Economic Inequities - Explanations

For What It’s Worth….    return

Here are some explanations Congress and the public is for the most part ignoring.  Obviously, congressional Republicans are resisting any solution that the administration might claim credit for during the next election cycle.  Regardless, here are some perspectives that we can use to measure politicians.

Economic Inequities!
     Consider this irrefutable fact... No matter how one slices it or dices it, there will always be a lower quartile, a lower half those persons in our national community who do not have the capacity - intellectual, education, experience and/or motivation to successfully manage long term financial planning and complex health care issues.  (You will see this perspective frequently on this site.)
Don't believe this? Already, half of our national community does not earn enough to pay any federal income taxes.  Well, that 50% includes those who are loosing their homes and jobs.  That 50% are those who now hold a pessimistic view of the future economy as reported just this week.  And, it is precisely those 50% who are coming together with the specific intent of changing the system.  One might want to consider the power that 50% as a potential "swing vote" even if they don't come to a total political agreement.
     Want the facts behind the protests? Check out these charts from Business Insider.  Certainly this group includes youth that have been provided everything they want without personal responsibility.  And now those youth are hitting the wall of reality that taking out unrealistic student loans has consequences.    

    P.S. Of the top 1% of American earners only 3% were in the "banking" industry!  The "cut off" is about $250,000 @ year.  There's a lot of entertainers, athletes, and entrepreneurs on that list! For different perspective underlying these protests see the Fogcutters "Observations Page."

Here are a few bed-rock facts that must be included in any inequities discussion.

1.  The housing crisis has cost citizens of trillions of dollars of net worth. The inability to relocate is keeping workers from moving to areas where their skills match job openings.

2.  Skyrocketing educational costs have let to enormous student loan levels. Outstanding student loans are now surpassing the national credit card debt.  The recent Pres. Obama executive order moderating the student loan terms may soften the impact but it does not address educational costs as a whole.

3.  Almost all statistics show that the lower 50% of wage earners have been loosing net worth while the upper income levels have been gaining net worth.  This trend has been growing for nearly ten years.

4.  NAFTA and other "Free Trade" agreements have benefited importers by providing cheaper goods but at the cost of American manufacturing jobs.  We have exported higher paying manufacturing jobs and have created lower paying service sector jobs.

5.  America has become obsessed with "cheap" foreign goods at the sacrifice of American jobs. America has a choice to make whether we are willing to spend more for "American Made" and "American Quality."

6.  There are, quite frankly, those who have sought the accumulation of wealth as their "career."  Meanwhile others have sought careers that are not destined to acquire great wealth.  Also, It is perfectly natural for politicians as well as ourselves to listen more closely to those who are successful.  The fundamental problem occurs when those who are successful use undo influence to create an environment favorable to them and destructive to the nation on the whole.

     The "1%" battle cry is catchy and simple to rally around, no doubt!  A closer inspection shows a lack of understanding of complex issues and a lack of precisely what changes are being sought. Recent interviews with some of the protesters follow the lines of, "asking politicians what they are going to do about... (fill in the blank).  This approach is just asking for a "snow job"! 
     Complaints include lack of jobs, low paying jobs, lack of access to mortgage loans, high student debt with few job prospects, and finally anger that the big money people are exercising excessive influence within the government. (See #6 above.)
     Most of the desired actions sought by the government are along the lines of more government spending to remedy the above problems. This attitude is further fostered by "Progressive Caucus" members and union activists joining the groups.  Thee is also an expressed desire to significantly increase taxes on the rich.
     Regardless of the symptomatic issues above there is a real and significant issue about just who Congress is loyal to. An example of this protective favoritism is the Cramer interview with Sen. Sanders, (I) Vermont.  Also see Sen. Sanders revelations about oil speculators.

     Eventually there will be elements of leadership rising to influence these movements. Protesters must absolutely study the many factors leading to these inequities - because as the lyrics of a country song goes, "You must stand for something or you will fall for anything!"  For many the only short term solution is self determination and a lot of personal work to achieve parity with other influential segments.
     This movement both in the U.S. and the world is widespread and for the most part a valid expression.  Do not discount these issues because... revolutions whether social or political, violent or peaceful begin and find support from those who have nothing to loose!

Understand the real, deeper issues and the facts involved!

2.  Review our detailed discussions regarding Unemployment and Housing Crisis.

3.  Review charts from Business Insider to better understand the actual facts here.

4.  View Cramer interview with Sen. Sanders Sander's web site.

5.  For a special view of self-determination thoughts see our "Observations" link.

6.  Stay connected to several of the "Occupy" web sites and discussions.  Don't hesitate to express yourself even if it may not be popular.  Somehow the movements seem to be taking pride in the lack of leadership - this is just naive! Without a coherent expression that is based upon actual facts the established influences will be inclined to simply write off these efforts. (See "#6, Also" above). "Who wants to listen to a bunch of losers?"

7. Finally, from everything that we have observed within the many issues presented at Fogcutters we can see only one central change needed before the rest of these issues have a chance of resolution: A thorough and fair campaign finance reform!  We need to break the money trail that is pulling Congress away from doing what is best for the nation and not just what is best for financial contributors.  (More on this elsewhere.)

Beneath all the political verbiage there are significant, ignored facts and considerations that we need to be aware of.  And, this is what Fogcutters is all about - Finding Where Truth Hides


Copyright 2011-2012 H&H Associates.  All rights reserved.       


Searching for solutions avoided by politicians and activists!

Links for your own research

Who are the "1%"?
Who are the 1%?
CNBC: Inside the 1%
CNBC: Author, Russell Simmons, "Super Rich" video interview

Trade Agreements
Economic Policy Institute
NAFTA's Failure

Education Costs
Education Costs Continue to Soar
CBS News

Student Loan Plan Will Help But... 
Finding Cost Savings

Sen. Sanders (I) Vermont

Interviews with interesting perspectives:
CNBC, Sam Zell on Protesters 
Lynn Tilton, 20/20 Interview
"If you're going to sell it in America you need to make it in America.



Note: The frequent use of CNBC video interviews offer a wide selection of viewpoints and also have the interview text available next to the video for the viewers convenience.