So where is the trickle down?
How can the economy be bad when corporate profits are higher than ever?
You know what is wrong with the economy?
That is what is wrong with the economy. 30 plus years of stagnant wages is what is wrong with the economy. Union busting that makes it harder for normal people to earn a decent living is what is wrong with the economy. Record corporate profits are not a sign that the economy has recovered, it is a sign that the economy is still functionally broken for everyone who isn't already rich. Since the financial collapse of 2008 the subsequent "recovery" over 90% of the profits made from labor in this country have gone to the top 2% of earners. So a small fraction of the population get's their boom time golden toilet days back while over 90% (300 million +) are stuck arguing how we can fairly divide the crumbs.
Then, after paying you crumbs, they curse you for your poverty.
Stagnant wages have created a economic cycle of stagnation that has been propped up by consumer debt, consumer debt that keeps bursting in bubble after bubble until the Big Bubble burst in 2008.
That is why wages have hit an all time low percentage of GDP.
That is why consumers don't have the disposable income required to drive the economy forward.
That is why the economy is not growing faster, because consumers have no money to buy shit with. Losing your job and taking a new job at a pay cut and with less hours has that effect. Henry Ford understood & it can not be said enough that he wanted his workers to be able to make enough money to afford the products they made. That idea raised wages all across the manufacturing industry of the United States and lifted countless households out of poverty for the first time and into a middle class lifestyle.
The problem is NOT "Government", the problem is the totally stilted division of profits between labor and capital. The rich are getting richer because the poor are getting poorer. Labor and Government are only the enemy if you hate democracy and working class people.
More thoughts below the fold.
Wage stagnation in America truly began at the end of the 1950s. Labor Unions had reached the peak of their power, the middle class (R.I.P.) was the driver of the economy, America had a strong manufacturing base and while the rich were still phenomenally wealthy for their time, we were able to look towards the future and imagine a better world.
And we achieved that world in many ways. Civil rights victories were won. We put a man on the moon.
But by the end of the 60's many problems we refuse to address 50 years later began to become too big to ignore, the seemingly never ending wars, America's over dependence on fossil fuels and the effect that had on our domestic and foreign policy. In the 1970's we still had a media who would report on wars and oil, but that was before corporations consolidated the media into the hands of a half a dozen companies.
In the 1970's women joined the workforce on a more full time basis. Since women are underpaid for having unregulated vaginas, higher wage earning men were driven out of the workforce. This is not the fault of women, it is the fault of the sexist, manipulative "job creators" of that day who found it easier to exploit women than men at the time. Men began accepting lower wages while women began to aptly compete in the workplace and thus was modern wage stagnation conceived.
Many American homes became two income households for the first time. In the past, a one income household had the benefit of an extra worker, a spouse or relative who could join the workforce if the primary income earner was suddenly unable to earn a wage. This helped serve as a family orientated safety net. But once both parents had to be full time members of the workforce this first frontline safety net disappeared.
Costs of living continued to rise, and wages continued to stagnate. To fill the gap consumers went into debt, financial institutions began to make cheap credit available, and thus America's addiction to credit cards began, and consumers went into debt while working for less and less money per hour compared to price increases, and the financial institutions encouraged this, because your debt is their profit.
This pretend family used to be a one income household in the 50's and 60's. They became a two income household in the 70s and 80s, and then the jobs started moving overseas. Multi-national corporations found that they could move their operations to where the wages were even lower, when India and China joined the world economy in the 80s and 90s three billion new workers joined the potential workforce multi-national corporations could employ. They took r jobs.
And as the better paying, more secure manufacturing jobs disappeared a few different businesses began to boom, namely health insurance and financial institutions. Money poured into these two industries for two reasons, growing consumer debt and credit made the creditor institutions and fortune, and for-profit health insurance makes money based on how little coverage they are willing to provide, so our jobs began heading overseas at an alarming rate, wages continued to stagnate, a two income household PLUS going into debt wasn't enough to keep this fictional family out of near poverty and now imagine one of them gets sick or loses their job. PRESTO! You have poor people. Working poor people, and it has been 30 frikking years of this shit.
And then the economy collapsed at the end of George W. Bush's Presidency.
This is why the economy sucks for so many people.
It is just that simple.
And there is a plutonomy that is feeding off of the larger economy. Wall Street is still killing Main Street.
That's why corporate profits are at a record high while workers' wages have hit an all time low. We have these wonder geniuses taking control of companies, lavishing bonuses on each other for being job creators and then wonder why the workers are mad that they are being told that their pensions are no longer a viable option. That their retirement security ended up as some golden parachute and that they shouldn't worry! They can just be retrained, and retooled for the 21st century job market! Oh yeah and you're 53 and have been at the same job for 20 years. What does it matter? They are the peasants.
I keep hearing about how average Americans are going to have to do with less, well what are the rich sacrificing? They asked for two unpaid for wars and got them with taxes staying the same. They asked for the deregulation of the banking industry and got that. They asked for the lowest tax rates in the history of our republic and got em.
Going back to the Clinton tax rates on the top tax bracket isn't a sacrifice, going back to the top Reagan rate of 50% would be, but God forbid the people with all the fucking money should be expected to pay more in taxes or wages. Where is the fucking trickle down? I don't see it. All I see is the rich getting richer than they have ever been before. All I see is that the Too Big To Fail banks that crashed the economy are now bigger than ever.
My, what free markets and low wages you have, Grandma?
The better to eat you with, my dear.
So you get the privilege of working your way into poverty and staying there. then going into debt until you die, and all so that Walmart can live. You work and you still get to be poor, you still get to live in debt, despite all of your work poverty is your reward. You have the right to work, just not the right to decent pay.
And they wonder why the economy is bad.
It is because the job overlords decided to give themselves bonuses instead of giving American workers good wages for the last 30 freaking years, and despite corporate America's recovery from the 2008 disaster we're still fucking peasants as far as I can see.
(A big hat tip to our fellow Kossack Tool, who contributed to this post)