TCS Daily


So, How Insecure Do Americans Really Feel?

By Nick Schulz - February 28, 2007 12:00 AM

Editor's note: Economic insecurity is much in the news lately. Presidential aspirant John Edwards has made it a focal point of his campaign. Armchair populists such as Lou Dobbs talk about it on their TV programs.

Karlyn Bowman, a senior fellow at the American Enterprise Institute, recently conducted a study that brings together existing trend questions from many pollsters about Americans' concerns regarding their jobs, personal finances, retirement, health care, and more. TCS spoke with her about what she discovered.

TCS: Democrats think that economic insecurity is a winning political issue. Is it?

BOWMAN: Americans have real concerns about future U.S. economic performance and about how their fellow workers are doing. Politicians understand and are responding to that. But most people are managing. Very few of us are on easy street, but we are handling our day to day expenses and obligations. We're optimistic about how we and our families will do in the future. Democrats have to understand both perspectives.

Concerns about the war in Iraq are contributing to a deep pessimism in the country, not only about Iraq, but also about the economy, the environment, and everything else. Politicians are aware of that.

TCS: Could you give us some idea of how people see things going in their own lives?

BOWMAN: Let me take a couple of areas I've reviewed.

About 10 percent in Gallup's question say it is very or somewhat likely that they could lose their job in the next year. At the other end of the scale, nearly six in ten say that isn't likely at all. Large majorities in other Gallup questions say they are satisfied with their job security. These responses tend to be very stable. Most don't worry too much about job security.

In terms of personal finances, in a new Los Angeles Times/Bloomberg question, 15 percent describe their personal finances as very secure and another 56 percent as fairly secure. Around 12 percent say their finances are very shaky. The Los Angeles Times has been asking this question since 1991 and the responses are pretty stable. Most seem to feel secure.

How about paying ordinary expenses? In Gallup's data, about 10 percent are very worried about paying their rent or mortgage, and around 4 in ten aren't worried at all. As for being able to pay the minimum payment on credit cards, 9 percent of those who have them are very worried and, at the other end of the spectrum, four in ten aren't worried at all. There's a little more concern about paying normal monthly bills. Around 15 percent say they are very worried about this, and three in ten aren't worried at all. There are a lot of people in the middle on these questions, but most people are managing. Fifteen percent told a bipartisan polling team recently that because they were short of money, they have fallen behind on monthly payments and paid bills late. In questions asked in two separate years by Pew, around 10 percent said they had ever declared bankruptcy.

There seems to be a slice of around 10-20 percent of the population that is very worried about keeping up. Around 10 percent say they have declared bankruptcy.

People say their health care expenses are increasing, and they are worried about them. About 20 percent say they have had a problem paying medical bills in the past year. Around four in ten are very worried that they will have to pay more for their health care or health insurance.

TCS: Lou Dobbs has been talking up the evil of outsourcing. Are Americans as concerned about it as he is?

BOWMAN: Gallup asked people for three years running (2003-2005) whether they thought it was likely that their company would ship their job overseas. In each year, around 10 percent thought it was likely. So most Americans don't see it as a problem for them. They think it is a big problem for their fellow workers and for America's economic future.

TCS: You say that people are optimistic about their own lives and futures, but pessimistic about the country. Which is more important?

BOWMAN: I trust what people say about their own lives. That's what they know best. Their impressions of how things are going in the country are informed by the national media which has a bias toward the negative. There is rarely a good news story on the evening news, especially now with the Iraq war looming over everything.

TCS: The writer Gregg Easterbrook published a book called "The Progress Paradox: How Life Gets Better While People Feel Worse." Was Easterbrook on to something? In other words, to what extent are Americans aware of the economic progress around them and to what extent does that factor into their views?

BOWMAN: The polls show that Americans are aware that life is better for them than it was for their parents and grandparents and that they are optimistic about their children's prospects. But when they answer questions about their job prospects for the next year or whether they have trouble making their mortgage payment, I doubt they think about this larger context.

TCS: Are the polls useful in this regard?

BOWMAN: Most of the pollsters cover what is going on in people's lives and their views about the country. The media who report (and often participate as partners in) the polls give far more attention to the national numbers. As I said earlier, those are almost always more negative than people's views about their personal lives. So many Americans get the impression that things really aren't going well for most people, and they are sympathetic.

TCS: Thanks for taking the time to talk to us.

BOWMAN: Thank you.

Editor's note: You can find more of Bowman's research here.


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110 Comments

The wealth of U.S. families
Nick: Kudos for having the bravery to introduce a subject certain to be unpopular with many in the house-- the validity of polling data. Many among us don't like to think about such data being true-- unless it supports some notion we like believing in already.

I would suggest though that your Ms Bowman may have restricted her database to people easily reached by taking a short drive from her house. Her data are consistent with one basic observation: that four in ten among us think we're fat and happy (or at least doing okay), while only one in ten feels like he or she is in trouble.

Compare her poll findings with this study, entitled The Wealth of US Families: Analysis of Recent Census Data. It was compiled in 1999, so the picture it describes is actually a little brighter than the one we see today.

http://www.census.gov/dusd/MAB/wp233.pdf

In it we find, for instance, that "The average (median) U.S. family in 1995 had net financial assets of only about $1,000. Average gross financial assets were about $2,700, before subtracting unsecured debt."

Also "The lowest thirty percent of families, ranked by the size of their net financial assets, have zero or net negative financial assets; that is, their unsecured debts equal or exceed their gross financial assets. The lowest 20 percent have net negative financial assets (net debt) of $800 or greater, and the bottom tenth have net debtof $4,700 or more."

This suggests that easily three in ten among us really don't have much to crow about. Maybe they weren't among the group being polled.

I know everyone will want to scrupulously check over my source, to see whether I have my thumb on the scale in summarizing the findings thus. Be my guest.

And I know as well there are those among us who will want to point out how much better this demographic is doing now than they were back during the 1990s. I welcome your comments, well referenced of course.

Problem with Lou Dobbs and others
Economic insecurity is no fun. But the problem with people like Lou Dobbs and his ilk is that they can only make things worse if they have their way. Economic security is best met by having lots and lots of economic growth and opportunity (Duh). Since we all know that government, being a form of bureaucracy, is not capable of creating economic growth and opportunity, it is best if people as free individuals can do so by pursuing what ever opportunities that happen to be out there (another duh). The only thing that government can do is to create more regulations which, in turn, can only decrease economic opportunity and, thus, increase economic insecurity (a third duh).

So, the only way to increase economic opportunities for people is to get the government out of the way and let people create their own opportunities.

The dream of a poor, hungry child in Calcutta
is to be a poor, obese child in America. You beautiful fools who lament the plenty that allows the poorest in your society to eat themselves to death.

Excellent
Many of the "poor" in this country have made bad choices in life that have put them where they are. Some really do not care if they are poor. Mazlows level of food and shelter is almost always met in this country compared to others. Poverty is a very relative thing.
During the Clinton .com economic bubble all we heard from politicos and the media was how great the economy was. The economy has been great since 9-11 and the Bush people did a poor job of getting that news out. The media is not going to tout a great economy with Bush as president, and has not been honest on this issue. Lou Dobbs is likeable but he is also selling a book and has a TV show on CNN to promote it.
Of course Democratic presidential candidates are going to say bad things about the economy. I think that the shudder that went thru the markets yesterday might have been the realization that the Democrats won the last election. Just a little humor.

So CEOs should continue to dismantle pension funds while creating $100 million pay deals for themsel
This makes the average worker feel much, much more secure.

And since everyone is feeling so secure, I guess we don't need to worry about millions and millions of people having no health insurance, and (because of pre-existing conditions) not being able to buy it.

Yes!
Thank you for the observation. Roy will not be moved, however. He's established a long time ago that he confuses hating "the rich" with loving "the poor". He sees no difference between the two; besides it so much easier to adopt attitudes that lend nobility to your own envy and convince yourself that you are a friend of the impoverished. Truly a study in cursing the darkness and blaming "society" for not providing universal luminescence.

.COM Mirage
I ALMOST took a position with a company called Suretrade.com, which was one of those companies that was going to make everybody rich through internet day trading...

Hmmm, can't seem to get the URL to work..

On the other hand, my client/friend the plumber still makes a good buck. The work is hard, long and occasionally dirty/distasteful....

Good thing he makes lots of money, Nancy Pelosi needs a 757.

Nancy needs a 757 more than the vice president does?
And she's never taken the plane, but don't let that stop you.

So Americans should be proud of having poor obese children and not worry about CEO packages?
I mean, if a CEO fails at his job, of course he's still worth hundreds of millions of dollars in golden parachuts This isn't India, after all.

Yes
I am glad that you can make the distinction between America and India. If only India had your problems it would be very happy indeed.

Don't envy you the caste system
But is "better than India" really the best answer for people worried about inequalities in American society?

Its your question, but the answer is NO
No,just whined about it....

Now if you can't tell the difference between VP and SOH, well your even more cognitively deficient than your rants would lead one to believe.

The pitch, the swing and yet another whiff...
IF you actually knew anything about pensions you'd realize how utterly indoctrinated with simplistica you sound..

The tragedy isn't that defined benefit pensions are disappearing, the miracle is that they lasted this long.

You see for decades, the GOVERNMENT has been tinkering with pensions for a variety of reasons such a messing with the various limits imposed on pensions can increase taxes without actually voting for an increase in rates; attempting to use the private pension system for social welfare purposes and just because its seems to be a compulsion for Congress. In the interest of avoiding insolvency, they legislated and regulated them out of existence.

Pension plan sponsors are confronted with regulation from the IRS and the Dept. of Labor. When they coordinate their efforts, they often disagree. Look up what the IRS considers a "highly compensated employee". Simple definition-earn more than the limit or own 5%, you are an HCE. The funny thing is, the IRS looks reasonable compared to the DOL. Oddly, the DOL is the one charged with ensuring we don't have another Studebaker incident-but constantly issues "prohibited transaction exemptions" for the likes of GM - a few years ago they allowed GM to use its own stock to meet funding requirements-ordinarily a BIG no no.

Then there's the limits. On compensation you'll have Sections 401(a)(4), 401(a)(17), 402(g), 404, 415, and a few others I might have left out.

So to navigate this thicket, you need experts, lots of them. CPA's audit your plan, actuaries tell you how much you owe and attorneys check the endless Washington logorhea and rewrite your document every couple of years ago. All of these experts cost big bucks and not a one adds a single penny to the bottom line. You also need trustees, a plan administrator and a "recordkeeper". There's big risks with being a "fiduciary" so they charge appropriately.

You really need to learn something other than the pablum talking points your puppet masters put in your inbox very day.






That is good
Be grateful for all that you have and for those unknown that have sacrificed for you.

Well done, nameless one
Anyone who has owned a business with employees will ask themselves "Did I really want this?"

dismantle pensions, agreed
I have to agree that the company pension system should be dismantled, also medical care tied to companies. Instead, it would be better if workers could just keep the money they earn and administer their own pension plans, and buy private medical insurance; both would follow the guy around whereever he works. Apparently even Chile has a much better pension system than the States. But I realize that statists want to keep poor people dependant on the nanny state, welfare system.

So the bottom line is pensions are disappearing while CEO packages are exploding
exactly as I stated. And this is supposed to make workers feel secure and confident??

>You really need to learn something other than the pablum talking points your puppet masters put in your inbox very day.

I do appreciate you taking the trouble to confirm my point in great detail, illustrating that in fact the pension system has gone to pieces. You blame the government; fine; presumably changes are in order. But admitting we have a problem is the first step.

Hare Krishna, Hare Rama, $210 million CEO severance package, Hare Hare
Robert L. Nardelli has abruptly resigned as chairman and chief executive of Home Depot, pocketing a lavish severance package and leaving shareholders with a stock that has languished even as sales have nearly doubled during his six-year tenure.

In a statement released yesterday, Home Depot's board of directors and Nardelli said they "mutually agreed" to the resignation, which took effect Tuesday. Under the terms of a separation agreement negotiated when he joined the company in 2000, Nardelli, 58, is to receive about $210 million in cash and stock options, including a $20 million severance payment and retirement benefits of $32 millio

He's second in the line of sucession to the presidency
she's third. She did not 'whine' about it. Her critics whined. Now you are repeating their whines.

How Secure is America?
I guess these article wants to prove to the American people that America is so ever secure while another nation has defacto settled in, where now its language has to be legally treated equal to English, while America's ever more inhumane and horrendous war machinery circles the globe and shoots to pieces anything its Emperor does not like, and while this shooting roars the USA borders are really in practice still non-existent and this invasion only gets more numoreous of perhaps the worst of mankind, but only God know's who they are? Yes, and more and more bullet proof glass is installed and banks, and many other places of business! Yes, while America's jails overflow of illegals who are criminals and gangs are all over of most of whom are also illegals! Yes, while of recent Bank of America will give credit cards to illegals with a SS! Yes, while all American Banks make loans of everykind to illegals! Yes, more secure as the sleeping pill industry has soared to billions upon billions of dollars while America sleeps less and less and works more and more hours weekly etc., etc., etc.

Bella Pelosi
She also appointed the congressman from La. that had $80 large in his fridge to the homeland security committe. He is still under investigation and refuses to resign. I see a pattern of corrupion based politics here. Wasn't she supposed to change all that?

The last speaker of the house only used a private jet.
That jet has enough range to reach CA without refueling.

And no, the Speaker of the House does not need a 757.

stupid comparison
The president has a 747, the VP is first in line, surely he's entitled to a 747 to. Then when he gets a 747, surely the Speaker is entitled to on.

That's what it's all about with eric, isn't it.

Entitlement and jealousy.
Somebody has something better than you do, and it just eats at your soul (whatever's left of it) until someone gives you one too.

If they are obese then they obviously have enough mone.
...

why does the fact that poeple who work, have more than you do, bother you so much?
Isn't your mother giving you enough to eat?

defined benefit pensions are disappearing, other types are in fact expanding
but they are being replaced with other things.
Almost everycompany has a 401K with matching funds.
My company matches 75% of the first 8% I put in. That's worth several thousand a year. They also put an amount equal to 2% of my salary into the same fund, regardless of whether I am participating in the 401K.

Just ignore the troll
trying to debate him will just encourage him.

Stupid repetition of stupid lies
1. Because the speaker is 3rd in line to the Presidency, for security reasons they aren't supposed to travel by commercial jet. Pelosi's predecessor used at small jet to go to Illnois. California is out of range. The only vehicle they hve is a 747. Which she hasn't used. Which hasn't stopped hate-mongers like yourself from manufacturing fictions about her royal fantasies.

2. When Cheney travels, he typically not only fills up a 747 but also a much larger air transport, since he brings an entourage of multiple vehicles including an ambulance with him whereever he goes.

3. This is not remotely about envy, and particurly not about my envy. But for Mark, for some reason, every single issue just turns into a personal hatespray; he has no abilityt to discuss anything on its merits.

Mark makes up facts, as he always does.
Hastert usually used a 12-seat military (not private) jet that had enough range to reach Illinois without refueling but not California. Look it up.

Please stop your inane personal attacks.
If you have nothing to say on topic, stop wasting everyone's time.

Speaking of class war...
Sounds like you have an ok deal, though lots of places do better.

And lots and lots do worse. My point was about places where people worked for years with defined benefits plans that got converted got screwed. In many cases, the executives who pulled the switch rewarded themselves enormously. But criticizing the executives is class war?? Why isn't what the executives did to the pensions class war?

Contract
I believe this was the contractual obligation meted in good faith. Are you a shareholder of Home Depot and if not, what business is it of yours? You should worry more about your own affairs.

Actually, the bottom line is...
that the nameless one has proven that you know nothing about what the topic you are spouting off about.

Nothing new about that.

How refreshing!
Must be nice to sit back at your computer and take a break from reality.

The poverty of polling data
>"Nick: Kudos for having the bravery to introduce a subject certain to be unpopular with many in the house-- the validity of polling data."

Validity has to be proven and the methods and standards transparent and provided with the data.

Actually the subject of automatically believing the polling data is what is unpopular with me. You have proven in the past to be a sucker for such things. The election polling data and Iraq death counts (the political hit piece by the Lancet) are two that come to mind.

When reality proves polling data wrong is it still wise to believe the polling over actual data?

>"Many among us don't like to think about such data being true-- unless it supports some notion we like believing in already."

Surely you are speaking of yourself? You seem to be the first to throw in a poll if it supports your various claims before doing a basic fact check.

It's the shareholders who are complaining
Among other things, that such contracts are negotiated between a CEO and boards who are not at arms length, and the deals aren't in the interest of the shareholders.

What CEOs receive these generous packages to do, often, is to shortchange contractual obligations to to workers. But why not remind the workers how lucky they are not to be scavenging garbage dumps in Mumbai?

the bottom line is he's made my point
in addition to the dynamics cited, raiding of pension plan assets for corporate empire building has been a widespread phenomenon. But the other hits on pensions are equally telling The bottom line is pensions are not now a big area of American security.

Nothing new
Of course it is already an old story getting worse while you and mosts Americans are drunk with materialism while they think that they are so smart while at the same time being overrun by a foreign power and at the same time financing America's most tremendous military enemy, that of Communist China! Yes, nothing new as Saddam was once the bedfellow of America for oil and now in a mess there, etc., etc., etc. Your answer is so childlike, it is a pitty, just sort of an ignorant shot! However, you may have picked me while responding to someone else.

Believe that if you wish...
since it shows you really didn't understand his post at all. Leave it to you to believe the boot in your ass was pat on the back.

Didn't pick you
I believe my post is clearly under LeMule's showcase of ignorance.

Although I am glad that you wish to carry on that ignorance for him. He really needs friends that are not imaginary.

Or, better yet, fearnot is yet another name for LeMule/Eric/Fortunato/Beatles1...

Who ya gonna believe?
"When reality proves polling data wrong is it still wise to believe the polling over actual data?"

You present yourself as a person so exalted that he always distrusts polls unless he has personally examined their methodology and pronounced himself satisfied.

So then... give us an example of a poll whose data has been "proven" wrong. Then offer the proof.

You can start with the data I've cited. After all, is not the US Census merely a poll?

http://www.census.gov/dusd/MAB/wp233.pdf

And you can proceed to the polls cited in the article-- the Gallup poll and the LA Times/Bloomberg poll. Tell us which of the three are the more accurate, and why.

My point stands and his post doesn't refute it.
And in terms of objects in ass, the big one you're feeling in yours is your head.

Don't do away with it just yet
"Since we all know that government, being a form of bureaucracy, is not capable of creating economic growth and opportunity, it is best if people as free individuals can do so by pursuing what ever opportunities that happen to be out there (another duh). The only thing that government can do is to create more regulations which, in turn, can only decrease economic opportunity and, thus, increase economic insecurity (a third duh)."

Permit me to say there's a bit more to it than that. Governments create monetary policy, for instance-- thereby preserving the worth of the currency they so thoughtfully provide to us capitalists.

They also set fiscal policy, which through public spending performs public functions that can't easily be performed for private profit. Among those are not only maintaining a transportation infrastructure but an educational infrastructure and a research program aimed toward the development of the next technologic generation. This may not by itself "create" economic growth. But it certainly provides and maintains an all-important medium for good growth.

Those are all programs that post short term losses, and thus are poor candidates for privatization. But they improve our long term collective prospects. And in theory at least, the costs are equally borne by all who benefit.

A good example is educational programs that provide higher ed to children of poor families. These people, properly educated, contribute an order of magnitude more to society than do those who are left to fend for themselves.

Get government "out of the way" by terminating these and similar programs, and in a decade or two what you have is the continent of Africa: no infrastructure of any kind to work with.

Le Mule
Le Mule's usually have nothing else to say but prove that they are indeed mules, by calling others mules, etc., etc., etc.

stupid inability to understand question
1) Nobody ever suggested that her highness take a commercial jet.
Pelosi claimed that Hastert's jet couldn't reach California, but the manufacturer of the jet, and the FAA beg to differ. That particular jet could reach Hawaii if they kept the passenger count down.

2) Chenney does not use a 747, only the president does.

3) Yes this about envy. Pelosi's and yours.

eric can't tell the difference between reality and his mother's basement
Where the heck do you think the military gets those jets?
DO you think they build them themselves?

The manufacturer of the jet has stated without reservations, that as long as you keep the passenger and luggage count down, that particular jet can reach Hawaii.

the places that don't have 401k's also never had pensions.
minimum wage workers never got pensions.

criticizing people for the sin of making more money than you do, is class warfare.

in his case, it's more like a permanent vacation.
...

Pournelle's Iron Law of Bureaucracy
I can tell you from a friend of mine who spent 10 years in the government funded R&D meliue. It is a completely unproductive and a waste of money. NASA and the Tokamak fusion program are perfect examples of this, as well as 99% of all medical research.

The problem with bureaucracy that should be understandable by anyone who has works in any large scale organization, either public or private, is that the organization and its programs take on a life of its own, regardless of the purpose it was created for. Thus, NASA exists to keep 20,000 civil servants employed until retirement.

Need I say anything about our public school system? Many of the other things would probably be better if they were created privately rather than by government.

Read Jerry Pournelle's Iron Law of Bureaucracy. It is a law of nature. I know of no method for creating any large scale social institution that would be free of this problem.

Usually people who say that a particular thing is "good for our collective benefit" is really trying to justify why he and his buddies should benefit from the public treasury.

Again, I recommend you read Jerry Pournelle's Iron Law of Bureaucracy before making further comments.

The worthlessness of government
"I can tell you from a friend of mine who spent 10 years in the government funded R&D meliue. It is a completely unproductive and a waste of money. NASA and the Tokamak fusion program are perfect examples of this, as well as 99% of all medical research."

I'm sure your friend is being very sincere, as he extrapolates from his own personal experience to the grand pronouncement that all government work, by definition, is useless. But others may have different experiences.

We don't tend to have depressions any more. And recessions seem to be getting shallower and shallower, with milder recoveries, fewer shocks, and admirable stats on unemployment and inflation, compared with previous eras. Thank the work of government economists for that.

Twice now I've been cured of cancers that only a few years ago would have been deemed incurable. How? Well, NIH has been putting ungodly amounts of money and effort into cancer research. And in every different type of cancer. we're seeing the payoff.

AIDS? Not much of a problem now, in this country. In other countries, mostly a problem of money, not knowledge. Why? Publicly funded AIDS research.

Clean air and water? A lot better than they used to be.

It's nice to create general rules. It's also smart to acknowledge the many exceptions.

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