The living standards of an individual in any country depend on numerous factors. The economic conditions of that country, is one of the most important factor which influences the lives of the people living and working in the country. The changes in the economic conditions of country have a huge impact on the lives of people, as they affect their earning and spending capacity. One such country which is experiencing massive changes in its economy is America.
America was regarded as a country where one can achieve his/her dream of an affluent and prosperous lifestyle but the recent economic situation in America tells another story. The book “High Wire: The Precarious Financial Lives of American Families” by Peter Gosselin deals with the economy of America and the changes it has undergone since 1970s. The author brings forth the affects of these changes on the financial lives of Americans. The changes in the economic policies of America have led to a situation in America where Americans are being deprived of financial security.
Through his book, Gosselin throws light on the financial life of Americans which is becoming more and more insecure, owing to the shift of risk from the employers to employees, from the insurance companies to their clients and from the federal government to the American people. Financial Lives In the book “High Wire: The Precarious Financial Lives of American Families” by Peter Gosselin, the author focuses on the financial lives of Americans in the present times. He begins his book by pointing out the difference in the economic conditions in America and the financial lives of its people in the past and in the present times.
In the period that followed World War II, Americans led a life of prosperity and affluence, owing to the favorable economic conditions in their country. “The first is that for most of the past quarter century, the United States has enjoyed the return of a resilient and growing prosperity that once seemed lost. ” (Gosselin 1). But in present times, the financial lives of Americans have been affected by the changing economic scenario in their country. Even if they are leading a life of prosperity, they are insecure regarding their financial lives.
“The second fact is that many of us, even the affluent among us -those with family income running into the hundreds dollars-have arrived at the new century increasingly uneasy, with a gnawing sense that our circumstances are changing in ways that leave us less secure. ” (Gosselin 2). The lack of security is having a huge impact on the lives of Americans. After citing the economic situation, in which the Americans are leading their lives, the author goes on to analyze the reasons for this insecurity that is gripping Americans.
The foremost reason he mentions in his book is related to the new economic policies which places the risk on the individuals instead of government. “In its place, wrapped in the economic doctrine of free markets and the moral precept of personal responsibility, stands a new first principle: Each of us is now expected to forge our own future, free to rise or fall as our talents or luck may dictate. ” (Gosselin 4). In support of his claim, Gosselin provides numerous examples which prove the shift of risk from government, employers and insurance companies to the people.
Insurance companies are taking advantage of the new economic policies and reducing the payments which are claimed by their clients. In such circumstances, American people are forced to bear their medical expenses, without any substantial support from their insurance companies. The concept that individuals or companies are responsible for their own financial conditions has led to the collapse of even big companies. “Within days, in September 2008, another investment bank, Lehman Brothers, was on the brink collapse…..
But Paulson under intense political pressure from Conservative Republicans in Washington to invoke moral hazard and let the company fail”. (Inside The Meltdown). Another factor that has greatly influenced the financial lives of Americans is the effect a job loss has on the work life of an individual. The unemployment benefits that a worker receives after a job have reduced drastically in the comparison to the times before a couple of decades ago. The author also brings forth the fact that a job loss leads to a greater drop in wages in present times.
A worker, who has lost his job, is compelled to work on fewer wages on his next job, thereby leading to a drastic reduction in his/her spending capacity. Effects on Individuals The effects of the drastic changes in the socio-economic policies of America on individuals working and leading their lives in America are presented by Gosselin. He writes in his book that in present times, American people are more concerned about the problems they will face in their financial lives than the national problems.
“Indeed, it has not been public events that sometimes awaken us and leave us tossing in bed. Instead, fleetingly, but recurrently, we have been night stalked by questions about our private lives. ” (Gosselin 2). They are worried about their medical expenses, the cost of education of their children, the impact a job loss would have on their family. The author cites the examples of some individuals in his book to bring forth the impact the changed rules in American economy is having on American people.
He writes about real people whose financial lives have been largely impacted owing to the new economic policies in their country. Individuals like Debra Potter had to bear the medical expenses on their own, as their insurance companies, taking advantage of the new economic policies, refused to pay them the proper amount of benefits liable to them. People received benefits from their insurance companies but they were insufficient enough to cover their medical expenses.
A job loss turned the life of an individual upside down, like Coss who had to manage with meager unemployment benefits after losing his job as the Vice President of a reputed bank. “As Coss-tall, taciturn, with short-cropped almost military, hair- recounted what it was like to go from earning several thousand dollars a week to collecting a few hundred in unemployment benefits. ” (Gosselin 6). With the aid of statistics, Gosselin proves his claim about the growing insecurity among the Americans regarding their financial lives.
The changed economic conditions has created such a situation in America where financial lives of its people lack the security which is needed to stabilize them when they are effected by a job loss, medical expenses or college education. The government is not providing a security net where people can cope with the changes that new economic policies are having on their financial lives. People have to deal with these changes on their own. “Instead of joining together to solve problems, that affect the whole society, the heralds of the new approach say, more responsibility should be placed on individuals and families.” (Gosselin 5).
Even though the number of people whose financial lives have changed owing to the new economic situation is less, these effected people are less likely to return to their former financial positions. “As with so much else about the present economy, the dangers are like rifle shots, hitting fewer targets but doing more lasting damage. ” (Gosselin 54). The financial lives of Americans are being influenced by a number of factors. Through this book, Gosselin brings forth these factors and the impacts these factors are having on the way the Americans are managing their work lives and family expenses.
Conclusion The author has put forth the current economic situation and the impact it is having on the financial lives of Americans in his book “High Wire: The Precarious Financial Lives of American Families”. Being an economics reporter, the author has succeeded in presenting the real picture of American economy and the insecurity experienced by American people regarding their financial lives. His book differs from other books written on this topic, for Gosselin has presented an accurate depiction of American economy in present times.
He also brings forth the reasons which have led to insecure financial lives for the Americans. He holds the government and the companies responsible for this situation in America. But he fails to consider the other factors that are influencing the economic situation in America. He focuses only on the economic policies of American government and American companies, and ignores the impact of other countries on the American economy. The book has aided me in understanding the present economic condition of America and the risk its people are facing regarding their financial lives.
It also made me aware of the negative impact the new policies are having on American economy. My thinking that the new economic policies were assisting in the economic development of the America was proved wrong after reading this book. The book can be helpful for economists as well as the common people of America, for it will inform them about the reasons for their insecure financial lives, and this information will assist them in voting for appropriate candidate during the Presidential elections.
Courtney from Study Moose
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