Why don't the economic geniuses recognize one basic fact -incomes did not keep pace

[Phoebe Loosinhouse]

Except for CEOs whose incomes did rise at an astronomical rate, in the last 10-15 years everyone else in the lower and middle classes faced rising costs of:

food
shelter
utilities
gas
tuition
medical
pharmaceutical
insurance

without a compensating rise in income. That is one reason people turned to purchasing real estate - hoping a rise in value would at least make up somewhat for what their salaries lacked. That is also why individual credit card debt rose so high.

If our economy is going to correct itself and get better

INCOMES HAVE TO RISE

The CEOs will have to be content with less and distribute some of their ill-gotten gains to their employees.

We will have to have national affordable portable healthcare so that workers can redistribute themselves more easily to the geography of labor opportunity.

It is very frustrating to listen to the same old GOP tripe this morning from Carly Fiorina and Mitt Romney on MTP still trying to push the Republican crap that WAGES (!!!!!) need to come down and businesses need still more preferential tax treatment. They harp on their same old hoary slogan that the US has one of the highest business tax rates without focusing on the fact that while the published supposed rate is high, most businesses get away with actually paying very little due to loopholes, accounting, and government giveaways.

The free markets have screwed the little guy for all they are worth in terms of unavoidable expenses like utilities, healthcare, pharmeceuticals and the like and I say regulate the hell out of them and bring their costs in line with something sane and rational.
Your heating bill should not be as much as your mortgage. Ditto for medicines. Ditto for health insurance.

The last 10 years have been as business friendly and unregulated as it is possible to be and financial mayhem and social upheaval is the result.

Wages. Incomes. Salary. Healthcare. Fairness. Opportunity.

[Phred42]

1. They're not stupid - they know that. - it's been part of the goal.

[Phoebe Loosinhouse]

2. I realize that was part of the goal - New World Order and all that

so that we would all be reduced to the plight of third world workers and it's pretty much worked.

But now we can see that it doesn't exactly work as planned. Worker bees are necessary to support the queen and her entourage. It's like the whole world economy has colony collapse disorder.

[Phred42]

3. agreer - but in this case the queen can survive without most of the workers

[Uncle Joe]

6. Tell that to Marie Antoinette. n/t

[Phred42]

8. Off with their heads

:bounce: off with their heads :bounce: off with their heads :bounce: off with their heads :bounce:

[Uncle Joe]

10. I would settle for "off with their immoral bonuses and 400 to 1 ratio salaries"

while they simultaneously drive the American People to destitution. Heads make poor soup, Phred.

I believe in the late 80s the ratio of CEO pay compared to their average employee was 26 to 1, so what happened?

[GoesTo11]

4. They would like a yacht-based economy

Where the economy is CEO's buying yachts with their bonuses gained at the expense of the underpaid workers they have building yachts. As long as the workers get subsistence wages and don't die, this is the idea. Then to make sure that there's no revolt, sweeten it from subsistence to subsistence plus an HDTV and a trip to Disneyworld so that people feel they at least have something to lose and will keep quiet.

[Juche]

5. 80% of economic growth has gone to the well off and corporations

And this was before Bush II. Under Bush II corporate profits tripled. It is almost a vertical line starting in 2001.



Its really not sustainable. But sadly there are still about 45% of the public who will always vote conservative, even if it means they live in a box and their kids can't go to college.

Rebuilding the unions is probably the only real way to fix this.

[Uncle Joe]

7. Kicked and recommended.

Thanks for the thread, Phoebe Loosinhouse.

[Hawkowl]

9. ROOT of the problem

The O.P. is 100% correct. Decline of wages means price deflation and is the underlying reason for the Bush Depression. The only reason "growth" occurred and the rich got richer is the fact that everyone was encouraged to borrow money and give it to the rich! In a sense all this growth and money was created out of thin air. Now, we must go backwards and shrink, prices decline, because the borrowing has come to an end.

We will not move forward again until wages start INCREASING. There has to be an equilibrium between consuming and earning and saving. Borrowing has simply thrown us into an accelerated downward spiral.

That is why it is absolutely SUICIDAL for the Rethuglicans to insist on more wage cuts. With no credit available and cutting everyone's wages further, the economy will simply accelerate and deepen the Bush Depression. It is downright scary at the way our national media is completely and utterly criminally negligent in understanding or reporting this.

[scarletwoman]

11. I think there's a corrollary that needs to considered as well -- we need to make stuff again.

You cannot sustain a society that produces nearly nothing of what it uses. We are not going have higher wages if all we have are service jobs, and no manufacturing base.

sw

[Dappleganger]

12. Agreed.

[truedelphi]

13. Wages are gonna increase around the same time that scientists

Admit that GMO foods are harmful and risky.

Decide that medical marijuana is a holy sacrament, and not an item that should allow the Feds to come in and take your assets, and destroy your reputation (Ask DU'er Fly by Night about the repurcussions of that one.)

When we see That scientists admit that vaccinating day old infants is as stupid as giving a six year old with a fever aspirin, maybe more so.

Come to terms with the fact that our "democratic society" excludes the middle income person.
Abe Lincoln, growing up in poverty today,would have zero chance of becoming an type of elected official, much less a President.



Decide that only by having a flat tax on things bought, excluding food, rent, housing payments (capped to a certain limit) etc would our tax system be fair (The richer, older people would pay more, the lower income pay less, proportionately - and those making money outside the system would pay something too.)

[OnionPatch]

14. More Pie!!

It all boils down to one very simple thing.....working people need a bigger piece of the pie, plain and simple. Our piece has been shrinking year by year.

[HughBeaumont]

15. Taxes are "too high"?

Where is Chainsaw Carly getting that? The top tax rate is the lowest it's been in 75 years. Has she glanced at Perfectly Legal? The super rich and the corporations they work for DO play by a different set of rules and get far better perks and advantages in the tax system than the rest of us do, and no amount of repeating the lie that they don't ain't-a gonna make it so.

Maybe in a world where businesses get taxed the same as individuals would that reality exist. But they don't.

[1776Forever]

16. You said exactly what I have been screaming about! MSM spewing crap on "consumers spent too much"!

Bull Shi_! That is such BS! I looked in our little local paper yesterday here in Central Ohio and there were 3 pages of foreclosures! These weren't for 5 bedroom $250,000 homes, they were for frickin' little 2 and 3 bedroom homes from $80,000 to $150,000! These weren't people who went out and spent way over their means! These were little everyday Middle Class families who were just trying to keep a roof over their families heads!

I get so damn tried of being preached to since I went back to school and got my MBA and my husband is a Retired Military person and we both could not find a full-time job in Florida! We had no choice but to give up our home and move away since our insurance and taxes had risen so much. We are now living in a rented 2 bedroom mobile home and we are glad to have it. But we had to give up on our dream, not because we went way over our heads, but because of an illness in our family for a loved one who had no insurance and the lose of good paying jobs in Florida, and unfortunately this is only going to get worse unless Obama and the Congress can wake this country up to the fact that without good paying jobs the Middle Class is going to become America's No. 1 Endangered Species!

Thank you for saying it so well!

[Hidden Stillness]

17. They Don't Want to Admit it is Same Thing They did to Bring on 1930s Depression

If you have been noticing the way the media has been covering this crash, not only do they still pretend it is "localized," and not general and systemic--calling it a "credit crunch" and "mortgage meltdown" and other "cute" slogans--as if the rest of the economy is still all right, but they have all been going to great pains to pretend this is "nothing like" the 1930s, this economy is "so different," "no relation."

Actually, exactly the same things that were done during the 1920s, leading up to the Crash of 1929 and the Depression, have been done since the 1980s especially, and because only recently did they accomplish their goal of getting at some of the last of the New Deal laws and regulations, it collapsed completely only lately.

During the '20s, taxes on rich people and corporations were lowered, and shifted onto the middle class and poor, wages stagnated and did not rise at all, people started getting into personal debt they could not pay off (credit cards now, time-payments and accounts at individual stores then), taxes on the losses of speculating investors were lowered, so that it was no longer risky at all to gamble on Wall St., etc. As a matter of fact, the last pillar to be removed, making the whole unbalanced system collapse again, was the killing of the New Deal-era Glass-Steagall Act, keeping investment speculation and deposited bank savings separate.

By the end of the '20s, only 13% of the population owned 90% of the Nation's wealth, and as now, profits of corporations were going to management, and not being shared by workers, as their income. There was a huge round of corporate deregulation then, there has been a huge round of corporate deregulation over the past era now. It is the same. This is why you never hear anymore, "No matter how bad the economy gets, this is why we have never had another Depression--because of the protections Roosevelt put in place." Now, you don't hear anything anymore.

[kentuck]

18. Bingo !

That is why they re-financed with 2nd and third mortgages. That is why they maxed out their credit cards. That is why they cashed out their 401K's. There is nothing else to cash out. It was inevitable that it come to this.

Because the greedy corporations and businesses took all the profit from the increase in production by the workers and gave huge bonuses to the CEO's and dividends for the stockholders and the workers were forgotten. If the horses don't crap, then the sparrows don't eat.

[Phoebe Loosinhouse]

19. And Bernacke said one of his "concerns" was wage increases!I

It's one of my concerns too, but not in the same light.

Somehow, we have to move this point to the top of the discussions.

The people who need assistance to level the playing field in this economy are the WAGE EARNERS - the people whose major source of income is reported on W2s and not 1099s.

Lowering the cost to the consumer of rigged and unregulated industries like healthcare, medicines, and utilities would be a good place to start.

[Danascot]

20. The American consumer accounts for

about 70% of the economy but inflation adjusted household income fell under B*sh. In addition to having less to spend, all the economic bad news this fall, has everybody terrified and caused the American consumer engine to sputter to an abrupt halt.

This paper, "Understanding Bushonomics" is worth reading - http://www.americanprogress.org/issues/2008/08/pdf/bushonomics.pdf

[sendero]

21. Back around 1993...

.. when Bill Clinton decided to open the trade floodgates with China, this result became entirely predictable.

With globalization, salaries are going to equalize. The Chinese and others' pay is going to increase, ours is going to decrease. Simple, predictable, and happening right before your eyes.

The Republicans and other globalization apologists/lackies claim that we can do the high paid service work, and let others to the manufacturing. Yeah, that is a really swell idea.

Few countries other than the US allow completely unrestricted no quid-pro-quo trade like we do. The Chinese sell us crap, and then we sell them treasury bonds. The whole thing is comical, but not funny because the Chinese and others are now worried about their "investments".

The world has already, in just the last few months, changed way more than most realize. Way more.