Tuesday, January 28, 2014
What's Going On America?
You may never have heard of Jamie Dimon or his ilk, but there's no doubt you've felt his influence. Dimon is the CEO of one of the largest financial institutions in the world, JPMorgan. His was one of the institutions which trigger the great financial meltdown a few years back, resulting in the largest bailout in US history and the now infamous phrase, "to big to fail". Mr. Dimon's company remains very much in business and none of executives or shareholders ever faced a day in jail though JPMorgan was forced to pay the largest civil penalty in US history. In fact, he just received a 74% increase in salary--mainly in the form of stocks and stock options---from $11 million to $20 million dollars.
Not too shabby, especially if you consider that real wages for the average working class family has continued to drop year upon year and, after being adjusted for inflation, is no better off than they were in the mid 1970's. In fact, since 1997, all economic gain has gone to those in the top 10% income bracket. Meanwhile, while companies like JPMorgan were bailed out on the taxpayer's dollar (against the will of the American People I should add), some 10 million individuals have lost their homes since 2008 due to the home mortgage meltdown. And, yes, while many should have known better than to borrow more than they needed or could afford , despite intense pressure for banks, so too should the bankers and mortgage companies have known better. Apparently Middle America wasn't deemed "too big to fail" by the Washington-Wall Street nexus.
As everyone should know by now, the top 1% control some 40% of the nation's wealth while the bottom 80% controls a scant 7%. Only 19% of that wealth is actually in the form of income. Most of it is in the form of stocks, bonds, and real estate. To put it another way, the richest 400 people in this country control more wealth the bottom 150 million people. That's a hellva of disparity. The largest ever in our history. So, what are we to do about, if anything?
There's been a lot clamor about raising the minimum wage from its current $7.25 to $11.00 or even $15.00 dollars an hour. Of course all that will do is raise the costs of products, increase the number of layoffs or reduce hours while increasing workloads, not to mention the likelihood of a reduction or elimination of benefits. Heck, some employers may just shut their doors. President Obama is expected to increase the minimum wage for federal contracts to $10.10 an hour, which is nice except the contract bids will simply be adjusted to accommodate the change and thus the taxpayers---that's you and I---will be forced to pay for the wage increase. Sounds like swimming in mud to me.
Typically those who hold minimum wage jobs are the poorly educated (as to whose fault that is, is the subject for another time). Anyway, the only option typically is to return to school. However, to do that means incurring a back breaking debt, despite grants and low interest loans. Since 1999, student debt has increased a mind numbing 500% while those graduating were faced with an average decrease in starting salary of 10%. And filing bankruptcy may help with some of their debt load, it won't erase their student debt, but it will leave an nasty mark on the credit rating, which is the last thing they need.
Unions can't help them much either. Membership continues to drop. Today, it makes up only 7% of the work force thanks to job exportation, NAFTA (thanks heaps Bill), and changes in technology. The only segment of the workforce where unions at least continue to hold their own is the government sector, though wages increases, benefits, and pension protection are but dead. If amnesty is given to the estimated 11 million illegal immigrants now living in this country (not including the anticipated 7--10 million that will follow in the next wave), we'll see wage and benefits decline even further as demand for jobs far outstrips supply. Blacks and Asians will be most adversely affected in the influx since they currently hold most of the jobs that will be undercut from them and taxpayer based services are redirected away to pay for translators, housing, re-education and training programs and other social services. Meanwhile, the strain of Obamacare all but break the back of America's healthcare capabilities. Minimum care will become the norm with only critical care being available for those deemed "productive" as doctors and other healthcare providers hang up their white coats and college bound students consider other professions. All this calls to mind Ronald Reagan's famous quip about the nine scariest words, "I'm from the government and I'm here to help". So, what do we do then?
Serious discussion about extensive government reform, and even revolution are almost commonplace, even anticipated, although the media attempts to make it sound like "crazy talk" from the lunatic fringe. But the facts are that less than 20% of population say they have any faith in the government while just over 50% say that US democracy needs a total overhaul, even if that mean open rebellion (of those, only a few believe that reform will suffice). The majority of Millennials (those under 30) support socialism, primarily because they see capitalism as it now exists as having failed. Perhaps that's why federal agencies have been on a massive spending spree acquiring military grade firepower and ammo; police departments have become more "militarized", senior military officers are quizzed about their willingness to fire on US civilians (those refusing have been largely relieved of command); increased drone and cyber-surveillance; ongoing government harassment; and a proliferation in what I term "diversionary television" designed to take the public's mind of our national and economic decline as well as get us accustomed to the idea of being watched with the variety of "reality" TV programs.
"Diversionary television" is of course, but one part of the media outlets controlled by the top 1%. While media coverage seems to be focused on gay rights, abortion, or domestic spying, not to mention such earth shaking events involving the likes of Justin Bieber or Miley Cyrus or the Kardashians, only 3% of those surveyed in a poll conducted by AP-NORC Center for Public Affairs Research in December 2013 thought those were important issues. The overwhelming majority of Americans it seems were interested in under-reported topics such as healthcare, jobs, the economy, and illegal immigration. Bread and butter issues seems to be the only "View" the majority of Americans are interested in. It may be why we don't hear very much about what's happening in places like the Ukraine. Certainly the goal is to keep America's attention diverted from the real issues, but also Americans divided along as many lines as possible to prevent a united front from focusing on them (this also explains the usual empty talking heads on TV and radio). Meanwhile, politicians are gearing up for their next cycle of hype and misdirection intended to play on the public's emotions. But, I wonder, for how much longer?
Why There's No Outcry
Could America's Wealth Gap Lead To a Revolt?
Why America May Be Ripe for a New Revolution