For average American’s it’s still the economy, stupid!

Posted on December 4, 2019

James Carville famously made economics central to Bill Clinton’s 1992 presidential campaign, insisting “It’s the economy, stupid!”

The mainstream media thinks that the American economy is roaring and that will help GOP campaigns. But today, for average Americans, the economy is worse than it was in 1992. And it’s absolutely essential for progressives to understand and communicate this. For progressives, real-world kitchen table economics should be the front and center.

“How can that be?” the mainstream media would demand. Unemployment and inflation are low, and the economy has been steadily expanding for the past decade. “Doesn’t that prove the economy is strong?”

No. Unemployment is low, but average wages and benefits are awful and millions of Americans have to work two or three jobs just to make ends meet. Inflation is low, but that benefits the rich while holding down salaries for everyone else. The GDP has expanded but virtually all of the wealth created is diverted to the rich; ninety percent of Americans gain virtually nothing from what they worked to create.

In fact, about 60 percent of Americans are living paycheck-to-paycheck; more than 50 percent faced serious economic problems during the past year; more than 40 percent couldn’t pay for an unexpected expense of $400; 40 percent report that they or a close relative are currently receiving some form of government assistance; on average, credit card holders are carrying negative balances of more than $8,000; about 60 percent of current college graduates have outstanding student loan debt, with an average of $28,400 apiece—not including any graduate school debt; for Americans without a college degree, wages (adjusted for inflation) have stagnated or declined over the past 30 years. In short, only the top 5-to-10 percent of Americans are economically secure.

But why?

Although the long-term benefits of increased productivity (that is, the creation of wealth across the U.S. economy) were fairly distributed to average workers from the post-war period into the Nixon Administration, starting in the 1970s and greatly accelerating during the Reagan Administration, real compensation (that is, wages and benefits, adjusted for inflation) stopped rising. While the economy continued to grow at a rapid pace, typical workers no longer received a reasonable share of the wealth they helped to create. Instead, nearly all of that money was, and still is, diverted to the most affluent.

This can also be seen another way. Since the end of the Reagan Administration, the richest 10 percent of Americans doubled their wealth while the bottom 90 percent gained only slightly, and the bottom half—which own just one percent of all the nation’s assets—gained nothing.

Today, the richest one-tenth of one percent of Americans (fewer than 200,000 families) own about the same amount of private wealth as the bottom 90 percent (about 110 million families) combined. The three wealthiest Americans own more assets than the entire bottom half of the U.S. population (160 million people), and just 26 people own as much wealth as half of the world’s population (that is, 3.8 billion people) combined.

It is no wonder that “death rates from suicide, drug overdoses, liver disease and dozens of other causes have been rising over the past decade for young and middle-aged adults, driving down overall life expectancy in the United States for three consecutive years” and that “the excess deaths were highly concentrated geographically, with fully a third of them in just four states: Ohio, Pennsylvania, Kentucky and Indiana.”

As professor Ellen Meara of Dartmouth explained, “People are feeling worse about themselves and their futures, and that’s leading them to do things that are self-destructive and not promoting health.” Princeton professor Anne Case, who has published multiple reports on the subject, “told reporters their research showed a ‘sea of despair’ in the United States among people with only a high school diploma or less.”

That’s reality. Average Americans are in trouble and they know it. Donald Trump (and the whole right-wing noise machine) says their suffering is caused by people of color, and in the absence of contrary information, they have believed it.

In short, the most important thing to communicate in 2020 is that the rich and special interests have destroyed the real-world economy for average Americans, and that you are going to fight for an economy that works for all Americans—not just the wealthy few.


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