The Election Issue That Hits Home Everyday

Many middle-class households are close to a tipping point - a bill or two away from losing economic control, surveys and interviews show. Even with the creation of a million new jobs over the last year, the percentage of people who say the economy is in good shape has fallen as Election Day approaches.
And if current trends hold, nearly one in seven families with children will declare bankruptcy by the end of the decade, said Dr. Elizabeth Warren, a Harvard Law School professor who is the co-author of "The Two-Income Trap: Why Middle Class Mothers and Fathers Are Going Broke" (Basic).

"These people aren't poor," Ms. Warren said. "But this is the first generation where college-educated people with a good job cannot find financial security." But Ms. Warren said the squeeze goes beyond short-term economic swings, and is worse than it has been at any time since the creation of the post-World War II middle class. Nearly two-thirds of people in recent polls say they have trouble paying bills and feel pinched by the rising costs of middle-class essentials.

In this Iowa family, one generation is trying to step through the gateway to the middle class; the other is struggling to stay in it. And it is the middle-class squeeze - rising college tuition and soaring health care premiums at a time when wages are stagnant and job creation is sluggish - that may be the sleeper economic issue of the presidential campaign.

"I feel the squeeze from both ends," said Beth Steenhoek, a mother of two who owns a small insurance agency in Newton. Fewer people are buying insurance, she said, because of a hefty increase in premiums, and her own family insurance costs have gone up as well.

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