Pundits, especially on the right, keep telling us that Trump's re-election is a slam dunk finish because the economic and job numbers are "the best in your lifetime". Only one problem with that analysis, and that is the analysis is flat out wrong for those left behind by wealth inequality.
Sommer Johnson thought everything was finally coming together for her last year. She was engaged, working full time and doing well in online college classes when her fiance’s mother died a week before their wedding day — triggering a series of large and unexpected expenses that left her struggling to pay her bills and brought her to the verge of bankruptcy.
“I keep hearing this is one of the best economies we’ve ever had and unemployment is down, especially among African Americans, which I am,” said Johnson, 39, who lives in Douglasville, Ga., an Atlanta suburb. “I’m looking around going, ‘Where is this boom?’ From where I sit, this doesn’t look like the best economy ever.”
The economic expansion this week became the longest in U.S. history, surpassing the 1990s boom, which lasted exactly a decade.
The stock market is at record levels, with the Dow Jones industrial average closing at a new high Wednesday ahead of the July 4 holiday, and President Trump has made the economy’s strong performance a centerpiece of his reelection campaign.
But this expansion has been weaker and its benefits distributed far more unevenly than in previous growth cycles, leaving many Americans in a vulnerable position.
This is a “two-tier recovery,” said Matthew Mish, head of credit strategy at the investment bank UBS. About 60 percent of Americans have benefited financially, he said, while 40 percent have not.
The 40 percent — which Mish calls the “lower tier” — have seen paltry or volatile wage growth, rising expenses for housing, health care and education, and increased levels of personal debt. They tend not to own homes or many stocks.
In discussions with 30 Americans unable to pay all of their bills, a clear pattern emerged: Most were able to eke by until they faced an unexpected crisis such as a job loss, cancer, car trouble or storm damage.
The extra expense caused them to get behind on their bills, and they never fully rebounded.
Economists fear such precarious financial situations put many Americans at risk if there is even a mild setback in the economy, potentially setting up the next recession to be worse than anything in recent history except the Great Recession.
“So many Americans are living paycheck to paycheck,” said Signe-Mary McKernan, vice president of the Center on Labor, Human Services and Population at the Urban Institute. “We are headed toward a political crisis, if not an economic one.”
It won't take much, either. I think the catalyst is going to be Trump's trade war with China, spiking consumer prices across the country, and that will hurt the "lower tier" more.
And again, we're talking 40% of the entire country, which means we're talking about a number of working-class white voters as well as black, Latino, and Asian voters who are going to quickly fall into real trouble and soon. How many working-class white voters will stick with Trump if they start going under?
Probably a large majority of them. Will they actually show up and vote?
We'll see.