NEW YORK (MainStreet) -- Economists struggle to say it, politicians aren’t courageous enough to really say it, and Wall Street doesn’t want to ruin a good thing by saying it.
But average Americans will say it: Financially, the American experience is lousy right now. It’s right up there with root canal and having a candy apple thrown into your “trick or treat” bag on Halloween night. Morale is low.
Need some proof? How about this 2011 survey from ABC News and Langer Research Associates, which pretty much sums it up:
“A near-record number of Americans call jobs difficult to find in their area; more than half say the long-running economic downturn has forced major changes in their personal lifestyle – and increasing numbers are upset and downright angry about it.”
The ABC poll reveals that only 15% of American say they are “getting ahead financially” while the rest are either treading water or drowning.
The upshot? Even politically disparate groups like Occupy Wall Street and the Tea Party believe that the American Dream is slipping away – and nobody can seem to agree what to do about it.
Usually, here’s where the “but” part of the story appears, signaling a trend that things are getting better, or that there is a silver lining on the horizon. Unfortunately, this isn’t one of those stories. The news, it seems, just keeps getting worse.
Exhibit A this week is a new study from the University of Washington that blames housing and health care costs as the two biggest reasons why Americans just can’t make ends meet.
The study, which focused on Washington state residents, estimates that it costs 13% more on average for adults to meet their financial obligations in 2011 than it did in 2009.
According to the “Self-Sufficient Standard For Washington 2011” report, a single parent with one preschooler and one school-age child living in Seattle needs an annual income of $56,904 – up 13% from $50,268 two years ago – to meet the family’s most basic requirements.
The news was somewhat better for residents of non-urban areas. Similar residents of Spokane County, Wash., need an average of $41,750 to get by – up 8% from $38,562 in 2009.
“Even as wages have stagnated and unemployment doubled during the Great Recession, the cost of meeting basic needs has continued to rise, putting an economic squeeze on families who are struggling to survive in this difficult economy,” notes Diana Pearce, the lead author of the report, in a statement.
Pearce’s data focused on what financial assets families need to pay for housing, food, child care, health care, taxes, transportation, and “other basic necessities”.
Of those items, the report concludes that housing and health care are really outpacing the cost of living for the average American family. Health care costs in Washington have risen 12% since 2009, while housing costs are up 10%, the study shows.
How can housing costs rise when most U.S. home values are in decline? The Washington study has an answer for that.
“Falling house values has not translated into falling rents for most households,” Pearce adds. “Of course, for families subsisting at this basic needs level, buying a house is rarely an option, and indeed some families may have experienced bank foreclosure on their homes, resulting in their coming into a rental market where rents are rising.”
And health care costs are rising despite the passage of health care reform nationally in 2009 – and they don’t appear to be coming down in the foreseeable future.
The Washington study shows what Americans already know – their financial picture is darkening, and nobody – especially once-trusted institutions like Congress and Wall Street – has a good answer of what to do about the problem.
So whether you’re a ticked-off Tea Partier or an outraged Occupier of Wall Street, you can take some consolation that your anger is truly justified – but that doesn’t mean things are going to change anytime soon.