Counterparties: The tasks of the proletariat in the present recession
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The financial crisis and subsequent recession hasn’t just chipped away at Americans’ net worth. A new Pew poll shows it has affected their economic self-image as well — 32% of all adults now consider themselves lower class, up from 25% in 2008.
Not only has the lower class grown, but its demographic profile also has shifted. People younger than 30 are disproportionately swelling the ranks of the self-defined lower classes.Â The shares of Hispanics and whites who place themselves in the lower class also are growing.
Specifically, 39% of 18 to 29 year-olds and 40% of Hispanics consider themselves lower class, increases of 14 and 10 percentage points, respectively, since 2008. Three-quarters of the lower class think “itâ€™s harder now to get ahead than it was 10 years ago”.
In that gloomy sense, America’s burgeoning lower class has something in common with its shrinking middle class. An earlier Pew survey found “85% of self-described middle-class adults say it is more difficult now than it was a decade ago for middle-class people to maintain their standard of living”.
They’re right. Census Bureau data released today show that “real median household income in the United States in 2011 was $50,054, a 1.5 percent decline from the 2010 median and the second consecutive annual drop”. Dig deeper into the data, and things look worse: real income in 2011 is basically unchanged from 1990.
Post-crisis, lower and middle-income Americans are becoming more class aware. (The rich, on the other hand, still don’t think they’re thatÂ rich.) The Economic Policy Institute’s “State of Working America” asks the key question: “how well is the American economy providing acceptable growth in living standards for most households?” The conclusion: “not well at all”.Â Â — Ben Walsh
On to today’s links:
How America is missing out on a huge investment opportunity – Ryan McCarthy and Ben Walsh