Editor’s Viewpoint: In the middle of the American dream
I was born a privileged child. My middle-class parents owned their own home and car, were able to send us to college, and could afford medical help and even a vacation every year. Thanks to their generation who solidified America’s middle class following World War II, the last 75 years spelled luxuries for millions previously afforded to only a few in history.
Middle-class life has been changing for the last few decades, though, with more two-wage-earner families and everyone working longer and harder to maintain or increase their incomes. Despite rising wages, middle-class lives have become more challenging, because the cost of a college education, health care and a home — three factors that define middle-class living — has outpaced incomes, according to a recent U.S. Department of Commerce study.
Defining who is middle class is tricky. Those who categorized themselves as middle class in a 2008 Congressional Research Service study noted their household incomes ranging between $40,000 and $250,000. That may be why the Commerce study concluded that middle class “is as much a state of mind and aspirations as it is a set of income levels.” Said another way, middle class can be defined by what people value, and according to the study, that includes home ownership, a car for each adult, a college education for their children, retirement and health security, and family vacations.
Bearing the brunt of five recessions since 1980, including two in this decade, two out of five people who consider themselves middle class are struggling to stay there, according to an ABC World News poll this month. And, it’s no wonder. Although we appear to be headed to the technical end of the current recession, we have had 25 months of job losses in the past 26 months.
Many large businesses, on the other hand, have reason to be optimistic, with fourth-quarter labor-productivity growth at 6.9 percent, following 7.6 percent and 7.8 percent in the previous two quarters — some of the largest gains in the past 50 years. Publicly held companies are doing just fine, too. Thanks to layoffs, budget cuts and a thriving business in fast-growing markets overseas, in the fourth quarter of 2009, Standard &Poor’s 500 companies tripled their earnings and saw the sale of their stocks increase from $2.02 trillion in 2008 to $2.18 trillion in 2009. Conversely, small businesses, which employ about half of the private sector workforce and have generated most of the new jobs (64 percent) in the past 15 years, continue to suffer, because they depend on American, not foreign, sales.
As politicians continue to argue through their differences on the way to solve our problems, I hope they do not lose sight of the end game: securing the future of America’s middle class. Because if they let the one pillar holding up the American dream crumble, then we will all have hell to pay.
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