During the past generation, the American middle-class family that once could count on hard work and fair play to keep itself financially secure had been transformed by economic risk and new realities. Now a pink slip, a bad diagnosis, or a disappearing spouse can reduce a family from solidly middle class to newly poor in a few months.
In just one generation, millions of mothers have gone to work, transforming basic family economics. Scholars, policymakers, and critics of all stripes have debated the social implications of these changes, but few have looked at the side effect: family risk has risen as well. Today’s families have budgeted to the limits of their new two-paycheck status. As a result, they have lost the parachute they once had in times of financial setback – a back-up earner (usually Mom) who could go into the workforce if the primary earner got laid off or fell sick. This “added-worker effect” could support the safety net offered by unemployment insurance or disability insurance to help families weather bad times. But today, a disruption to family fortunes can no longer be made up with extra income from an otherwise-stay-at-home partner.
During the same period, families have been asked to absorb much more risk in their retirement income. Steelworkers, airline employees, and now those in the auto industry are joining millions of families who must worry about interest rates, stock market fluctuation, and the harsh reality that they may outlive their retirement money. For much of the past year, President Bush campaigned to move Social Security to a saving-account model, with retirees trading much or all of their guaranteed payments for payments depending on investment returns. For younger families, the picture is not any better. Both the absolute cost of healthcare and the share of it borne by families have risen – and newly fashionable health-savings plans are spreading from legislative halls to Wal-Mart workers, with much higher deductibles and a large new dose of investment risk for families’ future healthcare. Even demographics are working against the middle class family, as the odds of having a weak elderly parent – and all the attendant need for physical and financial assistance – have jumped eightfold in just one generation.
From the middle-class family perspective, much of this, understandably, looks far less like an opportunity to exercise more financial responsibility, and a good deal more like a frightening acceleration of the wholesale shift of financial risk onto their already overburdened shoulders. The financial fallout has begun, and the political fallout may not be far behind.
31. Today’s double-income families are at greater financial risk in that
[A] the safety net they used to enjoy has disappeared.
[B] their chances of being laid off have greatly increased.
[C] they are more vulnerable to changes in family economics.
[D] they are deprived of unemployment or disability insurance.
32. As a result of President Bush’s reform, retired people may have
[A] a higher sense of security.
[B] less secured payments.
[C] less chance to invest.
[D] a guaranteed future.
33. According to the author, health-savings plans will
[A] help reduce the cost of healthcare.
[B] popularize among the middle class.
[C] compensate for the reduced pensions.
[D] increase the families’ investment risk.
34. It can be inferred from the last paragraph that
[A] financial risks tend to outweigh political risks.
[B] the middle class may face greater political challenges.
[C] financial problems may bring about political problems.
[D] financial responsibility is an indicator of political status.
35. Which of the following is the best title for this text?
[A] The Middle Class on the Alert
[B] The Middle Class on the Cliff
[C] The Middle Class in Conflict
[D] The Middle Class in Ruins
It never rains but it pours. Just as bosses and boards have finally sorted out their worst accounting and compliance troubles, and improved their feeble corporation governance, a new problem threatens to earn them – especially in America – the sort of nasty headlines that inevitably lead to heads rolling in the executive suite: data insecurity. Left, until now, to odd, low-level IT staff to put right, and seen as a concern only of data-rich industries such as banking, telecoms and air travel, information protection is now high on the boss’s agenda in businesses of every variety.
Several massive leakages of customer and employee data this year – from organizations as diverse as Time Warner, the American defense contractor Science Applications International Corp and even the University of California, Berkeley – have left managers hurriedly peering into their intricate IT systems and business processes in search of potential vulnerabilities.
“Data is becoming an asset which needs to be guarded as much as any other asset,” says Haim Mendelson of Stanford University’s business school. “The ability to guard customer data is the key to market value, which the board is responsible for on behalf of shareholders.” Indeed, just as there is the concept of Generally Accepted Accounting Principles (GAAP), perhaps it is time for GASP, Generally Accepted Security Practices, suggested Eli Noam of New York’s Columbia Business School. “Setting the proper investment level for security, redundancy, and recovery is a management issue, not a technical one,” he says.
The mystery is that this should come as a surprise to any boss. Surely it should be obvious to the dimmest executive that trust, that most valuable of economic assets, is easily destroyed and hugely expensive to restore – and that few things are more likely to destroy trust than a company letting sensitive personal data get into the wrong hands.
The current state of affairs may have been encouraged – though not justified – by the lack of legal penalty (in America, but not Europe) for data leakage. Until California recently passed a law, American firms did not have to tell anyone, even the victim, when data went astray. That may change fast: lots of proposed data-security legislation is now doing the rounds in Washington, D.C. Meanwhile, the theft of information about some 40 million credit-card accounts in America, disclosed on June 17th, overshadowed a hugely important decision a day earlier by America’s Federal Trade Commission (FTC) that puts corporate America on notice that regulators will act if firms fail to provide adequate data security.
36. The statement “It never rains but it pours” is used to introduce
[A] the fierce business competition.
[B] the feeble boss-board relations.
[C] the threat from news reports.
[D] the severity of data leakage.
37. According to Paragraph 2, some organizations check their systems to find out
[A] whether there is any weak point.
[B] what sort of data has been stolen.
[C] who is responsible for the leakage.
[D] how the potential spies can be located.
38. In bringing up the concept of GASP the author is making the point that
[A] shareholders’ interests should be properly attended to.
[B] information protection should be given due attention.
[C] businesses should enhance their level of accounting security.
[D] the market value of customer data should be emphasized.
39. According to Paragraph 4, what puzzles the author is that some bosses fail to
[A] see the link between trust and data protection.
[B] perceive the sensitivity of personal data.
[C] realize the high cost of data restoration.
[D] appreciate the economic value of trust.
40. It can be inferred from Paragraph 5 that
[A] data leakage is more severe in Europe.
[B] FTC’s decision is essential to data security.
[C] California takes the lead in security legislation.
[D] legal penalty is a major solution to data leakage.