Reality Crash

Two point five kids.

Four-bedroom house in a good neighborhood.

Two-car garage full of garden tools and two new cars in the driveway.

Good schools.

Fancy vacations.

Keeping up with the Joneses.

The American Dream.

It’s called a dream because it doesn’t seem realistic that it will come true for every American. And it doesn’t—but only for those losers who aren’t willing to work hard enough for it. That’s the hard-as-nails story anyway—the philosophical core of the American capitalist system on which we are raised from birth.

What does this hard work entail? At the core, it requires whole-hearted belief in the myth of the American economy; that the only reason for lack of success is failure to work hard enough. Macroeconomic obstacles don’t exist—except for whiners who think that the government should provide a level playing field. The article, The Heart of the Economic Mess by Robert Reich (AlterNet), points out that this is the prevailing attitude that drove the constant growth of the American economy. It was this propaganda that allowed Americans to continue to cling to an increasingly untenable standard of living that crept (was pushed) constantly upward and beyond their means.

Now, early in the twentieth century, it’s hard to see how even the most faithful will be able to keep up the sham. First, there’s the sheer fact that “80 percent of the work force” makes the same or less than they made 30 years ago—cost-of-living has increased, but wages have not. The “classic” wage-earner—“a man in his 30s”—earns “12 percent” less than 30 years ago.

There’s always a lot of noise about a booming economy, but it all goes to the top 1% or even 0.1% of the population, from where it’s supposed to trickle to the rest of us in the form of more jobs, or so our elected officials (and their corporate masters) would have us believe. No job? Foreclosed? No insurance? Can’t afford food? Try harder! Don’t be so lazy, stop whining and pick yourself up by your bootstraps! The economy’s doing wonderfully well—just look at the stock market! If you can’t make it in this economy, then that’s just the way the ball bounces. It would be unfair—to both you and your fellow taxpayers—to help you too much, or at all, if we’re going to be perfectly honest.[1]

The problem with that theory is that a comparitively small pool of rich people don’t buy nearly as much stuff as a much larger pool of poorer people: only so many cars and large-screen TVs fit into one mansion. The extra money that should trickle back into the economy is far more likely to be invested wherever in the world it is expected to make the highest return. Decades of experimentation have shown us that there are no guarantees that it ends up in the domestic economy—to the contrary.

Americans certainly gave the old college try though. First, they “sen[t] more women into paid work”; the “percentage of American working mothers with school-age children has almost doubled since 1970, to more than 70 percent”. When that wasn’t enough to maintain the American lifestyle, they didn’t question the system, hyper-consumerism or the way they seemed to spend a tremendous amount of money on a government that never did anything for them. No, they buckled down and started working more. Some got second jobs; others just worked many more hours, working more than they did 30 years ago as well (on average) and working “350 more hours a year than the average European”, who enjoys much better quality-of-life and a much stronger social safety-net, to boot.

When that was also not enough, Americans started to borrow, which brings us up to the present, where credit-card debt per household and number of expected foreclosures and defaulted loans are all at all-time highs. At this stage, with no more hours in the day left to work, no more people in the household to turn into wage-earners and no more collateral with which to borrow more money, it seems that chasing the carrot of the American Dream is finally at an end, stomped into the ground by reality.

Where once we shook our heads in amazement, laughing that the Soviets actually believed their own hype (which they, in actuality, did not[2]), we are now the butt of a joke we played on ourselves and are threatened with a fall just as precipitous as the Soviets suffered when reality took notice up and bit them in the ass. Reich offers the obvious solution, but it’s difficult to see how to get there from here without a revolution:

“Most Americans can no longer maintain their standard of living. The only lasting remedy is to improve their standard of living by widening the circle of prosperity. […] the long-term answer is for us to invest in the productivity of our working people […] We must also adopt progressive taxes at the federal, state and local levels. In other words, we must rebuild the American economy from the bottom up. It cannot be rebuilt from the top down.”

That will not happen in four years, nor will it happen in ten; at best, this complete turnaround will take a generation. He is talking about institutional change wherein the current holders of power will have to let go of some of their wealth in exchange for long-term goals.

Good luck with that.