The middle-class American Dream is being eaten away

Welcome to Trump’s America, The i Paper’s World Insight series presenting the sharpest, deepest thinking on an era-defining shift in history and politics, investigating how Donald Trump and his administration have changed the US and the world – and where we go from here. • America can’t afford to retire• The US is becoming impossible to live in• I told Trump over dinner he didn’t have my loyalty – it sealed my fate• This is how the world will look after Trump• I’ve seen what ICE has done to Minnesota. Farage wants to import that to the UK• The men who want to stop women voting• Trump isn’t damaging America. He’s reinventing it Socialism used to be a dirty word in the United States. In the age of Donald Trump, however, it is the coming force in American politics. From New York to California, Pennsylvania to Colorado and beyond, the Democratic Socialists of America (DSA) are winning local and state elections against more moderate Democrats. The DSA now looks poised to swallow the Democratic Party in much the same way Trump’s Make America Great Again (Maga) movement devoured the Republican Party. The difference is that, whereas in the 2010s frustrated lower-income voters embraced Maga, today it is America’s urban middle classes who are turning most bitterly against a capitalist society that seems only to reward tech tycoons, the super-rich and the President himself. Republicans blame social media, Chinese influence, mass migration or woke universities for this hard-left tilt. Yet, the bigger factor is what Democratic strategist James Carville famously called “the economy, stupid”. Shorts Since Covid-19, inflation has eaten away at the “American Dream“, and now even those with good jobs and stable incomes find themselves taking on debt just to cover everyday costs such as putting food on their tables. Eating healthily has become financially onerous – the cost of vegetables for instance, rose 12 per cent last year, tomatoes by 30 per cent in some states. In surveys, Americans report having to scale back on everyday indulgences, such as coffee or snacks, as well as cutting down on online subscriptions, just to afford the cost of more basic living. Housing is the greatest burden. Increased mortgage rates and stubbornly high property prices mean that buying a home is, for too many, beyond reach. The rental market is therefore often over-crowded. A typical urban-dwelling US family will spend up to 60 per cent of their income on rent. In pricey San Francisco, the average cost of a two-bed apartment is $5,200 (£3,880) a month. Owning and driving a car – that totemic symbol of the American life – is becoming financially difficult, too, especially in metropolitan areas. The costs of insuring, fuelling, parking and financing a vehicle have all shot up in recent years. In Florida, partly as a result of extreme weather, car insurance premiums have increased by 75 per cent since 2020, and in many states full-coverage for motor vehicles is about twice as expensive as it is in the United Kingdom. And since in America public transport is often limited, especially in suburbia, people are being pushed towards using ride-hailing apps such as Uber, which have been increasing their prices far above inflation in recent years. Traditionally, American families achieved upward social mobility through higher education, or what Americans call college. Those unable to afford the most elite institutions have long opted for public state universities. Today, however, even a cheaper college costs up to $30,000 (£22,385) per student per year in tuition and board. And it’s median earners who find themselves too poor to afford the fees – yet too high-earning to qualify for generous financial aid schemes. New York Congresswoman Alexandria Ocasio-Cortez regularly attacks Big Tech bosses for ‘sitting in their private investor calls … giddy about all the people they are going to put out of work’ (Photo: Aaron Schwartz/Reuters) Conscientious middle-class couples endeavour to build a “college fund” – a nest-egg for their children’s higher education. But that’s becoming increasingly challenging as the costs of raising a family rise on every front. “Saving for college?” scoffs Michael, a father of four in New York. “The problem is budgeting for anything. $7,000 (£5,200) a year for my daughter’s dance studio, son’s soccer fees $3,500 (£2,612) in fall, travel and baseball another $4,000 (£2,985) in Spring. Youngest needs private therapy for speech costing $10,000 (£7,462) a year. Making a well-rounded kid costs so much more in time and money than it used to.” The students who do go to good colleges – which can cost more than $100,000 (£74,620) a year at the higher end – find themselves still working off monstrous debts late into their adult lives. American politicians used to pitch themselves squarely at “the middle class” – meaning almost everyone except the ultra-rich and very poor. But, under the strains of the modern economy, the US class system is becoming crueller. And now, as the rise of artificial intelligence threatens to lay waste to so many white-collar jobs, the polarisation of American society risks becoming more extreme. Alexandria Ocasio-Cortez, the media-savvy DSA-aligned Congresswoman, regularly attacks Big Tech bosses for “sitting in their private investor calls … giddy about all the people they are going to put out of work”. AOC, as she is known, is expected to mount a serious bid for the presidency in 2028. Joel Kotkin, an urban studies fellow at Chapman University in Orange, California, argues that the US is moving towards becoming a “neo-feudal” society, as fortune has become increasingly concentrated among a few billionaires at the very top. The middle class, in this analysis, is now split between a smaller “clerisy”, who still thrive on high-status jobs in universities, non-profit groups and the public sector, and the “yeomanry” of the private sector, who make their money off what’s left of the free market. The new yeomans are becoming more downwardly mobile with each generation, as property prices and daily life become more unaffordable. As Kotkin says: “The decline of the yeomanry threatens the future of democracy.” Donald Trump’s election victory in 2024 was partly down to the fact he promised struggling Americans a new “golden age”. But, as the President revealed this month that he made a staggering $2.2bn (£1.6bn) last year, at least half of which came from suspicious cryptocurrency activities, the sense of burning injustice is spreading up the social scale. And, it’s the impossibly squeezed middle classes who are screaming loudest of all.