‘Ozark’ another example of Hollywood distorting the state of America’s middle class

By James Pethokoukis of AEI.

"I recently started watching the Netflix crime drama “Ozark,” which premiered in 2017. And the opening narration of episode one, season one — full of post–financial crisis angst — really had me rolling my eyes. From “Ozark”:

Scratch. Wampum. Dough. Sugar. Clams. Loot. Bills. Bones. Bread. Bucks. Money. That which separates the haves from the have-nots. But what is money? It’s everything if you don’t have it, right? Half of all American adults have more credit card debt than savings. Twenty-five percent have no savings at all. And only 15 percent of the population is on track to fund even one year of retirement.

First, by “savings,” Ozark must mean emergency savings rather than money in a personal retirement account, defined benefit plan, or Social Security.

Second, I could think of some other relevant survey findings, such as a 2019 Federal Reserve survey that found 75 percent of US adults saying they are either “doing okay or living comfortably,” 56 percent saying they are better off than their parents were at the same age (versus 25 percent saying “about the same” and 19 percent “worse off”), and 64 percent rating their local economic conditions as “good” or “excellent.” Then there’s this from AEI economist Michael Strain’s book, “The American Dream Is Not Dead (But Populism Could Kill It)”:

Over the past three decades, wages for typical workers have grown by 20 percent using the CPI. And using the PCE — the better measure of inflation — finds a one-third increase in wages. . . . It’s not spectacular growth, to be sure. But it is not reasonable to describe this growth as stagnant. Typical workers have not worked for several decades without a pay increase.

Third, I would be careful about scary stats and stories about American retirement savings. Again, such stories frequently ignore defined benefit plans (especially in the public sector) or how Social Security is extremely valuable for, say, the lower fifth of workers by income. Here’s what AEI’s Andrew Biggs wrote in The Wall Street Journal back in 2019:

Eight in 10 retirees tell Gallup they have enough money to “live comfortably,” and 6 in 10 working-age households say the same. Seventy-five percent of retirees tell the Federal Reserve’s Survey of Consumer Finances they have “at least enough to maintain [their] standard of living,” up from 61% in 1992. Census Bureau research that uses Internal Revenue Service data to measure retirees’ incomes found that the over-65 poverty rate was only 6.7% in 2012, down from 9.7% in 1990 and lower than any other age group. . . . According to Fed data, the median retiree household’s income grew by 56% above inflation from 1989 through 2016, versus only 4% real growth for working-age households. Incomes grew faster at the poorest fifth percentile retirees than at the 95th percentile of the working-age population."