A tiny part of a
tiny part of the population of the earth will set the terms for the
future of all humans. A tiny part that is broken, spent out, and increasingly
disillusioned. That sliver of humanity is the broken, spent out, and
increasingly disillusioned American middle class, burdened with the task of
spending all America out of catastrophe. When they break under the weight of
desperate impossibility, how will the heartlands good citizens react, and what
will they do?
According to the
World Bank, there are 6,692,030,277 human beings on the earth.
308,108,741 of them live in the United States, about 4.6 percent of the total.
Of these fortunate Americans, about 231,000,000 are of voting age. In general
elections in history�s greatest democracy, about half those eligible to vote actually
do . . . 115 million people. History�s greatest democracy has only two options
every election, a choice between two almost similar positions, and the winning
option typically enjoys the support of only half of those who choose,
approximately 60 million individuals.
For a scant 90 years, America has been the wealthiest, most
powerful group of humans in all 20,000 years of recorded civilization.
Decisions made by Americans can and do affect the lives of every other human on
the planet, often for both present and future, good and bad. By brute force of
American economics alone, a single, small 0.9 percent of the 6.6 billion people
who call earth home set the agenda for each and every one of all the rest of
us. Not even by force of arms has there ever been a time in glorious history
when so few people dominated so many in so complete a way.
Centuries from now, historians will want to know who these
few people were, if only to understand how they lived and thought, and better
know the cause of global events that shaped the world they live in. As we in
our time grapple to understand who the powers were that made a Roman, a Roman,
future thinkers will want to dissect the condition of the less than one per
cent of all humanity who call themselves American, and who alone make America,
America . . . and the earth, American as well.
It cost 1 billion dollars and four years to have .9
percent of the earth elect the president of the United States in 2008. It took
a similar amount of time and money to be the guy that lost. Hundreds of
millions more are expended to elect the 535 people who make up the United
States Congress. No statistical analysis is required to understand that these
are among the wealthiest and most privileged humans in all of history. A tiny
fraction of a tiny fraction of a tiny fraction of the population of the planet.
This, we are led to believe is democracy, and so this small sliver is at least
nominally responsible to those few who elected them, and nobody else.
Like all great empires, America has a well-defined class
structure. As a fedora on a table, at one brim is the thin cruel line of
poverty and disenfranchisement, at the other brim another thin line of luxury
and excess, and a middle where the head goes which has historically been the big,
fat, American middle class. The middle class sets the agenda by dearth of
weight, the luxury class promoting the agenda where and when it suits them. The
lower class doesn�t matter at all.
The great American middle class, then, at least nominally,
controls the fate of the planet. They do so by electing wealthy folks who
pander to their interests, those wealthy folks whose interpretations of the
middle class becomes policy. Future folks will want to understand how
representative those interpretations were, and will want to see if changes in
the middle class over time were responsible for changes in American policy
towards the world.
If anything defines
the great American middle class, it is the concept of the American Dream. The
basic building block of the American Dream is the family -- mom, dad, 2.4 kids
and a dog. The �dream� part is the very American right to economic freedom,
freedom to accumulate stuff. A box on a postage stamp in a sea of urban sprawl
called home, a couple of cars, a good education for the kids, and unrestricted
ability to consume as much surplus crap as possible. Americans define success
completely in economic terms and then attach the flag, religion, and everything
else to it. Without this absolute right to consume hordes of junk, there is no
American Dream, and no middle class. There is left only a lower class,
(whatever that is), and a powerful capitalist class existing as it always has
throughout time, changing flags and philosophy depending on how the winds blow.
Caesar, Czar, King, or CEO of Goldman Sachs.
The rise of the middle class at the end of the 19th century
tracks the rise of wealth and power for most Western, industrialized nations.
Production, trade, and consumption of machine made goods became a near
universal indicator of the rise of modern civilization. However, 40 years of
crushing war amongst European powers stalled the growth for most, but emerging
America remained unscathed, benefiting from the misdemeanours of a now dead
age. History will fix the date of the birth of absolute America to the year
1914, the dawn of the American age to 1945, and no doubt, the golden era to the
short period that began to erode in 1971. Of the time since, we the generation
here and now and in the teeth of it, can only speculate.
In the summer of 1914, America was an outlier in a world of
teetering monarchies, festering colonial empires, and rancid landed
aristocracies. While the rest of the world fed its gold and its young to the
insatiable maw of industrial war, Americans were building a dream from
limitless resources and the economic opportunities of a conflict that left
America unspoiled and prosperous. By the close of hostilities in 1945, with the
capital of the planet spent and exhausted, America burst from the ruins to
begin the greatest run of prosperity and innovation of all time. The American
middle class exploded, living the dream so thoughtfully given to them over a
generation of global war.
imposed its vision of a liberal, free market democracy on the �free world�
through the Bretton Woods agreement of 1944. The United States became the
world�s greatest manufacturer of goods, trader of goods, and consumer of goods.
Rebuilding the planet became a God given mission, the profits manna from
heaven. The American dollar became the world�s dollar. Freedom and cash
But with the US greenback backed by gold, American economic
expansion was limited to the bullion it horded. Wars in Korea and Vietnam, and
the massive expansion of �entitlements� began to strain the American Dream. By
the early 1970s the US had ceased to be an exporter of stuff, and the middle
class began to buy increasingly cheaper stuff from abroad =- at the expense of
their own manufacturing and jobs. Given that the dream of freewheeling
consumption was the bedrock of the burgeoning, voting middle class, politics
insisted on a populist solution to the increasingly broke US economy. In 1971,
Richard Nixon elected to abandon Bretton Woods, leave the gold standard, and
America was free to print its way out of deficit and keep the dream alive.
At the same time as the US set the world awash in USDs,
untold wealth and prosperity inflated its way through the massive baby boomer
cohort. Women were entering the workforce in exponential numbers, soaking up
inflated dollars with double incomes -- and less expensive kids. American
politics became a contest of pandering to the hedonistic desires of the
American household, boom times embraced and fuelled by lax regulation and
credit, busts fought off with the simple printing of even more money. Good times.
The American household saved 11 percent of its income in
1970, and had only 1.4 percent of its cash going to newfangled credit cards and
auto loans. Everything else exchanged for clothes, appliances, food, houses,
and shiny happy stuff, increasingly from overseas. Unknown to all, it was to be
the high water mark for the middle class of America.
In 1971, American imports exceeded exports for the first
time in modern history, by 2.6 billion dollars. At a time when a billion was a
lot, America began paying to simply exist. Gross Public Debt had grown from $43
billion in 1940, to $381 billion by 1970. Within a single generation -- the age
of narcissism, the computer age, the age of globalization -- the baby boomers
of the American middle class had tilted the entire planet�s resources towards
an unsustainable consumer culture. No longer living the dream, those alive just
moments before Lehman Brothers listed over, rolled under, and disappeared below
the waves of history, were fighting simply to keep the stuff they had.
The future had evaporated right before their shuttered eyes,
and for over 40 years.
The current version
of the American middle class bears no resemblance at all to that of the end of
the golden era in 1970. Forty years ago, Americans saved 11 percent of their
earnings -- which had evaporated by 2005, reaching the oxymoron of negative
savings. Credit card debt shot from 1.4 percent to 15 percent. In the space of
a generation, a single income family flush with cash, savings, and dreams had
become a double income nightmare staggered with debt.
In 2008, there were more household bankruptcies than
The cost of crap fell and Wal-Mart rose. Debt enslaved
suburbanites now spend 32 percent less on clothing than they did a generation
ago; 18 percent less on food; 52 percent less on appliances, and 24 percent
less on cars. The middle class is consuming as voraciously as it ever has,
however they have replaced sturdy $400 American Lawn Boy lawn mowers with $99
tin cans from China, and buy them now on credit. Some call that progress,
others, value. In reality, it�s inflation. The simple fact of the matter is
Americans no longer have the disposable income to consume their way out of
trouble, and that trouble lies in why it is the American middle class that is
broke, struggling, and increasingly angry.
At the same time that consumables were falling in price, the
fixed portions of the American Dream began an exponential increase. Two incomes
meant two cars -- or three, or four -- and despite the fact that cars were
cheaper, the cost of cars to the two-income family rose by 52 percent. Houses
got bigger, and mortgages increased 76 percent -- with 10 million of them in
various states of distress and foreclosure. Health insurance rose 76 percent,
taxes 25 percent. Childcare was an expense nobody had a generation ago, but one
that became essential with two adults working. The cost of education had
increased -- as did the length of time necessary to obtain that education. A
ticket to the middle class that cost 12 years of school -- grade one through
high school -- now includes daycare, preschool, grade school, high school, and
then college. Americans must now pay for the additional time.
In 2005, that .09 percent of the earth that set the agenda
for the planet was spending over 66 percent of its income on the fixed costs of
the American dream alone, where it once spent less than a third. Or, to frame
it in a way that defines the great problem, the American system that depends on
rabid consumerism has left its heartland with exponentially decreasing amounts
of disposable income, falling from 66 percent to 33 percent in a single
lifetime. When George W Bush implored the middle class to spend its way out of
the 9/11 chaos, in stunned and terrified whispers the American middle class
muttered, �With what?�
�The conscious and intelligent manipulation of the
organized habits and opinions of the masses is an important element in
democratic society. Those who manipulate this unseen mechanism of society
constitute an invisible government which is the true ruling power of our
country� --Edward Bernays, 1928
�Our enormously productive economy . . . demands that we
make consumption our way of life, that we convert the buying and use of goods
into rituals, that we seek our spiritual satisfaction, our ego satisfaction, in
consumption. . . . We need things consumed, burned up, replaced and discarded
at an ever-accelerating rate� --Victor Lebeau, 1947
�Too much consumption and too little investment, too many
imports and too few exports. We have not been on a sustainable economic track
and that has to be changed. But those changes don�t come overnight, they don�t
come in a quarter, they don�t come in a year. You can begin them but that is a
process that takes time. If we don�t make that adjustment and if we again pump
up consumption, we will just walk into another crisis.� --Paul Volker, 2009
�If you look around, you see how many people is out of
work, number one, and you see how many people is in foreclosure or lost their
homes or in default because they�ve lost their jobs, that tells you right there
what the economy is doing.� --Middle Class American, 2009
A tiny part of a
tiny part of the population of the earth had constructed a global
economic architecture that sustained it in wealth and excess, security and
predictability. In a scant 40 years that wealth, excess, security, and
predictability have proved to be entirely unsustainable. The approaching
political climate of the American middle class will reflect the shock and desperation
that may now be starting to manifest itself. How Americans react to their fast
changing circumstance and what they will do about it will deeply affect the 95
percent of the earth�s humans who are really only along for the ride.
In 2008, America gambled on hope, as hope is all it had. A
new administration faced the growing catastrophe in the only way it could
understand, frantically pumping in dollars to resuscitate a prostrate
consumerism. An insane amount of debt piled up, the annual deficit soaring
through $1,000,000,000. One trillion dollars. Absolutely none of it was
used to purchase plasma TVs, hot tubs, or bling. The richest of Americans -- as
they always have -- prospered along Wall Street and summered in the Hamptons
while the drought stricken middle class waited for a rain that will never fall.
The American middle class will not spend its way out of
disaster, if only because it can�t. There are no savings. The house is
worthless. The credit cards are gone. Jobs are disappearing. Today is bad and
tomorrow looks worse. People are nervous, frightened, worried. They are behind
in the mortgage, and struggle to make health insurance payments. All the while,
they watch the stock market explode, the bonuses arrogantly roll on, and their
government lie to their faces that the �recovery� is underway. China is
booming, so is India and Brazil. Beneath the hope, patriotism, and the flag,
the American middle class can feel it all slipping away.
In a nation consumed by politics, where pandering and
lobbying are two sides of the same platitude, what will the increasingly angry
gentle folks of Ohio, Iowa, and Florida demand of their philandering
representatives in Washington? What form of instant remedy will some baseless
political hack come to offer them as the snake oil for what ails them? How will
those decisions come to dominate the lives of those in Canada, Ecuador, and
In the distant future, historians will consider the rise,
fall, and collapse of the great American Dream and conclude that was the cause
of all that followed. None will be surprised at the all too human response of
anger, frustration, and action in the teeth of injustice and inequality. After
all, history is full of angry people who just weren�t going to take it anymore.
They will wonder only how it was we could not see it coming -- how we could be
so stupid to have blown it.
The coming fury of angry America is as palpable as it is
silent. What will that tiny part of a tiny part of the earth�s population do
when the utter hopelessness of the situation washes over them and the tides of
history curl around and bear them, inexorably, into the past?
What will they do?
Aetius Romulous, historian, economist, accountant, writer, and blood sucking CEO, born at the wrong
end of the Baby Boom Generation -- too late to enjoy the ride, too early to
have missed it, and stuck in the middle with the mess. Aetius writes and blogs
from his frozen perch atop the earth in Canada, spending the useful capital of
a life not finished making sandwiches and fomenting revolution. It�s a living. http://screambucket.com/. Email him at firstname.lastname@example.org.