Summary: Reading Time: 3 minutesThe great divergence of the 1980s and 90s changed the way Americans worked. This inequality changed American society. Most did not realize what was happening at the time. There were cultural implications of the growing divide between rich and poor. As the costs and standards of living grew much faster than the income of the middle class and poor, choices and changes of life were necessary.<br> We frequently don’t see the history of American culture in this light but changes at the economic level were affecting changes at the family and societal level as well. As these changes grew and developed across the coming decades they you completely upend and revolutionize American culture.<br> How Inequality Changed American Society During the Great Divergence<br> American homes changes from single income homes to double income homes as mom and dad both went to work. This shift was not about women’s liberation. It was about the need for grocery money, for car and home payments, and the growing costs of living. This was significant. When we see the growing gap between the rich and the middle class represented in graphs that chart the growth of economic inequality we need to keep in mind that those in the middle class and lower usually account for two incomes per home, not only one as they did in prior decades. The problem is even worse than the charts demonstrate.<br> <br> These changes were evident in the 1980s. New terms to describe our society like “latchkey kids” were invented. The movies of the era reflected the shift in America’s family culture, even if they did not address what was driving the shift. Have you ever wondered where the parents in the movies about teenagers from the 1950s and 1960s disappeared to in the 1980s? They went to work.<br> <br> Just as significant was a change in laws that opened up access to greater reservoirs of consumer debt to the middle class. The efforts for the middle class and the poor to keep up with the growing costs and standards of living were now being finances with personal debt. The rise of unprecedented levels of personal debt within the American economy was a game changer that would drive economic growth and transformation for the next three decades.<br> <br> <br> How Inequality Changed the American Economy During the Great Divergence<br> The home and the family was not the only thing that changed during the great divergence. The growth of debt and the financial sector changed the very nature of the US economy. While the markets began to experience more frequents booms and busts, the rich learned to get richer no matter what was happening. Notice the growth of market activity since 1980 versus all the decades prior in this chart.<br> <br> <br> At the same time consumer debt exploded in growth. Many of the stocks that were part of this rise in the markets were buoyed by debt. The easier financing of a car or home furniture led to more sales which led to better company performance and higher stock values. This was a vicious cycle of economic growth built upon debt. No one seemed to realize that eventually the bills were going to come due.<br> <br> <br> <br> This was the beginning of a new American experience and explains how inequality changed American society.<br> <br> <br> <a href="http://feeds.feedburner.com/~r/theendofhistory/PHVq/~6/1" target="_blank" rel="noopener"></a><br> <a href="https://feedburner.google.com/fb/a/headlineanimator/install?id=nb64uri41haerm5fvtnnavfgjo&w=1" target="_blank" rel="noopener">↑ Grab this Headline Animator</a><br> <br> This is part of my <a href="https://wp.me/p2iDfo-1su">Complete Guide to Understanding Inequality in America</a>. Check it out for more podcast episodes, infographics and articles and on this topic. Check out all of my<a href="http://www.theendofhistory."></a>
