Living in 2025 is a blessing. But it’s also a strange time to be alive, especially when it comes to wealth.
When you think about wealth and what it does for someone and the quality of their life, there are a few ways to look at it. Certainly, wealth “buys” freedom and flexibility, which is perhaps the most important role of wealth.
But at the micro level, for many Americans, measuring wealth is about daily quality of life. On the one hand, wealth should provide access to needs: goods and services that go beyond your daily needs.
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Wealth should also be a shield against the stress that comes with money, reducing worries about meeting basic needs and creating the feeling that you have financial breathing room from day to day and month to month.
Today in America, on a practical level, we live with a wealth paradox.
We have access to luxuries that people could not have dreamed of hundreds of years ago.
We have access to breakthrough medicines and life-saving procedures. We have technology, including wearable technology that we can carry in our pockets, with access to virtually all information ever created. We also have creation tools.
We have cars with incredible functionality (probably too much, in my opinion). We can fly across the country or even around the world. Many of us have closets full of clothes, shoes and accessories. Our supermarkets are filled with food, aisles packed with overwhelming choices.
We live with everyday luxuries that, if you take a step back, are in many ways hard to believe.
So even though we have access to needs, a large portion of the working and middle class still live with the stress of paying basic living expenses.
Housing is difficult and expensive to obtain. Even if someone can afford a house and interest payments, the costs, including property taxes, insurance and maintenance, eat up a larger percentage of wages.
Healthcare costs, especially for those without employer-sponsored health benefits, are skyrocketing. The insurance portion alone, apart from any out-of-pocket healthcare costs, is a heavy burden for families.
Education, especially higher education, is also a stressor, burdening young people with five- and even six-figure debts, while in many cases failing to provide adequate returns on their investments.
And while we have an abundance of food, US dollars can buy less. Even food at restaurants at every level, from fast food to sit-down dining, has exploded in price.
Yes, by 2025 the working and middle class may have access to more, but the stress of basic life has increased exponentially. And that makes it harder to feel ‘rich’.
Are we really rich, as individuals and as a nation, if a key principle of wealth, which protects against financial stress, has been broken?
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When we look at the culprits, from housing to healthcare to education, they are all areas where the government (and adjacent policies) have increased costs. It’s up to them to remove barriers and make Americans truly rich again.
Moreover, the Fed’s policies, including fifteen years of zero and near-zero interest rates, quantitative easing, suppressing real interest rates, and then whiplash tightening, have structurally created a world in which asset owners have seen their wealth grow and those without assets have fallen behind. This has underscored today’s prosperity paradox: Americans enjoy luxury consumption but cannot afford the “ticket” to wealth because the cost of the basic asset – i.e. a home – has been financed far beyond incomes.
A healthy economy must be balanced with a healthy society, and that is not possible if individuals do not have peace of mind. Financial stress is cited as a reason for almost one in four divorces. It correlates with anxiety, depression and physical health problems.
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Of course, we partly have ourselves to blame, but when we look at the percentage of income that covers basic needs today, something is not right.
Our wealth paradox is one that can be solved through action. We need real reforms to stop the government from sucking the wealth of hardworking Americans. Life, liberty and the pursuit of happiness are at stake.
