Saturday, May 12, 2012

Shocking Common Financial Realities

Bill Cimbrelo directed me to a CNN Money story titled “Retirement Shocker: 60% of Workers Have Less Than $25,000 Saved.”  To my mind, the main question that this raises is for whom is this a “shocker”?  If the cited fact applies to more than half of the people concerned, isn’t it safe to assume that the majority of people should be unsurprised by the information?  The only reason that I see why a person would be surprised by statistics that affirm the day-to-day reality of his life is if he thinks his own experience is somehow anomalous, somehow out of keeping with the daily experience of other people like him.  Unfortunately, this is almost certainly the situation with most lower-middle class and poor individuals.

So here’s a breaking point that I’m looking forward to, and it’s one that’s on my mind often, and that I’ve brought up earlier and elsewhere.  The news media and society in general needs to stop presenting affluence as the default state of life in America.  It’s not correct, and more than that it can be damaging to policy and social discourse.  Our collective understanding of income disparity is distressingly skewed by a distinctly hopeful presentation of American life in most media, whether fiction or non-fiction.  As with all things, failure to accurately recognize the problem makes failure to craft solutions almost certain.

 People should never be shocked by information that’s right under their noses all the time.  If they are, then it’s pretty clear that something had been wildly misrepresented in the past.  You might object that it’s not as though people walk around with their total retirement savings tattooed on their heads.  Why should we have any idea what sort of figures apply to the majority.  You shouldn’t, of course.  And if you’re not a meteorologist you shouldn’t know exactly how much rain your area has gotten this month.  But when somebody tells you that figure would you be shocked?  If so, surely you’re either terrible at estimating rainfall or you haven’t been looking outside very much.  And if you weren’t paying attention, in order to be shocked you have to have made some groundless assumption about what the amount might be, which will then be contradicted by the facts.

There’s a lot of information that casual observers can’t be expected to know about people, about the economy, about the world.  But learning something new is not the same as learning something shocking.  Yet I don’t dispute that the headline for the given story was accurate and that a great many people were shocked by the revelation.  They wouldn’t have been if they hadn’t concluded on the basis of nothing whatsoever that the majority of Americans are well prepared for a comfortable retirement.  I put forth that this sort of thing reveals the entire perception of income demographics in America to be pure fantasy.

Such a fantasy promotes a victim-blaming mentality.  And it promotes that not just among the beneficiaries of income inequality but among the victims of it, too, as they may tend to be surprised by information that shows their experience to be firmly in the majority.  And yet even the recognition of that information is not in itself enough to move commentators towards the idea that financial difficulty is an endemic problem and not a personal one.  The language applied to stories about the plight of the masses still suggests that the simple fact of their being a part of the masses is in some measure attributable to their own negligence, sloth, or ignorance.

The CNN article takes pains to spin the subject in a certain direction that is at once optimistic about general patterns and unfair to individuals.  It points out, “While workers' lack of saving and confidence in their ability to retire comfortably is troubling, [Employee Benefit Research Institute director Jack] VanDerhei said it's good that people are becoming more realistic about their financial situations.”  Sure, maybe, but there’s an enormously significant dimension of this story that stretches beyond the personal responsibilities of the people who are negatively affected.  At the same time that those people exhibit realism about that, how about analysts, media, and society as a whole become more realistic about the financial situations of people other than themselves?

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