Working-class households are being hit hard by the deepening crisis of capitalism today, squeezed by the lack of a good-paying job as well as high prices for basic necessities, from groceries to electricity, healthcare, housing, car payments, fertilizer for family farmers and more.
The consumer price index rose by 3.3% in March from a year earlier, the highest increase in two years. As Washington’s war against Iran has unfolded, gasoline prices jumped 18.9% and fuel oil surged by 44.2%, sinking the buying power of workers’ paychecks even further. Meanwhile, average weekly wages are up a measly 0.2% from a year ago.
Under this pressure, workers have to pick and choose what they can afford to buy. They “are spending less on goods like clothing, furniture and sports equipment, which have risen in price over the past year,” the Wall Street Journal noted April 28, focusing instead on just trying to cover basics like healthcare, food and other essential needs.
Food company bosses are moving to profit from the media hype surrounding new weight-loss drugs like Wegovy. The Magnum Ice Cream Company, which makes Ben & Jerry’s, for example, is now selling bite-sized, individual portions, at nearly the same price their larger packages used to go for. The bosses claim it’s healthier.
And the latest scientific reports indicate the weight-loss drugs only keep working if you take them for life, otherwise you put the weight back on. Costco just began offering a “discount” plan for those people who aren’t covered by insurance, only $499 for a four-week supply. That’s $6,487 a year. For life.
If under the pressure of monthly bills you fall behind paying for utilities, you can expect an unforgiving response. These companies shut off power to 13.4 million households and gas to 1.7 million in 2024, a federal report released at the end of April said. At the same time, electricity prices nationwide last year rose more than 11% on average, and much more in some states.
The report says that “final notices” demanding immediate payment of outstanding bills were sent to customers almost 95 million times in 2024 and 27 million times to residential natural gas customers. That’s fully two-thirds of all households that got electricity in 2024 and over one-third that used natural gas!
The bosses’ don’t care what your problems are. “Nadia Hasan, 36, has had her power disconnected at least three times in Detroit, for at least a week each time,” the Washington Post reported April 26. “Hasan was born with cerebral palsy and has been mostly confined to her bed for a decade, since an accident in which she fell off a lift in her wheelchair, breaking her spine.”
More owed on cars than they’re worth
More and more workers who purchased a car find themselves sinking deeper into debt. In the first quarter of this year about 30% of those who traded in a car to buy a new one had what is called “negative equity.” That is, they owe more to cover the outstanding loan and interest payments on their old car than it is worth. The gap is now as high as $7,200 on average, a 42% jump from five years ago.
Those trying to get another car, new or used, must continue paying these old debts on top of a new loan. Monthly “car payments in excess of $1,000 are no longer uncommon and can stretch out more than eight years,” reported the Wall Street Journal. Default rates on car loans in March rose to the highest level since 2010, alongside more and more visits by the repo man.
Rise in ‘cheap’ housing
In an effort to maximize their profits, some of the largest home construction companies, like D.R. Horton and Lennar, are using cheaper materials and shoddier designs in their homes in working-class communities. These so-called no-frills homes include particleboard cabinets instead of hardwood, thinner countertops, smaller and fewer windows, cheaper doors and, well, you get the idea.
Grabbing onto the lingo of liberals today, they pitch these moves as a step toward “affordability.” A spokeswoman for D.R. Horton told the Journal, “We have expanded the availability of smaller floor plans in some communities,” using “alternative products and materials,” to help people out.
This stands in sharp contrast to how real estate moguls treat the capitalist class and their upper-middle-class hangers-on looking for new digs. To find out more, just go to the Wall Street Journal online and visit their “Mansions” section.