It goes like this—“We’re going broke we can’t afford it.” It’s almost a mantra from the crowd of lawmakers and policy “experts” who are loudly and continually claiming the nation must make drastic cuts in family-help government programs; cut wages, pension and health care for public-sector workers and who also suggest working families should be satisfied with three decades of stagnant wages.

That’s just not true, writes Economic Policy Institute (EPI) President Larry Mishel, in a new briefing paper, We’re Not Broke, Nor Will We Be.

Nevertheless, while these claims have little in the way of truth, politicians and pundits have successfully used them to promote budget cutbacks and the notion that employers cannot afford decent pay and benefits.

The paper shows the economy has seen steady growth in income and wealth over the past 30 years and will see similar growth in the next 30 years. The caveat is the middle class hasn’t seen much benefit from that growth. Since 1979, the top 10 percent of households have received almost two-third of all the income gains, with the top 1 percent claiming 38.7 percent.

But Mishel says, if lawmakers couple the projected growth in income and wealth over the next 30 years, with the right economic policies, not only can governments afford the investments and services the nation needs, employers can provide rising compensation to employees.

The future prosperity of the broad middle class hinges on the economic policies and structures that determine how that income is generated and shared.

Click here for the full report.