Oh, it’s such an obvious economic squeeze by the wealthy against the middle class, and the sad thing is, middle class conservatives are the biggest allies the wealthy have. It’s pathetic. All the economic growth going to the top five percent and the rest stagnating. I’ve argued about it for years with the conservatives on this board and it took an economic crash to make most people see I was right.
Hey you want to hear something funny? I remember how, prior to the crash, all the conservatives were saying we should dump Social Security and put all our money in IRAs because it’s so much more efficient that Social Security, that it would guarantee us all a much more comfortable retirement. Remember when Brainless Bush went on a national tour to advance this notion and the conservatives were all cheering him on.
Of course, they’ve put a lid on that crap … many of them the same people that are now arguing there is no economic squeeze on the middle class. DO NOT BELIEVE THEM. They are either wealthy and trying to protect their own wealth, or they fantasize they will be and are being proactive. (Hell, sometimes I think it’s the economic equivalent of Stockholm Syndrome.) The conservatives care NOTHING about the interests of wage earners and the middle class. If you were starving, they would try to convince you that you were dieting. They’re doing the same with their denial of middle class squeeze.
Clearly productivity benefits come from lots of sources, and the benefit to a worker shouldn’t scale in such a simplistic way. On the other hand, engineers at various Western Electric factories I used to drop in on were well advised to listen to these button pushers, because they often saw quality problems before the manufacturing automation system did. Treat them right, pay them decently, and they would have the guts to stop accepting crap from up the line, and save you lots of money. The impact of someone running a thousand widget per hour machine doing this is a lot greater than one running a ten widget an hour machine, and they are more likely to get the defect rate right also.
I think a lot of this is actually Joe the Plumber syndrome - someone fantasizing about being wealthy, and backing policies that would help them then even if it screws them now. Kind of like a kid not doing homework in order to shoot hoops so he can become a rich NBA star. Shooting down the dreams of these knuckleheads is a dangerous thing. As a further example, see any lottery ad: “Hey, it could happen.”
What about those of us with comfortable upper-middle class lifestyles working in management rolls in large companies who managed to mantain some modest wealth through sound financial decision making? Where do we fall in this class war?
One thing that struck me during the recent economic downturn was an article about some former trader who went from making a quarter million a year to $20,000 a year working as the host of the Palms steakhouse. When they described his Manhattan lifestyle the only thing I could think of was “this guy is an jackass”. My GF and I have roughly the same household income and we are nowhere near living his idiotic lifestyle of $11000 a month appartments and whatnot. This guy couldn’t afford his lifestyle when he was actually working, let alone unemployed.
Idiots went bankrupt even before the recession. How would your modest wealth fare if you were out of work for a year, or stuck taking a crap job? I’m in the same boat as you, and I’ve spent a lot of time worrying, even though I’m fairly close to retiring and my wife is a freelancer who sees her income go up during recessions, as her clients use her more than full time staff.
You’re doing things the way they’re supposed to be done (ideally). The problem is when folks in your position assume everyone who is failing is 100% to blame for their predicament. I think 100% fault is rare in this society. The claims otherwise happen because it’s easier and more comforting to believe that anyone struggling is probably a deadbeat or somehow deserves it because it’s flattering to your own ego. Nobody who works hard and lives responsibly wants to accept that there’s a significant luck component to their success.
Not to mention the social and ideological disagreements that can pop up. For example, many people believe that married couples with kids deserve society’s support if they’re experiencing tough times, whereas I look at a young couple in their 20s with multiple children as somewhat irresponsible and deserving of their difficulties. Why? Because I don’t value blind reproduction from a group that I don’t consider to be all that mature overall.
My point is that I don’t put a lot of stock in ideals, ideology, and “the way things should be.” I’m paying attention to the way things are, and right now, things aren’t good.
Bad economic decisions transcend income and class. I know poor people (who are poor due to low income) who tend to make great decisions and as a result are self sufficient in high costs towns on low incomes and I know well off (don’t personally know any truly ‘rich’ people) who make terrible decisions with money and either have debt or low savings.
As far as class war and politics (which both sides do), it is not uncommon for those on the right to use bad economic behavior of poor people combined with tales of extravagant social programs to build resentment and popular support for the GOP. Throw in racial tensions (tales of lazy blacks and mexican immigrants bilking the system paid for by white tax payers), and it has worked extremely well for 30+ years. I’m not sure what you’re asking exactly. The issue is not totally black and white, however the fact is in the last 30 years the middle class has seen their incomes stagnate, their taxes increase and their expenses increase (as well as being told to pay more out of pocket for their own retirement and healthcare).
Either way, its good you make good financial decisions. However I know people earning household incomes 1/10 of what you and your GF are earning who also make good decisions with how to spend their money. Good or bad economic decisions doesn’t change the fact that most people in the US are being asked to pay for more expensive necessities with lower incomes.
Going back to this point made in the OP, I think that the idea of a tiered health-care system is a good one, but that we’re unlikely to end up there.
The fact is that society can’t afford to give everybody bleeding-edge expensive medical care, any more than we can afford to have everyone drive Porsches or dine on caviar. So we ought to be looking at how to provide the most value for health care, because we simply can’t provide the best possible spare-no-expense care for everyone. Generic drugs are great. For almost everybody (a few people respond badly to the non-active ingredients or specific formulations), they work as well as the name-brand ones, but for far less money. I’m not sure what a physician assistant is, but there is a push to allow nurses and other medically trained people to provide more care without the necessity to include a doctor, and I think that’s a good thing. Ideally, you’d have a variety of levels of medical professionals such that the lower tiers are easier to train and are capable of determining when they’re out of their element and need to kick it up to the next level. 5-10 year old treatments can still be excellent medical care.
Bare hospital rooms seem unnecessarily punitive. It’s not like sheets or a television are expensive.
As I said, I don’t think we’re likely to get there, as it looks like the political tide is carrying us toward a more socialized health-care system, and the political willingness to accept “cheaper” care for the poorer is simply not there. Of course, we’ll still have tiered care in a way; not everyone will get the most expensive treatments, because they can’t, but it will be decided less by individual willingness to pay, and more by politics.
Even if we follow Canada’s route (& there’s no chance in Hell that we ever will) and make it illegal to pay for treatment outside the public system those who can afford it will still be able to get the most expensive cutting ege treatments denied to the masses. They’ll simply need to add the cost of an airline ticket to someplace in Mexico or the Caribbean.
I was out of work for 6 months actually. I only started working again last month.
That’s not really my point though. Am I, as a middle manager in a big company considered part of the “middle class” being squeezed? Or because of my relatively high income and management level position in a fancy Manhattan professional services firm am I considered a cog in the machine that is doing the squeezing?
I don’t really buy into the class warfare bullshit though. It’s much easier to point your finger at some person you think is responsible for your woes than a general shift in the economy. Am I worse off because Warren Buffet or Bill Gates are billionares? Or because Lehman Brothers or GM don’t know how to run their business? Or because Goldman Sachs does? What is really causing regular workaday Americans to feel like they are constantly being squeezed?
The middle class squeeze doesn’t require a belief in class warfare. Again, the fact is that wages have stagnated, expenses have gone up and net income (after taxes, retirement savings and health expenses) has gone down. People are asked to pay for more expensive services with less money. So they feel cornered. True, people were worried about this back in the 1980s, but it has progressively gotten worse.
According to Paul Krugman, this shift in the economy that is causing these problems only happened in the US. Other OECD nations did not see the same level of economic changes which left most people more economically insecure the US did due to globalization. I’m not sure where his stats for that came from though.
Right, so the question is what are those other nations doing differently? But I don’t believe that Japan and Europe don’t have their own economic problems.
My guess would be the more pro-labor laws and regulations. If you do lose your job in, say, France, the government still picks up your tab for health care. The dole is more generous than it is here, and the government pays for that too. The state obviously has a vested interest in not having that happen, so it’s a lot harder in France, and elsewhere in Western Europe, to terminate a factory full of workers and move the jobs to China. (I’m going out on a bit of a limb here since I don’t have a cite, but given everything we hear about labor conditions in Europe, I can’t be that far wrong.)
Although, just to be fair about it, I have to admit that in the more regulated business environments of Western Europe, it’s usually more difficult to find a job in the first place, just as it is harder to lose one. I say usually, for I doubt that this is always true, especially right now. Last I heard, Germany’s unemployment rate was around 5-6%, and ours is at least 11%. I know where I’d rather be looking right now.
The argument he makes is it is due to the rise of movement conservatism in the US starting in the late 1970s having minor but far reaching effects in endless areas (corporate empowerment, deunionization, deregulation, lopsided tax burdens) which managed to disempower the middle class. However I have no idea how much of that is conformation bias or objective.
I would like to see objective evidence myself on how Europe managed to avoid the rise in economic inequality and middle class insecurity there is in the US (their gini coefficient is much lower). I would assume things like stronger safety nets, lower overall health costs, more consumer protections (ie fewer predatory lenders for credit cards and mortgages) all play a role, but I really don’t know.
Really? I would think that my endocrinologist would be jumping up and down on my head screaming at me to get this miracle operation … He doesn’t seem to be getting rich off prescribing medications to ME. I guess he must be absolutely cruel and heartless, wanting me to suffer through stabbing myself in the finger multiple times daily, and shoving needles with insulin into my body at multiple points [to keep the skin from breaking down in a single area one rotates where you shoot up]
Look it up if you do not believe me. The cost of care for a type II diabetic is about 10k a year and the cheapest gastric banding operations are about 10k.
Much of this is due to the German policy of having workers kept on the payroll at reduced hours, with the government making up much of the difference in salary. Here’s a cite. So it is not clear that this lower unemployment rate will make it easier for you to find a job, but it certainly makes life a lot easier for the people. There seems to be a lot of debate about whether this is the best policy in the long run.
There is also an acceptance of a different standard of living…for instance, in Germany many people don’t own cars. Homes are often passed generationally. There is a different level of consumerism.
I’ve been involved in closing plants in Europe. It isn’t cheap to do, which is why I haven’t been involved in OPENING plants in Europe. Job growth is pretty low.