Reply #5: a little reality check though

[hfojvt]

your family made $19,800 in 1977. In 2001 dollars that is $57,864. In 2011 dollars that is $73,816. That makes you upper middle class.

In 1977, the limits for the quintiles in 2001 dollars were
20% made less than $14,986
40% made less than $28,100
60% made less than $42,617
your income was $57,864, meaning that you made more than about 75% than the rest of the country.
80% made less than $62,130
95% made less than $100,441

You lived in a neighborhood with your economic peers, meaning that everybody you knew made about the same, or more than you did. Many people were still struggling then, the unemployment rate was probably over 6% and the poverty rate was 9.3%. The difference is that those people were not on your radar then. You did not have the internet and DU to remind you of their plight several times a week.

Things are certainly worse now, because we are very slowly climbing out of a very, very severe recession, but just five years after 1977, in 1982 the unemployment rate was over 10% for several months and the poverty rate had climbed to 12.2%.

One thing that has changed significantly is the two income households. Back in 1977, those were not as common, as you illustrate. It makes a difference in the economic picture though as it more widely distributes the pain. Back then with a 10% unemployment rate, you had a ten percent chance that hardship would hit your household with only one breadwinner. Now, with two incomes, that gives you twice as many chances for a breadwinner to lose their job. You have a 10% chance and your spouse has a 10% chance. So now a 10% unemployment rate means 20% of households are hurting, having lost a portion of their income. That probably leads to a bigger drop in consumer spending, further weakening the economy.

Now people in the 75th percentile have two breadwinners, but if one loses their job, that knocks them down to the 50th or 40th percentile.

And it is worse than that, because the 10% unemployment rate hides the fact that many have lost their jobs and gotten new jobs, but their new jobs do not pay as much as their old jobs.

I also find it hard to believe that there were no malls in KC in 1977. KC is a major metropolitan area, and I fully remember that Madison, Wisconsin had TWO malls, an East Towne Mall and a West Towne Mall, and they were magical places when we were kids. In 1979, after years of fighting with the Chamber of Commerce, my own little town (of 14,000) finally got its own mall, including a Kmart. They probably starting building it in 1977.

Credit cards were rareer. I remember dad having to search for a gas station that would take a mastercard, because not all of them would. Plus, on our long vacation from SD to grandma's in NY, dad made arrangements with a bank in NY so he would have a place to cash a check and get more cash to continue the vacation.