Death of despair and macroeocnomics

 

There has been a change in society since 2000. Drug deaths, suicides, and alcohol deaths are up significantly. Society is different, and this is being reflected in consumer confidence numbers and views on economic optimism. This has been documented in the book Deaths of Despair and the Future of Capitalism, by economists Case and Deaton, which focuses on the crisis in the American working class. Their argument is that the loss of manufacturing jobs in the US, especially after China joined the WTO and the pandemic, was a major driver for this change. We may be seeing a reversal in the pandemic effect, but the loss of manufacturing is unlikely to be reversed. 

The optimism in the country has a lot to do with spending and with policy choices, and the current despair is not helping to solve any gap between the optimism of the lower middle class and wealthier individuals.