Third World America - Arianna Huffington [9]
Despite its name, this bill will not be restoring financial stability to the tens of millions of Americans whose lives have been turned upside down by the economic crisis.
On nearly every front in the real economy—from jobs to consumer spending to foreclosures—we’ve made virtually no progress. While Washington and the media were consumed with the titanic debate over this reform bill, talk of the actual suffering by actual people in the actual economy was virtually a taboo subject, at least judging by how rarely it made the front pages or led the TV news.
But the data points are all around us.42 In a speech, Sandra Pianalto, president of the Cleveland Fed, surveyed the landscape and described an economy facing serious and long-term challenges, partly because of the huge loss of skills that is being suffered by the long-term unemployed. “Research … tells us that workers lose valuable skills during long spells of unemployment, and that some jobs simply don’t return,” she said. “Multiply this effect millions of times over, and it has the potential to dampen overall economic productivity for years.”
Her conclusion: “Many people are now just aiming for ‘financial security’ as their American Dream.”43 In other words, the core idea of the American Dream—work hard and advance up the ladder—has been gutted. Now the American Dream is try to not fall, or do all you can to slow your rate of decline.
And forget about having enough in the bank to give your kids a leg up on doing better than you’ve done. It’s hard enough just to keep a job until you retire—if that’s even going to be an option. At a D.C. jobs fair for older workers in May 2010, more than 3,000 job seekers showed up for the event, entitled “Promoting Yourself at 50+.”44 Not surprising given that, at the time, the average jobless stint for those unemployed who are fifty-five and over was around forty-three weeks. (Quick note to struggling politicians out there: want a huge crowd at your campaign rally? Call it a “jobs fair” and you’ll have people lined up around the corner.)
Their children and grandchildren who recently graduated from college aren’t faring any better. According to BusinessWeek, the 1.6 million new grads hitting the job market with their expensive degrees are confronting a youth unemployment rate of almost 20 percent—“the highest level since the Labor Department began tracking the data in 1948.”45
And many workers who have managed to hold on to their jobs are increasingly doing so only by accepting less pay and taking on a higher share of their health-care costs.46 “My company didn’t eliminate my job, they just eliminated my salary,” said marketing director Mike Cheaure. “I was back at work as a freelancer the next day working at one-fourth of the pay and no benefits.” The experience has made him very familiar with the new reality. “For us, the American Dream is gone,” he said. “Now it’s just getting by.”
Adding insult to injury, a growing number of working mothers are having to give up their jobs and rely on welfare because states are cutting back on child-care services that allowed them to keep working.47 And kids were left scrambling to find something to do this past summer when a number of states made deep cuts to summer school programs.48
This spring saw a surge in consumer spending that spawned talk of “green shoots.” But it turned out the spending surge was economically imbalanced. As the Los Angeles Times’s Don Lee put it, the “little-noticed reality” behind the “encouraging numbers” was that “much of the new spending [had] come not from America’s broad middle class but from a small slice of affluent people at the top.”49 In fact, according to the Labor Department, the richest 20 percent of American households accounted for 40 percent of all spending.
The news in consumer lending has been similarly dismal—especially among the banks that got the