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Friday, February 29, 2008

An Upside for the Middle Class

Interesting Washington Post article on the middle class:

Items once considered luxuries -- dishwashers, central air conditioning, video cameras -- are now common. The average size of new homes has increased 40 percent in the past generation. And as many consumer items cost less, Americans are shopping more. In 1991 the average American bought 33.7 pieces of apparel; by 2002 he or she bought 48 items, according to Boston College sociologist Juliet Schor. In 2005, she said, Americans were projected to discard more than 63 million computers.

Americans are twice as likely to travel overseas than they were in 1980, and overall they spend more than ever for other recreation, including sporting events, movies and plays -- the mark of an ever-improving quality of life, some researchers say.

Related video on middle class luxuries here.

The article also points out that while some groups point to "wage stagnation," but pick ups on the trend of greater compensation in benefits, plus other forms of income. There are several other trends to point out in regard to "wage stagnation" vs. middle class standard of living - but perhaps most importantly is the growth in the number of jobs. Because "median wages" ignore people unemployed and out of the labor force, raising everyone's wages while adding more workers leads to "wage stagnation" even while making everyone richer, as I explain here.

Finally, the article concludes with three areas where the middle class is getting "squeezed" - housing, education, and health care. Gosh, if only government would

  1. Subsidize higher education with student grants, institutional aid, and student loan subsidies
  2. Offer tax deductions for home mortgage interest, levy property taxes on homes, and heavily regulate housing construction
  3. Heavily regulate the health insurance industr and provide taxpayer-funding health insurance for low-income families and seniors like Medicaid and Medicare ...

Oh yeah, that is what government does, and maybe the cost of housing, education, and health care keep going on up because of government involvement in those sectors.

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