How One California Family Has Been Caught in the Middle

By S.C. Gwynne/Los Angeles

In a season of wildly conflicting pronouncements on the decline of the American middle class, the truth for most American families lies in the details of their lives. And the details paint a discouraging picture of the generational fortunes of the Forrester family since Bob, now 60, went to work as a tankerman in the Inland Boatmen's Union in Los Angeles harbor in 1957.

Look, for example, at the jarring similarities in two family purchases: Bob Forrester's first house, in 1957, and his daughter Peggy's first new car, in 1985.

Bob, then 29, bought a three-bedroom house for $9,750. He put $750 down, which was less than 14% of his $5,512 a year in earnings, and paid $175 a month. It was all he could afford.

Twenty-eight years later, Peggy, then 27, bought a Ford Tempo for $8,500. She put $1,000 down, which was almost 6% of her $18,000 annual salary, and paid $230 a month. It was all she could afford.

Bob's house, Peggy's car. Though the gulf in buying power is already startlingly wide, it grows wider with time.

Bob sold that house in 1973 for $46,250, nearly five times what he paid for it. He then borrowed $24,000 and built a house that is now worth $300,000. Peggy still does not own a house; her car is now worth $4,000.

So the generational tale goes.

At the heart of the story are runaway real estate prices and a younger generation that was unable to climb aboard before housing became so hard to afford. It would cost Peggy almost $38,000 for a down payment on a median- price house in Los Angeles, something she could not manage at her present savings rate for about 40 years. As it is, she pays $500 a month in rent, almost three times as much as her father's initial mortgage payments.

The Forresters' story, though, is about more than just real estate. It is about a fundamental shift in the social and economic structure of old working- class neighborhoods, away from the standard of living that Bob Forrester and his wife Carol have enjoyed.

Here's another snapshot from the family financial album:

The year is 1979. Billy Forrester, Bob's eldest son, 25, has gone to work "on the boats." He is married, has a child, and is a member of the Inland Boatmen's Union, just like his father. He works as a deckhand, making $11 an hour with full medical, dental and pension benefits. During his last full year in that work, he cleared $27,000 and saved $8,000, nearly enough for a down payment on a small house. The problem is that his company, United Towing, has just gone the way of dozens of other harbor companies: it has busted Billy's union by hiring maritime workers from Louisiana at a cheaper wage. Billy is suddenly out of a job. A year later, he is scratching out $10,000 a year as a gardener.

Billy is the rule rather than the exception. The number of jobs in his local has dropped from 450 to 250 in the past 15 years. Though the Forrester children have done far better than some of their counterparts elsewhere who work at minimum-wage jobs, they still face a stark choice common to many high school-educated children of blue-collar workers: either to make it into a well-paid but precarious union job or to walk off an economic cliff into a nonunion service-sector job that pays a fraction of such wages.

Today the harbor jobs pay up to $265 a day, which means a worker can make $45,000 to $55,000 a year. But the few jobs remaining are tough to get. As Bob's youngest son Paul, 26, who has had an application on file with the Longshoremen's Union for three years, explains, "They pass out 50,000 or 60,000 applications. They give 3,500 interviews. For about 300 jobs." Paul keeps updating his file, but has heard nothing.

All three Forrester children have the same odd feeling: that in spite of strong dreams and hard work they're somehow slipping into an economic backwater; that it will be measurably tougher, if not impossible, to achieve the same life their parents had.

The world looked very different to Bob Forrester when he married Carol in 1953 and began a new life in Los Angeles. He grew up in East St. Louis, where his father earned a modest blue-collar wage as an engineer in a chemical plant. Carol came from Staten Island, from two generations of longshoremen. Neither Bob nor Carol went to college. But back then, lack of a degree was no impediment to swift upward mobility, and for Bob a union labor job was the quickest ticket into the booming American middle class.

Bob and Carol got there fast. By 1962 they had three children, and they owned a comfortable three-bedroom house. Carol stayed home and raised the children. They had accomplished something else that has always been critically important to Americans: "I'm definitely better off than my father was," says Bob. "We have a nicer place, my retirement will be more comfortable than his." Bob now makes $40,000 as a union official, owns three houses and a lot, collectively worth $600,000, and when he retires will receive a pension of $1,600 a month from his union in addition to Social Security.

But the success is tarnished by the uneasiness the Forresters feel about the future of their children. "It doesn't look very good for them," says Carol. Says Bob, more pointedly: "I don't think my kids will be able to buy a house in this area unless they win the lottery."

Peggy Forrester, the one with the Ford Tempo, is the middle child -- 30 years old, well dressed, articulate, with a high school diploma and an assortment of credits from a local junior college. She has worked her way up to become a manager of a retail clothing store. Her salary of $25,000 a year sounds quite respectable. Nevertheless, she had to live at home until last year. "I couldn't afford to move out," she says. She makes about $300 a week after taxes. (The withholding includes $32 a week in Social Security tax that will help pay for father Bob's retirement, a curious transfer of income.) Roughly two-thirds of that goes to rent, household and car expenses. She is unable to afford a private phone. With a median-price house in the area now at $188,000, she does not dream of owning one.

Her brother Paul and his wife Silva are in similar straits. "What I'm afraid of," says Silva, gesturing across their apartment in Harbor City, only a few miles from where Paul's parents reside, "is to be living like this forever." The life she refers to, like Peggy's, doesn't look all that bad. They live in a modest but comfortable one-bedroom apartment. For most of the past eight years (they've been married for only a year), Paul has driven a delivery truck for a private mail company. He has worked his way up to $8.25 an hour. Paul too lived at home until last year. Though Silva works part time at a day-care center, they are struggling with their monthly payments of $600 in rent and $169 in credit-union debt. "When we pay everything off," says Paul, "we barely have anything left."

Brother Billy, 34, who lost his harbor union job, has four children, the oldest twelve. He migrated north to Washington State, looking for a better quality of life, and went into business for himself as a gardener. His income has ranged between $10,000 and $20,000. Last year Billy bought a house in a rural area for $43,000, a purchase made possible by his father's financial aid: Bob put up the down payment of $11,000. Billy too is looking for a job on the waterfront, where the $11 hourly wage and full benefits will go a lot further toward supporting his four children. But such jobs are so scarce, he says, that "you've got to stand in line three days just to get your name on a list. It's a rat race, but I've got enough motivation now to do it."

The Forresters are all aware of the growing polarization of income in the job market based on level of education. A few miles south of where they live, the family of Bob's sister Rindi offers an interesting counterpoint. She married Don Elster, a college graduate and a banker. They have the first child in the third generation of the Forrester family to receive a college degree. Steven Elster, 27, is finishing medical school. He is being supported by his parents, who are also paying for half his medical-school tuition. He has every expectation of rising quickly into the upper middle class and being better off than his parents. It is the widening gap between Steven and his cousins -- and the absence of the middle ground that their parents staked out with such relative ease -- that is most disturbing.

% It is more than a bit ironic, in this campaign season, that Bob and Carol Forrester, who look economically very much like Republicans, plan to vote for Dukakis and that the younger generation -- Billy, Peggy and Paul's wife Silva, who are balanced precariously on the lower edge of the middle class -- are all voting for Bush. Explains Peggy: "I personally like Reagan and Bush. We don't have a war, and taxes are better. No one has to make a job for me. I can do it on my own, and I think other people can too." Yet she is uneasy. "But if we're going to be better off," she says, "something will have to happen." Something to ensure that the middle rung of America's ladder to success does not shrink too fast.