When The Mountain Falls On You
A comment posted by reader Dennis Francis on my blog entry Descending Broke Buck Mountain serves as the skeleton for this post. His comments are in italics. Article excerpts are blockquotes.
The falling dollar is great for some.
[T]he big money, the “juice” as street people used to say, comes from squeezing the orange of American society for more work, more production and tax money.
Show me the Republican or Democratic leader who says … “My corporate campaign contributions come from people whose every action is directed at extracting two things from you, my dear voter: Your money and the cheapest possible labor you can be driven to provide. The absolute cheapest possible payment to you for the hours of your life consumed by work, which, depending upon the degree of your delusion, is called either a job or an exciting career.”
The excitement comes from being Just Over Broke all the time.
The middle class have not seen a real pay raise.
The average hourly wage of millions of production workers: $16.94
12 million suburbanites live in poverty. Cleveland was the city with the highest poverty rate last year, at 32.4 percent, while San Jose had the lowest, at 9.7 percent.
Suburban McAllen, Texas, at the southern tip of the state, was the suburb with the highest poverty rate last year, at 43.9 percent, while suburban Des Moines, Iowa, had the lowest, at 3.7 percent.
[At the] federally mandated minimum wage [of] $5.15 per hour… A full-time worker with a family of three working 40 hours a week 52 weeks a year would earn $10,712 a year, leaving them below the official 2006 federal poverty level [for a family of three] of $16,600… less than $900 a month to cover housing, food, health care, transportation and other expenses.
Poverty Income for Persons in Family or Household numbering:
48 Contiguous States and D.C., Alaska, Hawaii:
1 - $ 9,800, $12,250, $11,270
2 - 13,200, 16,500, 15,180
3 - 16,600, 20,750, 19,090
4 - 20,000, 25,000, 23,000
5 - 23,400, 29,250, 26,910
6 - 26,800, 33,500, 30,820
7 - 30,200, 37,750, 34,730
8 - 33,600, 42,000, 38,640
For each additional person, add
3,400, 4,250, 3,910
SOURCE: Federal Register, Vol. 71, No. 15, January 24, 2006, pp. 3848-3849
The number of Americans who can’t always depend on having enough to eat … is now 35 million.
Small business has been screwed by Big Government while feeding their big corporate buddies.
The Coast Guard plans to spend $24 billion to upgrade and replace its fleet of aircraft and ships over 25 years in a modernization program called Deepwater… A multibillion-dollar effort to modernize the Coast Guard’s fleet [which] has suffered delays, cost increases, design flaws and, most recently, the idling of eight 123-foot patrol boats that were found to be not seaworthy after an $88 million refurbishment.
[More such schemes here]
Politicians screw the poor and middle class while insisting that they are our only hope for the future.
Nationally, some 26 million people received Food Stamps in 2004 – only 60 percent of those who meet federal income requirements.
The investment class fool the middle class into thinking that they are investing for eventual wealth.
America’s corporate chiefs are unloading their own stocks at one of the boldest paces in 20 years. Analysts say a take-the-money-and-run flight from their own companies signals a growing lack of confidence in the economy’s future…
They forgot to tell them that the Wall Street Ponzi scheme is in full effect.
“What I am hearing from some of my colleagues is that this is as bad as housing and the economy are going to get,” said Ian Shepherdson, chief United States economist for High Frequency Economics. “I think that is completely wrong.”
A number of economists expect a further economic slowdown next year. “It is too optimistic to assume that consumers will just take in stride what is happening,” said Nigel Gault, chief domestic economist at Global Insight. “Year after year, spending growth has exceeded income growth, and we should now expect a period in which spending growth falls short of income growth.”
The banking industry is being challenged as the American consumer economy slows.
Morgan Stanley chief economist and director of global economic analysis Stephen Roach… predicts America and China (which control about two-thirds of the world economy) will face a tough 2007.
The slowdown in the US economy has world wide repercussions. The rate of growth in a number of countries, mainly China and Japan, depends on their exports to US and as such they may slow down along with the US. [India does] not depend on exports as much and of the exports only a fifth go to the US. As such the impact of US slowdown on [Indian economic] growth will be small.
There is a very good reason for this assertion:
The report from the Helsinki-based World Institute for Development Economics Research shows that in 2000 the richest 1 percent — most of whom live in Europe or the United States — own 40 percent of global assets… Average wealth in the United States amounted to $144,000 per person in the year 2000.
In India, the figure was just $1,100.
The richest 2 percent of adults owns more than half of the world’s household wealth, valued at $125 trillion in 2000. Nearly 90 percent of this is concentrated in North America, Europe and high-income Asia-Pacific countries such as Japan at $181,000.
The richest 10 percent of adults accounted for 85 percent of assets, the report said. Those in the richest 10 percent of adults had assets of $61,000 or more while those in the top 1 percent — who now number 37 million — had at least $500,000.
By contrast, the bottom 50 percent of the world’s adult population owned barely 1 percent of the world’s wealth. According to the report, individual assets of $2,200 placed an adult in the top half of the world’s wealth distribution in 2000.
“The sheer numbers of people living under the $1-a-day definition of poverty has been stubbornly high,” said Vinod Thomas, director-general of the Independent Evaluation Group. According to World Bank research, 1.1 billion people subsisted at that level in 2001.
But don’t let that fact affect your Christmas shopping!
Americans are better off than ever, but rising incomes often don’t satisfy rising wants. Advanced societies need economic growth to satisfy the multiplying wants—public and private—of their citizens. But the promise is so extravagant that it preordains many disappointments and sometimes inspires choices that have antisocial consequences…
Just last week Forbes magazine reported that the 400 richest Americans are now all billionaires. And the government’s recent release of household income and poverty figures for 2005 has sharpened the debate. The bottom line: productivity gains (improvements in efficiency) are going disproportionately to those at the top. No one should be happy with today’s growing inequality. It threatens our social compact, which relies on a shared sense of well-being.
That “shared sense of well-being” isn’t being shared to the same degree in Europe, where they expect to do better than America in the near future:
Forget the U.S. dollar. If America catches a cold, Europe barely sniffles. Europe’s quiet confidence is indicative of how much it has weaned itself off dependence on America over the last few years. Europe’s strengthening trade relationships with countries other than America give it more balance.
[T]he euro isn’t strengthening as much as the dollar is weakening. [M]ost economists expect the dollar to keep falling, driven down by America’s huge trade and budget deficits.
The U.S. economic advantages may be narrowing as other countries grow richer and develop better financial markets. Or, at some point, the big trade deficits may spill more dollars abroad than foreigners want to hold.
Bloated U.S. trade deficits don’t inspire confidence. They could provoke a panicky flight from the dollar or protectionism. a weak dollar might herald a weak global economy — which would be bad for everyone.
For some, a weak global economy has already arrived, with More Than 10 Million Germans Threatened by Poverty. The standard of living has dropped in Germany caused by growing unemployment. It’s seen as being bad enough for Kenya, the world’s 26th poorest nation, to offer economic assistance to Germany.
At the rate America is going, will the Kenyans soon be offering aid to us? Maybe - Hugo Chavez is already planning on doing so!