December 27, 2006


Myths And the Middle Class (Robert J. Samuelson, December 27, 2006, Washington Post)

What's striking is the huge gap between people's views about "the economy" -- an abstraction -- and their own personal situations:

- Although only 32 percent rate the overall economy as "excellent" or "good," 52 percent judge their personal situation as excellent or good (35 percent said "fair" and 13 percent "poor").

- Most Americans (60 to 37 percent) think their own living standards are rising; parents of children under 18 overwhelmingly (54 to 24 percent) think the same will be true for their children.

- Almost 70 percent of Americans say they've attained or will attain the "American Dream," as they define it. More than half say success comes from a good education and hard work, not from connections (18 percent) or being born wealthy (13 percent). [...]

People value stability and security. They also want higher incomes. Unfortunately, the two sometimes collide. In a recent book, "Economic Turbulence," three economists show that the constant turnover of companies and business locations ("establishments") improves economic growth -- but creates disruption and stress. In the five industries studied (trucking, computer chips, financial services, software and food stores), the productivity of the best establishments is often double that of the worst. Replacing the less efficient with the more efficient ultimately lowers costs and raises living standards. [...]

The economy will remain precarious if it remains productive. The new technologies and products we celebrate inflict anxiety by redefining middle-class society. The causes of our success are also the sources of our stress. Of course, many of today's complaints (growing inequality, eroding health insurance) are legitimate and, to some extent, might be corrected. But the remedies -- assuming they didn't make matters worse -- would succeed only temporarily, because they would not erase the basic dilemma.

The middle-class "squeeze" never vanishes. Sometimes the economy so outperforms expectations (say, after World War II or during the late 1990s) that it creates a lull. But that merely elevates expectations to more unrealistic levels and ensures later disappointment. The economy pleases most people most of the time -- but can never please everyone all of the time.

We need tv to bring back shows like the Waltons.

Posted by Orrin Judd at December 27, 2006 8:17 AM

And "Leave It to Beaver," "The Andy Griffith Show," and (my wife would say) "Little House on the Prairie."

Posted by: Bartman at December 27, 2006 9:30 AM

Reading sentences like, The economy will remain precarious if it remains productive. has given me a migraine. Life like the economy is far more precarious when it's un-productive.

Posted by: erp at December 27, 2006 9:44 AM

Progress---change for the better--is accompanied by a certain evolutionary stress.

I must say that I see my neignbors in a state of opulence beyond the dreams of avarice in the days of my youth, and, as the article points out moaning and doing that other thing they do when they moan concerning the "economy" and the "plight of the middle class." Individuals driving the latest luxury cars, taking several cruise-ship excurions per year, and, of course, gambling regularly, are all too ready to wave a tin cup in their neighbors' faces, demanding that their pills be paid for.

The Samuelson article correcly points out the insanity, that is, the sickness, of it all. Covetousness, I name it.

Posted by: Lou Gots at December 27, 2006 10:47 AM

Republican president, left wing media. It's really that simple. Have any of you guys actually sat down and watched the CBS News or other network in the last 6 years. It should come with a surgeon general's warning. The insanity that spews out of there spreads throughout the whole society.

Posted by: andrew at December 27, 2006 1:34 PM

"Sometimes the economy so outperforms expectations (say, ...during the late 1990s) that it creates a lull." The economy is damn easy to fix. When it is under a Dem president, a bubble lures you into complaceny, everything is rosy for as far as the eyes can see, and yet to see. When it is under a Rep president, everything is precarious. A rising GDP presages hard times ahead, decreasing unemployment means rising wage pressures, future "run away" inflations. Stable employment means coming deflations, rising unemployment means impending recession/depression, the worst economy since 1929. A hot economy under a Rep brings income inequalities, after all not everyone is making $56 million bonus like Goldman Sach's CEO, the poor guy in Morgan Stanley is only making $40 million, almost 29% less. A recession economy under a Dem brings heaven on earth that everyone is equally poor and miserable, but "equal". To fix the economy, we must put a Dem, even Jimmy Carter, in the White House.

Posted by: ic at December 27, 2006 4:14 PM

No one watches network news.

Posted by: oj at December 27, 2006 10:21 PM

Excellent use of evolutionary, Lou.

Posted by: oj at December 27, 2006 10:25 PM

oj, if nobody watched the network news the Democrat Party would have collapsed a long time ago. I know several people who are fairly conservative who religiously watch the network news and vote straight Democrat.

Posted by: andrew at December 28, 2006 3:25 PM

That you know only a couple demonstrates the point. At our fraternity everyone used to watch after dinner.

Posted by: oj at December 28, 2006 5:13 PM