Source: Christian Weller, Challenge, Vol. 51 no. 1, January-February, 2008
This economist presents a variety of ways of measuring how security has been reduced in the 2000s. How well can middle-class Americans withstand financial emergencies–a bout of unemployment, for example, or a medical emergency? He finds that the gains in security of the late 1990s were eroded entirely in the 2000s.
Source: David Howell and Mamadou Diallo, Challenge, Vol. 51 no. 1, January-February, 2008
These authors argue that traditional measures of employment and unemployment are not adequate. In the traditional data, a low-paying job counts as much as a high-paying one. The authors create new indicators to determine how well Americans are doing. They show that a strikingly low percentage of American workers have what the authors define as adequate jobs, although the rate has improved since 1979. Serious job-quality deterioration has occurred, however, for those, especially men, who have at least a high school diploma but no more than two years of college.
Source: John Schmitt, Challenge, Vol. 51 no. 1, January-February, 2008
This economist defines good jobs as those that pay a reasonable minimum and also include health care and pension benefits. The share of such jobs in the economy has declined since 1979. For men, the decline is especially sharp. Given that the workforce is better educated and more experienced, a decline is all the more an indication that the labor market is failing the American worker.
Source: Julia Isaacs, Economic Mobility Project, Pew Charitable Trusts, 11/13/2007
“Doing better” than one’s parents has long been a key element of the American Dream. The story embedded in our history suggests any person can start from humble beginnings and achieve great wealth, or at least reach the middle class. But are Americans today better off than their own parents were? How much does their eventual success depend on their family background?
Source: Corporation for Enterprise Development, 2007
From the summary:
The 2007-2008 Assets and Opportunity Scorecard contains evidence that even profound and enduring ownership patterns can change and change fast. In the two years since the release of the 2005 Scorecard, median net worth jumped 20% nationwide, while it jumped 68% for women and more than doubled for minorities. Most of these gains have come as a result of increasing homeownership and home values, and are therefore at risk that as interest rates rise and grace periods end, foreclosure rates will also rise. The results underscore the efficacy of housing finance and credit innovation and the need for policing and reigning-in predatory lending.
Yet, the most important message of the 2007-2008 Scorecard, like its two predecessors, is the disparity in asset ownership – and, consequently, economic opportunity–among states, and by race, gender and income.
• Guide to the Scorecard
Source: Leonard E. Burman, Urban Institute, October 29, 2007
From the abstract:
In a tax code with no shortage of ironies, the alternative minimum tax (AMT) stands out. Created by Congress in 1969, it was aimed at millionaires, but relatively few millionaires pay it. It is billed as a low-rate levy, but most of its victims face higher taxes because of it. It undermines two widely lauded reforms of the income tax–restoring both bracket creep and the marriage penalty. And though nobody favors keeping this Frankenstein alive, it will be very difficult to kill. Welcome to the tax policy twilight zone.
Source: Brookings Institution, Hamilton Project Roundtable, September 26, 2007
In recent months, problems with subprime mortgages have spilled over to the housing sector and financial markets more generally. These events have created widespread concerns about the hardships facing homeowners and potential risks to the overall economy. They have also raised near-term questions about how to best address economic risk, and provoked longer-term questions about the adequacy of current regulations and consumer protections.
On September 26th, The Hamilton Project at The Brookings Institution will convene a roundtable discussion with experts to help frame the challenges currently facing housing and the financial markets- where we are, what it means for the U.S. economy, possible next steps for recovery, and ways to minimize future problems.
Source: NPR Morning Edition, September 7, 2007
New research on the middle class shows economic anxiety is rising. The economy as a whole may be doing well but personal finances are suffering. Seven out of 10 Americans report living paycheck to paycheck, meaning there never seems to be enough left over for savings. Shira Boss, author of Green With Envy: A Whole New Way to Look at Financial (Un)Happiness, speaks with Renee Montagne.
Source: Hugh Price, Amy Liu, Rebecca Sohmer, Brookings Institution, Opportunity 08, August 2007
Middle-class prosperity is the cornerstone of the American Dream. Americans believe that through hard work and education families can enter the middle class and keep on climbing. However, recent evidence shows that, even with a rebounding U.S. economy, working and middle-class families are struggling more than in decades past, and upward economic mobility may not be continuing, even for those who work hard and play by society’s rules. Moreover, the road to middle-class prosperity is even rockier for minorities. Several time-honored pathways that lead to the middle class are postsecondary education, good jobs, living in viable neighborhoods, personal financial prudence, and entrepreneurship. This paper focuses on all but the last of these pathways of opportunity.