Wednesday, September 14, 2011
Recap on Where We Are
Overall there are a number of core ideas that bring the economy into focus and are in stark contrast to the ideas from the conservative side of the aisle. There is a theory out there that we can cut our costs of government and make it do more for us. The idea seems to be that if government is smaller we will, somehow, grow the economy. There is no connection made as to how, exactly, that will happen. There is a bullying by the media to say that this IS how it works but there is a lack of fact to support it.
In addition, there is still the theory that if the rich get richer we will see more money trickle down to those of lesser means. The last decade has seen the rich get richer at the expense of the poor. The current minimum wage as adjusted for inflation is at the lowest it has been in 50 (fifty) years! Corporate America is now sitting on over $2 Trillion in profit that they will not put back into the economy because they say they are fearful that the "down turn" is not over. They won't place money back into our economy because they don't have customers. They don't have customers because they will not pay a proper tax on what they have made. The current effective rate is the lowest it has been in 60 years! They will not help government stimulate the economy and create jobs. One in six people in the U.S. is living in poverty today. So many are in under employed situations that the MEDIAN income has been going down (recently went down to less than $50,000 /year per family). Real wealth has to be created by a work force that makes "things". A financial instrument is not a thing. Seventy (70%) percent of the economy is CONSUMER SPENDING! A slight uptick in wages results in a broad boost to the economy.
Henry Ford paid his worker 3 times the going rate to get more consumers in the economy. He literally created a vastly broader middle class. It worked. The tax system was progressive and recognized that the worker bees were the engine that made the economy work. Today the Ruling class feels entitled to more and more money without giving anything further to the workers who made it possible.
For a time I thought that unions had been necessary for a time but had outlived their usefulness. Today I no longer think that the unions will ever outlive the need to have them there. Between 1945 & 1975 there were 35% of all workers were in unions. That was a period of high growth in the economy.
More on this later when we explore the need to change our export policies and correct the direction we are going with the Right in charge or at least dictating what the discourse will be.