“The Fraying of Oregon’s Middle Class”

The Oregon Center for Public Policy, along with Demos, has issued a report “The Fraying of Oregon’s Middle Class.” It is a good summary of our current dilemma, with lots of useful charts, and  begins (here):

The American Dream used to mean that if you put in a hard day’s work, you could expect good wages, benefits, and a better life for your kids. Today, the kinds of jobs that can provide a solid middle-class life in return for hard work are in short supply – unemployment is high, earnings are flat, and hard-won benefits are being lost. The future of Oregon’s middle class, the backbone of the state’s economy for more than half a century, is at risk.

Oregon’s strong and vibrant middle class didn’t just happen. It was built brick by brick in the decades after World War II by hard work and workers’ strength in numbers that came from the unions that represented them. Unions made sure that the state’s prosperity was widely shared. As Oregon’s wealth and productivity grew, so too did the income and benefits of the people who worked hard to create that wealth – wages increased and more employers provided their workers with health insurance, pensions, and paid time off. The middle class was also built by policies that invested in public infrastructure (from schools and public universities to highways), supported homeownership and made a college education accessible to a new generation. Parents without higher education themselves were able to send their kids to college with the help of affordable tuition at state universities and financial aid.

But Oregon’s middle class is now threatened. Median income for Oregon workers is the same as it was a decade ago and only workers with a post-secondary degree earn more than their counterparts a generation ago. There’s also been a dramatic shift in costs for health coverage from employers to employees as well as a rapid decline in the number of employers who even offer health insurance. Rising out-of-pocket costs mean that a family illness can lead to substantial expenses and medical debt. And as employers replace traditional pensions with 401(k)-type plans – again shifting costs and risks to employees – middle-class workers can no longer count on a secure retirement. 

The report does not make even general recommendations about what to do. It states at the end:

Workers are going to have to fight to get their fair share. Just as the post-war middle class was built, it is possible to rebuild it and strengthen it for the next generation. That will require the strength of workers coming together to reclaim the American Dream and demanding that our elected officials work for workers.

Now I share a concern for all the statistics shown on the declining status of the middle class. It’s bad. But, unlike the report, I do not think nostalgia for the past, plus a feisty attitude by “workers”, is a good substitute for clear thinking about our economic problems and how to get out of them. The past, especially the old economy, is not coming back. Technologies have changed. The economy has become much more international. Changes are required.

Comments

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