Behold a new damage assessment from the credit crisis: The net worth of the median American household plunged 47% from 2007-2010.

So concludes a study by New York University's Edward Wolff. 'The debt of the middle class exploded from 1983 to 2007,' he writes, 'already creating a very fragile middle class in the United States... [T]heir position deteriorated even more over the "Great Recession".'

Remarkably, if you throw out housing, the picture is even worse: Median nonhome net worth dived 59% between 2007-2010 and is indeed substantially lower than it was in 1962 - which is as far back as Wolff dared to look.

In Washington, Wolff's study is prompting a thorough re-examination of policies that larded down the middle class with so much debt over the decades.

Just kidding: The Beltway class is latching on to the part of Wolff's study that noted median net worth among "the 1%" grew 71% between 1983-2010, measured in 2010 dollars.

'Inequality skyrocketed as a consequence of the Great Recession,' says the questionably named Center for American Progress, 'taking resources away from middle class, minority and young families while the wealthy made significant gains.'

The statistic is 'almost ready-made for an Occupy Wall Street banner,' notes a story at Salon.

Like it or not, here's another statistic of that ilk: Student loan delinquencies skyrocketed during the third quarter, according to new figures from the New York Fed.

As of June 30, less than 9% of loan balances were 90 days or more in arrears. As of Sept. 30, the number was 11%. That's bad enough. In the context of the last decade, it's frightening.

'Nearly all student loans - 93% of them last year - are made directly by the government,' The Wall Street Journal points out.

'The real fallout from the student loan crisis will hit in mid-2013, four years after the volume of government-funded student loans surged,' macro strategist Dan Amoss wrote in August. 'Like the infamous option ARMs (adjustable-rate mortgages) during the housing bubble, these loans have precisely timed fuses: Four years after the loans are made, borrowers must start making payments.'

'Within a handful of years,' he amends his forecast now, 'U.S. taxpayers will be on the hook for over $100 billion in student loan defaults.'

Then again, what's $100 billion in a "real" national debt of $86.8 trillion?

Officially, the national debt stands this morning at $16.3 trillion. That number does not include future liabilities for Social Security and Medicare.

Different people come up with different numbers when it comes to the true national debt: Former comptroller general and I.O.U.S.A. protagonist David Walker reckons it's $71 trillion. Boston University's Larry Kotlikoff's number crunching comes up with a figure three times as big, $222 trillion.

The $86.8 trillion figure comes from former congressmembers Christopher Cox and William Archer, writing in an Op-Ed posted yesterday at Yahoo Finance.

'Were American policy makers to have the benefit of transparent financial statements prepared the way public companies must report their pension liabilities,' the duo write, 'they would see clearly the magnitude of the future borrowing that these liabilities imply.'

Contra Messrs. Cox and Archer, they do: The Treasury Department issues an annual Financial Report of the United States Government - every year during the week between Christmas and New Year's, to make sure as few people as possible see it.

Regards,

Dave Gonigam
for The Daily Reckoning Australia