Survival of the Middle Class Threatened

New Threats to the Survival of the Middle Class

As director for the Committee for Positive Change, I recently prepared an editorial the other day on the coming re-engineering of society. I thought that it would appeal to a few thoughtful readers causing them to perhaps consider taking some kind of positive role to change the status quo. Quite surprisingly, I didn’t hear from anyone on the subject despite the fact that has such broad implications for the middle class and the very fabric of our society.

For many of us, brought up in a middle class milieu, it seems hardly believable that we could read this staggering assessment and not be concerned about what is happening to the middle class in America; but if anything, the middle class’ lot has deteriorated over the last six years bringing into serious question whether it can actually survive and remain viable; yet, alternatively, it is at the very foundation of our democratic way of life. Without a middle class in America, the entire dream collapses.

Could this really happen?

This is a question that has been plaguing us lately because we have not seen such a confluence of negative factors reinforcing each other that could have that deleterious effect. One might ask: Are we nearing the brink? Are we facing the prospect of chaos and entropy?

On the surface, such scenarios seem so far out and so improbable that we thought we would look more closely at the problem.

It is not a pretty scenario but it must be considered now in order that we can prepare a plan to deal with the multiple challenges we face.

The principal catalyst in this is, of course, oil and its availability., .

It is oil that threatens the middle class.

Reading background on oil supplies and producer reports, the news is not encouraging; nor has it been good for a very long time. A quick recap: We have done nothing to free ourselves from oil dependency while the supply of oil from the 41 world-wide suppliers is diminishing; but even worse, there is reason to believe that estimated quantities in the ground have been overestimated and our reserves, on average, may only last us another thirty years. In the end, Saudi Arabia and Kuwait shall rule; they have the largest supply of oil reserves and what they decide to do will, in large measure, determine our own fates….so no one is quite immune and the world has gotten perilously smaller in the interim..

But what does that mean?

Can Saudi Arabia be trusted to support our best interests?

History shows that the Saudis have always operated out of self interest and it is expected they always will. They cooperated with the US in the past because they invested their oil wealth here; that is no longer happening. America is so saddled with debt arising from a negative balance of trade and other forms of debt, it has literally changed the world’s perception of us as a safe haven for their investments.

Saudi Arabia, for example, is now investing directly in assets, in stocks rather than countries and that could significantly change the landscape for us…so they cannot be counted on as a stabilizing force.

However, and here is the kicker! If we wanted to wean ourselves away from oil, it would take generations. And we haven't even taken the first steps.

So, the oil increases where there is no oversight, puts the middle class and most of the US population between a rock and a hard place. And we are and will be dependent on oil for long into the future….that is the critical factor.

Years ago, back in the seventies, It was estimated that fundamental change in our society would take place when oil hit 2.00 dollars a gallon; it is now over three dollars a gallon and expected to go to four to five dollars a gallon in short order.

This will affect everything involving petrochemicals from the price of plastics, packaging, distribution, food, etc. In other words, you can expect to pay more for packaging, food, anything made of plastics, anything that employs a derivative of plastic or oil. If your budgets have not as yet been attenuated by divergent demands from every quarter, they will now.

Consider this: As recently as last year, you could fill your tank for under thirty dollars, now it is not uncommon that it will cost sixty five dollars to fill an average tank.

The trouble is that most people cannot afford to give up their cars; we live in a culture that has sacrificed mass transit to individual rights and we are now paying the price for it—a price that we cannot afford.

But when we talk oil, we are not only talking about transportation, we are talking about energy—energy to heat our home and power our needs. Heating costs this winter seemed to have reached stratospheric levels, almost capriciously as if there was no one or no department monitoring or supervising increases of twenty to thirty percent in home heating oil costs.

We observed that in smallish homes of 2,000 square feet or less, homeowners were paying in the range of 500 dollars a month plus to keep a home at 68 degrees. This can be staggering for families on fixed incomes or others who have not benefited from wage increases who are already pressed at every turn.
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Were this the only factor to consider, the average homeowner might be able to assimilate it, but it isn't. The average homeowner is faced with stagnant wages--even in a period of rapidly rising productivity and a continuing exodus of jobs and opportunity. Moreover, credit problems and a lack of equity in their homes has put the average middle class family at a level of risk seldom seen before especially in an economy characterized as “booming.”.

More and more, middle class families are finding themselves struggling with basic survival considerations: from putting food on the table to paying for medicines and, now, oil becomes the straw that can more than anything else break the back of the middle class.

You can see the depressing outcome without thinking too long or too hard on the subject

As we see it here at the Committee for Positive Change, there is considerable momentum from the pressure of today’s economic realities to propel society to entertain massive re-engineering of the middle class. This is not a positive estimate but an eventual reality predicated on the confluence of many factors and an inability to deal with society’s problems.

If nothing else changes, the average middle class family hugging the lowest rungs of the economic ladder will find that with few options available to them, hope will evanesce and without hope, there is greatest concern for the continuing stability of the middle class. Without stability, any outcome is possible—from protests to riots and beyond.

There are hints of of unpleasant outcomes even now. Families are maxed out; heads of households are finding it exceedingly difficult to maintain quality of life. Families are unable to pay for the three fundamentals: food, shelter and transportation. And the luxury of a night out or a new toy or game have become beyond the reach of most families.

Ordinarily, a wise and farsighted administration would recognize the need for bringing relief because, ultimately, it will impact that leadership’s own survival. But it seems such considerations are furthest from the minds of the current occupants of the White House. The very fact that they cannot contemplate the consequences of their precipitous actions in so many arenas on family stability is beyond imagining.

And without government intervention, there is little optimism for a change in outcome.. What we see is that the middle class is increasingly finding itself between a rock and a hard place with no solution in sight.
A society that cannot heed the warning signs from its society is in very difficult straits.

If no actions are taken to change the status quo, we see a clash between government and the society and one of two things will occur: repression or change. We are presently unprepared for the effects of either.


We hope that this warning will highlight the problem and begin the curative process but judging from this leadership's track record, we are not encouraged.

The answer in the light of the realities we are faced with is the massive response of the people. Increasingly, as Al Gore has said, and we have underscored: It is the people who must decide their own futures.

It should be noted here that something will happen that will change the projected negative outcome that may result from a pernicious do-nothing policy for the people and that happily we have misjudged the fundamentals. But on the other hand, the fundamentals are in place, housing is down, credit is tightening and most middle class people are watching their quality of life slide so that we are quite confident that the projected outcomes are highly probable if the government doesn’t act in its own interests to change the status quo.

Les Aaron