On the positive front, America is really good at dropping bombs on foreigners.
The American dream — the idea that anyone can own their own home and do better than the previous generation with the right amount of hard work — has been fading for years, with rising house prices and stagnant wages. Now, people who want to achieve it may be better off seeking it in Canada, the U.K. or Denmark according to a new study published by the Federal Reserve Bank of St. Louis.
At least the Fed is admitting its total failure.
The study, authored by Raj Chetty, professor of economics at Stanford University, defined the concept as the ability for children born in the bottom fifth of income distribution to reach the top fifth. In the U.S. the likelihood of that is 7.5%, whereas in Canada children born in that group are twice as likely to rise to the top — at 13.5%. In the U.K. the likelihood of achieving that move from the bottom fifth to the top fifth is 9% and in Denmark it is 11.7%.
Indeed, the rich do appear to be leaving the middle class behind. Most U.S. middle-income households (81%) had flat or falling income between 2004 and 2014, according to a U.S. Congressional Budget Office data analyzed by the McKinsey Global Institute, a global management company.
“Most people growing up in advanced economies since World War II have been able to assume they will be better off than their parents,” the report said. “Yet this overwhelmingly positive income trend has ended.”
This is primarily a function of our economy being dominated by rent-seeking parasites, who add no value to society but still somehow earn the most money. Until we shift to an economy that rewards creativity, production and innovation, the U.S. will never truly recover. Unfortunately, the Trump administration is not headed in that direction, as I outlined in my post earlier today: Donald Trump Works For Wall Street, Not Russia.
Meanwhile, Bloomberg News just published an article celebrating the reduced standards of living many Americans are facing as a result of decades of flat-to-declining wages, combined with soaring home prices in a piece titled, Now You Can Live in a Remodeled Shipping Container:
Startup Boxouse sells “portable, affordable, beautiful smart homes” made from shipping containers (the “deluxe” edition costs $49,000 and includes shipping). Chief Executive Officer Luke Iseman, a Wharton graduate who previously ran Y Combinator’s hardware program, concedes that “container houses aren’t perfect” but says they can help ease housing shortages. He shares one with co-founder Heather Stewart that’s set up in an Oakland warehouse. They’re partly financing the business by renting out two others on Airbnb.
Thanks for playin’ America.