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I was born in the middle of world war two. I grew up around the generation that had lived through the great depression and the war. They really never stopped talking about it. Most of them were left with recurring feelings of anxiety about economic security. They held onto that good steady job and were compulsive savers. My generation came of age without ever having known that atmosphere of pervasive insecurity. We were much more inclined to take relative affluence for granted. One of the debates between the two generations in the 60s was whether to plan life for security or to seek interesting experiences.

The political and economic upheavals from 1930 – 1945 forced major changes in the American economic system and resulted in an expanded middle class with income adequate for comfort and a growing wealth base. The programs of the new deal began to construct a social safety net with programs such as social security, public assistance, and unemployment insurance. Increased support for labor unions helped them to extend the benefits of organized labor to a much larger portion of the American workforce. After the war the housing programs stimulated a boom in residential construction and through low down payment federally assisted loans opened up home ownership to large numbers of families for whom it had never been a practical possibility. The dark side of this picture is that racial minorities were systematically excluded from much of this windfall. The Social Security Act and the Wagner Act excluded agricultural and domestic workers. The federal housing loans were explicitly limited to all white neighborhoods.

After the war the American establishment circled the wagons to get rid of any militancy left over from the depression. The Taft-Hartley Act restricted the ability of unions to expand to new industries and under the banner of anti-communism they were purged of people who thought labor deserved a bigger share of the pie. The US economy having run full tilt in building the war machine had expanded extensively while most of the rest of the industrial world was in ruins. American wages were kept at wartime levels as the carrot to go with the sticks and defined benefit pension plans became common. In 1950 America was a more affluent nation than it had ever been and the resources were more widely distributed than they had ever been before. In the 1960s Medicare was added to the safety net.

The depression generation began to reach retirement age in the 1970s just as the inflation crisis was beginning to rattle the post war prosperity. Many of them reaped their reward for the privations that they had endured in an earlier period of their lives. With Social Security, and defined benefit pension plan and Medicare they could expect comfort and security in their sunset years. They had also accumulated real estate equity. In many instances that was passed onto the next generation as inherited family wealth. My boomer generation thought that we could take the same thing for granted.

Fast forward through the economic crises of the past 40 years. Unions and defined benefit pension plans in the private sector have become almost as rare as the dodo bird. Both are under increasing pressure in the public sector. The 401K has shifted the burden and risk of retirement saving and investment from the employer to the worker. Finding a job at the beginning of working life and holding onto it until retirement is something that only happens in old movies. Reductions in Social Security and Medicare seem to have reached the stage of bipartisan political policy. The age of affluence has been replaced by the age of austerity. This is a result of long term trends and not just just the economic slump of the past four years.

The boomer generation has now reached the point of retirement and things don't look so rosy. There is much less certainty about pensions and investments. The value of real estate has declined. Life expectancy has increased meaning a longer period of retirement that must be provided for. On average the children of the boomers are having an even tougher time than their parents. Many of this newly retiring generation will have enough resources to get them through retirement, but they will be scraping closer to the bottom to do it. I think it likely that they will need to use up much of the real estate equity since pensions and benefits will be inadequate, This mean a shrinking wealth base to pass on the children and grandchildren.

At the end of WW II we saw the making of the great American middle class. We are now seeing its undoing. The economic resources are being transferred back to the concentrated financial elite. Most people are still desperately clinging to the shreds of the American dream. Something wonderful will turn up and the good times will return. The good times have been on the wane for a long time. A couple of bubbles have been engineered to makes us think that all would be well. The real effect of them was to speed up the transfer of wealth back to the wealthy.  

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Comment Preferences

  •  TnR (16+ / 0-)

    Good stuff.

    The best time to publish is 1pm EDT to 6pm, this gets the most eyes from the East coast to the west coast and gives a dairy the best chance of making the rec list.

    A dairy like this deserves more eyes. Thanks for writing it.

    ...... Social Security blogathon March 25th thru March 29th. #HandsOffmySS FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

    by Roger Fox on Sun Apr 07, 2013 at 07:20:54 PM PDT

    •  Thank you. (7+ / 0-)

      I've often depended upon the kindness of the rescue rangers.

    •  Yes, this diary does deserve more eyes (2+ / 0-)
      Recommended by:
      Richard Lyon, unfangus

      I wish it could get rec'd up again.

      Richard, thank you for this diary.  I often tell my husband and friends that he and I are living in the last sunset glow of the American dream.  We have a house and enough to live on.  I wonder about our children, though.

      The most frightening thing to me is the lack of jobs.  I've been out of work plenty of times in my life but was always able to find a job when I wanted one.  Now, I don't think that's possible.  Now, if you're over 50 and you lose your job, you'll have to be a consultant or think up some low-overhead business to start because odds are you'll never get another job. Employers are unlikely to hire over-50 workers.

      It is truly frightening.

      "Religion is what keeps the poor from murdering the rich."--Napoleon

      by Diana in NoVa on Mon Apr 08, 2013 at 07:09:20 AM PDT

      [ Parent ]

  •  You know that I feel that Americans (15+ / 0-)

    are as a whole in denial and delusional about what's happening.

    Whereas historically they could count on growth and economic prosperity, they are now holding on the past, rather than dealing with the current situation or the future.

    You also know I advocate a greater welfare state precisely because I believe we are catching up with the economic realities that the rest of the world has been facing. We can't link economic solutions to expecting low unemployment. We need to have a social safety net that assumes a large part of the population may be denied jobs because the economy works that way now.

    •  I'm afraid that people (11+ / 0-)

      will hold onto their delusions. There is not visible organized alternative being placed on offer. Both of the major political parties have been slowly pushing the same general policy. The public mistakes the campaign rhetoric for real difference.

      •  Yes, I absolutely agree on that (8+ / 0-)

        I just see people mostly complaining or resigning themselves to living in the country as it declines and not being able to do anything about it, if they are aware. That awareness, itself, however,is exceptionally rare. I can't even really say I am surprised. Its hard to deal with cold reality, and lies can be very comfortable.

        •  It's hard to know how to fight it. Where does one (2+ / 0-)
          Recommended by:
          Diana in NoVa, unfangus

          go to even start to challenge the powers that be? They are quite entrenched and their power quite awesome.  who are any of us, individually?  How do we start to become a collective force?  The political parties have sold us into slavery.  The vast majority of us don't belong to unions. Unions are completely ineffectual or in on the games of the rich and powerful even if you are a member.  Where is the institution through which we can organize to fight "them"?

          The elevation of appearance over substance, of celebrity over character, of short term gains over lasting achievement displays a poverty of ambition. It distracts you from what's truly important. - Barack Obama

          by helfenburg on Mon Apr 08, 2013 at 03:54:50 AM PDT

          [ Parent ]

      •  Well, there is the fact that we are being played (0+ / 0-)

        politically by some very skillful manipulators.  It's difficult to see through them. I had an insight this weekend, however, when my e-mail inbox lit up with e-mails from some supposedly progressive pressure groups seeking my immediate contribution in response to Obama's move on Social Security and Medicare.

        The elevation of appearance over substance, of celebrity over character, of short term gains over lasting achievement displays a poverty of ambition. It distracts you from what's truly important. - Barack Obama

        by helfenburg on Mon Apr 08, 2013 at 03:52:20 AM PDT

        [ Parent ]

    •  You Have to Have a Reasonable Chance to Know (5+ / 0-)
      Recommended by:
      blueoasis, mike101, wader, YucatanMan, Chi

      what's happening to qualify for blame of being in denial.

      The rightwing capture of the information systems of the information age began almost half a century ago.

      Only the left regards the people as stupid or denialist. The right has never dared let its fortunes depend on the inherent stupidity of the American people.

      We are called to speak for the weak, for the voiceless, for victims of our nation and for those it calls enemy.... --ML King "Beyond Vietnam"

      by Gooserock on Sun Apr 07, 2013 at 08:10:44 PM PDT

      [ Parent ]

      •  While your view may be comforting to believe (5+ / 0-)

        I don't believe its factually accurate.

        Below I try to cover a lot of ground, and I am not sure its all entirely clear.

         While its true the right wing propaganda machine has dominated Americans news, that has had less influence than the American middle class belief that it was a part of the establishment and that it benefited from being a part of that establishment. Welfare reform under Clinton worked, for example, because the public believed it was the other guy being harmed.

        They thought for most of that time that they weren't a part of the "other" that would be harmed. It would  be the people abroad. It would be the poor. If you were White, it would be the people of color. Etc. Always the other.

        The vast bulk of American public believed in the establishment because they benefited from their own grand bargain during that time. What's changed is that their bargain is dying and the chickens are coming home to roost. That the elites having run out of fertile targets are now turning on the middle class. Its that old line first they come for your neighbor, and then finally they come for you.

        And now, even as I type this, the reality is that 70 percent of the public has Internet access, and can, right now today, if it were interested, discover the truth if it wanted it. So, why don't they look for it? Why continue to believe a narrative that based on your own personal experiences (of job  insecurity, unemployment, malemployment, and increased serf labor)  should tell you that its false? It can't just be that others are lying if there's the ability to discover and get around the lie. I know this because anytime I have a question- I google it until i get an answer.

        If I want to understand the state of what's going on with 401ks I research it on line. Most americans can.

        if you are talking about the poor, however, that's a separate subject from this diary. The poor have never been a part of the conversation.

        It can't be as simple as "the right wing lied to the middle class, and had such power that the middle class couldn't figure it out" That may be comforting to  believe, but its just a comfortable lie if we choose to believe it.

        Lies don't work that well unless they resonate with the the audience. You can't run a con this long if you aren't selling something the public wants to buy.

        You also write something at the end that misses the point. Denial and delusional thinking aren't about intelligence level. We are all capable of being manipulated. Of having our buttons pushed, the question is how? Not if.

        The American middle class believes that it got something out of the bargain with the establishment (frankly I should say Western since what's going on in Europe right now with the electing of the plutocrats there is also a matter of the European middle class thinking the same: We are better off with the status quo. Yes more are fighting it, but they are still electing plutocrats in their elections. Why?) .

        The middle class after WW2 got home ownership, it got jobs, it got security- so long as it went along to get along with whatever the status quo wanted. It believed that. This provided the basis for the current con.

        Its feels good to believe that we "just need to educate them" (this is the standard liberal line  like OWS pushed), but its not reality. Emotions are at play here. Not education.

        What has changed is that going along to get along for the bargain no longer is true. The emotions that seemed valid before, no longer are. They aren't adapting to the new bargain in which the wealthy are extracting wealth from the middle class.

         What's changing is that you can't count on home ownership to gain wealth, you can' count on job stability, you cant count on retirement.

        Those things are clear just by looking at your own life. The same with every other American. You don't need the news media to tell you that. Its happening in your own lives.

        So, when I speak of clinging. That's the clinging. That the grand bargain of the American or Western middle class  after WW2 would go on forever so long as you buy into the status quo.

        That's why I speak of low-employment. That was one of the assumption. However- it is an assumption.  Because you can ask: What if its not true? What if low employment isn't forever? should we have a welfare state premised on it?

        What does that mean for policy?

        There are other such assumptions that are a problem.

        For example, we assume growth (left and right) because is happened for the last 200 years, but prior to that, this wasn't the history. what happens if the assumption of growth isn't correct? Should we have a zero growth welfare state not just because of the environment, but because we don't have the resources to assume eternal growth?

        I know I am jumping around here, but your argument touches on so much that is flawed in the ways we talk about these issues.

        So, yes, it is to me delusional and being in denial because the American public may have had, at one point, a valid belief that it gained something from the status quo that it can no longer expect, but still does expect.

        That's not a right wing construct no matter how comforting it is to say that it is. Its a matter o admitting that there's a reason why the public allowed itself to be manipulated, and then understanding that reason no longer exists, but that emotional need to believe in that reason (that we will be middle class if we believe) still exists. People are scared. They  know that things are unraveling. They just don't know based on the historic bargain what to do with it.

    •  Economy works that way cause of current gridlock (2+ / 0-)
      Recommended by:
      PatriciaVa, YucatanMan

      The short story:

      Due to resource depletion, energy constraints and a decline in the growth of the workforce the days of GDP growth of 6% to 14% are long gone. 3% to 3.5% is the best we can hope for nowadays. 2.8% GDP growth and raising the min wage increases FICA and we can see SS good thru 2090. 2.5% GDP growth will get us past 2033 easily, maybe 2040 or so.

      The effects of Plutocracy and Humanism show an ebb and flow thru hsitory. Things never stay the same.

      ...... Social Security blogathon March 25th thru March 29th. #HandsOffmySS FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

      by Roger Fox on Sun Apr 07, 2013 at 08:13:19 PM PDT

      [ Parent ]

      •  A few things come to mind (2+ / 0-)
        Recommended by:
        hrvatska, Diana in NoVa

        but here's one:

         I think GDP focused policy solutions are a problem because wealth and income inequality are increasing.  And right now we face a gilded age. That is as SS only captures part fo that income being generated, and as the part that is being generated is concentrated, less of that is included in the pile of money for SS etc. This is just one issue that I see with the idea

        I think the real solution is to start emphasizing over time the need for a stronger welfare state because America is in declien as a world power, but I realize that's a hard thing to sell.

        •  Sorry I limited my comment to GDP & Min wage (0+ / 0-)

          Your right of course. When it comes to SS, one needs to include Workforce growth, jobs, wages, inflation, and those are just the large order effects.

          But I did boil it down to this

           photo create20millionjobsFICA.png

          ...... Social Security blogathon March 25th thru March 29th. #HandsOffmySS FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

          by Roger Fox on Mon Apr 08, 2013 at 12:48:12 PM PDT

          [ Parent ]

  •  A truly enjoyable read. (9+ / 0-)

    I'm often puzzled by the disconnect so many seem to have at the moment regarding what is happening to them economically and their personal view of their relation to haves/have nots.

    We (sweeping with a broad brush here) support so many actions that only benefit a miniscule portion of the populace and cost the remainder dearly in the name of "low taxes", "free enterprise", etc., etc..

    The 1% doesn't have to fight that hard because so many individuals barely clinging to the middle class are holding their swords for them.

    Wonders are many, but none so wonderful as man.

    by Morgan Sandlin on Sun Apr 07, 2013 at 08:14:20 PM PDT

  •  There were 2 Depression Generations. (4+ / 0-)
    Recommended by:
    Roger Fox, YucatanMan, vtgal, nchristine

    There was the generation that created and then its internal opposition who solved the crisis, and then there was the generation that were children and grew up knowing only Depression.

    The latter we call the "Greatest" generation --my parents-- because after suffering as children, they were drafted into war and sacrificed so many lives and limbs.

    Then they came home, and the good half of the causative generation who previously created the New Deal, piled on with the Marshall Plan, Asian reconstruction and the GI Bill paying their childrens' Troop Generation to buy houses and go to college.

    This child's generation had a post-war Boom of Babies who grew up hearing tales of helping the underdogs, and refused to fight the immoral war the Depression Children generation ran, in VietNam.

    The younger Depression generation was outraged and launched the rightwing revolution.

    That's why we call them "Greatest."

    We are called to speak for the weak, for the voiceless, for victims of our nation and for those it calls enemy.... --ML King "Beyond Vietnam"

    by Gooserock on Sun Apr 07, 2013 at 08:37:12 PM PDT

    •  Good comment Goose and good diary (4+ / 0-)

      I am very concerned for the grands we adopted.   Especially the little one.  I already see some signs of ...holding on to clothes, toys, things the kids of the great depression did with boards and sticks and very careful to
      not waste.   I am grateful that she is appreciative and conservative in her not wanting much.  I like the way she give to others but can see it pains her some to depart with some items.  I worry on this aspect as I never remember at that age hanging on to much .  Mama and Daddy were middle class.    We never heard much about money when I was a kid and a child today cannot escape it.   Back in the depression days, people were oppressed but the poor like them shared. ( Stone Soup Story).  Doctors would help you out.  Today greed is so evident everywhere and the kids pick up on it from school, and most everywhere.  Phone rings, teachers sending notes to help, and so much coming over the airwaves, a child would have to live in a bubble to not know times are bad.
      She comes home and tells me about Susie ( made up name) not having shoes.  She sees Homeless signs almost everywhere on the main highways.   I don't recall this and I am scared for her as she grows and we pass on.   I always wanted to make their lives secure and even with can't be found.

      We the People have to make a difference and the Change.....Just do it ! Be part of helping us build a veteran community online. United Veterans of America

      by Vetwife on Sun Apr 07, 2013 at 10:05:04 PM PDT

      [ Parent ]

  •  Congrats on the rec list (1+ / 0-)
    Recommended by:

    ...... Social Security blogathon March 25th thru March 29th. #HandsOffmySS FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

    by Roger Fox on Sun Apr 07, 2013 at 10:02:23 PM PDT

  •  A good read (0+ / 0-)

    and also true. We are looking at a much harder time in retirement than our parents did. In my case I could even help my parents out if they need it so far my own kids can't find good jobs .  It seem good jobs are almost impossible to fine today in America. So if I need help I am SOL.  Welcome to the new America and it sure leaves a lot to be desired unless of course you happen to be rich!  

  •  generations (3+ / 0-)
    Recommended by:
    Diana in NoVa, unfangus, nchristine

      What I remember from my parents (besides hoarding) is that if one works hard one is rewarded appropriately. I learned many things besides this but that point is germane to this discussion. Growing up in the 60's there was a feeling that anything was possible with one's own life and if you could "do a half-assed job of anything, you're a one-eyed man in a kingdom of the blind." In the 70's it felt like everything had been done or was about to be undone and poorly decorated to boot.
       Now I am a 50-year old unemployed white man getting a prolonged taste of what so many before me have faced - total disillusionment and lack of hope. I have not had a regular job in four years and cling ever tighter to the idea that one day I will get a call, a call to come back to the world of plasma TV's, a new Ford and some form of security. The real world. It's the real world, right?
       I no longer believe Obama but do believe in a handful of senators and congressmen. I really believe that politicians are allowed to get to a certain point and then told, "whoa, fella." It doesn't matter to me if Clinton runs and wins in 2016. I've had my fill of hope, and these whipped up morons without memory can have her.
       If this reads like a pity-party it's not, really. I will keep fighting for survival until someone pushes down my eyelids.

    I want to stay as close to the edge as I can without going over. Out on the edge you see all kinds of things you can't see from the center. Kurt Vonnegut

    by klimtone on Mon Apr 08, 2013 at 06:57:22 AM PDT

    •  Sorry you're going through that, klimtone (2+ / 0-)
      Recommended by:
      klimtone, nchristine

      Hope things will improve for you. You are going through some bitter times.

      My parents were Depression-era children.  They grew up not always having enough to eat. They greatly distrusted the stock market and saved very little--they spent what they earned.

      I think my late mother, having experienced such hardship in the Depression, rationing during WWII, and then enduring years of marriage to my misanthrope of a father, just broke out after she divorced him. She spent hugely on anything she wanted--travel, clothes, entertaining.  Luckily for her, by that time she had quite a good income.

      After she died five years ago one of her friends said to me bluntly, "I'm amazed she left anything at all for you kids, she spent so much money."

      A rather rude remark, to be sure, but I'm glad Mother had a great time while she lived!  She was an atheist so she considered this would be the only life she'd ever have, and she made the most of it.  :)

      "Religion is what keeps the poor from murdering the rich."--Napoleon

      by Diana in NoVa on Mon Apr 08, 2013 at 07:20:29 AM PDT

      [ Parent ]

      •  generations (0+ / 0-)

        My father invested in insurance because he was so skeptical and wound up reaping a reward untroubled by any crashes. I like your story and your quote. Thanks.

        I want to stay as close to the edge as I can without going over. Out on the edge you see all kinds of things you can't see from the center. Kurt Vonnegut

        by klimtone on Mon Apr 08, 2013 at 07:33:21 AM PDT

        [ Parent ]

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