Tag Archives: mobility

A Few Facts and Figures

Tips When Borrowing Money From Not-So-Great Sources Of Credit

    1. The U.S. borrows $2.1 billion everyday to pay its debt, and the average American household is carrying more than 9,000 in credit card debt. Today’s so-called middle-class families, with two-working spouses are in worse shape financially—they save less and owe more— than a single-income and middle-class family of 30 years ago (pg 30).
    1. Real income for the bottom 50 percent of the U.S. populace over the last 25 years has remained relatively flat and the bottom 20 percent has experienced a slight decline. The top one percent experienced a sevenfold increase of income during the same period (pg 31).
    1. As many as 69 percent of American (92 million people) earned less than $50,000 in 2003. The average adjusted income, after expenses and line-item deductions, for this group was $19,512— not very much money left to pay for food, transportation, and clothing (pg 78).

      savings and budget

    1. Tuition at community colleges averaged $2,191 in 2005-06, and they enrolled 46 percent of all undergraduate students attending college. Tuition at private colleges, including room and board, averaged more than 31,000. The community college is becoming the forced-choice among students of moderate-income; nonetheless, their fundraising ability accounts for less than one half of one percent of all private funds donated to colleges. One likely reason is that a class bias exists in the business and philanthropic community helping to perpetuate a two-tier system of higher education (pg 81-82).
    1. U.S. production is peaking. China and India each graduate four to one more scientists and engineers than the United States, indicating where tomorrow’s innovation, and inventions will come from: Even worse, there is now reverse “brain drain” from the West to the East, as foreign science/math students graduate from college and leave the U.S. and follow the lure of economic opportunity back to the East (pg 95-96).
    1. In 1980, the top one percent in the U.S. owned 21 percent of the nation’s wealth. By 2005, they owned 35 percent, equivalent to what the bottom 95 percent owned. In 1980, the same top one percent earned 8.2 percent of the U.S. income; in 2005, they earned 22 percent, equivalent to what the bottom 50 percent (150 million Americans) earned (pg 140).

These facts came from my book Class Counts which you can find here: http://www.allanornsteinbooks.com

Like and comment what you think which is the most interesting (or eye-opening) figure.

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When the American Dream is just a Dream

Unemployment Report

A recent article focusing on the odds of employment after graduating in Nevada put a close-up perspective on a nationwide issue. There’s a growing number of graduating students, and all are hoping to achieve some sort of well-paying job that correlates to their major. But what jobs await them? The answer is startlingly bleak.

Underemployment is nothing new in the last couple years. Its something America’s been struggling with since the recession and collapsing of industries (like the housing market). But now, during what can be considered the ‘reconstruction’, there’s a high number of unemployed workers (with education) that either lack experience to get the job they want or are overqualified for entry-level positions elsewhere.

Over the past couple months, there’s been an addition of 280,000 jobs to the US job market, and yet unemployment rose ever so slightly from 5.4 to 5.5. According to HuffingtonPost, the bulk of these jobs are driven by construction and health care: and this could be one of the reasons why college graduates struggle in finding appropriate work in their field. And even though our economy is consumer based, our consumers are acting more cautiously than in the past. This makes jobs, wages, and wage-increases the most viable way to get them spending again.

Education vs Experience

It sounds like a relatively simple plan: graduate, get a job, contribute to capitalism. But what usually ends up happening is students are often forced to work while earning their education in order to help avoid crippling student loan debt. While struggling to get on your feet after and even in college used to be a sort of ‘rite of passage’ to becoming an adult, the period of time to do so is increasing. And the longer it takes to get “comfortable” in the professional/working world, the more difficult it is to do so. Many end up living at home to try to curtail expenses.

In my book, I talk about how

Our economic system is partially based on a culture that thrives on independence and individualism, not on the collective good… It is fueled by the spirit of work hard, and inner-directed behavior. If I work hard, and with a little luck, I’ll get what I need, and I don’t have to be concerned nor worry about the person who cannot or will not work as hard… it corresponds with the notion of Social Darwinism.
Wealth vs. Work (pg 36)

So what are the currently unemployed supposed to do? And what of those just graduating and future graduates that are going to be entering an over-saturated market?

Eeny, Meeny, Miny, Social Programs

Social Mobility - Student protest, London, 9 November 2011

We’re living in a time where upwards mobility is becoming more difficult, and the middle class is shrinking (and slipping) more and more into poverty. Social programs are used to combat poverty and have been a controversial topic since their inception, but there is finally hope in building a bigger picture on their effects on families. The thought of programs nowadays is that they’re a sap to government resources. That they’re essentially useless and are cushions for more lazy people who’d rather live off disability than get a real job. In many cases, this is true but recent studies featured in the NYTimes showed that

“much of the benefit appears to derive from helping low-income families pay for basic needs like food, housing or health care, or simply reducing the intense economic pressure…. In addition to long-term benefits, the safety net, of course, supports many Americans right now. In 2013, income and nutrition assistance programs lifted 46 million people, including 10 million children, out of poverty, while health programs benefited tens of millions more…. Moreover, safety-net programs do not discourage work in any big way
Smart Social Programs– NYTimes.com

While there is an undeniable fact that many programs have the proclivity for dependency, the benefits can’t be denied either. In the light of recent cuts to nutrition assistance, health care, housing vouchers and other social programs, studies like this can help determine exactly what programs are   most effective. They could also become a good way to better screen potential recipients and have more appropriate contingencies for remaining on any given program. Regardless of which programs are kept, it’s hard to deny their position in securing a safety net for downwards mobility.

10-26-11 Press Conference to Protect Social Security, Medicare and Medicaid

In my book, I talk about the decline of the middle class. The decline is due in part to people slipping into poverty- which can often happen from being denied help from a program. Deciding who gets help (and how much help) is a thin wire to walk across, and it doesn’t help that the government tends to borrow from Social Security and Medicare funds to finance its current deficits.

“The common people… should be concerned that the network of public and private social and health protection is unraveling. There are fewer safeguards against downward mobility in a world pulsating with economic insecurity for the vast unemployment, limited employment opportunities and lw wages; loss of retirement investments and pensions; deflating home values and equity; soaring medical bills and health insurance costs…”
Wealth vs. Work: How 1% Victimize 99% (pg 22)

So which programs do we keep? Which ones do we cut? Who gets them and for how long? Obviously, questions like this are why we have a government but who’s to say they’ll make the right decision, even with this new information?

Mobility in Moving

When starting a family, one of the first questions asked is “Where will we live?” Ultimately, whether out of choice or necessity, families must choose between staying in the area they’ve been living in, or to move elsewhere. Instinct often nudges some to stick to their roots, to not venture out into unknown territory, even if it were to be to a better neighborhood; there are those who feel a type of sentimental pride in their neighborhoods.LuMaxArt Golden Guys APR Home Moving Concept

But is this really the right way to go – especially when it comes to your children’s success? Research that has been conducted over the past few years showed evidence that moving to a better neighborhood is beneficial not only for the children in the household, but for other members as well. According to Raj Chetty and Nathaniel Hendren’s study, there are a few necessary key components that can help determine if a neighborhood will lead to higher success for a family.

“Within a given commuting zone, we find that counties that have higher rates of upward mobility tend to have five characteristics: they have less segregation by income and race, lower levels of income inequality, better schools, lower rates of violent crime, and a larger share of two-parent households.”

Equality of opportunity- Raj Chetty and Nathaniel Hendren

The benefits of moving include a higher college attendance rate and a relative decrease in the poverty rate. However, the benefits are dependent on time and age, according to the New York Times. In the article, the study said, “In the mid-to-late 1990s, 4,600 families living in public housing entered a lottery in which the winners were offered a voucher that enabled them to move to better neighborhoods.” There were those who were given the opportunity to move, but were still unable to reap the benefits of moving to a better neighborhood. This seemed to be the case when children were above a certain age during the move, making mobility less plausible to a parent.

 Moving sucks

That being said, what’s to stop anyone from any neighborhood from achieving the “American Dream”? And what of those who cannot achieve their dreams due to their economic situation or any other hindrance that life is known to give? It seems that whether given the opportunity or not, there’s always the option for “failure” in the sense that a person/student fails to increase their current amount of wealth and/or succumbs to financial instability. It does not, however, account for the general happiness of the person, who may be earning less money doing something they truly love.

“Given how American society has evolved, the idea is… to achieve a balancing act which rewards merit and hard work and provides  a floor or safety net for low-performing, slow running and weaker individuals. But despite this ideal standard for society, we are confronted with the harsh truth that this nation remains much more stratified than what its principles suggest… We would like to believe that through merit and hard work anyone can achieve the American dream”

Allan Ornstein, Wealth vs. Work: How 1% Victimize 99%

But it seems that simply ‘going to school and graduating college’ does not always make the cut for immediate success. There are those who grow up considered ‘doomed to fail’ due to their neighborhood or finances. Shouldn’t they still be provided with an opportunity to live a comfortable life? There is so much talk of how much education or a good neighborhood will lead to success – that having a passion for your job and financial stability will naturally go hand-in-hand if you do things the good ol’ fashioned “American” way.

But what do you do when neither of those options are viable or plausible?