The Death of the Middle Class

Many have been speaking about the death of the middle class for years, but hell, even the Financial Times is on the beat now.

Once upon a time this was called the American Dream. Nowadays it might be called America’s Fitful Reverie. Indeed, Mark spends large monthly sums renting a machine to treat his sleep apnea, which gives him insomnia. “If we lost our jobs, we would have about three weeks of savings to draw on before we hit the bone,” says Mark, who is sitting on his patio keeping an eye on the street and swigging from a bottle of Miller Lite. “We work day and night and try to save for our retirement. But we are never more than a pay check or two from the streets.”

The slow economic strangulation of the Freemans and millions of other middle-class Americans started long before the Great Recession, which merely exacerbated the “personal recession” that ordinary Americans had been suffering for years. Dubbed “median wage stagnation” by economists, the annual incomes of the bottom 90 per cent of US families have been essentially flat since 1973 – having risen by only 10 per cent in real terms over the past 37 years. That means most Americans have been treading water for more than a generation. Over the same period the incomes of the top 1 per cent have tripled. In 1973, chief executives were on average paid 26 times the median income. Now the ­multiple is above 300.

Alexis de Tocqueville, the great French chronicler of early America, was once misquoted as having said: “America is the best country in the world to be poor.” That is no longer the case. Nowadays in America, you have a smaller chance of swapping your lower income bracket for a higher one than in almost any other developed economy – even Britain on some measures. To invert the classic Horatio Alger stories, in today’s America if you are born in rags, you are likelier to stay in rags than in almost any corner of old Europe.

emphasis added

I strongly believe that the death of unions due to the incessant war waged against them by the Haves after their hard-won victories (much like our country’s abortion and privacy rights, there was never a single victory by the business/right, but a series of tiny steps that decreased the power and scope of their target bit by bit until the target was eventually unrecognizable. See also, boiling frogs).

Setting aside the gross unfairness of massive income inequality, a huge problem with this setup is that it will invariably lead to social unrest (as you’re seeing bubble up somewhat with the idiotic Tea Party), which will lead, eventually, to blood (whether on domestic shores or foreign, I don’t know).

My generation is the first generation that will not have a higher standard of living than our parents. My generation has known this for a long time (I remember discussing this in undergrad). I think that sociologists and other commentators forget this factor when trying to question why Gen X and Y are such sarcastic, cynical bastards. The reason is – we know we’re on a hamster wheel going nowhere. What is there to look forward to?