as the rich and middle classes separated in wealth. The plan was aided by Clinton in dismantleing glass steagall and creating Nafta. He was sold a bill of goods by Rubin. Had the techonology silicon revolution not happened we would be in a worse mess. That industry is now matured. All along we cried out socialism, and communism for those that wanted a better break for the middle/lower classes. Wars like Vietnam, Grenada, Panama, Iraq 2x helped to keep one industry going. The American people not knowing how the best nations were living thought everything here was the best (remember the best healthcare system in the world?). How did they do it. Basically with racism, religious fervor (God will deliver), federal handouts, etc. People we are in a developing nightmare which is not Obama's fault. He is trying to fill in holes.

[Catch 22]

11:25 AM on 09/22/2010

I have lived in the Third World, and a few things come to mind. Globalization is not helping us. In the Third World, an lot of the prominent political leaders, are Technocrats who have residency in the First World. Their interests are not tied to the country that they are Governing, even though they may have been born there. Let us move forward to Erik Prince, the former Head Honcho of Blackwater. He can safely go and live in The UAE or wherever he is, without any impact on him financially. Corporations do the same thing. The only ones who do no have that benefit, are the working stiffs. Hence the income gap between the haves and the have nots are widening. I am afraid I do not share Arianna's optimism.

[TonkaTruck]

11:30 PM on 09/23/2010

Great post; I do not share her optimism either, but I support her courage to be on the front line spelling it out for those who do not get what's going on here.

[So-called-bob]

04:48 PM on 09/21/2010

I first saw the Third World in South Dakota The year was 1974. I had just crossed into an Indian Reservation.

[pterack5]

03:25 AM on 10/24/2010

its still here, and the whites still blame the natives for their troubles. . .

[deeblk07]

12:18 AM on 09/19/2010

well, if the GOP and the tea-party rule come Nov then we will indeed be looking @ a 3rd world.

[Cydewayz00G]

01:07 PM on 09/20/2010

u got dat right.

[demedius]

01:07 PM on 09/17/2010

Arianna, the problem is we have third world CORRUPT politicians on both sides of the aisle that only respond to the interest groups that finance their campaigns and don't give a bleep about we the people. Term limits and campaign reform must be implemented urgently.

[LisSuzNCrittrz]

03:14 PM on 09/16/2010

Worth another post: by Tiggy

We need President Obama to call out each and every Senator who is standing in the way our the prosperity of our fellow citizens. Each and every day an announcement should be made as to who opposes helping job creation and afford the constituents the opportunity to contact them and encourage them to do what is right. We need the President to stand by us and with us! After all, that is what we did for him when we elected him.
This is how we can jumpstart the economy, check the big banks and take back our Senate.

[unique]

08:10 PM on 09/17/2010

Now this is change we can believe in.

[TonkaTruck]

11:34 PM on 09/23/2010

But that would make too much sense.

I think we should also implement a pay for performance program; lower their wages and slash their benefits; if they do a majority of what they campaigned for after they get in office; we can do a job review and decide if a pay increase is worthy (well, that's what the rest of us have to do at our jobs).

[mixpiklix]

09:35 PM on 09/14/2010

Arianna i 'm a fan but because you see big cities and they have problems , but rural America say gaylord mi. or darbydale oh. or other small towns have differant problems. You should travel to some of these places and see what is foriegn to new york or how foriegn new york is to those folks

[befree56]

10:35 PM on 09/13/2010

After listening to Arianna and many others on this topic, there appears to be a 900 pound gorilla in the room that goes ignored, PROPAGANDA. It appears as we approach 3rd world status, propaganda becomes a more powerful tool and perhaps the only means of moving people. I am not a history expert but it does seem that what we have in common with other countries that fell in great part to propaganda is a downward spiral that is increased by propaganda which leads to more propaganda and further downward spiral. Humans seem to be programed to relate to propaganda as things get worse and I do not know of any country that has overcome this vicious cycle without the rest of the world stepping in forcefully and saying enough.

[I3edlam]

11:56 PM on 09/18/2010

That's an interesting take on the problem. There are many examples of revolutions taking place despite the propaganda of their home countries. In fact South America was rife in Socialist movements against fascist/dictatorships in the earlier half of the 20th Century.
America has been conditioned over the coldwar to completely distrust radical movements, especially socialist ones. We were the establishment fighting commies after all. I think the only way to overcome propaganda is to get in touch with yourself. You have to raise some sort of spiritual awareness of the conditions surrounding you through your own power. There are tons of ways to do it, through art religious/spiritual techniques, traveling helps. There has to be strong principles, and clarity about what your against, and what you believe in. Those are just some thoughts. I'm not a historian either, and I've never been in a revolution. Sometimes I wish America would just revolt though but it obviously isn't bad enough for that to happen otherwise we'd see more examples of revolt.

[reveal5]

01:30 PM on 09/13/2010

A vote for the GOP is a vote for "Third World America."

[PotomacOracle]

09:45 PM on 09/12/2010

Continuation: quote by Ravi Batra,

"In 1986, Reagan slashed the top tax rate further. His redistributionist obsession led to a perversity in the law. The wealthiest faced a 28 percent tax rate, while those with lower incomes faced a 33 percent rate; in addition, the bottom rate climbed from 11 percent to 15 percent. For the first time in history, the top rate fell and the bottom rate rose simultaneously. Even unemployment compensation was not spared. The jobless had to pay income tax on their benefits. A year later, the man who would not spare unemployment compensation from taxation called for a cut in the capital gains tax. Thus, Reagan was a staunch socialist, totally committed to his cause of wealth redistribution towards the affluent.

How much wealth transfer has occurred through Reagan's policies? At least $3 trillion.

The Social Security hike generated over $2 trillion in surplus between 1984 and 2007, and if it had been properly invested, ... it could have earned another trillion by now. At present, the fund is empty, because it has been used up to finance the federal deficits resulting from frequent cuts in income tax rates. If this is not redistribution of wealth from the poor to the rich, what is?

Thus, Reagan was the first Republican socialist - and a great one, because his wealth transfer occurred on a massive scale. His accomplishment dwarfs even FDR's, and if today the small businessman suffers a crippling tax burden, he must thank Reagan the

[PotomacOracle]

09:38 PM on 09/12/2010

We should not ever forget how we arrived at Third World status. Ravi Batra, Economist/Author writes:

"Let's go back to the early 1980's. In 1981, Reagan signed a law that sharply reduced the income tax for the wealthiest Americans and corporations. The president asserted his program would create jobs, purge inflation and, get this, trim the budget deficit. However, following the tax cut, the deficit soared from 2.5 percent of GDP to over 6 percent, alarming financial markets, sending interest rates sky high, and culminating in the worst recession since the 1930's.

Soon the president realized he needed new revenues to trim the deficit, bring down interest rates and improve his chances for reelection. He would not rescind the income tax cut, but other taxes were acceptable. In 1982, taxes were raised on gasoline and cigarettes, but the deficit hardly budged. In 1983, the president signed the biggest tax rise on payrolls, promising to create a surplus in the Social Security system, while knowing all along that the new revenue would be used to finance the deficit.

The retirement system was looted from the first day the Social Security surplus came into being, because the legislation itself gave the president a free hand to spend the surplus in any way he liked. Thus began a massive transfer of wealth from the poor and the middle class, especially the self-employed small businessman, to the wealthy. The self-employment tax jumped as much as 66 percent."

[Joseph Conklin]

05:25 PM on 09/14/2010

All true, However most Americans have Beatified Reagan and don't believe any of this if you tell them the history. I believe our education system has failed us. People would rather believe a lie than the truth if it conflicts with their political viewpoint. I know that we all create our own reality, But it should not be so easy to ignore the facts.