Last week The Federal Reserver released their Survey of Consumer Finances report, covering 1989 through 2013. Here are two discussions of the report:
From the Institute for Policy Studies: The Fed Finds an America Deeply Divided and
from the New York Times’ The Upshot: How Are American Families Doing? A Guided Tour of Our Financial Well-Being.
Key point: the survey is comprehensive, lengthy and often conducted in person so the conclusions are taken seriously.
And the results are grim. Folks at the very top have continued to sail along quite well and everyone else has lost ground. From the IPS article:
“Families in America’s statistical middle class — the nation’s middle 20 percent of income earners — held a median net worth of $75,300 in 1989. This middle’s median net worth in 2013: $61,700, an 18 percent dropoff.”
The report confirms yet again the fact that most Americans have experienced wage stagnation or even reversal for years. People have to spend more to get less; people have been dropping out of the stock market (something about which I have mixed feelings), and people are not particularly optimistic about their financial futures. All this while “productivity” has gone up, up, up.
The only bright spot is that people have been paying down debt and reducing or eliminating their use of credit cards.
None of this should be a surprise to anyone who’s paid attention to facts on the ground for the last few years. But the nagging question is: what to do?
My view is that some kind of major economic realignment/restructuring/reimagining is going to have to happen or we can expect more of the same. And as long as the economy is stagnant, legacy industries and interest groups will continue to offer Americans a false choice: pollute/destroy or be unemployed.