Yes, Americans Are Feeling the Squeeze. It’s Coming From Health Care.
Curator Note: This article presents many interesting facts, one is that median income has stagnated for the past 20 years, which is why many Americans feel that they are not getting ahead. The author then goes on to talk about health care in a confusing and meandering way. What he could have said, in a straight forward manner is this — health care costs, and insurance costs, have increased exponentially over that same period. So if your health care costs go up, and you are making more money to just cover those increases — YOU ARE NOT BETTER OFF, YOU ARE JUST KEEPING EVEN. The problem is health care costs, which has been proven over and over and over, in study after study, to be too high. The comparison with other countries is stark. Look at Switzerland and Germany for good models or private/public systems at a lower cost and much greater peace of mind.
The idea that most middle-class Americans have been treading water economically is conventional wisdom. It is already playing a role in the 2020 campaign, as the Democratic presidential candidates propose policies (Medicare-for-all, free college tuition at state schools, subsidies for child care, to mention a few) intended to relieve the financial stress on millions of middle-income families.
But the conventional wisdom is wrong — or at least misleading. Although the squeeze is not a myth, it’s highly localized: uncontrolled medical spending. This is crowding out other spending, from wages to defense budgets. If we don’t stabilize health costs (and there is little sign that we will), we should expect the squeeze to continue indefinitely. Income inequality would also probably worsen.
We now have a new study from economist Richard Burkhauser of Cornell University that illuminates health care’s peculiar role. A standard benchmark of economic well-being is median income: It is the earnings in the middle of any distribution of income figures. The higher the median, the better off people are assumed to be. In recent decades, the median income of U.S. households has grown slowly, stagnated or declined. In 2018, according to the Census Bureau, the median household income was $63,179; in 1999, it was $61,526.
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