Crowdfunding as privatized, casino-style public assistance

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Crowdfunding started as a way of raising capital for entrepreneurial projects, and then it also became a fundraising tool for non-profit initiatives. Now, fueled by a growing wealth divide and the lingering effects of the Great Recession, crowdfunding is turning into a popular medium for individuals to launch pleas for money to meet unexpected and sometimes dire personal expenses. Some campaigns are started by people who are trying to help friends and family members in need.

Many such requests are posted to Facebook. Using sites such as GoFundMe, they request individual donations to cover medical bills, rent, burial costs, educational expenses, and the like. The funding goals usually are in the four and five figures. I’ve seen a few for six-figure amounts. Because the crowdfunding campaign is almost always posted by an individual, donations are rarely tax-deductible as charitable gifts.

I have no idea what percentage of crowdfunding appeals for individual expenses are successful, but my guess is that there are many more misses than hits. Many, if not most of them, carry a voice of desperation. Those launching these campaigns feel like they have run out of options, and so they are asking others for support to keep them afloat.

Welcome to today’s privatized, casino-style form of “public” assistance. As the bottom continues to fall out of America’s middle class, and our safety net increasingly shows its holes, we’re going to see more and more crowdfunding campaigns on behalf of those who are trying to make ends meet. 

The successful appeals will be compelling in voice and substance and supported by a network of friends. The unsuccessful appeals will be unpersuasive, sound questionable, or naively assume that lots of strangers are waiting for reasons to give away their money. In other words, something of a twisted “meritocracy” will develop between those who are successful and unsuccessful at pitching for money to help them survive.

Perhaps this is a logical, unsurprising result of a society that has bought into the notion that the “free market” is a panacea and the solution to all of our problems. A reality TV show pitting those in need against each other cannot be far off.

Related posts

“Should I support that Kickstarter, GoFundMe, or Indiegogo crowdfunding campaign?” (2015)

More to come: The experience of everyday wealth differences

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A guest contributor to The Guardian‘s “What I’m really thinking” column — apparently a female student — writes about the awkwardness of making social plans with friends who have a lot more money than she does:

“I’ll meet you there,” I say. “I’ve got something to do first.” That’s a lie. I just don’t want to take an hour-long taxi with you; the fare for that is outrageous. No, better to take public transport and spend an extra hour and half to save the money.

. . . Make no mistake, I am by no means poor, but by your standards I might as well be. When we go out for dinner, I scream inside at the cost. Often I don’t eat, saying I’ve had something already or I’m not hungry. Some people ask if I’m anorexic, because they never see me eat a proper meal outside school.

Iceberg ahead…and we’re steaming into it, full throttle

Of course, the socially awkward dilemmas confronting a younger person with less disposable cash than her friends are one thing, while deep inequalities in income and wealth are quite another. At least here in the U.S., I believe those inequalities have been, and continue to be, intentionally baked into our economic and political infrastructure. And they are becoming evident across the generations.

For example, here’s a piece of writer Sarah Kendzior’s insightful take on the “post-employment economy” that confronts many recent graduates:

A lawyer. A computer scientist. A military analyst. A teacher.

What do these people have in common? They are trained professionals who cannot find full-time jobs. Since 2008, they have been tenuously employed – working one-year contracts, consulting on the side, hustling to survive. They spent thousands on undergraduate and graduate training to avoid that hustle. They eschewed dreams – journalism, art, entertainment – for safer bets, only to discover that the safest bet is that your job will be contingent and disposable.

On the other end of the generational spectrum, you have late Boomers and early Gen Xers — a cohort that just missed out on the golden era of employer-provided pensions — hurdling into middle age and beyond with scant retirement savings. For example, a 2015 study by the non-profit National Institute on Retirement Security concluded, among other things:

The average working household has virtually no retirement savings. When all households are included— not just households with retirement accounts—the median retirement account balance is $2,500 for all working-age households and $14,500 for near-retirement households. Furthermore, 62 percent of working households age 55-64 have retirement savings less than one times their annual income, which is far below what they will need to maintain their standard of living in retirement.

My prediction? Without significant changes, we are going to see more and more instances of everyday inequality staring us straight in the face. For some, this will mean quietly bowing out of pricier social activities due to a money crunch. For others, it will mean trying to maintain appearances of “middle class” status while opting for a dinner of macaroni & cheese from a box. And these will be among the folks who actually have “choices.”

I haven’t yet said a word here about climate change.

Saving ourselves from a dystopian future

Yes, I know I’m sounding overwrought. But too many indicators are suggesting that (1) we have yet to pay the full price for our inequalities and excesses, especially during the past thirty-five or so years; and (2) we have not come to a reckoning about the mess we’ve made.

For those who can afford it, there are things that can be done on an individual level: Be generous. Give to good charities. Pick up the check. Leave a nice tip. To help someone dear who is in a financial bind, give, don’t loan, and do it without fanfare. Instead, be grateful that you can afford it. (I try to hold myself to these standards, while confessing that I sometimes fall short.)

More broadly, all of us, regardless of financial status, must grasp how our economic, political, and social systems have stoked massive inequality, nationally and globally, and then help to do something about it. 

I’m not sure of all the answers, but I believe they will be a combination of changing how we live, building a more robust yet inclusive economy, and repairing our social safety net. We will have to be smarter and kinder in creating a society that places greater value on human dignity and the common good.

Two tales of the Times

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Two articles published in last Saturday’s New York Times drive home a pair of contrasting narratives about aging and retirement prospects in the United States. One paints an idyllic picture of retirees who have the flexibility and financial resources to engage in adult learning activities for pleasure and intellectual company. The other details the challenges facing women who became unemployed in their 50s during the Great Recession and who have struggled to find work since then.

Back to school (for the fun of it)

In “In School for the Sake of Keeping the Mind Stimulated,” Harriet Edleson opens with the story of a retired couple, both 68, who are enrolled in an advanced adult learning program for personal enrichment:

JOSH AND SUSAN FRIED attend classes three days a week but they never receive any grades or cram for midterms or finals. They are not trying to earn an additional degree or retrain for a new career.

. . . Dr. Fried retired from his dental practice eight years ago and moved with his wife, Susan, a former English teacher, to Rockville, Md.

. . . The Frieds are among the 150,000 men and women nationally who participate each year at more than 119 Osher Lifelong Learning Institutes. . . . Along with an array of other such programs fitting under the “lifelong learning” umbrella, they tend to attract educated, passionate people who are seeking intellectual and social stimulation among peers who often become new friends.

These adult education programs can be like going back to school, but without final exams and term papers. According to Edleson, these “lifelong learning programs position themselves as communities where the participants not only take on challenging subjects but also seek to engage more deeply with their fellow students.”

As I’ve written before, later-in-life transitions aren’t limited to immersing one’s self in books and ideas that may have escaped post-adolescent attention spans many years ago. Still other empty nesters, near-retirees, and retirees are creating “encore” careers that allow them to pursue work that is more soul satisfying and contributing to the community.

Overall, for those in good physical and financial health as they grow older, the present and future are bright. For guidance, they can access a growing body of self-help and personal development literature and online content detailing how to maximize life’s second half. The choices are and will continue to be plentiful.

Searching for work at fiftysomething

In “Over 50, Female and Jobless Even as Others Return to Work,” Patricia Cohen opens with a different type of story, one of a woman in her fifties who has not worked since a 2007 layoff:

Laid off at the start of the recession from the diagnostic testing firm in Seattle where she spent more than three decades, [Chettie] McAfee, 58, has not worked since 2007.

. . . Ms. McAfee is part of a group that has found the postrecession landscape particularly difficult to navigate: women over 50.

. . . A new study on long-term unemployment from the Federal Reserve Bank of St. Louis found that the prospects for women over 50 darkened after the Great Recession.

. . . The employment picture has definitely improved since then, economists point out, and more older women have managed to return to work. Still, the waves from the recession, which ended six and a half years ago, continue to upend many people who were cast aside during and immediately after the storm.

Hard evidence of age discrimination against women helps to fill in the picture. Nancy Collamer, writing for Next Avenue, reports that a “National Bureau of Economic Research study, Is It Harder for Older Workers to Find Jobs? , offers ‘robust evidence of age discrimination in hiring against older women.’”

Apples and oranges?

Concededly, we’re talking about two different age cohorts here, so I’m not suggesting there’s a direct comparison. But it’s noteworthy that one piece is touting the intellectual and cultural enrichment options available to retirees of sufficient means, while another is spotlighting the job hunting woes of a group 10 or 20 years behind them who, absent dramatic changes of fortune, will never have those choices.

In fact, a 2015 U.S. Governmental Accountability Office study on retirement readiness documents the limited retirement savings of retirees and workers in their mid-50s and older:

Many retirees and workers approaching retirement have limited financial resources. About half of households age 55 and older have no retirement savings (such as in a 401(k) plan or an IRA). According to GAO’s analysis of the 2013 Survey of Consumer Finances, many older households without retirement savings have few other resources, such as a defined benefit (DB) plan or nonretirement savings, to draw on in retirement . . . .

My own interests in these topics have been spurred by the effects of workplace bullying on middle-aged workers. While bullying at work is difficult to deal with at any stage of one’s life, it can be especially challenging for individuals who experience it later in their careers and lose their jobs in the process. Furthermore, there’s evidence to suggest that middle-aged women, in particular, are vulnerable to bullying behaviors.

While some are examining how to help the  older, long-term unemployed, there are no easy answers. In the meantime, America’s huge wealth gap is heading into a more pronounced chronological dimension, separating those who can afford at least a relatively comfortable retirement from everyone else, with the latter group constituting a big share of the population.

Related posts

Triple jeopardy: Workplace bullying at midlife (2013)

Retirement expert: “Most middle-class Americans will become poor or near-poor retirees” (2013)

Not “Set for Life”: Boomers face layoffs, discrimination, and bullying at work (2012)

Singled out? Workplace bullying, economic insecurity, and the unmarried woman (2010)

On “quit lit,” “encore” careers, and the realities of creating work options

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This headline from the Yahoo! News page is an enticing one to many: “How to Afford to Quit Your Job.” Kimberly Palmer, writing for U.S. News & World Report, introduces us to a former NPR program host, Tess Vigeland, who one day realized that it was time to say goodbye:

When Tess Vigeland, the former host of public radio’s “Marketplace,” came home from work and cried in her backyard for three hours, she knew it was time to leave her job. “I decided I couldn’t take it anymore and I felt like I deserved better,” says Vigeland, who turned in her notice the following week.

Vigeland now has a book, Leap: Leaving a Job with No Plan B to Find the Career and Life You Really Want (2015), in which she is encouraging other folks to follow her path. In her interview for Palmer’s article, Vigeland recommended, among other things, assessing one’s financial situation, including alternate income sources, savings, freelance work, and “a partner’s salary”:

“I did some back-of-the-napkin calculations with my husband and we figured his salary could pay the mortgage with me not working at all,” she says. In addition, she planned to take on freelance work so her income would not go to zero. “I also knew I had a large retirement account that I could tap into if I had to, and home equity,” she adds.

Midlife “quit lit” and “encore” careers

Okay, here’s one of the issues I have with so much of the midlife “quit lit,” i.e., the quit-your-job-and-live-your-dream-type books and articles based at least in part on an author’s personal experience. I’ve looked at a lot of these writings, and almost invariably the Dream Chasers have financial resources from a supportive spouse, partner, or family and/or have a good chunk of savings that can be tapped to ease a likely income drop, at least temporarily.

More than a few have strong networking connections as well, including some in pretty high places.

I don’t begrudge people who have those options — I’ve encouraged some friends to consider that very avenue — but in reality many folks, because of limited incomes and savings, kids and other dependents, single status, etc., find the hopes inflated by this type of book/article title quickly deflated when they realize that the author had a cushion of financial support and cash.

I find similar dynamics when it comes to “encore” careers, a term used to describe experienced professionals who decide to step off of a demanding, if highly paid, treadmill to pursue work that is more soul satisfying and contributing to the community. There’s even a popular website and book devoted to encore careers.

Yes, encore careers can be great for those who have the financial resources to sustain them. However, most people in their 40s and 50s, especially, happen to be in their potentially strongest earning years. The pursuit of Something Very Different in the heart of midlife typically should not be done on a whim.

I’m not saying Don’t do it. Rather, I’m urging that the strong emotions driving such considerations be complemented by dispassionate assessment and planning.

More realistic options: Avocations, hobbies, and Millennial-style startups

Some loyal readers may feel like they’re hearing a mixed message from me. After all, for those in toxic work environments, I’ve suggested that an exit strategy may be the most viable option when health and psyche are deteriorating. And I’ve also recommended sites like Encore.org for those seeking to make significant career transitions. Furthermore, there are people who, against more “rational” assessments, took that risky leap without a parachute and landed on their feet. Some have enjoyed remarkable success in their transitions.

That said, there may be less risky alternatives to exploring and making major career/work changes. A few considerations:

First, do you have an avocation that has income-producing potential? An avocation is typically a labor of love, so you know the passion is there. A next question to ask is whether you can grow it into a steady income stream.

Second, how about taking something you really want to do and starting it as a part-time micro-business? Chris Guillebeau’s The $100 Startup has a Millennial generation audience in mind, but it contains inspiration, insight, and information for anyone considering a lower-risk road to entrepreneurship.

Third, do you need additional training or schooling? Formal degree and certification programs tend to be expensive, but low cost or free adult and independent learning opportunities abound. You might, for example, go to a local SCORE workshop on starting a business, or take an online course or two through educational content providers such as Coursera, Udemy, and EdX.

Fourth, might it help to work with a really good career or life coach to help you plot your way through all this? A wise voice who asks the right questions and helps you to make and stick to plans and identify priorities can be very helpful. 

Finally, if your potential plans include going out as a freelancer, you might want to take a look at Sara Horowitz’s The Freelancer’s Bible for some of the business details you’ll need to address.

The term go for it has a lot of emotional power, especially if you’re in a less-than-wonderful work situation and considering alternatives that sound freeing and exciting. Pursuing your passions is good, life-affirming stuff. But it’s often helpful if you do so with research, planning, and assessment to help prime a path to success.

“Should I support that Kickstarter, GoFundMe, or Indiegogo crowdfunding campaign?”

Screen shot of Indiegogo home page

Screen shot of Indiegogo home page

The growth of “crowdfunding” or “crowdsourcing” sites such as Kickstarter, GoFundMe, and Indiegogo has created a sort of privatized lottery system, whereby if you can design the right appeal for a product, cause, or someone in need, and it happens to gain momentum, then you may be buoyed by monies from complete strangers over the course of a few weeks.

To be sure, most crowdfunding campaigns do not go viral and do not raise hundreds of thousands of dollars, despite occasional news stories suggesting that if you merely ask for it, then it will come. Many campaigns fail dismally. (Hence, the lottery-like quality to the whole deal.) However, crowdfunding has evolved into a viable option for entrepreneurs, social causes, and personal appeals.

If you Google around a bit, you’ll find plenty of advice on how to design a crowdfunding campaign. But what if you’re on the receiving end of those requests? Over the last year, I’ve looked at several dozen crowdfunding campaign requests, either through sites such as the ones mentioned above, or via more informal means such as Facebook.

At times, I will happily support a crowdfunding campaign for a good cause, interesting new product, or an individual facing tough times. On other occasions I might decide not to contribute.

For what it’s worth — and I’m not claiming to be the first or last word on this — here’s what I look for when approached by a crowdfunding appeal:

1. Above all, is the request a legitimate one? There are so many factors that go into this assessment, including the individuals involved, the nature of the funding request, and the information provided in the crowdfunding appeal.  This question pervades many other considerations discussed below.

Whether it’s supporting a niche business idea, helping to launch new social venture, or lending a hand to someone in need, I want my contribution to have a positive impact. While this applies specially to larger amounts of money, it’s relevant even if we’re talking about modest donations.

The integrity of a crowdfunding campaign depends in large part on its sponsor(s). Are they identified? Do they have an online presence? If you don’t know them or of them, can you otherwise verify the legitimacy of the request?

2. Is the funding campaign “fixed” or “flexible”? A fixed campaign specifies that if the minimum listed amount isn’t raised, then no one will be charged. By contrast, a flexible campaign takes your money even if the stated dollar goal isn’t reached. I tend to favor fixed campaigns because they tell me that the sponsor is confident in the appeal and its chances of success.

In considering an appeal from a high dollar flexible campaign, I will weigh whether (a) it’s an organization or individual I know; (b) the appeal (including the amount) is realistic and well articulated, and (c) I strongly support the project on its merits. At times, if a flexible campaign seems promising but perhaps overly ambitious or not too well thought out, then I’ll wait to see if it’s attracting a lot of support. If not, there’s a chance that others have the same concerns.

Let’s suppose, for example, that someone is asking for $25,000 for a project on a flexible funding basis. If, say, my $75 contribution is part of only $1,000 raised in total, then I may feel like a bit of a chump, having sent money to a project that isn’t even close to having sufficient funds to go ahead. On the other hand, I may so strongly believe in the project and its sponsor(s) that I will quickly make a contribution, knowing that they will use the money wisely even if they fall short of their fundraising goal.

3. Is there a sufficiently detailed budget? I want to know how the money will be used. I’ve read compelling appeals that are specific and detailed. I’ve read others for amounts around $5,000, $25,000, or even (yup) $100,000 that tell me very little. Guess who is more likely to get my contribution?

When foundations consider grant applications, they typically required a fairly detailed budget. Having both written and evaluated grant proposals, I know that writing out these budgets can be a pain, and frankly there’s often some guesswork involved. Nevertheless, it’s about transparency and accountability. Likewise, crowdfunded campaigns should provide a budget, too. If someone is asking for money in a public way, it is reasonable to expect some specificity concerning how the funds will be used.

4. If it’s a personal appeal for, or behalf of, an individual in need, then how credible does it sound? This is a difficult question, loaded with personal biases relating to who is “deserving” of help, and subject to the narrative skills of the person(s) writing the funding appeal.

Here are the personal appeals that cause me to back away fast: They tend to ask for larger sums of money, often five or six figures or more. Some sound excessive or suggest a failure to explore options. A few smack of The Secret on hallucinogens; it’s as if someone sat down and thought, I sure could use $100,000, so let’s go for it and maybe my request goes viral.

However, especially in this age of massive wealth inequality, economic uncertainty, and a frazzled social safety net, it’s also true that a lot of people are struggling to pay their bills and to put food on their tables. We should keep our hearts open to personal appeals, while considering them carefully.

5. What do the perks, if any, say about the attractiveness and integrity of the funding request? On occasion I’ve funded something because the perk(s) offered seemed pretty cool. Maybe a perk includes the very product I’d like to support. Or perhaps it gives me a good feeling of connection with the people organizing the campaign.

On other occasions I’ve declined to fund something because the perk(s) seemed cheesy or, well, insincere. By the latter, I mean that the perks were somewhat contrived and, in some cases, appeared to be deliberately difficult to fulfill. If, say, a $500 donation to a national campaign gets you a face-to-face cup of coffee with the project organizer, but you have to fly halfway across the country on your dime for that latte, then this should tell you something about the campaign sponsor’s regard for potential contributors — regardless of whether you can afford that level of support.

6. Is the funding request on behalf of an abused animal, or a beloved pet who needs expensive surgery? Put a sad looking little doggie or kitty cat on the funding page with a cry for help, and my critical evaluative skills often go out the window. Unless the critter is Cujo, I’m fumbling through my wallet for my credit card. Yup, I’m a sucker.

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This post was revised in December 2015.

Unemployed at midlife, “faking normal”…and sometimes bullied, too

Screenshot from Next Avenue.org

Screenshot from Next Avenue.org (Photo: DY)

In a plaintive commentary posted on Next Avenue earlier this year, Lizzy White writes about professional, middle-aged women who have lost their jobs and are struggling to make ends meet as they search for work:

You know her.

She is in your friendship circle, hidden in plain sight.

She is 55, broke and tired of trying to keep up appearances. Faking normal is wearing her out.

To look at her, you wouldn’t know that her electricity was cut off last week for non-payment or that she meets the eligibility requirements for food stamps. Her clothes are still impeccable, bought in the good times when she was still making money.

To be sure, the effects of the economic meltdown that began some seven years ago continue to be felt by men and women in almost every income level and vocational category. But those of my generation (late Boomers in their 50s), and notably unmarried women within that group, have felt its impact especially hard, with livelihoods and careers interrupted or ended at what should be periods of peak earning potential. White continues:

She lives without cable, a gym membership and nail appointments. She’s discovered she can do her own hair.

There are no retirement savings, no nest egg; she exhausted that long ago. There is no expensive condo from which to draw equity and no husband to back her up.

Months of slow pay and no pay have decimated her credit. Bill collectors call constantly, reading verbatim from a script, expressing polite sympathy for her plight — before demanding payment arrangements that she can’t possibly meet.

White provides more facts and figures to document the income disparities and disproportionate caregiving responsibilities that often put women in a less advantaged position than their male counterparts. It’s an important piece, and the comments posted below it are worth reading as well, including those who rightly point out that middle-aged men who have experienced job losses are facing these circumstances, too.

The bullying effect

This topic intersects with workplace bullying, because middle-aged workers endure a lot of it. When work abuse culminates in their termination or departure, they often face multi-level challenges in trying to pull themselves together and obtain new employment.

Two years ago, I summarized Workplace Bullying Institute instant poll results showing that workers in the 40s and 50s are frequent bullying targets. The poll asked visitors to the WBI website who have experienced workplace bullying to respond to a single question, “How old were you when the bullying at work began?” WBI collected 663 responses and reported the following:

The average age was 41.9 years. Targets in their 40’s comprised 30% of all targets; in their 50’s were 26.4%; under 30 years of age were 21.3%; those in their 30’s were 18.9%. The prime productive years are also the prime years for being [targeted] for bullying.

Five years ago, I suggested that unmarried women may be specially vulnerable to being bullied at work, especially if they have kids:

Let’s start with the observation that truly abusive bullies often have a knack for sniffing out vulnerable individuals. Then we look at potential targets: Demographically speaking, is there any group more vulnerable than single women raising kids? They already are juggling work and caregiving, their schedules seem timed down to the minute, and not infrequently they are struggling financially — especially if there is no father in the picture.

Unmarried women without children may not be as economically desperate to hold onto their jobs, but they can be very vulnerable as well. Women in general remain underpaid compared to male counterparts. Those who came out of busted marriages may have re-entered the workforce later in life. In any event, they are less likely to have someone to fall back on if bullied out of a job.

Over the years, I’ve encountered many women in their 50s who have been bullied out of their jobs and then face the daunting challenges of recovering from the experience in terms of psychological well-being, employment, and personal finances. For those individuals, “faking normal” may require wearing a mask that feels like a heavy weight, in addition to carrying the burdens of their situations generally.

Sad, disturbing stuff

This makes for pretty unpleasant and unsettling reading, especially if you’re on the north side of 50. These challenges are hitting my generation of late Boomers especially hard.

Decades ago, many of us entered the workforce in the heart of a severe recession. At the same time, employers were cutting back or eliminating pensions and other benefit plans. For those going to school, loans were supplanting need-based grants and scholarships as the primary form of financial aid.

And now this group has experienced an even more severe economic downturn during the heart of what should be its peak earning years.

It distresses me greatly that we have not summoned the collective will to make this a major political and public policy issue. What will it take to make it so?

In addition to rethinking abundance, let’s spread it around a little better

Economist Arthur C. Brooks, president of the American Enterprise Institute, a conservative think tank, suggests in an op-ed piece for the New York Times that we embrace abundance without excessive attachment to material things:

In other words, if we are lucky enough to achieve abundance, we should be thankful for it and work to share the means to create it with others around the world. The real trick is the second part of the formula: avoiding attachment.

In Tibetan, the word “attachment” is translated as “do chag,” which literally means “sticky desire.” It signifies a desperate grasping at something, motivated by fear of separation from the object. One can find such attachment in many dysfunctional corners of life, from jealous relationships to paranoia about reputation and professional standing.

In the realm of material things, attachment results in envy and avarice. Getting beyond these snares is critical to life satisfaction.

I think it’s great advice for people who are blessed with sufficient disposable income to have spending options. As I wrote here back in 2012, research suggests that the correlation between happiness and income levels tends to peak at somewhere around $75,000, subject to obvious variables such as cost of living differentials. Furthermore, studies indicate that giving to others can increase our personal happiness and that money spent on creating memorable experiences rather than on accumulating more stuff tends to be more satisfying. (Brooks acknowledges the latter point in his article.)

Abundance for some

However, at least here in the U.S., we’re living in an age of a widening wealth gap, with that $75,000 mark looking like an illusion to a majority of its citizens. Millions are living paycheck-to-paycheck, and still more are doing worse than that.

Don Lee reports for the Los Angeles Times on a new Pew Research Center study showing that the “wealth gap between middle- and upper-income households has widened to the highest level on record.” He continues:

…(T)he typical wealth of the nation’s upper-income households last year was nearly seven times that of middle-class ones. By Pew’s calculations, that is the biggest gap in the 30 years that the Fed has been collecting statistics from its Survey of Consumer Finances.

“The latest data reinforces the larger story of America’s middle-class household wealth stagnation over the past three decades,” Pew said. “The Great Recession destroyed a significant amount of middle-income and lower-income families’ wealth, and the economic ‘recovery’ has yet to be felt for them.”

An economic system that provides selective abundance

Brooks engages in some rhetorical sleight-of-hand when he says that “we should be thankful for [abundance] and work to share the means to create it with others around the world.” In other words, he’s not suggesting that we share big chunks of our own abundance with others. Rather, if you read the rest of his article, you’ll pick up an implicit defense of a market-based economic system that supposedly can provide others with abundance as well.

There’s a problem with that, of course. The economic system that has produced so much inequity over the past three decades isn’t exactly creating an abundance of opportunity these days. Steady jobs with good pay and benefits are in increasingly short supply. Around the world, the same corporate entities that took millions of those jobs out of the U.S. are now putting their manufacturing plants in countries where they can pay workers a fraction of what their American predecessors once earned.

Toward something better

If you’ve read this blog for any stretch of time, you know that I’m not going to call for a socialist utopia to replace the big, bad capitalist system. I’m way past the point of pitching any rigid economic ideology as the answer to our wealth gap. But I’ll happily repeat my belief that a robust private sector must be complemented by strong public and non-profit sectors, as well as an ethic of giving that asks more of the most fortunate. On balance we need a healthier mix of economic opportunities, regulatory safeguards for the public good, and a social safety net.

In his New York Times piece, Brooks writes that his inspiration for rethinking abundance was a travel encounter in India with “a penniless Hindu swami,” a “son of Indian petroleum engineers” in America who had traded in his MBA and the fast track for a more contemplative, austere life. That certainly provides grist for a curious narrative (well-paid think tank executive takes life lesson from ex-pat living in self-imposed poverty), but the deeper truth is that austerity and detachment from material goods are much easier to opt for voluntarily than finding yourself with no other choice.

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