eand.co | It is impossible — flatly impossible — for the average American to make ends meet. I can tell you that as an economist, one of the only really good ones America’s ever had. Americans grew poor because their economy failed them. But a poor society can’t afford many things. Things which matter. Like democracy, truth, reason, goodness, decency.
Societies faced with sudden descents into poverty implode into authoritarianism, just the way America is. Greed broke America in this larger, truer sense.
But Americans don’t really understand it yet, I think, just how extreme and out of control greed really is in America — and how, paradoxically, it left society poor. Too poor to afford to even be a functioning country or democracy anymore, in the end, and so America’s just imploding now.
Let’s do a little math first, to prove the point that it’s impossible to make ends meet, and then I’ll teach you a little bit about how what’s normal in America is completely and totally abnormal in the rest of the entire world, more or less.
The median American income is about $35K. That is what millions of Americans earn. For a “household,” meaning in economic statistics, a family of four, it rises to about $60K.
It is impossible, and I mean impossible, to live on that level income. That is a median income more suited to a poor country than a rich one. But let’s prove it.
Rent? The average rent for an apartment was $1124 in 2021. That’s $14,000. That’s half of the average person’s income eaten up by rent alone. Now we have…all the other expenses of life. Let’s start with the other big one in America: healthcare. The average cost for a family paying for healthcare was almost exactly the same: $1152. Bang. Another $14K. That’s the average American’s entire income gone, on just rent and healthcare.
But maybe you object — my employer pays for my healthcare. Or maybe I don’t even want healthcare (LOL, you mean you can’t afford it, I get it, we’ll come back to that). Sure — it’s not going to make much difference in the end. The average American spends about $1200 “out-of-pocket” even if they’re insured by their employer — let’s call it $1500, because that’s surely an underestimate. That leaves us with maybe about 14K of income per year for the average person — and we still haven’t gotten to most bills.
You need a car in America, to get much of anywhere. You need insurance for it. The average monthly car payment is $600. Let’s call insurance another $100. That’s $700…a month. Or $8400 per year. Suddenly, we’re left with about $5K to cover everything else you need in life.
Water, electricity, gas to put in the car. Internet. A mobile phone. The average water bill’s around $100 per month — bang, another $1200 gone — and now we’re down to just about $3800. Internet and a phone? Call them another $100 per month. Now we’re down to $2600. Electricity? Another $100 per month. Now we’re down to just $1400. Average annual cost of gas to put in that car? It’s about $1100.
Now you’ve got just $300 left.
But you still have to feed and clothe yourself. Your kids. Pay for random stuff like maybe a toy here and there, a treat. I’m sure I’ve left plenty of stuff out that isn’t remotely a luxury — like paying off student loans.
The point I’m trying to make should be crystal clear by now — not least because you’re probably living it. Making ends meet in America is flatly impossible. It cannot be done. My lovely wife’s income is so low that it doesn’t even cover her expenses — car, travel, a hotel every now and then because she’s asked to work overtime regularly.
The economic effect of all this is somewhere between a joke and an embarassment. I’m subsidising this world-famous billion dollar institution which pays its “administrators” millions, because my wife isn’t even paid enough to cover her basic living expenses. Think of how ridiculous that is. The reason those administrators earn millions is because I’m effectively paying them to employ my wife — after they get a cut of overcharging Americans for operations and medicine. But this story isn’t personal — it’s social. Those economics — people can’t make ends meet — are absolutely fatal for a society.
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