Well, it’s a fairly simple answer. The benefits of steady economic growth- the same formula that made everyone happy in bygone years– is no longer trickling down to the average person…
Here’s a shocking fact:
98% of the value of publicly traded stocks is owned by the wealthiest 20% of the population, leaving just 2% for the rest of us to potentially turn a profit.
Let’s face it… the bull stock market that soared over the last forty years was mostly a rich man’s arena. The wrenching truth is that the majority of Americans have stopped participating in the forward march of wealth. In fact, most Americans are just one paycheck away from bankruptcy.
Over the past twenty years, Americans have witnessed the purchasing power of the U.S. dollar drop. Unlike the sudden onset of the Great Depression in the 1930s, the current recession has been gradually creeping up on us…
In the early 1900s, it was common for parents to put their children to work by the age of twelve. Likewise, it was relatively rare for anyone to get a college education. Only the upper echelon of society typically had anything beyond an 8th grade education. This scenario sounds absurd in today’s world but life wasn’t always peachy keen for our predecessors.
As the evidence of falling ‘real incomes’ becomes glaringly obvious, having a full time job plus some moonlighting is definitely on the rise.
But what do the terms ‘real wages’ and ‘real income’ mean? It’s two-fold.
Real wages are measured against inflation. Back in the early 1970s when inflation had super spiked, employers were practically throwing raises at employees because their salary couldn’t even come close to a real ‘living’ wage. Today, employers are not offering raises. Meanwhile, most people can barely afford basic rent and food. Instead of employers paying a real living wage (a wage someone can comfortably live on) we have to get 2nd or 3rd jobs to make ends meet.
Real income is the money left over after you pay all your monthly bills, groceries, fuel, and basic living necessities. The technical term for this is called ‘discretionary spending’ and it’s what you can afford to buy after all your basic needs are met.
It’s a solid measure of how much current inflationary conditions cut into your total monthly income. Likely, it’s a deep cut as rental prices are out of control and you can barely leave the grocery store without spending $100 on food that might last a few days, maybe a week if you’re super frugal.
How Does This Shape Our Labor Statistics?
Recent job reports in the U.S. for October of 2023 have come in higher than expected. But that doesn’t mean our economy is booming. The stats are evasive by design and fail to reflect that a big chunk of the 150,000 new jobs created in October- were filled largely by people now working second or third jobs in addition to a full-time career.
It’s the new norm for many people to work some kind of side hustle or part-time gig in addition to a full-time job. The hardest hit is the single person, relying solely on themselves, financially speaking. Couples who cohabitate, sharing rent and monthly expenses definitely have an advantage, financially speaking. Albeit, even a dual income hasn’t prevented the need for moonlighting.
The full time salary just isn’t enough anymore to stay above water, let alone get ahead in life. The average person should not have to spend 75% of their monthly salary just to pay basic living expenses. It’s no wonder that most Americans are drowning in debt with virtually no ability to save money or wisely invest for their future.
Americans’ total credit card debt has shot up to an alarming $1.079 trillion in the third quarter of 2023. In fact, 5.08% of credit card balances fell into serious delinquency or were at least 90 days past due in the second quarter of 2023. *data compliments of the Federal Reserve Bank of NYC*
With inflation in the double digits and housing prices astronomical, it’s simply impossible to get ahead. It’s apparent our government wants us to live in squalor. Who knows, maybe that was their overarching plan all along.
The average American struggles to live a fulfilling life, hampered by an economy that the American government has created to make the rich ever richer. The widening dichotomy between the rich and dwindling middle class will leave the have-not’s unable to enjoy life’s simple things or anything at all for that matter. The once-great American capitalistic democracy has evolved into a socialist totalitarianism that has one message:
You’ll own nothing and be happy.Klaus Schwab