How is the economy treating you?

I hope that I will be able to enjoy the standard of living my parents do, or at the very least be able to give to my children what my parents have provided me...and if I don't, that will be my fault, not the governments. As for a shift in the American middle class, who knows?... perhaps there is more of a shift in the upper class. Before they were only buying 15 million dollar homes, now they can afford 50 million dollar homes, before they were flying first class, now they own their own planes.. So now back to the middle and the lower classes the difference is that before we earned our paycheck and then spent it, now we spend before we earn, and we just end up owing more and more money. As far as what we could afford..well I guess it depends on your credit.....

For most of the 20th Century, when the US emerged as the world's greatest economic power--and therefore its greatest power--manufacturing was the engine of prosperity, and, although most of America was not educated beyond high school, most Americans were in the middle class. A quarter century ago, as US manufacturing began to be sent overseas to rising powers, such a China, we were informed that we were getting, in exchange, a mature, post-industrial economy, based on service industries. But in recent years, as we began to have what former White House counselor Dan Bartlett described as a "dynamic" economy, where "jobs are created and destroyed," we were advised by our President that education is the key to staying in the middle class and not having a service job along the lines of working in a fast food restaurant. Many experts joined in, almost blaming younger Americans for "losing our edge," in innovation by not getting as many technical and scientific degrees as young people in China and India get. But what happens when, as Tracey Chang showed you in The Next Giant? an Indian company paying its engineers $10,000 a year figures out how they can do the jobs of skilled Americans, many of whom carry tens of thousands of dollars in student loan debt for their technical/scientific degrees? If we are losing our edge is it because you in the younger generation shirk science or because in our present economic system it might be making less sense to go in debt to learn scientific skills that might get outsourced?

I don't think we should be too worried. When my parents were in their twenties, they were in pretty much the same boat I am in now - owing student
loans, trying to get a mortgage, and worrying about how to pay the bills. As they got older and moved on with their professional lives, their financial
situation improved - I expect that the same thing will probably happen for me.

Also, I'm not sure that people's standard of living has changed as much as their expectations have changed - people want what they want when they want
it. A lot of young people are trying to live beyond their means, and with the advent of credit, they can appear to be better off than they are. Previous generations were not afforded that 'privilege' - they had to save
for things they wanted, and therefore weren't in debt to the same degree a lot of people are now.

I think if our generation works as hard as our parents did (and I know mine worked pretty hard) then we'll be just fine!

Robert Shiller, a Yale economist who wrote Irrational Exuberance, about the stock market of 2000 also wrote about the recent housing boom. One interesting point he made was that from 1890 to 1990 the overall housing market, not factoring in yearly inflation, was basically flat.
The housing market took off after 1990 (not necessarily everywhere across America) and we got this bubble that had to eventually burst and probably for the better as the year over year growth in house prices was not sustainable as salaries have not grown at the same pace. I often joke with friends of mine that we were born a few years too late.
I am definitely entrenched in the middle class...I have a great career, I save my money, and I try to invest wisely. However with the price of housing, I live in the bay area, the way it was and even still is for $500000 with a 20% down payment, the most I can afford is a condo. My parents, who were not as well off at the same point in their lives were still able to buy a house in San Francisco. Not all markets are the same though. If I were to move to Texas or elsewhere in the midwest where prices increased modestly or stayed flat I'd be able to buy a nice big house too. So really the economy depends on where and how you live.
I try to live within my means and not run up any debt.
My parents taught me well and they did live through some tumultuous times from the stagflation in the 70's through at least 2 recessions in the 80's and earlier this century.
The cost of living may be high in the bay area, but I choose to live here for reasons that go beyond how well the economy treats me.
Now when I get married and the kids start coming, well then I'll have to reevaluate how the economy treats me. I've heard Montana is incredibly beautiful.

PODS IN PRODUCTION:

Sam in Chicago---I actually know KAY-ro a bit—isnt that how its pronounced? I went to school in St. Louis and I absolutely LOVE Abandoned midwestern towns with trees growing in the middle of the streets.

In St. Louis, as a matter of fact, over the last 10 years, they’ve lost the HQs of nearly a dozen fortune 500 companies and our producer Jen Rich is trying to document how the best of the best of the present graduating class needs to leave a city they know and love.

In Pittsburgh Ben is documenting a trend where some people are actually moving back into the downtown area—a kind of rebirth that isnt without its PITfals, but it could be the idea that these barren towns may once have opportunity again in their emptiness.

Then in Indianapolis, Neal Taflinger is looking into the people the stay behind there, attempting to plug something called the brain drain.

Michael Wickham in Albany is doing the story of the small GE Plant town that is dealing with a dying plant—he’s making it into an election piece tying it to the issue of unemployed industrial folks that arent getting the attention they’d like in this election.

CRITICAL MASS JOURNALISM TIMELINE--a present tense story line reflecting the full magnitude of this problem:

Indianaoplis—trying to stop a leak
St. Louis—starting to crumble from the top
[SPACE RESERVED FOR TOLEDO my hometown where its hard for a 20 something to get a date because the economy is so bad, this story has been assigned, but needs a new producer]
Albany—serious cracks, the end is near
Cairo—over and done with
Portland & Eureka--Where people are fleeing to
Pittsburgh--rebirth of a economy

I STRONGLY encourage anyone interested in this to read Lou Dobbs' "War On The Middle Class". I am about halfway through it and I am sobered and inspired all at the same time. He basically outlines how the middle class in this country is being consumed from both sides; from the top by billionaire business leaders and executives, and from the bottom from the "peasant" class (that according to him, also includes ILLEGALS). He outlines how the so-called "strengthening" of American businesses through tax cuts and such have left many, once prosperous individuals, in the dust and trying to rebuild their lives at age 40 and 50. He is also very wary of the growing dependence on China and points to how even some of the animating you see in the movies is outsourced to Asian companies. And speaking of the media, he blasted the big three and how their brand of network news is in reality "The New York, Washington, and LA report". I did like his solution though, one that has crossed my mind a number of times and that is a national network based in our nation's geographical and cultural heartland, Omaha, NE (you listening Mr. Buffett?) And to the issue of immigration, he points to a California program that gives college tuition breaks to illegals while those out of state are having to pay 175% of in state tuition.
****MY EDITORIAL*****
Case in point; while many Americans are doing VERY well right now, many are indeed being left in the dust. I recall a news story a while back about many retired seniors who had to take up another job just to keep pace with the rising cost of, well, everything. While I was in college, tuition increased almost 30% from when I entered. At that rate, tuition alone will be $100,000 by 2015, and don't even get me started on housing. My mother has constantly been pushing me to get my MBA b/c it will be an absolute necessity in the future workplace. Well, I say yes and no. While I am a strong advocate of leadership education and advanced learning, I do not feel we need to become the "home office of the world" i.e., a nation of businesspeople that simply outsource and mechanize the rest of the world's labor force. One of the great promises of America is (or was anyway) that hard work and a little bit of can do attitude will take you far. It seems that American companies have taken the idea of "the bottom line" to the extreme. Taking yet another quote from Lou Dobbs book, he says that competitiveness in the American job market is now defined as "being able to do something that a machine or foreign worker can't do better & cheaper" So you're new competition is no longer the person in the next cubicle but the pages of C++ code hes running or the automator next door. While it is the responsibility of a company to grow its bottom line, they also have a responsibility to the very economy that they depend on. While replacing a factory worker's job at a toy factory with that fancy robot may indeed save money, that is now one less father who's making enough money to buy his kid the very toy you laid him off of producing. And just try selling that toy to a mechanical arm. Point is, companies have a responsibility to serve as sources of income for the American people so they may spend their money buying the things that businesses put out. Make sense? So anyway, theres my two cents

I'm a well-educated, law-abiding citizen. I've always followed the rules, paid my taxes and given an honest day's labor for my pay. While I've worked nearly every day since I was 15 and have always done the right thing and what I considered to be in the best interest of my neighbors and in line with my own ethics, I feel like I have been abandoned by my country and the economy because I choose not to rabidly pursue the almighty dollar as the ultimate goal like many of my peers. I chose to take pride in my work and pursue good friends and family, and I'm paying the price for it now.

I have watched many people I know do whatever they had to, ethical or not, to "get ahead." They focus solely on the amount of money they can make regardless of the effects on others or what they had to do to climb the ladder into the next economic strata -- the "Investor class."

The "investor class" seems to get all the rewards from the prosperity we've seen in this economy while those whose work is what built that prosperity and that the Investors are profiting from, don't get to share in the prosperity -- they get the shaft.

The Investor Class is celebrated as "savvy businessmen" for abhorrent behaviors like cutting costs by ignoring environmental regulations or outsourcing jobs in order to bust unions and worst yet, cutting jobs simply to increase profits that are already ridiculously bloated.

This country allows its corrupt politicians to use their power and the laws to widen the gap between rich and poor in order to further reward the investors and the super wealthy at the expense of everyone else.

So how do I get rewarded for my years of hard work and doing the right thing? Let's see....

I can't afford to buy a house. I have little or no retirement benefits waiting for me, and since I just got laid off from my job as a "cost-cutting measure" so the company I worked for could post record profits for the 10th straight quarter, I'm also about to lose my health care coverage. (Seems no private provider will insure me as an individual because of my physical disability is considered a "pre-existing condition" that excludes me from coverage.)

So you ask how is the economy treating me?

I feel like cannon fodder, I'd say.

The current economic situation is interesting because it doesn't look so good for most people in the United States, and beyond. I think the housing and credit burst will have much greater impact than the dot com burst did.

My personal situation just got a little better. But, because I've had years when I was disabled and living cheap, my credit isn't so good. And, I currently live in an incredibly expensive location. Of course, I wouldn't be here if it weren't for the economic opportunity swinging my way.

I think others will fare worse than myself, and that will make it harder for all of us. We are all connected, when one house sells for less and the former owner has to give up the location, they'll go elsewhere... that ought to help along the brain and talent drain. I imagine that Georgia, with its cheap living, will fare well in the IQ sector of their social web. Once I've put in my four to five years in my new job, I'm out of here. I'll be moving to cheaper digs, too.

It is incredibly insulting to see hundreds of billions of dollars be sent to an unjust war in Iraq and Afghanistan when so many people at home are suffering. Will this insanity ever stop? Sometimes I think the President Bush must be getting blackmailed, or held hostage in some way. Why else would anyone willingly choose to ruin America's economy?

When I see someone comment that we will do as well as our parents did, since nothing is different between now and when they were just starting out, I feel like that person is out of touch with history and today's reality. There is no comparison. When my folks were just starting out, the government was not sending hundreds of millions of dollars overseas to instantly become unaccountable. Government today has lost all ethical and moral standards. There is no way my parents generation would have sat by and said, "don't worry, everything will work itself out." In fact, they aren't saying that right now! America's economy is suffering and so are the people of America. It will be along time before we come out from under this mess. If we do.

Come to Michigan!! You can buy bargain basement houses as we have the highest rate of foreclosures in the country. Oh, that includes the highest rate of unemployment too. Did I also mention that the State of Michigan is on the verge of having a state shutdown? I.E., no more state services. But wait, the governor voted to raise taxes to balance the budget. So, thankfully, the state welfare office will be open to help those people forced on welfare get the help they need as more and more jobs are being outsourced.
Come to Michigan and see it's booming economy, not!

I watched your mini-pod on this topic this morning and wanted to immediately say something!! Being a teacher in NYC is extremely rewarding and I work at the most amazing school (which should have its own pod if anyone is interested in making one!). But to get to this point I have put myself into a life of DEBT. I try to get myself to think that this is just "imaginary" money that I owe- but of course the numbers are very real. Ironically, I am doing one of the most important jobs in our society and I am paid at a very low level (for NY). And to make it worse, if I were in another state, I would be paid less....since supposively cost of living would be less.

All I want to do is live the life my parents lived for me- but I realized as an adult, that this was done with my father's extroardinary talents in balancing 10 or more lines of credit! We seemed to have that fantastic family life, with vacations, activities and cars, etc. My parents worked thier asses off to be high-end middle class and I feel like at this point in our economy, I will never even get close to their level.

My boyfriend and I moved to NY from San Francisco to discover new things and learn more about each other and life- but in the process we are feeling stuck here. How the heck are we ever going to buy a house anywhere????? Our block just had 3 different brownstones sell for like 1.5 million - who the hell bought them???? It really boggles my mind...sometimes I feel we will only be able to live in a house in another country....most likely in a 3rd world country...Are we going to be pushed out one day???

ps. i love this channel, this website and all the people on it....support or REVOLUTIONIZE our education system!!

Martine Kelsch
Brookyn, NY

Great Pod.

I am part of a Typical blended and a little screwed up family now a days. I'm the 3rd wife to my husband who has 4 kids. 3 live with us, and we have a newborn.

In the last 5 years, the economy has gone so far downhill, what we thought we gained, we lost. My industry went from paying $70k to paying $32k. I have been laid off 4 times in 6 years. Everyone is going overseas. My husband went from $120k to $60k because of an enforceable Non Compete agreement that is enforceable even if an employee gets fired. He quit to spend more time at home, and they sued us.

The IRS has some to us and said that I owe an extra $8k in back taxes from 2003 because they say I did not HAVE to work at home. I was Outside Sales. It means OUTSIDE. They want about $40k from my husband because he received $20k in moving expenses from a company and forgot about it. IRS told us a year or so ago and after fees and all it is $40k.

I could work a good job about 40 miles and an hour and a half away, but it would cost me about $12k a year to get there.

Our house is on an adjustable. it's gone from $875 to $1500 in 2 years. Yeah, we were stupid for doing it in the first place, but our credit sucks because we have the IRS BS.

Tell me how were doing? Pretty s*&%%$. It's one thing after another. We are killing ourselves paying for thnings that are killing us. Great.

I'm 28 years old and live in small town Ohio. I feel like saying things could be worse, but I don't feel so good about where we are. either. A combination of Walmart and the economy from outsourcing has caused there to be no jobs anywhere nearby. All the houses are for sale. If you don't work for Walmart, you have to work at a check cashing place or fast food. My fiancee and I are trying to start a life. I can't get a job with my BA degree, and he is stuck in his. We are too afraid to even think of having kids. I have begun my MA degree but the idea of the debt is overwhelming because we are having trouble with what we already have. My fiancee has to drive an hour and a half for his job. It is at least three hours a day of driving with the current gas prices. Most other people who commuted have left. Many young people have left to find jobs. The rest are in very low paying, service type jobs.

I am extremely grateful for what we do have. I count my blessing daily. I see a lot worse situations all around me. Still, we aren't doing near as well as someone with our education and skills did not so many years ago. And the future is scary to think about.

We have fell and continue to fall, this country has been in debut for years now, and the people have been picking up the tab,only thing the tab grows every minute of everyday. The biggest tab todate is the war and the only reason we are at war is for oil, everyone should know this by now and the truth about 9-11, but thats a (diffrent topic). This country has a large American Exspress bill and we pay at the pump and pay for luxuries that we are told we need, but don't need, but we have to have it so we go and get it using our cedit card that was issue by them and they charge us a high rate, but again we have to have it which puts you in debut. The media is told to make this itemor items hot and plant it in the peoples head that this is whtas happening, this is the hot item go get it or go watch it or drive it wear it what ever. America is in bebut, so to pay for Americas bebut they being the ones in charge of this gr8t nation have to rely on the people. To break it down the economy is falling ,have been falling ,and will continue to fall until we control one thing the oil....