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First some startling facts about life in America at the end of 2012:

1. Only 55.3 percent of all Americans between the ages of 16 and 29 had jobs.
2. There were 240 million working age people. Only about 140 million of them were working.
3. According to CareerBuilder, only 23 percent of American companies planned to hire more employees in 2012.
4. Since the year 2000, the United States has lost 10% of its middle class jobs. In the year 2000 there were about 72 million middle class jobs in the United States but today there are only about 65 million middle class jobs.
5. According to the New York Times, approximately 100 million Americans were either living in poverty or in “the fretful zone just above it.”
6. According to that same article in the New York Times, 34 percent of all elderly Americans were living in poverty or “near poverty,” and 39 percent of all children in America are living in poverty or “near poverty.”
7. In 1984, the median net worth of households led by someone 65 or older was 10 times larger than the median net worth of households led by someone 35 or younger. Today, the median net worth of households led by someone 65 or older is 47 times larger than the median net worth of households led by someone 35 or younger.
8. Since the year 2000, incomes for U.S. households led by someone between the ages of 25 and 34 have fallen by about 12 percent after you adjust for inflation.
9. The total value of household real estate in the U.S. had declined from $22.7 trillion in 2006 to $16.2 trillion by the end of 2012. Most of that wealth has been lost by the middle class.
10. Many formerly great manufacturing cities are turning into ghost towns. Since 1950, the population of Pittsburgh, Pennsylvania has declined by more than 50 percent. In Dayton, Ohio 18.9 percent of all houses now stand empty.


The most significant take away from the above dolorous statistics and the most predictive of the future of American society is the sudden and calamitous reversal of traditional American expectations that each generation is destined to enjoy greater economic and material success than the prior generation.

To step away from examining the political and economic causes of that reversal, hopefully without ignoring or diminishing them, it may be worthwhile speculating on whether or not there are other contributing or exacerbating causes.

One possible and I guess one can call a positive influence on this seeming slide is the emergence in our economy and society of the pervasive and ubiquitous impact of mobile communication and social networking. To look at it in one way, those most proficient in using the devices, have the potential to provide for pennies almost all ones needs except food and shelter. If that is even remotely so, what remains of the incentive to work hard and achieve material success, if such success is directed in part to acquiring those things necessary to travel to and impress others or to entertain oneself? Does Veblen's analysis of a society driven by "conspicuous consumption" even apply any more.

And, in terms of personal satisfaction, proficiency in manipulating the device may be adequate for many and if truth be known more personally rewarding than what was available for most people only a generation ago.

So, if I am right that access to basic food, basic shelter and inexpensive mobile communication devices and applications may satisfy an increasing number of the emerging generation, who grows the food, who delivers it, who builds the shelters and the devices? Robots? Perhaps that is why Amazon purchased Kiva Robots. What happens to the economy if a sizable portion of the population chooses to travel less, buy less clothing or cosmetics and the like?

And what sort of world is being created? Do those without food and shelter take it by force from those who have, like they did thousands of years ago? Who fights to preserve this rudimentary lifestyle? Does the industrial economy continue to contract and along with it the metaphors for work –  credit and money, find less and less upon which to, well, work so that gambling appears as valid a use for it as any? And what is the purpose of education? Are these new people, lazy parasites for opting out as they may do? If so, what do you make them do instead, work on the farms?


Today's Quotes:

"Even without being able to gauge the actual political power of wealthy citizens, we can confidently reject the view that extensive political power by the wealthy would be of little practical importance anyway because their pol- icy preferences are much the same as everyone else’s. On many important issues the preferences of the wealthy appear to differ markedly from those of the general public. Thus, if policy makers do weigh citizens’ policy preferences differentially based on their income or wealth, the result will not only significantly violate democratic ideals of political equality, but will also affect the substantive contours of American public policy."
            Democracy and the Policy Preferences of Wealthy Americans, by Benjamin I. Page, Larry M. Bartels, and Jason Seawright
"Empirical research suggests that parents’ economic resources affect their children’s future earnings abilities. Optimal tax policy therefore treats future ability distributions as endogenous to current taxes. We model this endogeneity, calibrate the model to match estimates of the intergenerational transmission of earnings ability in the United States, and use the model to simulate such an optimal policy numerically. The optimal policy in this context is more redistributive toward low-income parents than existing U.S. tax policy. It also increases the probability that low-income children move up the economic ladder, generating a present-value welfare gain of more than two and one half percent of consumption in our baseline case."
            Alex Gelber and Matthew Weinzierl: Equalizing Outcomes and Equalizing Opportunities: Optimal Taxation when Children’s Abilities Depend on Parents’ Resources:

        (I don't really understand what they are saying here, but I agree with their conclusion that sending poor kids to good schools is, on balance, a good thing)

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Comment Preferences

  •  Reversing History (5+ / 0-)

    To reverse the trend towards a lower standard of living requires that citizens not only engage in the political system - but in the economic system as well.

    What the wealthiest few have successfully executed is a takeover of the political system (which in previous generations held them at bay).

    Though progressive voices/interests engage in the political process, you will find that there is no real difference between Republican & Democratic administrations - on economic issues. There is a clear difference on social issues.

    Indeed, NAFTA was signed by a Democrat, and the TPP (currently being written by large corporations in secret) will probably be signed by a Democrat as well.

    So, it is time to engage the wealthiest few on the economic front i.e. fight for control of large corporations

    •  Progressive (1+ / 0-)
      Recommended by:
      Alexandra Lynch

      You make an interesting point but  just as technology has to a great extent driven out land-use and social patterns, how do you deal with the potential that modern communication technology may allow a significant number of us to opt out of that system? If they do so than, it is possible that the rich may be less rich or rich in something other than finance or natural resources. If the automotive industry shrivels, is it a good thing or a bad thing? Good for the environment perhaps.  

  •  Here's the key quote: (2+ / 0-)
    Recommended by:
    camlbacker, PhilK
    The optimal policy in this context is more redistributive toward low-income parents than existing U.S. tax policy.
    In other words, end the tax policies which, over the past forty or so years, have siphoned wealth from the 99% and given it to the 1%.

    A more progressive tax policy, e.g.

    Irony takes a worse beating from Republicans than Wile E. Coyote does from Acme. --Tara the Antisocial Social Worker

    by Youffraita on Fri Aug 30, 2013 at 10:05:22 AM PDT

    •  Youffraita (0+ / 0-)

      Thank you for your comment. While I whole heartedly agree with you that our tax system sucks, one of the things I imply in my projection is that for the first time in a long while a significant portion of the productive population may through these new technologies opt out of the tax system and much of what current society provides. I'm not sure this is a good thing because it will ravage the suburbs and the transportation system (a good thing for out survival but a bad thing for jobs) and may produce an even larger group of people separate and uninterested in the problems that beset the rest of us who remain in the Capital-19th Century technology economic and social systems.

    •  It is not just taxes. The economy is driven by (0+ / 0-)

      usury and moving money and ownership around.  People don't make stuff.  We are losing skills and not passing knowledge from proceeding generations.  We need to take on tribal structures and stay closer together.

  •  An Old World. The American Experment Has (2+ / 0-)
    Recommended by:
    The Dead Man, PhilK

    concluded, finding that the old way of aristocratic wealth and authoritarian control was right all along.

    We are called to speak for the weak, for the voiceless, for victims of our nation and for those it calls enemy.... --ML King "Beyond Vietnam"

    by Gooserock on Fri Aug 30, 2013 at 10:05:44 AM PDT

    •  Gooserock (0+ / 0-)

      Thank you. I do not know what it proves about the American experience, but I suspect that there is being produced by modern communication technology a sizable class of those who are turning Veblen on his head, from Conspicuous Consumption society to a Conspicuous Non-consumption society. If that is true, some of the verities we have assumed may be changing. It is neither good nor bad although it may be both.

  •  Pittsburgh's a ghost town? Hardly. (0+ / 0-)

    Yes, there was an unpheaval in the '70s and '80s, when the steel industry collapsed.

    But Pittsburgh rose from those ashes and ushered in decades of innovation, focusing on technology and healthcare. Our universities and medical facilities are world-class.

    From wikipedia:

    These legacies have earned Pittsburgh the title of America's "most livable city" by Places Rated Almanac, Forbes, and The Economist while inspiring National Geographic and Today to name the city a top world destination. Since 2004, the area has added 3,304 hotel rooms and boasts higher occupancy than 11 comparable cities.

    Google, Intel, and Apple are among 1,600 tech firms generating $10.8 billion in annual Pittsburgh payrolls with the city serving as national headquarters for federal cyber defense, software engineering and robotics since the 1980s. R&D leaders Carnegie Mellon University and the University of Pittsburgh produce multiple startups annually ranking Pittsburgh as "America's smartest city" with 68 area colleges and universities, 38 of them non-profit.

    The nation's fifth-largest bank, nine Fortune 500s, and six of the top 300 US law firms make their global headquarters in the Pittsburgh area, while RAND, BNY Mellon, Nova Chemicals, Bayer, FedEx, and GSK have large regional bases that helped Pittsburgh become the sixth best metro for U.S. job growth. Area retail and housing have also grown with the multi-million dollar SouthSide Works, Bakery Square, and Washington's Landing repurposing former industrial sites.


    Yes, the population of Pittsburgh proper has diminished from its peak, but this is a very misleading "fact." The Greater Pittsburgh Metropolitan area boasts a population of more than 2.5 million people.

    In addition, the Buccos, barring a total collapse, are headed to the playoffs.

    How about I believe in the unlucky ones?

    by BenderRodriguez on Fri Aug 30, 2013 at 10:11:41 AM PDT

    •  Bender (0+ / 0-)

      Thank you. I am happy for you and Pittsburgh. It is an example of how to deal with a radical change in the socio-economic base of a community.

      Modern communication technology and related technologies, I argue, will impose the burdens of adjustment on our society perhaps even greater than that experienced in your City when those captains of industry its citizens so slavishly followed decided to put their money elsewhere and blame it on the workers and residents of that town. I believe the changes I see are national in scope. Can a country react as well as a city? I do not know but a great concern is what will be the human cost of the transition.

      By the way, one of the good consequences of the social changes I envision is just what happened in Pittsburg and is happening in a lot of the places in the country, a migration of the mandarin class back into the cities. The bad part is the collapse of the suburbs and the loss of the transportation related jobs that had been the backbone of our national economy for 150 years.

  •  I find this stat somewhat misleading. (2+ / 0-)
    Recommended by:
    Alexandra Lynch, qofdisks
    1. Only 55.3 percent of all Americans between the ages of 16 and 29 had jobs.
    If we raised that low-end age to 18 and counted full-time college students as having a job, how would that number change? A lot of high-school and college students either don't have time for a job or want to concentrate on their schoolwork instead of working.

    I'm not saying that if you make those adjustments that number will be significantly better, but I don't think we should necessarily be making economic decisions on a vision of full employment for 16-year-olds.

    "When I give food to the poor, they call me a saint. When I ask why the poor have no food, they call me a communist." --Dom Helder Camara, archbishop of Recife

    by JamesGG on Fri Aug 30, 2013 at 10:40:53 AM PDT

    •  James (1+ / 0-)
      Recommended by:
      Alexandra Lynch

      Thank you. You make a good point. Alas, whenever one refers to statistics assembled by others one is usually stuck with them. In any event even with your adjustments included, I am sure, the percentage would resemble most other analyses of youth unemployment and show it is a lot higher than the general unemployment rate in the nation.

  •  Someone sent me a link to a Reddit thread (1+ / 0-)
    Recommended by:
    Alexandra Lynch

    where people posted "dirty secrets" --  Just like anywhere on the internet: caveat emptor; but one of the responders said s/he was a lobbyist working diligently to turning us all into indentured servants within 10 years.

    Obama: self-described Republican; backed up by right-wing policies

    by The Dead Man on Fri Aug 30, 2013 at 11:01:51 AM PDT

    •  We're already working as sharecroppers... (1+ / 0-)
      Recommended by:

      ... on the health insurance plantation, The home mortgage plantation, and the college loan plantation.

      Indentured servitude is starting to look pretty good.

      “It is useless to attempt to reason a man out of a thing
      he was never reasoned into” - Jonathan Swift

      by jjohnjj on Fri Aug 30, 2013 at 04:02:47 PM PDT

      [ Parent ]

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