Say Goodbye to Capitalism
If anyone has been thinking I've painted a grimmer picture than need be to show just how bad the plight of the Middle Class is, here's the low down from Michael Snyder (shown at right), a graduate of the McIntire School of Commerce at the University of Virginia, holder of two law degrees from the University of Florida and writer/editor of The Economic Collapse Blog at http://theeconomiccollapseblog.com.
In my last post I described the blistering pace at which the rich became filthy rich, all at the expense of the Middle Class, through the purposeful redistribution of income to those at the pinnacle of annual income and accrued wealth. In 2009 according to the U.S. Census Bureau, the household median income, adjusted for inflation, was $49,777. Do you know what it was in 1975? $42,936! That's 13.8% over 34 years.
The cost of wheat shot up 60% last year.Yesterday, a loaf of fresh baked sourdough bread cost me $4.99 at Publix. Last month economists announced that the price of a bag of family groceries is up 29% this year. It makes me wonder how a family of four trying to make it on $49,777 ($4,148 a month before state and/or federal taxes are deducted, paying $3.85 a gallon for gas, $550 a month for health insurance, $950 mortgage/rent and $555 a month for groceries are doing.
The numbers I've tossed out don't include a car payment, car insurance, water, electricity, TV and internet cable, telephone, entertainment and a plethora of other things many of us don't think twice about when we purchase them. How much has the quality of life changed for families forced to do without life's small luxuries--a trip to the book store, replacing a broken TV or iPod, taking the family out for dinner, keeping a supply of the kids' favorite treats on hand?
Our big, global corporations are profiting magnificently while exploiting third world workers and they're salivating over the rapidly approaching day when jobs and wages will bottom out here and they’ll have us all at the mercy of their soulless black hearts. Then we'll have what Arianna Huffington has chosen for the title of her new book, Third World America.
"Proletariat? What Proletariat?"
Here are Snyder's 22 statistics that leave no room for doubt that the Middle Class has been in the the process of systematic erosion for decades.
1. 83 percent of all U.S. stocks are in the hands of 1 percent of the people.
2. 61 percent of Americans "always or usually" live paycheck to paycheck, which was up from 49 percent in 2008 and 43 percent in 2007.
3. 66 percent of the income growth between 2001 and 2007 went to the top 1% of all Americans.
4. 36 percent of Americans say that they don't contribute anything to retirement savings.
5. A staggering 43 percent of Americans have less than $10,000 saved up for retirement.
6. 24 percent of American workers say that they have postponed their planned retirement age in the past year.
7. Over 1.4 million Americans filed for personal bankruptcy in 2009, which represented a 32 percent increase over 2008.
8. Only the top 5 percent of U.S. households have earned enough additional income to match the rise in housing costs since 1975.
9. For the first time in U.S. history, banks own a greater share of residential housing net worth in the United States than all individual Americans put together.
10. In 1950, the ratio of the average executive's paycheck to the average worker's paycheck was about 30 to 1. Since the year 2000, that ratio has exploded to between 300 to 500 to one.
11. As of 2007, the bottom 80 percent of American households held about 7% of the liquid financial assets.
12. The bottom 50 percent of income earners in the United States now collectively own less than one percent of the nation’s wealth.
13. Average Wall Street bonuses for 2009 were up 17 percent when compared with 2008.
14. The average federal worker now earns 60% MORE than the average worker in the private sector.
15. The top 1 percent of U.S. households own nearly twice as much of America's corporate wealth as they did just 15 years ago.
16. In America today, the average time needed to find a job has risen to a record 35.2 weeks. 17. More than 40 percent of Americans who are currently employed are working in service jobs, which are often very low paying.
18. For the first time in U.S. history, more than 40 million Americans are on food stamps, and the U.S. Department of Agriculture projects that number will go up to 43 million Americans in 2011.
19. This is what American workers now must compete against: in China a garment worker makes approximately 86 cents an hour and in Cambodia a garment worker makes approximately 22 cents an hour.
20. Approximately 21 percent of all children in the United States are living below the poverty line in 2010 - the highest rate in 20 years.
21. Despite the financial crisis, the number of millionaires in the United States rose a whopping 16 percent to 7.8 million in 2009.
22. The top 10 percent of Americans now earn around 50 percent of our national income.
Hear That Giant Sucking Sound?
The reality is that no matter how smart, how strong, how educated or how hard working American workers are, they just cannot compete with people on the other side of the globe who happily put in 10 to 12 hour days for less than a dollar an hour. What corporation will pay an American worker 10 times more (plus benefits) to do the same job? The world labor market has been flipped. The mega corporations are making massive amounts of money paying foreign workers pennies on the dollar. In time, after the will of the American Middle Class is completely exhausted, U.S. workers will be merged into the new "global" labor pool. And they will learn what it was like to be a galley slave.
What do most Americans have to offer in the marketplace other than their labor? Not much. The truth is that the Great Recession has made them absolutely dependent on someone giving them a job. U.S. workers are "less attractive" than those overseas because their wages and benefits make them extremely expensive. But are these wages and benefits unreasonable demands or necessities in the country they helped build?
Corporations argue that the costs of labor and a coalescence of financial events they had no control over--the transformation of the world economy--make it impossible for them to continue to do business in the U.S. and make a profit. But that is not true. What's more likely is that the time has come to pull the plug on capitalism.
"Keep Your Capitalist Hands Off of My Internet!"
Capitalism is no longer a viable economic system because it is an inward-looking, closed-ended means of serving selfish corporate interests while disavowing any social responsibility and working against the ideals of a democratic society. For example, as I write this, AT&T, Verizon, Comcast, and Time Warner Cable are scuffling amongst themselves and with the FCC to take over the internet and turn it into their personal, money-making enterprise.
These corporate egotists have the audacity to presume they can acquire ownership of what has been a free and open marketplace for worldwide communication, the exchange of limitless information, thoughts, opinions, news and ideas and sell it back to us.
The internet as it exists, is democracy in its purest form. No governmental, philosophical, religious, economic, political or revolutionary entity owns or censors it. Until just a few years ago it was a non-existent place, a dream world of possibilities and promise beyond technology's reach.
Today it's where people who can read and write go to acquire vast amounts of knowledge, explore all manner of things previously inaccesible to them, and form their own notions of what the world is and what its inhabitants--man and animal--are all about. The net is a limitless Garden of Eden brimming with free roaming thoughts about everything--both known and yet to be discovered--and it's always in full bloom. It is the history of Man and the World, uncensored and free of charge.
Now some misanthropes are using their money and political influence to convince the government to grant them license to package and sell it. Their initial proposal is to turn the internet into two lanes: a fast one and a slow one. The fast lane will cost more. And we can all ready see where our future lies: the fast lane will cost more and more until it becomes the exclusive superhighway of big business, political interests, and monopolistic entities that will control news, entertainment and information.
Free speech will disappear and there will be little or no competition in the marketplace of goods, services and, most important, ideas.
Capitalism Has Outlived It's Usefulness
The End Time is near for capitalism because it requires corporations to look after their own interests at all times. Profit comes before god, people and country. The cheaper you can make a product and the more you can sell it for, the better. In America, to keep labor costs down, workers were as expendable as old draft horses. That's why it took over a hundred years--from 1830 to 1950--and dozens of bloody clashes between workers and hoodlums hired by corporate employers to get to a minimum wage, an 8-hour work day and five-day work week, paid holidays, paid sick time and personal leave days, safe work places, health benefits and paid vacations.
Today, with minimal resistance from Washington and no labor unions to intervene, workers' historic gains are disappearing like sandcastles drifting into the sea with the tide.
From the onset of the economic bust in 2008 till now, hugely successful corporations like General Electric and Exxon Mobile have continued making billions of dollars, but they've evaded paying corporate taxes by moving their "headquarters" to tropical islands in the Carribbean. Wells Fargo is taking its billions in bailout money and using them to construct dozens of branch banks in China where the grass is greener. The muckety-mucks of Wall Street like Goldman Sachs, the criminals who brought down the economy, continue to wallow like pigs in million-dollar salaries and millions more in bonuses.
The capitalist system is a close-ended, circular one. The wheel grinds round and round, pumping billions of dollars out of the earth, oceans, woodlands, lakes and rivers. Corporations suck natural resources out of every nook and cranny, despoil the environment and give as little back to the cities, states and workers as they can get away with, frequently leaving critical infrastructure aged and deteriorated, a large element of widespread urban decay.The cream, or profit, is divided among corporate directors, upper tier executives and rich stockholders.
Many American cities no longer pulse with the sounds of manufacturing but live with the silence of depressed neighborhoods strung around the destitute edges of empty industrialized areas.Vacant factories, standing side by side, lean like drunken derelicts trying to hold each other up. You see them huddled along the streets and roadsides throughout New England and the Mid-West. Empty knitting cotton and textile mills squat in small towns dotting the Appalachians from Upstate New York south through the Carolinas.
The hills of Pennsylvania and West Virginia bear the furrowed scars of mountain top mining and the streams often flow bright orange with drainage from the mines. Where western New York and Pennsylvania meet, the steel mills have been dead silent for decades, the only sounds being the eery whistling made by winds that occasionally blow through them. Somehow, these old towns hang on and you wonder where the money comes from that puts food on the tables of residents.
Polluting For Profit
When I say capitalists look inward only, here's what I mean: In corporate minds, there is never a limit on profits so there is never a reason to let up on the money throttle and treat workers fairly or humanely by turning some of those extra dollars into higher wages, benefits and retirement pensions; the environment we all share can be damned as businesses go about concealing their polluting ways in order to keep profits growing; they knowingly injure the public by giving us cancer and other diseases through contaminated factory runoff water; chemical and manufacturing plants routinely dump poisonous waste anywhere they're not likely to be seen. Besides, even if caught dumping hazardous waste, they know profits can always offset most fines.
Supposedly reputable companies kill and maim people through defective products--exploding automobile tires, faulty brake systems and hazardous prescription medications--lie about it then drag their victims through courts for years on end, hoping to beatdown their resolve to be compensated for a death or injury. Manufacturers bristle when juries return huge verdicts against them, blame their legal problems on personal injury lawyers and turn to lawmakers to restrict access to the courts by plaintiffs and to cap damage awards to the people they've injured.
As our national economy moved into globalization, big business began bolting the country. Rather than taking the time to prepare for a future they foresaw and contemplating strategies for taking on foreign competition or helping the government develop policies to cushion the economic blow, corporations took their money and jumped ship, taking the life boats with them. By fleeing overseas they avoid government regulation, free themselves from fair labor practices, pursue new and cheaper sources of raw materials, and are permitted exploit foreign workers in nations where leaders look for personal gain and not after the welfare of their people.
What makes capitalism close-ended is that corporations see themselves as rightfully amoral--responsible only to their stockholders--and their horrendous history proves it.
" Dyin' Just Tryin' to Make a Livin' "
Last April's explosion killing 25 West Virginia miners in the worst mining disaster in more than a quarter century is ugly proof of capitalism's profits-at-all-costs philosophy. The media reported on how the Massey Energy coal company had received dozens of warnings and citations concerning its reckless operations, yet the mine was never shut down until all conditions that threatened the lives of workers were corrected. The miners' deaths were foreseeable and avoidable.
The conditions in the Appalachian coalfields have, except for easily absorbed fines here and there, been ignored for decades. Drive through these gray, desolate hills and you'll see the mining sites are little changed from a century ago. The history of coalmining is replete with stories of multimillionaire mine operators, exactly like the ones at Massey Energy, who ignored elemental safety concerns while demanding that miners work 12-hour shifts under hazardous conditions for the sake of maximizing profits.
Other labor problems exist in the cozy relationships between businessmen and public officials. An example of such unhealthy ties went almost undetected during the political standoff between Republican Governor Scott Walker and the Wisconsin teachers union. The issue there was much larger than labor unions and balanced budgets. While the conflict appeared to be centered on the proposal to eliminate the collective bargaining rights of state employees, it wasn't. Hidden in the new legislation was a proposal that would allow Walker to sell off or lease the state's several dozen energy plants to private companies, with or without the approval of the Wisconsin Public Service Commission and--get this--with or without a competitive bidding process!
Here's some fun facts to go along with the Walker story. Standing in the wings, hoping that the Democrat Senators would scurry back from Illinois in time for a quick vote on the bill were billionaire brothers Charles and David Koch. Although ideologically and financially "invested" in Walker through their $43,000 campaign gift (the second largest one he received) and a multi-million dollar attack ad campaign against his opponent (which was run through through their political action committee, Americans for Prosperity), nothing exists to prove that the Kochs would directly benefit from privatizing the state's power plants. What is widely known, however, is that they own Koch Industries, the largest privately held company in the U.S. with extensive coal interests in Wisconsin.
Today, in this historically deep Recession, big corporations, the Republicans and their symbiotic Tea Party appendage are looking to cut away every last sliver of gains Working Class and Middle Class Americans have made since President Franklin Delano Roosevelt's New Deal created in 1934. President Obama and the Democrats haven't given us any solid reasons to believe they can handle the onslaught. We all need to do whatever we can to let the White House and our Congressmen and Senators (whether they are Democrat or Republican) know that we don't just expect a good fight to keep Social Security, Medicare and Medicaid intact,we demand nothing short of victory.
Mega-corporations claim it was capitalism and sound business management that brought this country to the heights of greatness and prosperity, forgetting they didn't do it alone. Not by a long shot. From 1830 on, it's been the muscle, hard labor and dedication of Working and Middle Class people who actually ran the plants, turned out the products and transformed the capitalists' investments into profits.
Capitalists have never given workers a thing without forcing them not merely to work for it, but fight for it. Now that the time has come to help workers and the country meet the challenges of globalization, and what have the major corporations done? They 've cut and run.
But the biggest question begs for an answer: What are we going to do about it?
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