Collecting the tools of a sustainable, self-directed life

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06- Money, Power and Structure

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Hard work pays and a good steward saves. 

At least that’s what I learned getting allowance as a child. At a time when my parents fulfilled my three lowest needs, it was easy to see how financial success and woe resulted from individual virtue. As an adult, I’d see more possibilities.

Every year, the Bureau of Labor Statistics (BLS) puts out a Consumer Expenditures report that details how Americans spend their money. This report is used by a variety of organizations—both for-profit and not—to determine their course of action. This same report can be a powerful tool to help individuals see the larger structure in which we live and make choices about how to use our financial power.

The 2016 report, published last month, opens with a chart on how average-income households spent their money. The amounts spent on the top three expenses and the percentages of the total expenditure ($57,311) look like this:

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Given that 70% of Americans households bring in less than this $74,664 average income, it's important to remember that the first figure in the 51-page report does not represent the everyday, middle-of-the road American. 

At the 2016 median household income (the income that splits American households spectrum into two equal halves) of $57,617, American households spent the following:

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Although median-income households had about $13,700 less than those with average incomes, their spending in these three areas was not much different. But with only about $1,549 in savings a year, medium incomers can’t even cover their top three expenses for one month in the case of an emergency. On the other hand, mean incomers could save $9,289 across a year, which will cover their three top expenses for about three months. And of course, people in households below the median income can barely save, if at all.

But this news is not new. CNBC, for one, has consistently been reporting on this "savings crisis" since 2013.

And the decreasing ability for the majority of Americans to save has been a part of our economic structure that we can see reflected in these Consumer Expenditure Survey’s for well over a decade.

The structure of things is clear. And this structure is not sustainable. 

While the Department of Labor, which houses the BLS, has a mission “to foster, promote, and develop the welfare of the wage earners, job seekers, and retirees of the United States; improve working conditions; advance opportunities for profitable employment; and assure work-related benefits and rights,” in reality, it can only enforce the laws that congress makes.

Congress has not increased the minimum wage since 2009, when it raised it to $7.25 an hour, which is the equivalent of $15,080 a year for working 52 40-hour weeks.

Who are your representatives and where do they stand on the federal minimum wage? Put your answers in the comments below.