What Happened To The American Middle Class? | Financial Crash Documentary | Business Stories

[Music] the usa has always been known as the land of plenty a place of wealth and opportunity yet for americans things have hit rock bottom with the situation looking almost as bad as it did in the 1930s depression era the american middle class would be considered well off by european standards their yearly income is between forty thousand and a hundred and twenty thousand dollars and yet they are struggling more than anyone else in the us to meet their daily living expenses family incomes have taken a huge hit over the last three years so this has been a really rough you know 11 years for the typical family in this country and it came on after 30 years of people just hanging on the middle class is being wiped out in the united states it's becoming what was the working class in the 19th or 18th centuries basically people who as long as they are working can stay alive but when they stop to work they stop working they have no wealth they have no assets we don't really have a rainy day fund we don't have a a lot of savings i always prioritize okay these are the bills that we have to pay and these are the bills that if we get the money we can pay them we had to borrow money for our daughter's education or scrambling around our son's education we've struggled i mean we've gone from having money in the bank having savings to living paycheck to paycheck and basically trying to make ends meet and sometimes they don't meet with over 1 million inhabitants boston is one of the largest cities in the united states but the middle class are being forced out property prices here are far too high for the average american family this is the home of the cox family husband jonas works for a software company his wife is in publishing after the birth of their first child jonas's wife stayed at home for a year without a second income the family nearly went through all their savings a few months later jonas lost his job although he was only unemployed for four months the family savings are gone and they are now deeply in debt we tend not to talk about our financial lives we tend to keep it pretty private both my wife and i i think have been that way even in my family like the cox family three quarters of all americans are so out of pocket that their monthly income is not enough to maintain their debts let alone feeding their family and putting a roof over their heads my wife and i earn about twenty 120 dollars a year i don't think uh i spend money for usually i i'm getting down to just really the daily routine i um i i make lunch for myself every day i um i never buy lunches we very rarely go to restaurants to eat out i go a long time without buying clothes maybe more so than i would like to the middle class is defined as people who have a set of aspirations those aspirations being i want to have i want to own my own house i want to live in a safe neighborhood with good schools i want to be able to put away a little bit of money for taking a modest vacation every year i want to have health insurance i want to be able to save a little for retirement i want to be able to send my kids to college those those sorts of things that make up what i would call the middle class baskets traveling north from boston is a bleak journey through the old industrial towns of new england their heyday has long since passed textile manufacturing was outsourced many years ago to third world countries offering cheaper labor [Music] vermont near the canadian border has always been a popular tourist spot its many ski resorts and stable weather conditions have made it famous for its winter sports [Music] yet on a day like today a clear day with plenty of snow the slopes are almost empty [Music] within the villages of vermont you can still find the old american spirit neighbors trust each other front doors always stay unlocked [Music] here you find people that still treasure the original pioneering ideals hard working yet wayward free thinkers people that want to live in harmony with nature and are conscious of their environment six years ago george shank and his wife went into the forest and cut down some trees from which they built this log cabin and made it their home even for frugal people like the shanks times have been better there are no promises about the future you can plan and hope for the kind of economic future you dream of but that may not happen the shanks have been producing american flatbread for over 30 years of a classic artisanal bread this is our homemade organic tomato sauce the couple own a restaurant they have franchises in other american towns and also own a range of frozen food mozzarella cheese they also delivered their flatbread to schools and prisons they were doing well and were hoping to retire soon but along came the credit crunch and crunched their retirement plans with it i'm feeling a little squeezed i feel uh that i'm getting to the age where i should when i grew up my parents were retiring when they were um let's not talk about that age but they were retiring in their 60s and where from where i'm sitting i don't see i don't see the end of my work the couple had to use their pension funds in order to send their children to university it is a tough decision to make between the children's education and retirement funds yet it is one that many average american families simply have to make these days but george doesn't want to complain and the last thing he wants is pity he maintains that even when times are tough you still have to focus on the positive effects one of the things that's been fascinating about the recession which were seem to be coming out of is that it created a pause for a lot of people to reevaluate are they doing the things that really matter in their lives do they really need or want the things that they thought were so important you know one of the things i think that we as a takeaway here is that you can feel richer if you want less when reagan came into office we were the world's largest creditor we loaned money to other people we were the largest exporter manufacturer and exporter of finished goods in the world that the world had ever seen we made things we were the largest importer of raw materials so we brought in iron ore we made it into television sets and computers and we exported it for credit and the the very definition of a first world country 30 years later all of those numbers are absolutely upside down we are now the world's largest debtor in the history of the of the planet we are the world's largest importer of manufactured goods and exporter of raw materials a lot has changed since the 1960s when the wife stayed at home to bring up the children whilst her husband went out to work today both husband and wife have to bring in an income and even that is sometimes not enough to make ends meet the idea that people spend much more now than before is a myth the cost of living education health care have risen exorbitantly yet wages haven't increased at the same pace so what has changed in the past two generations to make this the case on this farm in vermont three generations are living under one roof for the people in vermont washington and its politics are very far away the political opinions of the lincoln family are very diverse the experience of life on their farm has been very different for each generation [Music] my brother doesn't eat vegetables and i do i think it was much easier for my parents to make a um i don't call a profit i would call it pay the bills and we were in a situation so the farm and my mother worked out but they my parents put all five of us kids through college i don't know if a farmer with five children today could put him through college when i think about um grandma and grant i mean they how many times did grant leave the farm never he never left i mean i was in his work in seventh or eighth grade and grant left the farm for four days and we went to washington d.c farmers across vermont are suffering from financial pressures and right now there are people who are under extreme stress i i mean you know you can't believe hundreds of thousands of dollars in in millions of dollars in debt and hundreds of thousands of dollars going behind yet the lincoln family don't want any help from the government if i'm a good person in business it's my responsibility to create an environment that i don't need to be subsidized i think the true vermonters the true old-time vermonters and we've got two coming here they don't need a safety net they can adapt to the to the environment they're living in and they create an environment that's economically sustainable to them it's this is uh it's always been show you how to do it and take this farm would not survive both of us working on it i think i have to work outside the house and i think that's for health insurance for all of us when we got engaged that this ring was a good investment because it paid back the health insurance that i saved paid for the ring in less than one year although farmers are struggling this family business is surviving for now the lincolns have come up with other sources of income these days they are undertaking forestry operations for other businesses on the other side of america from vermont right by the mexican border lies the state of arizona an average american city it is many fast food chains along the outskirts all are suffering from lack of customers the property market in arizona is on the verge of collapse nowhere else in america have so many people lost their houses through repossession mostly because the property owners were unable to pay off their credit card debts katinka let me show you this home that is bank owned foreclosed first of all the fountain normally would be flowing estate agent jennifer o'brien shows us around a repossessed property superficially the house seems to be in good order but the previous owner dismantled everything she believed she could turn into cash what the real estate agents have been doing for you know hundreds of years which is selling homes you know we're in the business of selling homes the banks let houses like this deteriorate and they don't sell them in a timely fashion and they continue to deteriorate they like to be lived in they like their toilets flush the water to be run you know the landscaping to be maintained none of this is being done they're managing these things that are assets the banks are but they're not they see them as numbers not as homes not as the american dream jerry abreu lows the daily walk to the letterbox he knows there will only be new invoices which he is unable to pay the businessman has lost eight hundred thousand dollars in the stock market and as a consequence his house the investment of a lifetime all gone they want to offer us it's frustrating um i guess you know part of you feels like you failed you know you feel like uh like you've dropped the ball so to speak you know especially in my 40s you know i'm in my 40s now and i was kind of hoping to have a pretty good nest egg set aside for my kids to go to college and for us to kind of you know look towards a retirement and now it's kind of like starting over in contrast the banks got billions it's not fair that the banks should get these guaranteed loans back because they were backed by foreign investors because they were backed by people that are wealthy and and these you know real estate investment trusts that they that they should be the ones to be okay and safe yet i'm losing my home i'm losing my business i'm losing my job you know and and here they are worried about whether or not these big publicly held companies are going to fail like so many of the white middle class jerry believes that washington no longer represents the people's interests he is increasingly inclined to sympathize with the conservative tea party as much as he dislikes their extremism and racist views the ideas of the tea party appeal to a growing part of the discontented middle class who are longing to bring back the good times they know intuitively that something's wrong and i think the tea party movement they know they are poorer than they should be they know that they are at risk they know that that they and all their friends are six months away from disaster if they lose their jobs i mean genuine disaster the sun windows yeah the solar windows that'll keep the room warm planted together this was the house jerry and his wife kimia used to own it is not easy for them to go back it was the place where they wanted to bring up their children and grow old together once a family home everything is now owned by the bank [Music] i try not to go there you know but i do feel a little you know you know sad to see it again be strong and move forward i didn't blink an eye about having a 500 000 loan on a house because that's what the typical cost of a home was back then and now when i think about it's like that's a half a million dollars that's a lot of money that i'm promising and committing to paying over 30 years and you know it when my parents bought their first house i think it was 18 000 you know and i and how did it go from 18 000 to 1970s to 500 000 you know 30 years later it just doesn't make sense the collapsing property market is only one symptom of the economic downturn affecting america's middle class companies are looking for short-term profit a quick fix if you like it one of the easy ways is through health insurance they now let the employees themselves pay for it another problem is the increased competition with china and other low-wage countries as well as a lack of organizations like the unions organizations only 7.5 of all americans are union members that puts the individual in a very vulnerable position the the weakening of the unions had already started during the reagan presidency ronald reagan took on the toughest union at the time the air traffic controllers he broke down the strike and set the tone for the future today the decline of the unions continues in wisconsin the republican governor scott walker made it his goal to break up the teachers union who were supporting obama's democratic politics in the united states you have no right to sick days off from your work you have no rights to vacation you are not guaranteed you know a strong pension from your employer you are not guaranteed health care from your employer all of those things are taken for granted from people in other countries by the united states this is something that we have less and less of not more and more of the gap between rich and poor is increasing rapidly right now the top one percent of americans own more wealth than the bottom 90 percent and the top 1 percent of americans own earn more income than the bottom 50 percent people think yeah okay rising inequality is objectionable but is it bad is it bad for the country and um one thing that i think is important to think of at the same time is what's going on with mobility people aren't moving up and down the income scale people are really stuck where they were born means that goes against core american values that means that this idea of people have equal opportunity people have the opportunity to to to make their mark to make their their millions um it's just it's just not there many americans have lost hope of change every month around 120 000 people are declared bankrupt one such couple was amy and jeff knisley jeff is working in middle management of a bank and amy is a child minder they don't want to say exactly how much they are earning but is only just enough to take their kids camping once a year that is their only luxury bankruptcy was really our only option that we felt we could go with from the research we had done the people we had talked to so we didn't want to do that and that was scary as well but it just seemed like it was the best the best solution for us to get out from under the big that big rock that just seemed like it was holding us down i think that our society does need to focus more on the united states on us and um as far as you know i i think a lot of the lower class get a lot more help from the government since their insolvency amy spends hours every day looking for bargains in every available newspaper shopping has become a complicated and time consuming undertaking it is part of jeff's and amy's daily struggle to keep their heads above water what would make me sleep better is where you're not taken from one thing to pay the other you know where you can just actually sit down and pay your bills and pay them and then still have money to get through the rest of the week with groceries and gas and you know stuff like that that you would need i would be so happy just to have a typical week where i could sit down and write out the bills and then go oh you know what we have money to get groceries this week there will be more women declared bankrupt in the u.s this year than women obtaining a university degree there will be more children in the us this year with bankrupt parents than divorced parents the most frequent new year's resolution the past five years has been paying off debts without a doubt all this has a devastating impact on american society what happened was that this this gradual shift of of the mythos moved from i will work and i will build and i you know i would be part of this too i'll hit the jackpot [Applause] [Music] despite all this a belief in the american dream still survives within some rob and sarah hamelman made it their ambition to grow wine in the arizona desert [Music] the bank refused to give them a loan for this new enterprise but they managed to get enough money together to buy this vineyard with the help of family and friends [Music] we have what it takes here to for this to become a great vineyard we have the high elevation warm days cool nights in the summer great free draining sandy loam soil it's a great spot for a vineyard after they had finished university jeff and amy worked in vineyards all over the world this year will be the first season on their own vineyard i think it has been hard for people our age but then um kind of gives you something to work harder for but is hard work really enough to fulfill your american dream these days what are sarah and jeff hoping for i would wish for america to have for the financial institutions and people in power to be more responsible to kind of think ahead of what their actions are doing it seems like every the things that led to the collapse were very short-sighted um people weren't looking towards the consequences of their actions um yeah and just more financial opportunities the banks to loosen up a little bit for people who want who have dreams who want to make it happen anthony lascaris is more skeptical 20 years ago he emigrated from greece he is the manager of a bicycle shop with nine employees in his opinion the decline of the middle class is unstoppable i mean it's it's really tempting to insist on protectionism and isolationism and thou shalt not import goods from overseas but but that that doesn't really work everybody knows that but man is it tempting when we hear of the inequities and inequalities of work forces it's very tempting to say why do we permit our companies to import from countries that don't maintain the same labor controls and protections that we do at great expense even though globalized trade is highly criticized by many americans the usa is still outsourcing much of their manufacturing we have no longer the right to expect to live a better life than our parents and by extension than everyone in the rest of the world it's just not possible for the concentration of wealth to remain in one small society i i see it as an inevitable uh consequence of of globalization that our standard of living must necessarily drop slightly in order for the rest of the worlds to rise how will the struggle of the american middle class affect the nation's status in the world the signs are everywhere that this is a country in crisis [Music] we focus and tend to focus so much on the more extreme left and right views and they seem to take the uh the spotlight all the time and i think it's time that you know americans you know the middle class the americans that represent this country the most have a voice heard in this country that hey you know it's time for us to really start focusing on getting back to what made this country great building manufacturing creating inventing that's what this country was was built on and we need to get back to that i think you

Channel: Business Stories

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Keywords: business documentaries, business stories, business, documentary, money, documentaries, tv shows, The Death Of The American Middle Class, middle class, economy, american dream, america, recession, news, capitalism, television, american middle class, world news, income, shrinking middle class, economics, politics, government, bbc, usa, family, neoliberalism, journeyman pictures, current affairs, american, american documentary, real stories, real stories documentary, full length documentaries

Id: YbTlq7A-wVs

Length: 28min 13sec (1693 seconds)

Published: Thu Jan 28 2021