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October 28 2016

4 Reasons Middle-Class Americans Need Solutions — Not Sympathy

The Hill
featuring Carrie L. Lukas

In the campaign’s final days, both Hillary Clinton and Donald Trump are making the case that they have the right skills and policies to bolster America’s shrinking middle class. 

It’s a tall order for any politician, with manufacturing jobs disappearing and wages stagnating, members of the middle class are in a precarious position. 

A generation ago, being in the middle class meant stability. But now it means being constantly on the edge of economic crisis, Carrie Lukas, managing director of the conservative Independent Women’s Forum (IWF) said at a panel about the future of middle class sponsored by the group in Washington, D.C., Thursday night.

The panelists highlighted the challenges facing middle class workers now and in the coming years:

1. Is it the Economy or Culture? Yes. 

What ails the middle class? Unfortunately, the problem is almost as hard to define as it is to solve. 

Today, one in four children under the age of 18 in the United States are raised without a father. About 40% of children are born to single women. This is a dramatic change from a generation ago, when two parent families were the norm.

This shift in culture and the make-up and expectations of the family is causing an economic strain as single parents (usually mothers) struggle to do the work of two people. But at the same time, the economic shift away from manufacturing jobs is causing a strain on cultural norms too. 

Lisa Schiffren, a senior fellow at IWF, said defining the problems the middle class faces is tricky because they are so interconnected. 

“Is it culture? Is it economics? The answer is yes. These things are both true,” Lisa Schiffren, a fellow at IWF said, “When you have less good, well paying work, families become more fragile.”

2. Artificial Intelligence Becomes More Intelligent 

For years, experts watching the technology sector have lauded the rise of robotics and intelligent machines and how this may create for us a “world without work.” But increasingly it seems that, instead of freeing Americans up to have more leisure time, these developments will just leave Americans unemployed.

There are nearly 4 million professional truck drivers in the United States, for instance, who will lose their jobs when self-driving trucks get on the road. Truck drivers are some of the few Americans still able earn a solid middle-class income of about $40,000 a year without an advanced degree.

Those sorts of jobs will disappear in the coming years as artificial intelligence advances, according to AEI scholar Charles Murray, author of "Coming Apart: The State of White America." 

 

“We’re facing an unprecedented job situation in the coming years,” he said at Thursday’s panel, “AI has been overhyped for 30 years. It is now catching up with the hype.” 

Murray argued the shift in the economy would benefit those already in the top income brackets, who are less likely to be replaced with machines. 

“The nature of today’s economy will provide the biggest rewards to the people at the top,” he said.

Job loss isn’t the only economic effect on individuals and their families. As young people with means and opportunity flee to metropolitan areas, the population of low-skilled, rural America is declining. A smaller population means a smaller tax base, leaving rural areas to raise taxes on land and agriculture, an already strained industry.

But, like nearly everything human, this is more than just about economics; the shift to AI has large cultural ramifications as communities fade away and shared culture is forgotten. 

3. Hugging the Middle Class to Death

Government policies meant to help the middle class actually hold them back, Lukas of IWF argued, pointing to growing student loan subsidies — which come from the federal government — and regulations increasing mortgage access as things driving up the cost of college tuition and home prices.

For instance, a 2015 analysis from the Federal Reserve Bank of New York and Brigham Young University found colleges increased tuition 55 cents for every $1 increase in Pell grants and by 60 to 70 cents for each extra dollar of subsidized student loans. 

These well-intended policies make it far harder for people to achieve historical middle class aspirations — college education and home ownership — as a hug from policy makers quickly becomes suffocating.

4. A Sense of Loss

There’s a real, tangible sense of loss over missed opportunities and fading communities in the middle class, Lukas said.

There’s no longer a sense of optimism or a feeling that anything is possible with hard work and determination. Communities, once held together buy a common employer like a factory or mine, have lost their connections as local economies have faltered.

Instead of working to move into the upper-middle class, middle class Americans are fighting just not to slip further down the ladder.

“Prosperity isn’t defined by money,” she said. Instead, it’s defined by possibilities, the chance of upward mobility and economic stability. And, sadly, for the middle class those things have all but vanished.

These four challenges — and countless others — facing the middle class help to explain the rise of Donald Trump and the popularity of populist figure Bernie Sanders in the Democratic primary.

Middle class voters, watching their communities collapse and seeing a bleak future with limited opportunities, are turning to candidates promising a dramatic overhaul of the status quo.

But with such challenges not only to the middle class’s economic security, but also to their social and cultural security, the only question left to ask is — can we stomach an overhaul dramatic enough?

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Independent Women’s Forum’s mission is to improve the lives of Americans by increasing the number of women who value free markets and personal liberty. Sister organization of Independent Women’s Voice.
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