This is Modern America

The state of America today is unfamiliar to many older Americans who were able to afford a house, a car, and children well within their family budget from employment, even from a single earner. The state of America today is in much worse shape across nearly all demographics except the top 10% of earners. The income average in this country stands at a modest $55,000 but if you take out the top 10% of earners (those earning more than 80K a year) that average drops to just $34,000. 

For many Americans the modern reality includes a car is financed for years, shopping at dollar general, living with family and friends, and the leasing (not purchasing) of a cheap smartphone. For older people having a smartphone might seem like a silly expenditure and non-essential. What many people don’t understand is that thanks to the rise of digitization, having a smartphone is the primary way people will keep up with their work schedule, apply for jobs, keep track of banking information, keep track of the family budget, apply for government benefits, keep track of events for their children (and homework for school), and serve as a primary source of entertainment. A smartphone is not a toy or a dalliance for only those who can afford it. It has become an essential tool. 

Today’s America often doesn’t include homeownership for an increasing amount of Americans. Renting with family and friends has become common. Multi-generational households have been on the rise since the Great Recession and show no signs of slowing down. Certainly, the COVID Depression will only make that trend worse. 

This America is not the future anyone was promised. For those that own assets and property, the country is operating very well. The government has spent an inordinate amount of money propping up asset prices. Housing, stocks, bonds, have all been saved through loose fiscal policy. The people shut out are the young and poor. Most TV shows won’t admit but there is virtually no Middle Class in this country. To be Middle Class means that there is plenty of money, derived from labor, floating through the pockets of Middle-Class people. They can afford vacations, houses, and a future for their children. For most Americans, this is simply no longer possible. We live in a country where a $400 expense would send most to a payday lender or to friends and family. A Middle-Class family would be able to weather that inconvenience. Most people live paycheque to paycheque and have little savings. That’s not middle class, that’s poor—plain and simple. 

This fact became obvious to me when Wal-mart reported that if funding for the SNAP (food stamps) benefits program was not renewed they would lose billions because food stamp recipients overwhelmingly shop at Wal-Mart. Dollar General is in the same boat. Walking into any Dollar General, you can immediately see the sure signs of the demographic that shops there. Western Union has set up shop there, cash is commonly used, and every product is off-brand. The stores are often messy and not well kept. No one will be there to help you, you’re on your own. The aisles are narrow and the lighting dim. Dollar General has been building so many of these in rural areas and downtown areas that if a structure doesn’t exist they use large, metal, fabricated buildings, put down a parking lot and a store is ready to go.

Housing is equally problematic with most Americans spending 50% or more of their income on housing and for no other reason than we’re simply not building enough of it. Part of this is due to local permitting costs and construction costs. Another part of this is zoning. Cities have used zoning to keep industry away from residential housing but certain cities have also used it to make sure that low-cost housing or denser housing never gets built. The property values for those already owning homes goes up and shuts out those who can’t afford. Most American now rent and do not own their home. This is a major post-WWII reversal. Before the recession 66% of Americans owned their homes and that is now down to 49% nationally and falling. The new Covid depression will only make this worse.

The big question that now remains is this: are we ok with this way of life? Are we ok with living in an America where the most popular store is a dollar store and people are renting forever and have ever-lengthening commutes? Are we finally ready to address the systemic issues within our country or are we content to let the poor, the young, and other suffer to prop up the assets and wealth of a comparative few?