Over the past month, many US media publications have been sounding the alarm: death of the middle class of America and the end of the “American Dream”.
According to the independent American portal – “End Of American Dream”, one of the main reasons for this is that the rate of the cost of living increase in the United States is higher than the growth of wages. In particular, the cost increase for food, rent, health insurance, and therefore the number of the “working poor” in the country is increasing exponentially every year. However, the current US authorities do not care about the decline of the middle class, which once supported the country.
For example, health insurance premiums have been increasing 3 times faster than the federal officials say, and in 2016, across the whole country, an increase of 20.3% in these payments is expected, which would affect millions of families. Since July 2012, the food price index rose from 73 to 162 kinds of products. Today, 47 million Americans live in poverty, every fifth child in America is issued food stamps, 1.5 American families live on less than $US 2 a day, and each year 46 million Americans use the services of food banks.
In these circumstances, the future does not look very bright for the “ordinary hard-working Americans”, since a large number of Americans, previously considered as a part of the middle class, are losing their jobs and homes. Homelessness and complete impoverishment have become a real prospect in the life of the middle-class, and with its disappearance – the death of the “American dream”.
According to The Social Security Administration, a half of Americans earn less than the minimum subsistence level ($US16.87 per hour), i.e. less than $US 30 thousand per year. However, this level of revenue, as estimated by the “Alliance for a Just Society”, is not enough to achieve an adequate but modest standard of living, even with two workers in a family of four people. It was found that for every job created in the United States there are seven candidates, so $US 15 per hour payment is only enough for one person to barely make ends meet.
Another study – Go Banking Rates – found that nearly half of Americans do not have any savings, while more than 70% have less than a $US 1,000 savings. This conclusion is confirmed by the statistics of “The Pew Research Center”, according to which almost half of American families spend more than they earn. Lack of savings especially affects young adult Americans whose savings after the recession are now showing negative values. The Wall Street Journal explicitly states that 62% of Americans do not have even $US 500 for emergency repair of their vehicle, and the US Federal Reserve survey found that almost half of the respondents are not able to cover extraordinary expenses in the amount of $US 400.
Although American officials say that the official unemployment rate is 5%, in fact it is 10%, if the short-term unemployed are taken into account, and 23%, if the long-term ones are taken into account. Between 2007 and 2013, the average welfare has dropped by 40%, leaving the poorest half of Americans with adverse levels of personal wealth, subject to deeper debt relief. Thus, the once strong middle class of America has fallen to a level below average and continues to fall, and half of America lives next to the line, beyond which the actual poverty begins.
The business publication Financial Times calls the latest data on the financial troubles of American families the witness to the collapse of the middle class in the US, because one out of five American adults is currently living at the risk of poverty. Since the global financial crisis, 5.7 million joined the ranks of Americans with the lowest incomes in the country. More than 45% of them, or 2.5 million adults were added to the ranks of people with the lowest incomes after 2011, i.e. even after the recession supposedly ended.
Noting the slow death of the “American Dream”, a number of American observers recalled that until recently middle-class families accounted for 62% of total revenues in the United States. Today, that figure has dropped to 43%.
Over the years, the middle class of America has been steadily declining. Its income, equity, the number of jobs have been steadily declining, and only the cost of living is rising. Now, as a result of all these factors, more Americans live in poverty than ever before, and there is no change for the better.
Since 1971, the middle class has contracted from 61% to 50%. Wealthy Americans are increasing their wealth at a much faster rate than the middle and lower socio-economic groups. According to the national statistics study by The Pew Research Center, the average income of the richest Americans between 1971 and 2014 soared by 47%.
The current social situation in the United States suggests that America is under the full control of the major financial, military-industrial and energy giants that fully control the course of the political process – something most people do not realize. This control over the political process determines the way things go. For the sake of these endeavors, new laws, regulations and requirements are issued and their performance monitored, whereby the US government merely guarantees the exercise of these interests. Illegal wars and occupations, including the fabricated “war on terror” are only disturbing, they interfere with the prevention of the closure of American workplaces; solving the problem of students debt in the amount of more than one trillion dollars; the lack of universal health care and free medical assistance to the needy; the crisis of affordable housing, etc. That is why the liberal news portal – Opednews.com – states that the American people are held hostage to the country’s corrupt political and economic system, and US citizens should get their country back – take it away from the oligarchs and officials.
As noted by one of the ideologists of the American conservatism, politician and journalist Patrick Buchanan in the column for the publication of The American Conservative, the end of the era of great national projects in the United States, has dealt the most painful blow to the middle class of the country. The US Federal budget of $US 4 trillion has faced a consistent deficit of $US 1 trillion for four consecutive years. To balance the budget, defense spending and other social programs would have to be cut.
Under these circumstances, Patrick Buchanan has raised pertinent questions: How long will the United States allow spending more than the next, successive ten countries taken together? How long will the United States continue to protect dozens of countries halfway around the world from America? How many more wars, at the cost of trillions of borrowed dollars, such as Iraq and Afghanistan, will the United States continue to support?
In the meantime, while the White House does not respond to these questions, the middle class of America, and with it the “American Dream”, is facing gradual destruction…
Vladimir Platov, expert on the Middle East, especially for the online magazine “New Eastern Outlook”.
First appeared: http://journal-neo.org/2016/01/12/the-end-of-the-middle-class-in-the-united-states/