Posted on 06/15/2015 12:22:04 PM PDT by Cincinatus' Wife
It’s no secret that the American middle class has been on the ropes for a while now. The problem isn’t just a crippling recession and an economic “recovery” that has mostly gone to the richest one percent, but the larger shifting of wealth from the middle to the very top that’s taken place since the late ‘70s. Add in things like the dismantling of unions that has accelerated apace since Ronald Reagan crushed the air-traffic controllers, and we’ve seen the middle class more solid in places like Canada, Germany, and Scandinavia, and begin to grow in a number of nations even while it shrinks here. Economists like Thomas Piketty thinks the process is inevitable with global capitalism, while others – the equally wise Joseph Stiglitz, for example – think the balance can be restored if we can find the political will.
It turns out that those concerned about a tattered middle class are right about most of it, but overlooking one thing: Boomers – or rather, a particular strain of Boomer and near-Boomer – are doing great. That is, if you were born in the ‘40s, you are going to be the last American generation to enjoy a robust safety net, and your gray years will be far more comfortable than those a decade older or younger.
Here’s a New York Times story, which looks at “the 25 million Americans now between the ages of 65 and 74”:
Supported by income from Social Security, pensions and investments, as well as an increasing number of paychecks from delaying retirement, older people not only weathered the economic downturn that began in 2007 but made significant gains, a New York Times analysis of government data has found.
And despite our generally ornery Xer jingoism, we’re going to concede something here. We’ve noticed that our friends who we could call “young Boomers” – born in the late ‘50s and early ’60s – are often far less privileged and spoiled than those born in the years right after World War II. This younger group grew up or came of ago, after all, in the ‘70s and ‘80s, as the postwar boom was fading, colleges were becoming expensive, and the Reagan Revolution was pulling the rug out from under the middle class.
And it turns out that those young Boomers are indeed a kind of transition generation. It’s the group now retiring that will take most of the spoils of the U.S. postwar boom and leave the rest of us with scraps:
In the past, the elderly were usually poorer than other age groups. Now, they are the last generation to widely enjoy a traditional pension, and are prime beneficiaries of a government safety net targeted at older Americans. They also have profited from the long rise in real estate prices that preceded the recession. As a result, more seniors now fall into the middle class — defined in this case between the 40th and 80th income percentile — than ever before.
If you wonder why you are working so hard to get a job, please note that a lot of these guys are sitting on theirs or at least working part-time. (It reminds us of the Onion story: “Parents With More Vacation Time, Financial Resources Want To Know When Son Will Come Home For A Visit.”)
The Times piece shows how a variety of Americans in that sub-generation is faring. Some are struggling, like the rest of us. But between the fancy cruises and fat pensions and gated communities and golf courses and vintage ‘57s Chevys, it’s not a world that younger Americans have any reason to expect. In fact, it sounds like something from a museum of postwar affluence.
So part of us is glad the American middle class will go out with a boom, so to speak. We don’t begrudge these people – our teachers and professors, our older friends, our parents and other relatives – comfort in their gray years. The way Americans, in the days before social security and other protections, lost their footings in old age was simply inhumane. But why couldn’t the prosperity be spread so that those born in the ‘50s, ‘60s, and after can enjoy the same stability and wealth?
Well, this is a complicated one, and we’ll nod to the usual suspects: Globalization, technology, and the depletion of natural resources (especially energy) meant that the postwar boom would not last forever.
But you know what else the original Boomers brought us? Despite their dabbling with progressivism and hippie utopianism, this group served as the shock troops for market-worshipping neoliberalism and the Reagan-Thatcher shift in the ‘70s and ‘80s. They gave us junk bonds and the privatization push and Gordon Gekko. Some of them went into the corporate world and started dismantling.
Let’s hope they enjoy their retirements. But these gray Boomers and grayer Silents – not all of them, but enough to do substantial damage – put forces in motion that mean for the rest of us, the twilight years will be significantly less cozy.
Scott Timberg is a staff writer for Salon, focusing on culture. A longtime arts reporter in Los Angeles who has contributed to the New York Times, he runs the blog Culture Crash. He's the author of the new book, "Culture Crash: The Killing of the Creative Class."
Singapore got there by shunning leftist ideology.
It is not just the left.
Notice what party is fighting for TPP, and who is advocating for open borders.
perhaps the solution is to import a bunch of people from south of the border.
I’m, not talking about your specific situation.
Back in the 40s 50s and 60s my folks and millions of others brought homes on one single income. Mom was able to stay home. Jobs were secure and had benefits and yes retirement pensions.
You do understand that’s all but history for the boomers and their kids right?
My Mom could not understand what boomers were paying in 4 or 6 months of mortgage payments, was what they paid TOTAL price for their homes. Read this again real slow.
These are the ugly brutal facts, millions deal with it.
Whatever the sins of the boomers, they weren't really responsible for the corporate raider economy of the 80s and 90s. They were the generation coming up then, but the bosses were still older men who came of age in the 40s and 50s. The boomers only played subordinate roles until they filled their old bosses shoes.
TPP IS open borders with no possibility of being able to close the door.
And the GOP is fighting for it.
I'm feeling a severe micro-aggression coming on...
-PJ
Not all of them :)
Take 2 martinis and call me in the morning.
The aftermath of WWII allowed us the competitive advantage. That is over, and the leveling of the playing field is obvious. New tech simply leaves expensive labor markets out of the loop.
BTW, that's total bull sh*t. Most would never have zip today. Try buying homes, delivering 3 babies and everything that goes with it, insurance, 75 dollars to fill their freaking gas tanks and on and on. In fact, most don't have squat and are barely making it on *two* incomes today. That's if they're lucky enough to have full time jobs.
Why do you think the American middle class is all but dead on the floor?
Get real.
I like your idea and there are lots of us in the same echo chamber. The 16th amendment needs to be abolished first however. Everyone pays the same “rate”. No kick backs, no loopholes, no graduated income brackets. Beyond that, fedzilla operates within its means. If the money is not “there”, entire agencies start massive cutbacks if not entire agencies wiped from the books.
I believe at last count (and this was a handful of years back) there were 4500+ federal agencies. 4500. We simply DO NOT need that much government.
From this 1951r.
Contributions to Social Security, by me, wife and employers should pay us around $100,000 per year if grown with the S&P500. We will collect a small fraction of that.
The move out of suburbs hurt RE values there, but gen Xrs must be making a killing in Brooklyn-Hoboken-UES-Marina District-SOMA etc.
The H1Bs taking the Silicon Valley jobs are getting US market wages, usually in the low 100s. They marry each other and can afford most anything, anywhere. Our children can (and do) train and obtain these high paying jobs.
Fracking has made fossil fuels virtually unlimited.
My Millenial daughters have been to Europe for fun many times, usually at their own expense, at a younger age than when I went there.
Salon missed it big time.
And yet the middle class keeps voting for it.
Isn’t Obamaland great? :)
The air traffic controllers were FEDERAL workers, and yes, part of that AFGE mess.
They, against their federal employment contract, decided to GO ON STRIKE, which was illegal.
Therefore, they, not Reagan, are to blame for their own demise.
Duh.
With any retirement-savings plan; you're supposed to get back more than you paid in. It's simple arithmetic.
You let your payments be distributed immediately to your parents...
We "Let" that happen? Like we had a choice? As if it was our idea? Are you nuts?
Apparently you are unaware that Social Security wasn't sold to us as the Ponzi scheme that it really is. We were told that our "contributions" were to earn interest, like any retirement fund. We know now that there was no "trust fund" earning interest. So that was a lie. But it wasn't our lie. We were the ones who were lied to.
For most of us Middle-Class Boomers, our return-on-investment from Social Security is less than 2%. Less than what Passbook-Savings-Account interest averaged over the past 50 years.
It isn't a freebie. It's a scam. And the scam is on those of us who paid into it for decades; and who now receive somewhere between one-half and one-fourth of what we would be receiving if our money had gone into average interest-bearing retirement accounts.
But don't worry; when you reach retirement age, I'm sure your grandchildren's generation will be more than happy to pay for your retirement.
This is just the latest tech disruption, they always wipe out major swaths of employment until people settle on new ways to get out in front of it. My job category has been decimated and I’m training for something else.
In the past people who were good enough at getting ahead of the disruption made a fortune.
I think we should be going back to strategies that served previous generations well (not living above your means, valuing family).
***** “The left doesn’t understand the concept of ‘creating value’ thus creating REAL wealth” *****
Exactly .... “You didn’t build that”
They don’t have a clue, or they do and prefer to Lie.
TT
The real blame is shared between the left and the Kondratieff winter we’re living through. Even if we get rid of all the destructive left-wing policies starting in 2017, the middle class won’t come back until capitalism rebuilds itself with a generation that has to work to create and accumulate capital, rather than coasting on what the last three generations built.
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