I’m always on the lookout for interesting articles about what’s going on with the American middle class, of which I consider myself a member. There are lots these days – frankly: a worrying number.
Consider this chestnut from last year, in which the writer Neil Gabler wrote about the 47% of Americans who say they cannot come up with $400 to cover an emergency expense (including Gabler, himself). Or this one from the New York Times last month about a study showing that the middle class in the U.S. has contracted over the last two decades.
The big question is “why”? That’s why I was interested in this review of a new book by MIT Economics professor Peter Temin on “the vanishing middle class.” Temin’s thesis: the U.S. is now two countries. There is a small, prosperous nation inhabited by high wage elites mostly living in coastal states who work in fields like finance and technology and a vastly larger, poorer nation populated by…basically…everyone else.
Temin employs a well-known, simple model of a dual economy to examine the dynamics of the rich/poor divide in America, and outlines ways to work toward greater equality so that America will no longer have one economy for the rich and one for the poor.
The result, Temin argues, is that for many Americans, the country is not the vanguard of the First World most of us think of, but a poor, developing nation. From the MIT Press write up:
Many poorer Americans live in conditions resembling those of a developing country—substandard education, dilapidated housing, and few stable employment opportunities.
The proof of this, he says, is all around us:
We have entered a phase of regression one of the easiest ways to see it is in our infrastructure: our roads and bridges look more like those in Thailand or Venezuela than Netherlands or Japan.