One of the great things about the US in years gone by was the size and wealth of its middle class. Unlike many other nations that had rich elites and poor commoners, the US had a large and affluent middle class of people who could afford luxuries such as automobiles, refrigerators, and air conditioning. Generations of people grew up expecting that this middle class would remain intact, but it appears that it is not to be.
Ask someone what it means to be middle class today and you’ll probably get some answer about a family with 2.3 kids, a dog, a house in the suburbs, and two cars. They can afford a vacation every summer, have a cable subscription, smartphones for everyone in the house, and their kids expect to go to college. But that kind of lifestyle is increasingly out of reach for more and more people in the US.
The median income in the US last year was just under $33,000. That means that 50 percent of US workers make less than $33,000 per year. Even if that income were untaxed, it wouldn’t be enough to support a family, which means that after the tax man takes his cut most Americans are even less able to live well.
Consider that the average rent for an apartment in many areas of the country is $1,500 a month or more, and rent for a house is even more. An income of $33,000 per year would allow someone to afford a mortgage of less than $90,000, or less than one-quarter of the $380,000 price the average home sells for in the US. Even two people earning that median salary wouldn’t be able to afford the average US home.
In short, the US middle class really is no more. There is no way that most people today can afford the lifestyle that defines middle class. If they can’t even afford to buy a house, they certainly can’t afford to send their kids to college, or afford a vacation, or afford fancy cars. The only way to buy those things is to go into debt, which many households have unfortunately done. But that just enslaves them to debt, keeping them working to pay off those debts that they still may not be able to afford.
Something’s got to give, because a country with a vanishing middle class and a deteriorating standard of living is ripe for political and economic upheaval. Let’s hope that this problem is acknowledged and addressed before the US goes any further down the road towards becoming the next Argentina or Venezuela.