An End To The American Dream?
Over the last decade, it has become clear that a tide is rising in the United States. One that does not stand for progress or change, one that does not lift all the boats, but rather a tide that clearly has an agenda of its own. This tide is supporting an increasingly smaller proportion of American society, not for the people or by the people, and is leaving the working class behind.
You may argue, yes, the stock market is soaring, unemployment is at 5.8% (down from nearly double that in 2009), and GDP is steadily regaining its pre-Recession levels, but what has this growth done to improve the lives of the average American worker, the working middle class that accounts for over a third of the US population? It is clear that economic improvements can be seen all across the spectrum, but for the median income earner, this picture is anything but flourishing.
Is this an end to the middle class?
According to recent figures, after adjusting for inflation, “today’s US average hourly wage has just about the same purchasing power as it did in 1979.”What compensation have median workers seen? An increase of “just 5 percent between 1979 and 2012, despite productivity growth of 74.5 percent—while the 20th percentile worker saw wage erosion of 0.4 percent and the 80th percentile worker saw wage growth of just 17.5 percent.”
It is evident that the pie has greatly increased at the hands of typical US workers, but why do they not see an increase to their slice? American workers used to see the fruits of growth and their progress first-hand, but now, a new era of stagnation is here to stay in this post-Recession world.
The US prides itself in 20th century economic policy – an era that needs to be re-looked into in order to return to an age of the “we” economy. Where people such as my grandfather and 2.2 million others by 1956 had used legislation including the G.I. Bill for education benefits in order to attend colleges, universities, and vocational schools, or receive low-cost mortgages and low-interest loans to start a business.
These are post Great Depression New Deal economics that evidently showed the US at its most prosperous. The average job provided health benefits and insurance, was well paid, and allowed creature comforts: a car, refrigerators, and a yearly vacation. Under the Great Society in the 1960’s, average household income doubled from the previous decade and poverty levels halved. Programmes such as Social Security and Medicaid thrived and the United States became the largest and most powerful economy in the world.
Today, it appears we are entering a second Gilded Age with inequality levels staggering back to pre-Depression era figures.
When did this trouble begin?
Most ideology comes from the beginning of the 1980’s where excessive deregulation, globalisation, weaker unions, lower labour standards, and tax breaks now govern the redistribution knock-on effects we see today.
However, “the shrinking of the middle class is not a failure of capitalism. It’s a failure of government. Capitalism has been doing exactly what it was designed to do: concentrating wealth in the ownership class, while providing the mass of workers with just enough wages to feed, house and clothe themselves” (Salon).
In this new age of subsistence life, government cannot just sit on the side-lines. I urge the nation to realise what it was responsible for half a century ago and that can still be made possible under its strong leadership today: build the US economy from the middle out. But until the dawn of a new populist era, for most Americans, the American Dream is just that, a dream.
Image from https://www.flickr.com/photos/owsposters/6270937787