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The End of Entitlement
Paradoxically, "the lives of individual Americans have grown simultaneously more prosperous and more precarious," writes Peter Gosselin in his new book, "High Wire." Gosselin, a reporter at the Los Angeles Times, has provided the most thorough account of this phenomenon to date. As he shows, the chances of being hit by a life-altering event (a long spell of unemployment, divorce, a big decline in work hours for one spouse) have declined slightly since the inflation-plagued 1970s and early 1980s.
But the consequences of setbacks have grown, he finds. The share of families suffering a 50 percent loss of income with a spell of unemployment rose from 17 percent to almost 26 percent. Fear of these setbacks has also up climbed the social ladder: not just factory workers and low-paid service employees but also managers and engineers. Companies downsize. Older workers exit in buyouts. Companies raise health-insurance premiums. The reliable "defined benefit" pension (which paid a fixed monthly amount) has given way to the riskier 401(k)—vulnerable to bad investment decisions and sinking stocks. Corporate protections have weakened, as Gosselin notes.
One result is that bad economic news packs greater psychological punch than it once did, because more people identify with the victims. Change isn't just something that happens to them; it could happen to us. It is this widespread sense of vulnerability, especially among those who did not expect to feel vulnerable, that helps explain the contrast between the state of today's economy (weak, but not collapsing) and the very pessimistic poll results. People worry even if they hold well–paying jobs.
We are losing our sense of entitlement. Under the implied social contract, people who "played by the rules" (to use a phrase popularized by Bill Clinton) deserved modest middle-class guarantees. No one ever specified the rules: presumably, hard work, a good education, prudent personal behavior. Nor did anyone list the guarantees: presumably, a fairly stable job, rising living standards, an adequate pension, protection against random misfortune (sickness, disability, job loss, accidents). But there was a belief that diligence and responsibility were their own rewards.
It's worth noting that this imagined entitlement never universally existed. From 1975 to 1984, unemployment averaged 7.7 percent (today's: 5 percent). The now venerated defined-benefit pensions sometimes weren't fully funded (so that promised benefits weren't always paid) or were funded at the expense of the next generation. Today's retired and well-pensioned autoworkers have, to some extent, condemned those who followed to lower-paid jobs or no jobs at all. No matter. People aren't measuring the present against the past. They're measuring it against their expectations.
Almost all Americans consider themselves middle class. In the Pew survey, 53 percent put themselves in the "middle class" and 19 percent each in the "upper middle" and "lower middle" classes. People classifying themselves in the "upper class" (2 percent) or "lower class" (6 percent) are, in effect, self-identifying as elitists or failures, two unpopular labels in a democratic and striving culture. But the prevalence of middle-class ambitions and values subjects us to a vexing contradiction: the advances in living standards that Americans routinely expect require a flexible and competitive economy that weakens the security and stability that Americans also routinely expect.
© 2008
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Member Comments
Posted By: swilds @ 05/29/2008 11:04:38 AM
Comment: Yes, we middle class are feeling less secure despite our improved standard of living. But why? I think it's because we have too many choices, and too much advertising. We're keenly aware that there is a whole industry out there bent on smoothly swindling us out of our dollars. No one seems to be really interested in providing services anymore; the goal is just to get people to spend money, even if the goods or services offered are shoddy or unnecessary.
There used to be one phone company and a handful of phone models; now there's dozens of each, including phones that do far more than we need them to. We're bombarded everyday with ads for credit cards, loans, and insurance, none of which we're sure we need, for which we do not have the expertise or information we need to make wise decisions. Bad decisions have major consequences; witness the subprime loan debacle and the travesty of home insurance in New Orleans. We stand in the aisles at the grocery story, reading cereal boxes, trying to figure out what the brightly colored label 'whole grain' really means. We see ads from oil, energy, and car companies telling us how 'green' they are, and we wonder how 'green' they REALLY are. We're forced to make decisions based on slick advertising, from companies focused on short term gains, not long term service.
People feel like no one cares about them anymore, that the corporations are out to make a buck off of them; that we're just a bunch of commodities to be taken advantage of. We may not be fighting off indians, communists, or diptheria anymore, but the world is still full of real dangers, though they are more corporate than terrorist. THAT'S the real problem. THAT'S what is making people feel insecure.
Posted By: mark3132 @ 05/20/2008 7:40:50 PM
Comment: I can't believe there is a typographical error in this article. Is the online edition not worthy of the same level of scrutiny as the printed version? "Fear of these setbacks has also up climbed the social ladder" Editors need to pay attention.
Posted By: timrogers @ 05/18/2008 11:58:35 PM
Comment: The psyche of the middle class consists of big chunks of insecurity and anxiety. Are these mental states at higher levels than in the past? Globalization and illegal immigration, downsizing and outsourcing, increased productivity and the pace of technology have all made the middle class just a little suspicious that something is wrong, and nervous about whether it is headed their way. All have watched a powerful trend that turned a full time job into part time work, or contract work, or consulting work ,or self employment, or temporary work, or day labor, or no work at all. All have watched costs for food, energy, health care,insurance,and debt creep up. As the middle class slides toward lower class it is little consolation to see the lower class slide toward poverty. The middle class is uncertain about the present and afraid to think about the future. Economists talk about the consumer confidence index, and say it is always headed either up or down. Middle class people call it 'things getting worse instead of better". Most of them will stay middle class only by sinking with rest to a lower level full of poorer people like them. There will always be a middle class, but they won't always need any money to qualify. Insecurity and anxiety will suffice.