Why is the US middle class on the brink of extinction?

Why is the US middle class on the brink of extinction?
© REUTERS / Erin Scott

Life expectancy in the United States is declining more and more compared to other industrialized countries. The country is slowly moving towards disaster: its middle class is quietly dying, writes the German magazine Der Spiegel.

In joint research, Nobel laureate economics Angus Deaton and American economist Ann Case have concluded that the US has been affected by a social illness and Donald Trump’s presidency is its symptom rather than the cause.

In his book Deaths of Despair and the Future of Capitalism, the researchers warn that the US is moving towards a disaster that the media ignored because this problem emerges slowly and gradually. This debacle would include not only economic decline, but would also leave hundreds of thousands of victims among the American population.

Deaton and Case determined that life expectancy tended to increase gradually in all developed countries, except in the United States, where they registered practically no increase in this indicator over the years. In this sense, the US lags far behind countries like Canada or Sweden.

Life expectancy is an average indicator that encompasses all segments of the population. During their study, US analysts analyzed the death rate and found that its level had increased in the US. This increase is caused by three main reasons: the increase in suicides, alcoholism, and its consequences, and drug overdose.

The white working class, made up of American citizens without higher education, suffers most from these problems. In almost all industrialized countries, the death rate in this social group between the ages of 45 and 54 is decreasing, while in the United States it has increased compared to the end of the 1990s.

After comparing these statistical data in the US with that of Sweden, the authors of the book concluded that a middle-aged white American is twice as likely to die as a Swede. Since 1999, the number of those additional deaths, which could have been avoided, has stood at 600,000, the German magazine writes, citing American experts.

The increase in mortality in the United States maintains a link with the opium crisis, but this does not explain everything completely: without the weakening of the white middle class, the drug crisis would not have reached the current scale.

“Despair is spreading in society. This has led to increased sales in the pharmaceutical industry, which is not well regulated,” explains Angus Deaton.

The tectonic shifts in the US labor market were the cause of this despair. If previously uneducated employees could have a decent life, they now face increasing difficulties. Inflation-adjusted wages for the poorest part of the American population have not risen in half a century. Between 1979 and 2017, white men in this social stratum even lost 13% of their purchasing power, according to researchers.

All of this has not only financial implications but also on health, which is gradually deteriorating. In fact, representatives of this age group between 45 and 54 years now account for more cases of chronic disease that US retirees.

In their book, Deaton and Case criticize the US public health system, which constitutes about 17% of the country’s GDP. Health insurance payments represent a great burden for US citizens. Unlike many European countries, which do not see an increase in deaths from despair, the US does not have social systems that could prevent the development of negative social trends, the authors note.

Furthermore, given the high costs of health insurance, employers prefer to hire more high-level specialists with their corresponding claims. This is due to the fact that paying for expensive insurance is more feasible when the salary is also large and is more difficult when the cost of insurance is practically equivalent to the salary in the case of lower-level specialists. 

The tragedy of this situation is that the Americans themselves do not know the causes of their discomfort, facing many social difficulties, and Donald Trump cannot offer his voters a solution to these problems, conclude Deaton and Case, cited by the German media.