Two American families — and two Americas

By David Rohde
July 26, 2013

Over the last 20 years, two middle class American families — the Stanleys and the Neumanns — have done all the right things. Milwaukee natives, they worked hard, learned news skills,  and tried to show their children that strivers would be rewarded.

But their lives — as captured in an extraordinary Frontline documentary — are an American calamity. Followed by filmmakers for two decades, they move from dead-end job to dead-end job, one of the couples’ divorces, and most of their children spiral downward economically, not up.

The Stanleys and the Neumanns are a microcosm of the middle class that President Barack Obama — and House Republicans — will spar over for the remainder of Obama’s presidency. And they are part of a global trend. Across industrialized nations, income inequality is growing and people like the Stanleys and Neumanns are the losers.

“Mobility is a two-edged sword,” said Miles Corak, an economist at the University of Ottawa who has studied income inequality across countries. “And you’re looking at the other edge of the sword.”

At the very top, life is getting sweeter. As my colleague Chrystia Freeland noted last month, the global “winner-take-all economy” is intensifying.

A June study found that the number of people worldwide with more than $1 million to invest soared to a record 12 million in 2012, a 9.2 percent increase over the previous year. The number of ultra rich — the 111,000 people with investable assets of at least $30 million — surged 11 percent.

The Stanleys and the Neumanns, meanwhile, are falling behind. Whatever your politics, please watch this film. These two families, one black and one white, put a human face on the polarized debate about what is happening to the American middle class.

Conservative viewers may feel that the two couples made mistakes — failing to go to college, for example, or not moving out of a dying industrial town like Milwaukee. Liberal viewers may see them as victims of a globalized economy that rewards the few spectacularly and relegates the many to low-paying jobs.

Whatever the cause, their spiral is startling.

When filmmakers Bill Moyers, Kathleen Hughes and Tom Casciato, first visited them in 1991, the family’s wages from union factory work comfortably supported them. In the early 1990s, however, as Milwaukee factories moved overseas, both of the Stanleys, and Tony Neumann, the Neumann patriarch,  lost their jobs. They took lower-paying work and, to makes ends meet, Tony Neumann’s wife, Terry, also had to enter the workforce.

Throughout the 2000s, the couples struggled on. Claude Stanley, the Stanley patriarch, waterproofed basements, started his own home inspection business and became a minister. By 2012, an illness has saddled him with enormous medical bills and his business had failed. At 59,  he was a city forestry department worker making $26,000 a year trimming trees and collecting garbage. His wife Jackie became a realtor, but never gained a foothold in a declining housing market. Only one of their five children finished college, paying tuition with credit cards.

After his layoff, Tony Neumann took a low-paying overnight factory job, and rarely saw his wife and three children. His wife Terry worked as a security guard, forklift operator and home healthcare attendant. By 2012, the couple, high school sweethearts, had divorced and lost their home through foreclosure.

The children in both families fared even worse. Those who attended at least some college had steady work. Those who did not had low-paying jobs or no work at all.

Many also had failed relationships. As of 2012, one Neumann son was a high school dropout who had fathered two children with two different women. The other was unemployed and had fathered three children with two different women. Defying stereotypes, the Stanleys, who are black, proved to be a more stable family than the Neumanns.

In one of the film’s most wrenching scenes, Terry Neumann visits the house she lost to foreclosure, where she had expected to live out her American dream. The family that bought it at auction for $38,000 looks on as she tours the home, wondering what went wrong.

“The way the economy is going, no, I don’t think anybody is going to be financially secure, truthfully,” she tells Moyers near the end of the film. “And we’ll just work until we collapse and keel over and die.”

Recent studies have found that economic mobility is stagnating in the United States. Where one grows up and who one’s parents are increasingly determine a child’s economic future. And a smaller percentage of Americans escape poverty than their peers in other wealthy nations, including Canada, Germany, Japan, France and Australia.

On Wednesday, President Obama again vowed to change all that. In the first of what administration officials say will be a series of speeches about the middle class, Obama repeated a laundry list of economic proposals that are stalled in Congress. House Republicans, meanwhile, vowed to do everything in their power to block Obama and slash government spending.

Americans, understandably, are tuning out the noise. Washington’s deadlock is likely to continue. Yet the problem is real and global.

Corak, the Canadian researcher, said workers like the Neumanns and Stanleys who lack college degrees or specialized skills are struggling across many industrialized nations. Shifting manufacturing jobs overseas to developing nations as well as sweeping technological change has led to stagnant middle class wages.

But a recent study he authored found that the dynamic played out differently in different nations. In Canada, more equal public education and healthcare systems, as well as the lack of a large housing bubble, helped mitigate the impact of globalization. In the United States, meanwhile, families more often struggled on their own.

Corak said the polarization of the U.S. inequality debate puzzled him. Yes, an individual’s actions mattered, such as the Neumann’s divorce. But global economic trends beyond each family’s control affected them as well, as did the quality of public education and healthcare.

“You can still accept that families are very, very important,” he said, “without rejecting the economic issues.”

As I’ve written before, Obama’s proposals are imperfect but will do more to aid struggling middle class families than those of far-right Republicans. White House officials vow that this Obama drive to aid the middle class will be different.

For the sake of the Neumanns and Stanleys — and millions of families like them — hopefully they’re right.

This piece was updated and revised at 4:00pm EST on July 26, 2013. An earlier version incorrectly described Jackie Stanley’s past work, Claude Stanley’s current job title and the relationship of one of the Neumann sons. 

PHOTO (Top): Clockwise from top left, Claude Stanley, Jackie Stanley, Tony Neumann and Terry Neumann, in the 1990s. Courtesy of FRONTLINE

PHOTO (Insert): Terry Neumann in 2012. Courtesy of FRONTLINE

12 comments

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/

it seems to be common knowledge that the middle class has been in decline in the US for years.

US Census income data tells a different story.

Looking at 40+ years of household income data, you’ll see that the percentage of households in the lower income group (under $25k/yr) and middle income group ($25k to 100k/yr) has decreased while the percentage of upper income households has increased. Bottom line, households are becoming more prosperous.

http://unrepentantcapitalist.blogspot.co m/2010/08/act-one.html

Posted by jambrytay | Report as abusive

I watched the doc., it was very good. The parents in both families were hard workers, but unfortunately did not have educations or skills beyond that of a will to work, show up everyday on time, and a strong back. But those alone no longer do it.

I had my 11 & 6 yr olds watch with me so show them why having an education or developing marketable skills are so important, and why mom & dad make sure they are loving to learn.

However, the article author was a bit inaccurate – with the Stanleys, (1) did graduate college, but a daughter was enrolled in college and had to drop due to a cancer scare type illness and a lack of money. And another son opted for the military after HS, and appeared to be on a very solid post-military career track working for a defense contractor in Afghanistan.

Posted by JustSomeOleGuy | Report as abusive

This article provided its own answer.

Those without “specialized skills” are going to struggle well into the future. That’s the nature of our job market–low skills, low pay, low security.

The first place to address that problem is within our education system. The comments of the President not withstanding, a college degree without some “specialized skills” is just a diploma and has little value in the employment market other than a preliminary qualifier. Why hire a non-graduate when there are 100′s with degrees? That’s all it does.

We need to re-think our education system from K through university. The high schools have to prepare students to be able to learn specialized skills, and the junior colleges have to be more than prep schools for universities. The JC’s have to develop programs where the “specialized skills” are taught and certified. Deliver certified talent, and the employers will find you. (See BMW and the JC’s in South Carolina).

We have to get this idea out of our heads that without a college degree one is personally diminished. E.g. a good body and fender guy in Denver is worth $100K a year. Where does one get those skills? If the demand (as reflected in the salary)is there why are our JC’s not teaching those skills? Ask any B&F guy if he thinks he’s diminished personally because he does not have a college degree, or the guy working in the oil field making $70K vs. the college grad earning $2000 a month doing clerical work. I think you will find the college degree’d person to feel very diminished.

It’s simple. Define the need, develop the requirements, train and certify.

Posted by COindependent | Report as abusive

@COindependent,

You got it!

Posted by OneOfTheSheep | Report as abusive

Education is very, very important but not the only answer. The problems are to complex for single answer. Globalization and automation are each very complex topics that education alone will not answer. Then throw in Population and, in the USCA, unregulated capitalism. I think some commenters are showing their age as in their time, education and hard work were all you needed.

Posted by tmc | Report as abusive

@ tmc Yes, times have changed, but there still is not any substitute for having the skills and do the hard work. If one does not believe that, which many young people still do (as I work with them), then we as a country are condemned to mediocrity.

The opportunities available are as numerous as they have always been, but they are different than before. There is no magic pill or pre-defined path to secure them and the reality of competition will crater even the most perfect plan. Without a doubt, the U.S. worker can compete globally.

One has to be prepared to assume risk, with NO guarantee of success. There is a certain percentage of the population who will not (or is unable to) assume that risk, but it has always been that way.

Posted by COindependent | Report as abusive

@COindependent, I don’t disagree with you that specialized skills are needed; they always have been though.

But what skills? Electricians, car mechanics, plumbers..they’re all great careers and can be lucrative, but what happens when we have millions of them in our economy? How much can they make if the market is flooded?

I’m not disagreeing, I’m just asking. Most careers require education. The vo-tech schools aren’t cut from a very wide swath.

Nurses, teachers, day care workers are all traditionally female careers but require education and typically don’t pay very well until you hit Master’s degree level or above and have several years experience in that field.

What vo-tech careers other than the ones that first come to mind are you talking about? (I’m asking respectfully)

Info Tech jobs require education. Call center jobs are outsourced to cheap labor. Doctors, lawyers, etc. require extensive and/or highly education.

Posted by JL4 | Report as abusive

@ JL4

I know there is an extreme shortage of (NCM) machine tool operators and personnel in the oil field at this time–that’s two right off the top. Welders. Auto body and painting. (Law schools are graduating thousands each year with no place to go–industry is saturated. Forget practicing law in your not in a Top __ law school. Doctors..well, Obamacare is changing that model as well.)

In the oil field, many of the companies merely need motivated employees as they have extensive job-specific training programs, including driving school. The biggest issue (get this!) is that in the oil field about 50% of the applicants cannot pass a preliminary drug screening. So they do not even make it to the application process. I know that for some of the technology companies, that holds true as well.

The second issue is that one has to be mobile. If you want to stay in your home town and the jobs are somewhere else, then you have an availability problem.

It’s all a matter of matching the opportunity to the motivated individual. I have people tell me “I am really interested in this job or industry, but I don’t want to leave…..”. The other objection is that “I went to school to be in management…so, I really don’t want to do anything beneath my degree, or I don’t want to work nights or weekends or (whatever).”

It’s really difficult to hire anyone who lays those requirements on any employer.

Posted by COindependent | Report as abusive

@COindependent: points well taken. However, I think people still have the “right” (if you’ll allow that word) to choose their careers. Someone with a management degree should be able to get a job in management – at least at some point. I think the employee has a many rights as the employer. I would make a terrible plumber or machinist. I would be thoroughly miserable as a call-center employee. I’d rather starve than go into telephone sales…and a nail tech? Never.

Some can’t move. It costs a LOT of money to move, and then there are family considerations…

But I agree that we need more robust vo-tech courses out there. That’s just one of the solutions though. I hear what you’re saying.

Posted by JL4 | Report as abusive

You can choose your career and you can choose to fail. So if I want to be a typewriter repairman, then I choose to fail as there is not any demand for that skills.

“Should” be able to get a job in management ignores the issues of competency and demand. That’s an entitlement mentality that has created so many problems in this country. So, that person “should” be able to manage in any industry they desire whether or not they are qualified. Can a great manager in a stock brokerage firm be successful managing software engineers, or power plant technicians? Those skills are not necessarily transferable.

An inability to relocate for work is different than an unwillingness to go where the work is. But, circumstances are very often driven by other decisions made at the individual level. (e.g. read the part about the Neumann’s son above–H.S. dropout, two children by two different women….) Those decisions he made and they have long term impacts. Sorry, but nothing (education, wealth, etc.) can save some people from themselves (and they tend to create burdens on society).

Posted by COindependent | Report as abusive

My niece just graduated from Cornell. I was stunned by the number of Chinese students. And they were just the obvious foreigners. Why are Americas finest educational institutions teaching the competition instead of our children? I can’t believe there are not enough American born students to fill those seats. At commencement, they were begging them to stay. I don’t get it.

Posted by tmc | Report as abusive

@TMC you’re are confusing qualified American students with the increased revenue stream provided by international students. If you think Cornell, or any other university is focused primarily on the needs of students, you are sadly mistaken.

The agenda is defined by the administration and the faculty with their personal and collective interests at the forefront. That’s why you see 8%+ annual tuition increases in each of the past ten years while your wages have remained relatively flat. That’s why you have course schedules defined so that students now take 9 or 10 semesters to graduate–so they maintain the revenue stream for an additional 6-12 months–while the “professors” have only six hours of classroom time with the students. And you support layers of “administrative” personnel that did not exist even 10 years ago.

Posted by COindependent | Report as abusive