Archives For prosperity

I know all you young folks out there who might accidentally come across my blog know very little about the history of prosperity but most of the older folks have recollections of more prosperous times.  I can remember the 1950s where everything seemed to be going well  for many of us. We couldn’t build enough houses or cars to meet our needs.  Instead of our returning vets coming home to unemployment, jobs were being created at a vigorous rate.

The 1960s was my decade for growth. Even though I was raised in the single parent household and my father was a milkman I managed to get accepted by a great State college and worked my way to a bachelor’s degree paying all the expenses by working in a dormitory cafeteria up to 40 hours a week. It was a struggling time but probably the happiest of my life. I made such good friends during those years before I became deaf.

In the 1970s things started to change. Good middle class jobs for those without a formal education beyond high school were starting to disappear.The Oil Embargo put a hamper on things and inflation was roaring along. Things were starting to change by the end of that decade and then came the 1980s.

The 1980s seemed to be a pivotal decade. It is the time when we elected a very conservative president who believed that government was the main problem in our society. It was a time when the elite among us began to get inordinate influence in our society. It was a time that the social conservative that seemed the dwarf the emphatic among us. It was a time when the rich started getting much richer.  It was also a time when the MBA college degree started taking root. The MBA degree taught that people where no longer to be considered valuable members of a company but instead liabilities that needed to be trimmed as much as possible.  At that point the middle class shrinking came fully into force.

The 1990s, or the Clinton years as I knew them, brought back prosperity at least the a degree and to a limited segment of society. These were my most productive years from a financial standpoint. My retirement funds and 401k’s grew at a rapid pace. The growth of the stock market rivaled that of the 1930s. A new thing called the Internet was taking hold of everyone including corporate America. I took advantage of the trend by re-purposing myself into an IT guy (information technology). I was suddenly in demand for my skills. but toward the end of the decade panic started. Luckily I got pretty much out of the stock market before the crash.

The 2000s were a very pivotal and dramatic decade that saw  the stock bubble burst and then years of a stagnant economy. When Mr. Bush came into the Oval Office the DOW Industrial averages were at 11,000, When he left eight years later it was at 8,000 and due to too much deregulation much of the banks were on the verge of bankruptcy along with a couple of our biggest corporations.

The 2010s finally ushered out the president who started two wars and huge increase in military spending. The new president managed to get us out of these two catastrophic emergencies and as a result in six years the DOW averages went from 8,000 to 18,000.

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So, studying the above graphs let’s recap all this. When the super rich were being taxed at up to 90% of their income we had prosperity. Then when that was reduced to about 30% things started falling apart. I think you should get the idea  that giving big tax breaks to the super rich is not a way to get us once again to prosperity.

I am way over my word limit here so I have to stop.

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Prosperity…

April 23, 2013
Banner - Will Rogers
“There is nothing that sets a nation back as far in civilization as prosperity.” – Will Rogers, 2 April 1933

Yeah Will, prosperity does seem to bring out the animal in many of us. Just look at the Robber Barons of the early 20th century for evidence of that.  Heck, you don’t even have to look that far back, just look at the 1%ers now who will do just about anything to maintain their wealth.  Prosperity brings out the best in a few but the worst in others.

Banner -Off The Top

budgetI know the current version of the Republican party is supposed to be all about fiscal austerity but I have trouble actually seeing them live out that concept. When it comes to the safety net and so-called “entitlement” issues they scream about needing to cut back or at least for total accountability. But when it comes to the bloated military expenses, homeland security and tax breaks for the rich they appear to throw that concept out the window. Of course that means that their austerity programs, if they are implemented as they suggest, will end up being done on the backs of the poor as almost everything else is “off the table”.

We spend more than the other 96% of the world combines on our supposed security. Our military budgets eat up so much of our prosperity as to force future looking programs off the stove.  Education, our R&D forces, and our colleges suffer as a result of our insistence that to be safe we must spend so much on our war machine. In fact we throw so much money into the military that they don’t even bother to try to determine if it is going to the best place. For that matter they really don’t even try to categorize where it is even spent.  But that doesn’t seem to phase the Republican senators and congressmen in Washington. They continue to demand more and more of our precious resource for this bloated machine.

For that reason I have little confidence that my budgeted minded friends are really serious about budgets but are really more concerned in reducing or even eliminating the very function of government or at least making sure that 47% don’t get things they supposedly haven’t earned.  If they were really serious about our current deficits they would be looking at  our war machine first not last.  When you throw trillions of dollars into a black hole you dictate that much of it will be spent unwisely or even fraudulently.  They demand total accountability for agencies supporting our safety net and nothing for our industrial/ military complex. How strange is that???

About Germany….

September 18, 2012

Why is it that Germany seems to be just about the only country in the world who is not struggling with a disappearing middle class? They are doing well in that regard because they are the most unionized country in the world and their increased wages drives their demand. How do they manage to keep their wages high in light of the pennies-on-the-dollar labor found elsewhere?  They do it by government regulations prohibiting companies from exporting jobs.  Of course this is something that the “free traders” among us say is impossible but it seems Germany didn’t know it was impossible and went ahead and implemented it anyway.

Could the same thing be done in the U.S.? Could we actually drive up demand by driving wages back to where they were twenty years ago. In the last decade the auto industry’s starting wage has gone from $28/hour to less than $15/hour and there are similar numbers throughout other industries in the country. The middle class is quickly disappearing as a result. And with the middle class disappearing so is the discretionary income and resulting demand. We are in a catch-22 until we can figure out a way to bring the middle class back to existence.

The conservative elements in our country insist that the door to the middle class is pretty much now closed and we must depend on trickle-down from the rich to maintain any semblance of prosperity in this country. I just don’t buy into that logic. If our once mortal enemy of Germany can maintain their middle class through corporate regulations prohibiting the export of jobs then certainly the biggest economy in the world can do something similar.

Germany is now pretty much bailing out all those other E.U. countries with their affluence.  And this is just a score of years since they incorporated the very destitute East Germany into their country! Maybe we should take a plan from their play-book and duplicate it here in our own American style. But like our healthcare debacle we can’t seem to learn that the rest of the world has pretty much learned to control their medical costs through a universal single-payer system so how are we ever going to learn how to bring back our middle class through lessons from elsewhere?

Now don’t get me wrong here; I am not saying that Germany is a better country than we are. They have some restrictions on their citizens that should never and would never be acceptable to us. We don’t have to become another Germany to learn some ways of doing things better. Pragmatism is finding what works and then using it regardless of where it came from.

But what do I know….