MIT economist Peter Temin is getting rave reviews for his new book The Vanishing Middle Class: Prejudice and Power in a Dual Economy. While Temin certainly has some updated data, the phenomenon he is describing- the hollowing out of the American middle class and the increasing divide between affluent and those scraping by - has been in progress for decades at least since the deindustrialization of American began in earnest in the late 1970's. Sociologist Katherine Newman aptly described the early stages of the decline of the middle class in Falling From Grace: Downward Mobility in the Age of Affluence in the 1980's.
Many social scientists, policy makers, and politicians have noted the decline of the "rust belt," but blithely assumed that new industries (especially in high tech fields) would replace the older manufacturing centers. They offered up condolences to industrial communities devasted by the closing of steel mills, automobile factories, and coal mines, but have done little of substance to change the decline of those communities. The old economy workers who cannot be retrained for the new economy are members of the "unnecessariate" - disposable people who do not figure as workers in the new economy but become the fodder for the careers of law enforcement, prison guards, social workers, doctors, and therapists. It is not terribly surprising that so many of them voted for the one politician that appeared to care about them, speak to them directly, and tell them they were worth something.
The cavalier abandonment of so many small cities and towns in America, who have not made the transition to the new economy is a major indicator of the rot in our society. However, the real problem is that the new economy itself is divisive and destructive to American society.
Seattle with its booming tech/internet economy is an excellent example of how economic success contributes to the increasing divide in American society. Not all of the jobs of the new economy are "good" jobs - lots of lower paid, dead end warehouse and service sector jobs come out of the same economic developments that provide high paying tech jobs. Moreover, influxes of higher paying jobs can push up housing costs, tax rates, strain transportation, and other public services, increasing the cost of living on those who do not have the "good" jobs. Nestor Ramos, a Boston Globe reporter describes the benefits and pitfalls of a booming high tech economy. An article intended as a cautionary tale to those communities that might be bidding for a new Amazon headquarters.
