We sense the trouble in our gut when we tear open our stubbornly flat paychecks. If you live in a big city like Houston, as I now do, you feel the dysfunction in the soles of your feet as you rumble homeward, bouncing along pitted roads or jostling for space on overcrowded subways. Once you do make it home, you confront more ill omens when your bills and bank statements arrive; according to a recent study by the Federal Reserve, 47 percent of Americans now have so little in savings that they couldn’t cover an emergency outlay of just $400. You’re reminded of the problems yet again when your kids walk in the door, having valiantly navigated their underresourced schools. And if they’re lucky enough to get into college, you’ll confront the troubles one more time when their skyrocketing tuition comes due. (Don’t count on them being able to pay you back, either; unlike previous generations, few young Americans today can reasonably expect to make more money in their lifetimes than their parents did.)
Feeling anxious? If so, you’re not alone: 72 percent of Americans still think we are in a recession, and according to a poll taken in December 2022, just a quarter of US citizens think their country is headed in the right direction. Such pessimism is not just an American phenomenon either; another recent survey found that only 38 percent of Russians, 35 percent of Turks, and 20 percent of Frenchmen expect their economic outlook to improve in the next year.
What adds to our dismay is that many of us are still in shock. It wasn’t that long ago that experts and politicians were assuring us that the good times were here to stay. Remember the Aughts, that golden age of progress, progress, and more progress? Fueled by innovation, higher education, and a red-hot real-estate market, America’s economic engine—the world’s mightiest—roared ahead.