Here’s a great lecture by Elizabeth Warren at University of California Berkley called “The Coming Collapse of the Middle Class: Higher Risks, Lower Rewards, and a Shrinking Safety Net” It’s a little less than an hour long, but it is packed with insight into why so many households are having such a hard time. I want to call your attention to, specifically:
- her discussion of the risks that two income households face relative to a one income household,
- the increase in household spending on inflexible expenses (such as a mortgage and health insurance) versus the decrease in household spending on flexible expenses (like food and clothing), and
- what really causes the increasing bankruptcy epidemic.
There’s a lot of meat in this lecture, so set aside the time to watch it when there aren’t many distractions. When you’re done, I bet you’ll look at the economic forces acting on the middle class with fresh eyes.