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Declining Fortunes: The Withering of the American Dream.

Something happened to the American economy around 1973. We don't know exactly what, but we do know the consequences: Productivity growth slowed markedly and has never fully recovered. From 1947 to 1973, hourly work output increased by 3 percent a year; afterwards, by less than 1 percent. Productivity drives living standards. When it slows, so does the growth of wealth. Median family income doubled from 1947 to 1973; since then, it has risen only slightly.

This is the great economic change of our time, and it is where Declining Fortunes begins. Katherine S. Newman, an anthropologist at Columbia University, sets out to explore how economic change translates into generational friction. In a northern New Jersey town near New York City--"Pleasanton," as she calls it (all names are changed to protect privacy)--she conducts more than 150 interviews. And she concludes: "There is virtually no aspect of daily life that has been left unruffled by the shock of declining fortunes ."

Newman is at her best parsing the intricacies of middle-class hopes and discontents. She has an attentive ear and a gift for putting her finger on points of social tension. Subterranean economic change, she demonstrates, leads to eruptions of moral strife. For example, in the age of the working woman, who is a moral mother? The mother who works may be frowned upon as materialistic, but the mother who stays home may be frowned upon as unfulfilled. Or again: Baby boomers, she says, feel economically insecure and so wait longer to have children. "Hypercalculation thus replaces the casual, unplanned style of pregnancy of the postwar parents." This opens another values gap. Postwar parents think their children are being too finicky and waiting too long; the baby boomers think they are being prudent.

All of that is good and useful stuff. Newman's insistence on rooting her analysis in the real lives of real people, supported by her clear and unpretentious prose, makes her book a good example of how the anthropologist's lens can help bring American life into sharper focus. But wait a minute. The book wants to do more than map the changing middle-class mindset. Is it also selling a world view, a new victimology, beginning with its title, "Declining Fortunes"? Something fishy is going on here.

Pleasanton in the fifties--and, by extension, America in the rifties- is bathed in a nostalgic glow. The town was an upwardly mobile melting-pot community where houses were cheap, jobs secure and plentiful, hard work amply rewarded. It was the town of the American Dream. But those days are gone, and, through the bleak picture of the present day sketched by Newman, you'd think the Great Depression had returned. "Contractions, leveraged buyouts, bankruptcies, layoffs, and general despair over the state of American competitiveness--these are the headlines in today's business pages." Manufacturing is "on the skids." Baby boomers comprise "the first generation since the Great Depression to have a lower standard of living than its parents," and so on.

This is, very largely, nonsense. American manufacturing is not "on the skids"; mainly, it is thriving. Newman mentions the "slow descent" of wages but does not mention that total compensation (a better measure which includes fringe benefits) has risen 15 percent since the early seventies. She says that the median income has fallen since 1973, which is wrong. And she says that the eighties brought "steep declines in the purchasing power of the vast majority of Americans," which is bizarre.

One soon begins to notice that Newman trots out all the depressing economic statistics while leaving all the cheerful ones on the shelf. She notes that inequality has increased, but omits that the effects are relatively minor; overall distribution of income has changed remarkably little since World War II. In 1949, the bottom fifth of families received 4.5 percent of the income, the top fifth 42.7 percent; in 1991, the figures were 4.5 percent and 44.2 percent, respectively. Some sea-change. Partly because more poor and near-poor families are headed by single women, family income has fallen since the early seventies, but by and large the middle has held its ground or gained. True, the richest fifth gained faster than the middle fifth, but that's not the same as "declining fortunes." Newman bemoans the shrinking middle class. Says economist Gary Burtless of the Brookings Institution: "The middle class is shrinking, all right, but partly because they're jumping above ."

She writes of recessions as though they were permanent. "There appears to be no end in sight to the economic downturn of the late eighties." Oops. And: "Unemployment was at record levels in the early eighties, as the impact of the 1979-82 recession devastated the younger boomers." But the Reagan recession ended, unemployment fell, and the otherwise mediocre eighties expansion created 18 million new jobs. She points out that home ownership rates have declined for people under 50 but does not mention that homes are greatly improved. For instance, three-fourths have central air conditioning, twice the percentage of 1971.

I'm the first to agree that the post-1973 economy has been disappointing, but Newman is not playing fair. Instead, she is out to show that the complaints of the baby boomers are righteous. And they do complain. Her first-quoted interviewee is a woman ("Lauren") who "was born in the halcyon days of the fifties." Lauren cannot afford a home in Pleasanton (which is, after all, a suburb of New York City). "They lied to me," Lauren says. "I worked all those years and then I didn't get to candy land. The prize wasn't there, damn it."

There's more going on here than credulity, I think. Newman is constructing a new victim class. Many people would already include among such classes blacks, Hispanics, Asians, women, American Indians, the poor, and others. Newman seems to want to take the next logical step. She wants to extend victim status to an entire generation.

In her world view, the younger generations were walking in the park one day when the economy fell on their heads. Her presentation is moral: They suffer but are innocent. "There is no justice in the notion that Mr. Flory was in the right place at the right time, whereas [his-daughter] Mary and her husband had the bad taste to be born at the wrong historical moment." It's unfair, Newman concludes: "At the very least, sympathy would seem to be in order ... Surely the country must realize that they are deserving of some concern, some recognition of the price they have had to pay for maturing in the wrong place at the wrong time."

Okay, some sympathy is in order. There is a large element of arbitrariness in economic change. But let's also be a little more frank about the causes of middle class discontent. Among those causes are middle class greed and self-pity. Reading Newman, you would never guess that the middle class electorate--baby boomers and their parents--have had anything to do with the budget deficit, which burns up desperately needed capital; or with the extravagant expansion of Social Security, whose tax bite has quadrupled since 1950 and hurts poorer and younger families the most; or with Medicare, which helped send health care costs into the stratosphere; or with the home-mortgage tax deduction, which helped inflate the price of housing for first-time buyers; or with a thousand other subsidies and guarantees which the middle class has ladled upon itself, at great cost, over the last several decades.

I can't prove it, but I believe that a person of Harry Truman's generation would have felt ashamed to hear the way many of this book's interviewees talk. He would have pointed out that, despite everything, America is richer today than it or any other country has ever been, and more secure than it has been in 100 years. He would also have pointed out that the average U.S. high school student does as much homework in a week as her Japanese counterpart does in one day. Could that have something to do with the sad fate of the middle class?

I realized the complaining was getting out of hand when I came to the "successful corporate attorney" who "is earning more than her father ever did." "God," the young lawyer moans, "if we work so hard to get where we've got, there should be a better reward for it." This is embarrassing. Newman intends to paint a picture of a victimized generation. What emerges instead is a nation of whiners, abetted by intellectuals (and politicians) who pander to middle-class self-pity. Let us hope that this book is not translated into Japanese.
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Author:Rauch, Jonathan
Publication:Washington Monthly
Article Type:Book Review
Date:May 1, 1993
Words:1435
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