Credit Where Credit Is Due

The administration noted Wednesday that the U.S. auto industry has added 77,300 jobs since GM and Chrysler emerged from bankruptcy, that vehicle exports are up more than 40 percent from 2009, and that the nation's Big Three car companies posted operating profits for the first three quarters of this year...Those millions of lost jobs would have been an significant number even in an economy as large as ours. The economic crisis we still face today would have been made much, much worse had the Federal Government led by Obama and the Democrats in Congress failed to act, and act promptly. - Alternet

I, like many other progressives have been highly critical of this President and this Congress in the last two years concerning many of the missteps they have made. However, their actions in bailing-out GM and the auto-industry is worthy of credit. It is one thing to criticize other people and only be willing to highlight the negative and God knows we have turned criticism into a new art form. With the advent of the 24/7 cable news cycle and the need to fill all of those empty hours with distractions and nonsense it is especially important to identify those policies and efforts that do what they are designed to do.

When the wing-nuts were pontificating on the demise of the free markets and the federal takeover of the private sector with efforts like the auto industry bail-out this administration made a calculated decision to step in and save American manufacturing jobs and a staple industry. The lack of repentance on the part of the wing-nuts should be proof for anyone in or out of Washington that these folks have no intention of changing the tone in Washington. You add to this intransigence the results of the last election and the wing-nuts believing they have received some sort of mandate and the prospects of our getting anything done to solve the massive problems facing this nation are almost non-existent. The fact that we have not heard from one Republican to step up and acknowledge they were wrong says volumes about who they really are and what their true intentions are.

At some point in America we have to be willing to overcome our selfish tendencies that have been exacerbated over the last few decades and once again consider what is best for the nation as a whole. The greed that was exemplified during the Reagan years has been pumped full of steroids and we now find ourselves in the grips of this me, me, me mentality. We have become a nation of special interests being led by the wealthiest among us. These folks are willing to flaunt the laws and rules of our country to advance their profit margins at the expense of our country. As a result we have become so tribal that instead of our politicians and many of our citizens asking what’s best for the country the mantra is now what’s in it for me and my group.

The time has come for those who have received the most among us to demonstrate one of the most American of traits and that is self-sacrifice for the sake of our country. We have a history in our nation of people who are willing to look beyond their own self interest for the benefit of the group and often times those people have been wealthy. How many wealthy folks were willing to make major sacrifices during WWII because of the call for self-sacrifice by FDR and the need for the benefit for all Americans? Today instead of an atmosphere of shared sacrifice we have this atmosphere of what can I get out of it. This attitude of selfishness permeates every area of our society. Over the last few decades the rich have done better than most Americans and now is the time for those people to step up and ask what they can do to help the country.

This administration has made a number of miscalculations but in this case they made the right decision despite the protests of the wing-nuts. I hope this success will embolden them to begin to stand up for the American people against the onslaught being waged by the wealthy through their political and media minions. I think this President should call for an end to all of the Bush tax-cuts and return the tax rates to the levels of the Clinton years. I know this is considered treason by many folks who want to consider raising taxes during a recession as insanity, but the truth is that having these lower tax rates in effect have done little to create jobs which is how the middle-class will see their lives improve. Some may say this will be political suicide for the President because of the successful campaign of the rich to equate tax-cuts to this panacea of economic growth that has little if any basis in reality.

Making tough decisions in the face of a crisis is the definition of leadership. The President must be willing to use his political skills to educate the American public on the nature of the challenges they are facing. If I were advising the President I would schedule weekly television addresses and town halls from now to Election Day to allow the President to make the case for what he believes in. My hope is that he believes in rebuilding our crumbling infrastructure through public works. I hope he believes in retooling American manufacturing and creating new entrepreneurs through investment. One of the things I think that has been lost in our loss of manufacturing is that the manufacturing industry was built by small plants that over time expanded. We should be providing investment to people who have ideas and products that we can develop for mass manufacturing to rebuild our base and middle-class. This idea that we can never make anything again is insane and being perpetuated by the ruling class to maximize their profits and not to keep America strong.

"Just giving them $25 billion doesn't change anything," Sen. Jon Kyl of Arizona, the Senate's second-ranking Republican, said on Fox News Sunday. "It just puts off for six months or so the day of reckoning." - Senator John Kyl

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Work Your Way Out

On the back of this industrial output, rose America’s middle class. High-paying manufacturing jobs in turn helped spur a robust and growing economy that had little dependence on foreign nations for manufactured goods and armaments...However, manufacturing, as a share of the economy, has been plummeting. In 1965, manufacturing accounted for 53 percent of the economy. By 1988 it only accounted for 39 percent of the economy, and in 2004, it accounted for just 9 percent...The loss of the manufacturing industry manifests itself most clearly in job losses. - The Trumpet

The wing-nut shell game continues as they on the one hand decry the loss of jobs and the high unemployment figures and yet at the same time were the architects of the policies that gutted the manufacturing sector which drove the job creation. The unfortunate truth that the politicians, pundits, and CEO’s refuse to tell the American public is that unless we retool our manufacturing base we will continue to have high unemployment. The current and future high unemployment numbers are not solely based on the recession. Prior to the recession we were seeing unemployment rising as the economy was supposedly humming along.

The historic fact is that you get out of a deep recession or depression by working your way out. You don’t get out of it through austerity measures or attacking the unemployed. You didn’t get out of it by giving tax breaks to rich folks. You build or make things. This presents us with an impossible scenario. We no longer make things. The engine that would power our economy back to profitability and high employment is now driving the economies of China, India, and Singapore. What we are witnessing in America today are the results that were predicted but roundly denounced when the whole outsourcing process began. You don’t have to be a Harvard educated economist to figure out that if you ship your middle-class creation mechanism overseas that you will have fewer middle-class people. In fact it’s probably easier to understand if you’re not Harvard educated.

Remember, how we were going to replace all of those “dirty” manufacturing jobs with “clean” new technical jobs. While granted there were people who were able to make the transition from the manufacturing sector to the technical sector the majority of people were not so lucky. Many of those living wage manufacturing jobs were replaced with low wage service sector jobs which did not offer benefits that many people were accustomed to. What the economist’s neglected to tell us was that there was going to be a segment of the population who would not be able to transition into the new technical jobs. This magnitude in the numbers of people who can’t transition is the real cause of the term “jobless” recovery.

According to one study, every 100 jobs in durable manufacturing support 372 jobs in other industries, while every 100 jobs in business services supports 164 jobs elsewhere in the economy. We are losing good jobs which will stimulate the economy (and we are left with the shit jobs). – Stephen Hanson

As the American labor force has become more efficient and with the advent of robotics and other technological advances this places more pressure on an already shrinking labor force. When you combine these with the changes in the attitudes of the corporate elite from thinking of what is best for America to what is best for their short-term profits you have the current situation we as a nation find ourselves in. Let’s be clear the early industrialists were no angels and they clearly made enormous profits on the backs of their workers but one thing many of them understood was that they were Americans and they were guardians of a dream (the American dream) and their long-term success was tied to their workers long-term success. At no point in American history has there been this large of a discrepancy between the corporate elite’s salaries and their workers. The really sad fact for most Americans is that the media and the politicians have been co-opted by the wealthy into this mind game that none of the policies they have instituted have led to this American trauma.

The current state of affairs with the American economy is not some accident of nature or some perfect storm of naturally happening occurrences it was orchestrated by a group of greedy and unscrupulous people who presided over one of the largest transfers of wealth in the history of the world. And yet despite all evidence to the contrary we have these shell groups who on the one hand claim to be against bail-outs and yet they are being funded by those who created the need for the bail-out. This could only be created in America. Where else would you have a group of peasants with pitch forks and torches at the gates of the wealthy but not to demand equality but to bring more riches to them? It would be funny if it weren’t so tragic.

Every person familiar with business knows that labor is always your biggest expense and whatever you save in labor goes directly into your pocket, it is this mentality that has caused this new class of corporate titans to join the race to the bottom searching the world for the lowest labor costs they can find. We have supported our own demise through allowing the politicians to give tax-breaks to those who have shipped our jobs overseas.

There are those who claim that the days of American manufacturing are gone and will never return. They claim we are better served as a country because of it. I disagree because if you look at the fastest growing economies in the world they all make things. The other thing that is not being discussed is that when you outsource your production you also outsource your ability to innovate. Innovation is primarily done through the production process by workers who through the process recognize ways to create a more efficient or even a better way to create a product. Those innovations are now being made overseas. It’s not surprising that all of the new green and innovative products are now being developed and manufactured overseas. We have not only lost our production capabilities we have also lost our ability to innovate.

If we are to regain our leadership in the world we have to become a producer again. We will have to do it better and cleaner than we did it in the past and how they are doing it overseas. As a country we have to make some tough decisions about our future. Are we going to continue to ignore the evidence and continue to listen to the greedy or will we demand a return to the principles and policies that created the largest middle-class in history? That is the choice that lies before America.

“I have come to a resolution myself as I hope every good citizen will, never again to purchase any article of foreign manufacture which can be had of American make be the difference of price what it may” – Thomas Jefferson

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Made in America

“I have come to a resolution myself as I hope every good citizen will, never again to purchase any article of foreign manufacture which can be had of American make be the difference of price what it may” - Thomas Jefferson

At a time when we are losing manufacturing jobs in this country, we should be doing everything we can to help our manufacturers stay competitive. They are the backbone of our economy. - Debbie Stabenow

This is my ode to the America worker on Labor Day.

Remember the “Made in America” mantra that epitomized our once mighty manufacturing sector. I wonder today if there are any products left to put the Made in America tag on. While this is definitely an ode to manufacturing in this country, it is also an indictment against those who have reduced the standard of living for the middle-class so that they are forced to purchase inferior products at reduced prices. As the manufacturing base of this country has continued to shrink I believe there is a direct correlation to the shrinking middle-class.

From the beginning of our Republic the founding fathers realized that it was imperative for a nation to be able to provide for the needs of its citizenry internally. The welfare of a nation and its citizens would be directly influenced by that nation’s ability to provide not only goods but also subsistence or employment to its citizens. Alexander Hamilton put it this way:

Not only the wealth, but the independence and security of a country, appear to be materially connected with the prosperity of manufactures. Every nation … ought to endeavor to possess within itself all the essentials of a national supply. These comprise the means of subsistence, habitation, clothing and defense. - Alexander Hamilton

There are those who have tried to put forward a new dynamic over the last few decades that say outsourcing manufacturing and other jobs overseas is a natural outgrowth of our new global economy and the evolution of the post-industrial age. While this philosophy has served the corporations and the investment class very well it has left the middle-class in shambles. Since the off-shoring of jobs began in the 1970’s we have lost millions of jobs that were supposed to be replaced with cleaner, better jobs. Despite their rosy prognosis our economy has not been able to keep pace with creating new jobs that provide livable wages to these displaced workers. Instead what we have been given is more service oriented jobs that tend to be low-paying and many without benefits. So we have replaced good paying manufacturing jobs that provided a pathway to the middle-class with these low wage nowhere jobs that are providing a pathway to poverty or the working poor.

We are constantly being bombarded with the images of folks saving money at these big box retailers. What is not being shown in those commercials are all of the small businesses in towns all over the country who will not be able to open businesses or who has had to close businesses. These small business owners will not be able to return their profits to their local economies. What we don’t see in those commercials are the inferior quality of the products we’re being sold or the sucking sound as our trade deficit with China and other Asian countries continues to rise. While their standard of living improves ours declines. Researchers are beginning to believe that our economy can now perform at capacity using 25% fewer workers. That means we currently have a surplus of workers due to increases in our productivity. Yet while the American workers productivity has continued rise their wages have remained flat for almost a decade. With the wing-nuts assault not only on the middle-class but also against the unemployed how will our society deal with such a large portion of our fellow citizens not engaged in our economy?

Consider the depths of our new dependency. Imports, 4 percent of GDP for the first 70 years of the 20th century, are near 15 percent now, and 30 percent of the manufactures we consume. Pat Choate, author of Agents of Influence, gives the following levels of U.S. dependency on foreign suppliers for critical goods:

Medicines and pharmaceuticals: 72 percent
Metalworking machinery: 51 percent
Engines and power equipment: 56 percent
Computer equipment: 70 percent
Communications equipment: 67 percent
Semiconductors and electronics: 64 percent

There are enormous challenges facing this nation and one of the greatest is reestablishing our ability to manufacturing and produce things. Has our society been better served by dismantling our manufacturing sectors, by off-shoring jobs, or by removing the incentives for small business development? With our march into the future and our drive towards technology is it inevitable that we will continue to push so many of our neighbors into economic peril? Some would have us believe that we don’t need to produce anything that we will retool our workforce and reeducate our workers into more technical positions. I personally don’t consider just the economics of manufacturing as reason to reestablish it. I believe that there are some intrinsic values gained for a society that creates and builds things. It gives the society a sense of accomplishment and the people a sense of pride. The time has come for us as a nation to stop allowing the folks who have sought to gut our middle-class for their short-term profit and against our long-term benefit.

“As long as our culture continues to fawn over its downward-aspiring lowest common denominators, the United States will remain a social and political punch line. As long as we continue tracking the every deed and fart of the Paris Hiltons and Kevin Federlines among us, we will continue to come out sixteenth best with regard to producing and introducing to the human race things of true substance worth appreciating for their aesthetic ingenuity.” - Anthony Beal

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You Are Expendable

This blog is to that 20-25% of the population that has now become expendable to our economy. When we switched from a manufacturing based economy to a market based economy the need for a large work force became unnecessary. As our manufacturing infrastructure was being dismantled more and more of our people became expendable and many of those workers were the low skilled and under educated. In a manufacturing economy there is a need for low skilled and low educated workers to learn repetitive skills to keep the manufacturing machinery humming.

We as a nation must come to grips with the fact that we are a declining empire. Instead of reinvesting in our infrastructure and in our people we have chosen to invest in those whose only job is to perpetuate this false notion of selling crap as if it were gold. Our markets today are based on this notion that things that have no value are valuable. When you discontinue manufacturing products then the only methods for creating wealth is to create false markets of false worth. A good example would be the derivatives market that were bought and sold globally as valuable commodities when the reality was they were worthless. What we have created as an economy is a giant ponzi scheme where those on the top continue to prosper while those in the middle and especially those on the bottom continue to suffer. What has always amazed and intrigued me is how the wealthy have convinced the middle class to vote for policies that are in direct contradiction to their own interests. Policies that have allowed the top 1% of our population to double their wealth in the last decade while their tax liabilities have continued to decrease. As any historian knows the great empires of the past have not fallen from the assaults of outside foes but because of internal excesses that were allowed to fester until they crushed these empires.

The question now becomes what do we do with these expendable people. The answer we have come up with is to warehouse them. We warehouse them in our inner city ghettos and in our prison system. We have created a permanent underclass with little or no hope for mobility. These folks live on the margins of our society. These folks don’t vote nor do they participate in the larger efforts of our society. We have created a false economy for them to participate in (illegal drugs) but it is an economy where we control the winners and losers. We control this false economy by the people we target to prosecute for their illegal activities. Can any of us honestly believe that if we as a nation did not want illegal drugs in this country we could not prevent their introduction or at least decrease their availability? We lie to ourselves and say we want to educate, train, and employ them, but my question is this even if you educate and train them what jobs will they have? It is not enough to train and educate people if you don’t have industries to employ them. We must create industries to provide employment opportunities for these forgotten people. If we don’t then we will not have enough prison or ghetto space to house them.

We need to have an honest conversation with ourselves and with our politicians and stop the lying. We have to as a nation be willing to accept the truth and the reality of our position. Those of us in the bottom 99% of the population who has not seen their wealth double must unite and demand that the wealth of our nation be distributed in a more equitable manner. We need political leaders who have the wisdom and the political will to create a new deal that focuses on reestablishing our manufacturing infrastructure. We must put an end to this giant pyramid scheme we currently call our economy. Let’s be clear those other empires saw the issues that would be their undoing, but chose to ignore them and continue down the path of self destruction. My fear and my guess is that we will do likewise and sit quietly on the airplane as it continues to descend into the ground. We will continue to focus on the minutia that the wealthy continues to feed us to keep us from discussing the real issues that we face as a nation. An example would be the current healthcare debate. Who among us does not believe that our current healthcare system is broken and will bring our economy to a crashing stop? Yet, rather than be able to agree on what we all know are the facts we allow the wealthy to turn this into a partisan debate of philosophy. Why do we believe that we are right and the rest of the industrialized world is wrong? The only thing we are missing is Nero fiddling. Nero where are you when your country needs you?

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