Welcome to our next installment in our Poverty Series!

If you feel like getting ahead or much of anyone in this country is harder than it was before, you’re feeling isn’t incorrectly placed. It’s right on par with where we are as a country now. The American Dream as we’ve known it is dead on arrival for many Americans. The death of this social contract has left many Americans on the sidelines wondering what is going to happen to them.

The American Myth

America has built quite a myth around personal accomplishment. The idea we are taught from our youth is that if we work hard, don’t go to jail and stay out of too much trouble then success can be ours with all the accessories that come with that. We extol the ideals of getting an education and a good-paying job and then keeping that job. In the recent past, having a job was enough to raise most people out of basic poverty. A job could provide housing, transportation, and a life. Over time, people were able to get promoted into higher positions and earn more money. Most people earn the least in their youth and then through working and gaining experience make the most of their lifetime earnings starting in their early 30s. Now, however, for many Americans this is simply not possible. Getting on the ladder to success In the modern American economy, that is simply not enough for many people.

Hard Work is No Longer Enough

However, in 2019 it seems like hard work doesn’t take you as far as it used to and with the higher cost of living, getting the money together to buy a house or start a business seems like an impossible dream. The simple fact of the matter is that the cost of living in the US has grown so much in the past decades that most people simply work to live. That lifestyle does not provide enough money for people to save for a house or start a business and find their way to success. It does not allow them to grow their wealth over time and to continue to make investments that will create wealth for them. Most Americans live paycheck to paycheck and that is not nearly enough to truly live or thrive. Often, it’s not even enough to survive.

Whatever Happened to the American Dream?

The American Dream and we’ve known it for the 20th century was made possible by several important developments that started during the Great Depression. The 1930s were dominated by a wave of unionization and an increase in organized labor forced wages to grow higher for industrial workers. This also corresponded into other areas of the economy like firefighters, police, and other public workers. This increase in wages gave Americans newfound spending power that extended after the war and fueled the economic boom that lasted from after World War II into the early 1960s. Roosevelt also set prices for things like airline tickets, freight rates for trucks and trains, taxi fares, and other things Americans used every day. These price controls would remain in place until the early 1980s when President Reagan began his campaign of de-regulation. The increase of wages alongside productivity had already stopped by 1975-1977 and after 1978 productivity began to increase while wages stayed the same or fell in real terms. Americans didn’t notice the problem for many years due to women joining the workforce and the availability of credit from ever-larger financial institutions. This system came crashing down in 2008 and the last decade has been one long hangover from these economic changes. Americans are faced with dim economic prospects that have left some American homeless, in poverty or simply as the working poor.

The Death of the Middle Class

This combination of deregulation, economic changes, and breakdown of social contracts has gutted what once was a vibrant middle class powered by good-paying jobs and the ability to be upwardly mobile. For 2 generations, people have been able to work hard and see their kids do better than them. Now that dream is more possible for people in European countries with a strong social safety net or in Asia where good-paying jobs (for the area) abound which will empower their children to seek education and do better than their parents.

The results of these changes have been seen all around us. Popular stores are closing, malls are dying, and homelessness is more visible than ever before. Housing is unaffordable because wages have not grown and the expenses of daily living outpace the wages being paid to regular workers. This is going on in a society where the wealthy are not just doing well, they are increasingly hoarding the wealth for themselves.

This is a great video which illustrates just how the Middle Class has been squeezed out of existence and what changes need to be made in order to turn things around for the vast majority of regular working people.