Posted on 12/02/2014 2:30:05 PM PST by dennisw
The American middle class has absorbed a steep increase in the cost of health care and other necessities as incomes have stagnated over the past half decade, a squeeze that has forced families to cut back spending on everything from clothing to restaurants.
Health-care spending by middle-income Americans rose 24% between 2007 and 2013, driven by an even larger rise in the cost of buying health insurance, according to a Wall Street Journal analysis of detailed consumer-spending data from the Bureau of Labor Statistics.
That hit has been accompanied by increases in spending on other necessities, including food eaten at home, rent and education, as well as the soaring cost of staying connected digitally via cellphones and home Internet service.
With income growth sluggish, discretionary spending on things like clothing and movies, live shows and amusement parks has given way.
The data—drawn from 14,000 households that either keep diaries on their spending for two weeks or agree to quarterly interviews—helps explain why so many retailers are turning in persistently lackluster results, and why the household-products business has shown virtually no growth for years. It also helps illuminate why the consumer-led U.S. economy has been so slow to rebound from the financial crisis.
(Excerpt) Read more at online.wsj.com ...
Why MacDonald’s sales are down....The great American middle class has less discretionary income. Not just MacDonalds. Many businesses are in the same boat.
Romneycare in MA and Obamacare everywhere drove up the costs of private health insurance because that’s what the insurance and hospital lobbyists along with the politicians wanted.
Cell phones are compulsive and addictive. I get by with talk and text but others are using their smartphones to the max racking up supersize bills.....
my cell phone bill and inet has only gone down. I bundled the sat tv phone and Inet with ATT and it cut the cost 1/2
tracfone.
stuff that kills people’s incomes:
cable bills
phone plans
new car leases
basically any re-occurring monthly billables on products they do not have to have (ie you can get a phone that isn’t smart and require an expensive plan). most don’t have to have a smartphone. they want it.
but they wonder where all their money goes.
“I get by with talk and text but others are using their smartphones to the max racking up supersize bills.....”
I and several wealthy people I know get by on the basic cell phone. Nobody has a house phone. Today, a guy on welfare showed me his phone. It does everything on the internet you can do on your computer. He pays over $100/month. (Did I mention he’s on welfare? Free medical for him and his family, too. Us taxpayers are SOOO generous.)
well, too bad for them they’re middle class privileged. if they weren’t so privileged they could get obamacare and Obama phones.
Years ago, no one “needed” a cell phone, computer, internet service, cable TV, Starbucks, etc. Now, almost everyone “needs” these things. No wonder no one has any money.
True, what you said, but also the cost of necessary food and utilities are only increasing, income flat, and cost of health insurance/health care is way out of line as a percentage of take-home pay.
We don’t have a smart phone, have basic cable, haven’t had car payments of any kind in over 3 years... we are not “getting ahead” by any stretch of the imagination.
I didn’t go down the whole laundry list of things that take up income. I agree with you. I see what it’s done to my grocery budget, and for most of the last years, gas budget.
incomes have stagnated over the past half decade
The Larger problem that is much more insidious, is the 4% Annual Theft of VALUE of each Monetary unit of measurement since 1964, The Beginning of LBJ’S War on the Family.
Be careful with bundling too much together because if the service goes down, everything you have bundled might go down, too. Also, if you’re cell phone connection is iffy, then you might want to have a landline as a back up. The landline would also help if the internet is down. Backups and Plan B.
Our healthcare went up which caused our income to go down. All utilites went up. We wanted to cut back on cable but it’s on an older contract so in the end it’d cost more to cut down. My cell phone did away with the cheap program so now I’m having to pay 4 times as much. Property tax went way up, again.
I'm happy with a cheap flip phone, for mainly talking and an occasional text.
I've seen people making barely more than minimum wage with $500 phones and $100 rate plans. Ridiculous.
Mc Rib is back...... so far I’ve had 5..... just couldn’t help it
BTW, did you did you ever get your Mod question answered?
While tracfone is convenient in many respects, they aren’t the best bargain. Consumer Cellular is one of the best carrier values for domestic use, with custom plans for various needs. When absolute connectivity outside the US in the most countries is the priority, T-Mobile wins hands down.
what he has is a very small computer with a phone app
"We all have cell phones......so come on....let's get real."
I guess maybe 24% is an average but our health insurance costs have gone up 50% in that amount of time. Maybe it all balances out by those that get enough subsidies that theirs is really low and let’s not forget the huge increases in Medicaid. Guess there’s has gone close to 0.
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