If you didn’t catch wind of the Federal Reserve’s triennial Survey of Consumer Finances, issued late Monday night, then … top of the morning to you!
It’s bad, bad, bad.
In short, the Great Recession has acted like the planet-devouring Marvel character Galactus when it comes to wealth.
The New York Times: “The recent economic crisis left the median American family in 2010 with no more wealth than in the early 1990s, erasing almost two decades of accumulated prosperity, the Federal Reserve said Monday.”
Reuters: “The housing market’s collapse was at the core of the recession, during which the economy contracted nearly 5.1 percent between the third quarter of 2007 and the second quarter of 2009, with the unemployment rate rising 4.5 percentage points to 9.5 percent.”
And the Washington Post: “Over a span of three years, Americans watched progress that took almost a generation to accumulate evaporate. The promise of retirement built on the inevitable rise of the stock market proved illusory for most. Homeownership, once heralded as a pathway to wealth, became an albatross.”
Once you absorb shock of a 40-percent decline in median net-worth, a harsh reality comes into relief. And it is this: The promise of “Ownership Society” capitalism in the age of globalization — essentially, that advanced nations could safely deindustrialize and deregulate, raising the living standards of even the noneducated and unskilled by means of cheap housing and plentiful consumer goods — is over. It’s a right-progressive god that failed.
President Obama was quite right to call the Greenspan-Clinton-Bush economy a fragile “house of cards.” His solution, though, is to try to recreate the consensus of 1949 — pour money into infrastructure, R&D, and green energy and hope to God something sticks. His feckless opponent’s solution, meanwhile, is to try to recapture the magic of 1979 and sprinkle some Reaganomical fairy dust, just one more time.
No major candidate has yet materialized to inform Americans that they might simply have to get used to modest growth, and modulate their consumption patterns so that they’re more in line with what they’re producing.