The circle of the finance strangle in America | It's been a long time since Betty Friedan called for attention for the problem that has no name. What she meant back was the dissatisfaction of millions of American housewives.

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Although poverty doesn’t describe the situation of middle-class Americans, who by definition earn decent incomes and live in relative material comfort, yet American households are still are in financial distress.

For people earning between $40,000 and $100,000, 44 percent said they could not come up with 400 dollars in an emergency. Even more astonishing, 27 percent of those making more than 100,000 dollars also could not.

And as we keep going up the income ladder, people have “things” — goods, houses, and, most importantly, education—to show for their higher earnings, but they do not have healthy finances.

This drives them to spend any money available and it comes not from a desire to consume more lattes and own nicer cars, but from the pressure people feel to provide their kids with access to the best schools they can afford. Breaking the bank for your kids’ education is, to an extent, perfectly reasonable. When understood mainly as a consequence of this rush to provide for one’s children, the drive to maximize spending is not some bizarre mystery, nor a sign of massive irresponsibility, but a predictable consequence of severe inequality.

Even though there’s not a great term for this phenomenon and its consequences. Neal Gabler, the author of The Atlantic’s story on this problem, decides to go with the phrase “financial impotence,” which is indeed capturing the powerlessness that many feel when confronting a financial abyss.

© 2018 PETROS STATHIS | ALL RIGHTS RESERVED.

Petros Stathis

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