Tuesday, November 18, 2008

The Former Suffering Middle Class

NYT's David Brooks takes a look at what the recession might bring and the "suffering" of the "formerly middle class." I say welcome to my world. Actually, I see a silver lining in the recession. It seems more people are thinking about their purchases, wasting less and saving more.
What's wrong with that? Hopefully, it will be a trend.
I guess the downside is the people who are already poor, those who didn't buy a house they couldn't afford because they couldn't afford one, they are the ones who are actually suffering. Suffering is a relative term.
NYT: Recessions breed pessimism. That’s why birthrates tend to drop and suicide rates tend to rise. That’s why hemlines go down. Tamar Lewin of The New York Times reported on studies that show that the women selected to be Playboy Playmates of the Year tend to look more mature during recessions — older, heavier, more reassuring — though I have not verified this personally.

This recession will probably have its own social profile. In particular, it’s likely to produce a new social group: the formerly middle class. These are people who achieved middle-class status at the tail end of the long boom, and then lost it. To them, the gap between where they are and where they used to be will seem wide and daunting.

The phenomenon is noticeable in developing nations. Over the past decade, millions of people in these societies have climbed out of poverty. But the global recession is pushing them back down. Many seem furious with democracy and capitalism, which they believe led to their shattered dreams. It’s possible that the downturn will produce a profusion of Hugo Ch├ívezes. It’s possible that the Obama administration will spend much of its time battling a global protest movement that doesn’t even exist yet.

In this country, there are also millions of people facing the psychological and social pressures of downward mobility.
...
In the months ahead, the members of the formerly middle class will suffer career reversals. Paco Underhill, the retailing expert, tells me that 20 percent of the mall storefronts could soon be empty. That fact alone means that thousands of service-economy workers will experience the self-doubt that goes with unemployment.

They will suffer lifestyle reversals. Over the past decade, millions of Americans have had unprecedented access to affordable luxuries, thanks to brands like Coach, Whole Foods, Tiffany and Starbucks. These indulgences were signs of upward mobility. But these affordable luxuries will no longer be so affordable. Suddenly, the door to the land of the upscale will slam shut for millions of Americans.

The members of the formerly middle class will suffer housing reversals.