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Robert Reich begins: "Next time you hear an economist or denizen of Wall Street talk about how the 'American economy' is recovering, watch your wallet. There are two American economies. One is on the mend. The other is still coming apart."

Portrait, Robert Reich, 08/16/09. (photo: Perian Flaherty)
Portrait, Robert Reich, 08/16/09. (photo: Perian Flaherty)


America's Two Economies

By Robert Reich, Robert Reich's Blog

05 November 10



America's Two Economies, and Why One Is Recovering and the Other Isn't.


ext time you hear an economist or denizen of Wall Street talk about how the "American economy" is doing these days, watch your wallet.

There are two American economies. One is on the mend. The other is still coming apart.

The one that's mending is America's Big Money economy. It's comprised of Wall Street traders, big investors, and top professionals and corporate executives.

The Big Money economy is doing well these days. That's partly thanks to Ben Bernanke, whose Fed is keeping interest rates near zero by printing money as fast as it dare. It's essentially free money to America's Big Money economy.

Free money can almost always be put to uses that create more of it. Big corporations are buying back their shares of stock, thereby boosting corporate earnings. They're merging and acquiring other companies.

And they're going abroad in search of customers.

Thanks to fast-growing China, India, and Brazil, giant American corporations are racking up sales. They're selling Asian and Latin American consumers everything from cars and cell phones to fancy Internet software and iPads. Forty percent of the S&P 500 biggest corporations are now doing more than 60 percent of their business abroad. And America's biggest investors are also going abroad to get a nice return on their money.

So don't worry about America's Big Money economy. According to a Wall Street Journal survey released Thursday, overall compensation in financial services will rise 5 percent this year, and employees in some businesses like asset management will get increases of 15 percent.

The Dow Jones Industrial Average is back to where it was before the Lehman bankruptcy filing triggered the financial collapse. And profits at America's largest corporations are heading upward.

But there's another American economy, and it's not on the mend. Call it the Average Worker economy.

Last Friday's jobs report showed 159,000 new private-sector jobs in October. That's better than previous months. But 125,000 net new jobs are needed just to keep up with the growth of the American labor force. So another way of expressing what happened to jobs in October is to say 34,000 were added over what we need just to stay even.

Yet the American economy has lost 15 million jobs since the start of the Great Recession. And if you add in the growth of the labor force - including everyone too discouraged to look for a job - we're down about 22 million.

Or to put it another way, we're still getting nowhere on jobs.

One out of eight breadwinners is still out of work. Most families in the Average Worker economy rely on two breadwinners. So if one out of eight isn't working, chances are high that family incomes are down compared to what they were three years ago.

And that means the bills aren't getting paid.

According to a recent Washington Post poll, more than half of all Americans - 53 percent - are worried about making their mortgage payments. This is many more than were worried two years ago, when the Great Recession hit bottom. Then, 37 percent expressed worry.

Delinquency rates on home loans are rising. Distressed sales are up as a percent of total sales.

Most people in the Average Worker economy own few shares of stock, if any. Their equity is in their homes. But with all the delinquencies and distressed sales, the housing market has a glut of homes for sale. As a result, home prices are still dropping. So the net worth of most Americans is still dropping.

And even though interest rates are falling, most people in the Average Worker economy can't refinance their homes. They can't get home equity loans. Banks don't want to lend to the Average Worker economy because people in it are considered bad credit risks. They still owe lots of money, their family incomes are down, and their net worth has fallen.

And according to the Reuters/University of Michigan survey of American consumers, expectations about personal finances are at an all time low.

Inhabitants of the Big Money economy are celebrating Republican wins last week. They figure financial regulations will be rolled back, environmental regulations will be canned, the Bush tax cut will be extended to the top 1 percent, and it will be harder for workers to form unions.

Inhabitants of the Average Worker economy aren't so sure. The economy has been so bad they're angry at politicians. They showed their anger at the ballot box. They took it out on incumbents.

But if nothing changes in the Average Worker economy, there will be hell to pay.

 

Robert Reich is Professor of Public Policy at the University of California at Berkeley. He has served in three national administrations, most recently as secretary of labor under President Bill Clinton. He has written twelve books, including "The Work of Nations," "Locked in the Cabinet," "Supercapitalism" and his latest book, "AFTERSHOCK: The Next Economy and America's Future." His 'Marketplace' commentaries can be found on publicradio.com and iTunes.

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+24 # Activista 2010-11-05 21:18
they say that $1 invested in politician (the winner) brings $100 contract in return.
Big business "invested" heavily in 2010 election - with cheap FED money available - what irony.
Bank of America, Morgan-Chase, Goldman Sachs ... bought media and the "people".

Today, right in front of Bank of America was Impeach Obama petition stand - with president's picture aka Hitler mustache.
One blue color older guy and young oriental were signing.

It was not TP - Tea Party aka Toilet Paper gang. But it fits - nazi group at the front door of the Bank of America - 2010
 
 
+3 # Ken Hall 2010-11-05 23:57
Yeah, impeach the guy who, under US law, should be bringing racketeering and fraud charges against the owners of the BoA empire. But will he have the courage to do it? Odds against.
 
 
+31 # Phillip 2010-11-05 22:30
Americans should run corporations, but instead corporations are running (and ruining) America!
 
 
+27 # Shirley Shimada 2010-11-05 22:31
I expect an increase in job losses when states, cities and counties start laying off workers to meet their budgets toward the end of this year. How will that affect our unemployment picture? This kind of furloughing and reduction in forces at what were once considered "good" and "stable" jobs with government agencies will turn out to produce a lot of unemployment. What are we to do with this situation? Here in Washington state, voters voted down an income tax on the rich, increased the legislature's need for approval of budgetary items to 60%. Many vital and necessary programs are not going to be funded because a small minority can stop any budget item! I am very worried.
 
 
+14 # Realist 2010-11-06 10:32
You should be VERY worried! California has for years been strangled by the Republican minority and we are now beginning to really feel the effects of that foolishness. Despite the passage of a proposition that reduces the budget passage to a mere majority, we still have serious roadblocks to raising funds through taxation. There will be major cuts in state services and staffing.

I hope the greedy "conservatives" are happy - for the rest of us know who to blame.
 
 
+15 # DaveW. 2010-11-06 15:55
Realist, I'm in California as well and am somewhat relieved we didn't follow national trend. Which means we didn't completely lose our minds at the ballot box. Angry voters have essentially put the very people who bent them over and screwed them back into the saddle again. It all boils down to jobs and money. Americans are simply saying to hell with environment, to hell with the future, to hell with our kids, to hell with holding previous administration responsible for digging us into enormous hole, to hell with everything. Just give us a job and the money to pay on the the enormous and extravagant debts we've been running up since Uncle Ronnie told us we could have our cake and not have to pay for it. Reich is correct that there will be hell to pay. Especially when "the folks in real America" become cognizant of the definition of the word "chump."
 
 
+10 # Activista 2010-11-06 11:13
I am also from WA - the income tax on people with over 200K + per year was supported by Gates senior and many "rich".
Did make sense and tax did not pass. Now the poor - FOX crowd -(who voted mostly against) will take hit in social services.
 
 
+1 # Marty Lee 2010-11-06 21:34
Tim Eyman's I-960 passed in 2007. It too required a 2/3 majority in the WA state Legislature to raise taxes and fees. I-960 was passed by voters but overridden and repealed by a Democratic legislature in 2010. (The legislature may repeal an initiative after two years with a simple majority vote.)
 
 
+2 # Doris Wilson 2010-11-07 09:23
You are right to be worried. Obama should have gotten a better, bigger stimulus. This is the key to the midterms. The stimulus he did get, saved many of those jobs, but only temporarily.
 
 
+19 # brenda 2010-11-05 23:15
Every time I think about how the politics is going here in the USA, I get sick. Now I read what Activista wrote about the idiots in front of the bank are a frigging stupid as hell. Yet here they stand, right in front of a Bank of America with an Impeach Obama petition stand. So now you would think that Bank of America had something to do with this, which they probably did. If I saw that, I would have gone over and kicked the stand down and then kicked the old guy in the ass for being so stupid.
 
 
+2 # forparity 2010-11-06 10:53
Well, it's interesting. B of A absorbed Countrywide Financial (CWF)following their collapse. CWF became the country's leading lender to poor minorities in 2000 - accelerating their lead in 2001 - following several years of HUD regulating lower lending standards and setting demands for massively increasing home ownership amongst poor minorites. The 2000 order alone, called for 28.1 million new mortages for this group - to the tune of $2.4 Trillion in loans guaranteed to be purchased by Fannie/Freddie.

On the other hand, it is intersting to note that, although Obama had only been in the US Senate for 2 years when he ran in 2008, he had taken over the #2 spot in contributions received from Fannie/Freddie (from 1989-2008) - ahead of John Kerry, and second only to Sen. Dodd.

Obama's #2 contributor was Goldman Sachs.
 
 
+5 # Activista 2010-11-06 12:33
www.newgeography.com/content/00621-case-shiller-housing-price-index-chart-december-2008-the-free-fall-continues

housing bubble was contain to the 2002 - 2006 - Bush administration - and financial speculators. Real value of 100 - selling for 300%. Greed -

rortybomb.wordpress.com/2010/04/19/franchise-value-of-banks-and-the-effects-of-deregulation/

banks profits are growing exponentially after deregulation ... and they want stop Obama ...
 
 
+2 # forparity 2010-11-07 12:02
Housing bubble was contain to the 2002 - 2006 - Bush administration - and financial speculators. Real value of 100 - selling for 300%. Greed -

I have no ldea of what U are trying to say? But, I certainly agree with your "greed" summary. Just as the dot.com bubble (the Enron era of the late 90's) increasing depended on greed to propel the bubble upwards into new uncharted terrority, so did the housing bubble.

But, the housing bubble was born of HUD actions mostly between, 1995 and Oct, 2000. Perhaps, on the deregulation side, you should watch the PBS Frontline presentation of "The Warning." That should be easy to find. The left claims that was partly to blame for for a piece of wall streets role in the latter stage of the housing bubble.

It's important to understand, that had HUD not pushed the regulations, there would have been no housing bubble taking off in the fallout of the recession caused by the March 2000 rather historic market crash.. and in the aftermath of 9/11.

Perhaps Wall Street would have found something else to do - I'll give you that.
 
 
+1 # Activista 2010-11-07 14:24
www.newgeography.com/content/00621-case-shiller-housing-price-index-chart-december-2008-the-free-fall-continues

housing bubble maximum 2002 - 2006 - Bush administration - compared to bank profits in the same period

rortybomb.wordpress.com/2010/04/19/franchise-value-of-banks-and-the-effects-of-deregulation/

my conclusion is that banks were driving the housing bubble (supply economy) NOT DEMAND. Low income people were not calling banks to buy "American dream" - but banksters were pushing loan and refinance (cash machine) on them to make a quick profit. And boy they did .. till ..
And then (before Obama) FEDs bailed "too big to fail" friends out. Where is a risk and responsibility of free market? More like big banks socialism.
 
 
+2 # forparity 2010-11-08 18:13
Activista.. look, the banks, mortgage companies, realtors, investors, mortgage out re-fi nuts average Joes -- all jumped on the bandwagon.

But it was HUD who ordered that Fannie/Freddie and the banks were to lower lending standards and set the goal to push 28.1 million poor - mostly minorites - into buying properties, with $trillions in loans guaranteed to be purchased by Fannie/Freddie. That is a Demand economy - it resulted in a shortage of supply, which fueled the rampant price acceleration openning up the door for more greed.

Here's but one little piece of regulation by HUD:

Oct. 2000 - HUD ANNOUNCES NEW REGULATIONS TO PROVIDE $2.4 TRILLION IN MORTGAGES FOR AFFORDABLE HOUSING FOR 28.1 MILLION FAMILIES

http://archives.hud.gov/news/2000/pr00-317.html
 
 
+3 # Activista 2010-11-06 11:37
I screemed at them - something about making US president a Hitler is sick.
www.youtube.com/watch?v=FtUFokaOaLE
joke is that this is a fringe of democratic party - Larouche PAC protests for Obama impeachment in Kohler, WI
- very sick and antisemitic
 
 
+25 # Jonathan Back 2010-11-05 23:36
Mr. Reich is an eminent American scholar and perhaps one of the most deliberate thinkers of our times.

Ferdinand Lundberg in the excellent tome "The Rich and the Superrich" clearly set out the premise that Mr. Reich speaks to.

Yes we are a 2 percent and 98 percent nation. The "Finpols" demand that the "Pubpols" do their bidding and dish out any kind of hogwash in order to get elected and much of it is pure nonsense. By the way Finpols are the Master rich with mega billions and mega millions and Pubpols are the lowlife garden-variety politicians and both parties have their fill of them. Many of the Finpols are Communist Chinese. Bet you did not know that.

If you are an American voter thou shall not just vote with your official ballot but with thy purse. So many lament the Fox system of misinformation dissemination yet pay their cable bill happily and thus support this wicked system.
continued in next posting
 
 
+3 # Sursum 2010-11-05 23:36
So what's the answer to how to revive the American economy?
 
 
+11 # Gardenqueen 2010-11-06 06:42
how do we fix this? I'll tell you. Have Obama call in the top 10 corporate CEO's from every state. Tell them you grasping greedy so-and-so's are sitting on piles of cash, hoarding it. Use some of that cash to create Amercian jobs and but fast. Or we will institute New Deal job creation programs and raise your (corporate) taxes to pay for it. So you can do it your way or the government will do it ours. You pick - make your decision. Right now, you've got 10 seconds. tick...tick.... tick...
 
 
+23 # GeraldT 2010-11-06 00:03
Nice article, but it reached the wrong conclusion. Yes, the Average Worker economy will worsen because the Republicans won at the polls. But the hell to pay will be paid against the Democrats. The voters are already aimed at the Dems by the massive influx of anonymous cash wielded quite effectively by the Repubs and their shadow army. All it will take are a few more well-placed appeals to emotion and fear and there will be lynching of Dems in the streets while the Repubs stand back with arms piled high with cash, smiling at their handiwork. Until the Dems crawl down into the trenches with the Repubs and use every dirty tactic - and more - used on them, this will be a one-party country until the final collapse.
 
 
+3 # DaveW. 2010-11-06 19:07
GeraldT, You write a well thought out scenario. I see the same thing coming. On another post, a lady I believe, was bemoaning the lack of "civility" in modern political discourse and lamented the fact Democrats would "stoop" to such undesirable tactics. After Elvis grabs Judy Tyler for an unsolicted kiss in "Jailhouse Rock" she complains about his "cheap tactics" and how they won't work with her. Snarling, lip curled, the King replied "them ain't tactics honey, that's just the beast in me." In a slight differing from your "one -party" observation, I would say we have one and a half parties. Obama better find his "inner" beast pretty soon.
 
 
+16 # jack ferguson 2010-11-06 03:47
Reich is right on. The corrupt power structure is having a field day while the LUMPEN PROTLATERIOT SITS IN FRONT OF ITS t.v. AS THAT IS ALL IT WANTS TO KNOW.
 
 
+5 # Mike 2010-11-06 04:13
This is true sad to say.
 
 
+11 # Cathy 2010-11-06 05:36
The people in this country have been dumbed down so much that they are fighting against their own self interest.
I want to see what their reaction is when the Republicans- who they voted for- take over all aspects of government even the presidency. That is the only way the Sheeple will "Get it"
 
 
+2 # Jim Young 2010-11-06 06:47
Is there a measure of what I would call "useful" Velocity of Money? What is the current Velocity of Money compared to the late Hoover administration? What I could find on it is not encouraging.
 
 
+8 # Homer Peters 2010-11-06 08:32
Thank you Robert Reich for the above article. I'm waiting to see the fallout from the "suspension" of Keith Olbermann, one of the few voices willing to speak to the power. Week in and week out he, Rachel Maddow and Ed Schultz, pull few punches when dealing with the Rethugs. Mr. Reich has been a guest on Countdown w/Keith Olbermann and is equally willing to say, "the Emperor has not clothes." If you want to email the MSNBC jackwagon responsible for the Olbermann suspension try this address: phil.griffin@nbcuni.com
 
 
+8 # Tom Sawyer 2010-11-06 08:34
I agree with this article, but I did not read of a solution. There is no simple solution, but there are things that could be done that will help. We must break NYC's hold on the country. Make a minimum stock ownership period of four hours, since we now have 30+% of trading being done in flash trading. Make all political donations from Wall Street firms and from the AIPAC (American Isreali Political Action Committee) public. Require the Fed to open it's books, remember that we still do not know where 2.0 BILLION was spent. Raise income taxes on everyone making over $1.0 million dollars. Raise short term capital gains tax rates to 50%.
 
 
+15 # jlohman 2010-11-06 09:19
Yea, there is a solution: public funding of campaigns. Once you get politicians off the payroll of the corporations miracles will happen. They will then fix the problems that today they are benefiting from.
 
 
+3 # The Rolling Stone 2010-11-07 10:45
Quoting jlohman:
Yea, there is a solution: public funding of campaigns. Once you get politicians off the payroll of the corporations miracles will happen. They will then fix the problems that today they are benefiting from.


Absolutely true! And, include "None of the Above" on the ballot. That way if "None of the Above" wins a whole new slate of candidates must come forward next time. None of the previous candidates can run.
 
 
+16 # Protect Democracy 2010-11-06 09:10
Millions of inhabitants of the Average Worker economy voted for the same Republicans who have repeatedly destroyed their economy and will continue to do so now that they have another chance.

The right wing is winning the culture wars, and its victims have willingly joined the ranks of the conquerers. It doesn't matter if we're unemployed, broke, about to be kicked out of my houses, and without medical care options,We voted for the ones who will make sure that gay marriage is never legalized.
 
 
+1 # Jonathan Flamm 2010-11-06 10:11
Why don't we tax the Big Money economy?
We could redistribute the money back from the interests it was originally redistributed to.
Mostly a rhetorical comment
 
 
+13 # psyche 2010-11-06 10:23
The solution is quite plain ...Raise revenues, by: Taxing the trades, each and every one of them, 1% should do it nicely, but we could live on .5% as well. Then we remove all Farm Subsidies, Fuel Subsidies, Drilling subsidies, and all Corporate Welfare programs. That should pay down the debt quite nicely too. Next we need to control the Banking sector, beginning with Restructuring the Federal Reserve and creating a New Central Bank of America. It seems stupid of me to believe we pay the Private Fed Reserve to print and lend us (THE GOVERNMENT) money at Interest. This would certainly save us a lot of money. Next, we nationalize all Natural Resources and sell them at competitive bid. Highest bidder gets the Resource. Hello Free enterprise and Capitalism at its best. Money saved gets spent on infrastructure, high speed trains, airports, roads, bridges, schools etc. Money in working peoples pocket gets spent and creates demand. Economy recovers.
 
 
+6 # Mary Bell Lockhart 2010-11-06 10:39
Read the election by who DIDN'T vote - millions would have voted Democratic. Economic collapse of the Average Worker Economy, not disgust with economic policy, was at fault. Millions didn't vote Republican in anger; they didn't vote AT ALL because they're in personal crisis. Who are they? Young, mobile, unemployed, lost their home, minority members - the mainstays of the Democratic Party. When people are in crisis they have to focus on that. Depression. Lost voter registration or dropped from the rolls. Progressives and Democrats didn't keep these folk engaged. We didn't reach out to inform them, get their feedback, enlist their involvement and keep track of them. This midterm election, amid economic collapse, was particularly bad specifically for Democratic voters. Meanwhile Faux News and Citizens United money used lies, hate and fear to motivate low-information voters.
Result, the people in the government who recently did more than anyone else for average Americans lost voters.
Nevertheless, across the country among ALL the people there is strong support Democratic efforts. It's not "the economy, stupid," it's "ALL the people, stupid."
 
 
+3 # Milt Lauenstein 2010-11-06 11:17
Why omit entertainers and athletes from the list of those doing well?
 
 
-17 # Lord Wraith 2010-11-06 11:21
Instead of whining about the rich and how they should be taxed to the heavens why dont you work your butt off so you can be Rich then see how you like paying 34% of your income in taxes verses the guy who did not risk is home to grow a small business and only pays 20%. Just how is that fair? Dont like Bank or america then dont use there services! Simple as that. The Government should not Bail out any Co ever! Omaba wasted Billions just to protect Labor unions who got him elected. You blame the Republicans for Omabas mistake, he made the Super Rich even more Rich, not the Republicans.
 
 
+7 # Activista 2010-11-06 11:55
"work your butt off so you can be Rich ..."
obviously you do not work hard and you are not rich - one need also IQ over 100. Most of the new rich are in financial sector - get rich quick speculators (Madoff etc.)
Selling houses for 300% value - making $30 -$60K on a "transaction".
People with brains stopped to use Bank of America, Chase etc. Let us use small community banks.
$4 billion spent on elections - who and why - this is the question .. (Hint: it was not small business)
 
 
+1 # DaveW. 2010-11-07 22:32
Lord Wraith, "Good evening my Lord, Jeeves here, will you require anything else before I retire? Nothing you say...oh pardon me, another scotch and soda...indeed sir, straight away sir." Progressive income tax is what allowed U.S. to become a world power and not a two-tiered banana republic where arrogant aristocrats lived off mostly INHERITED money for centuries. You're living the old Horatio Alger, pull yourself up by the bootstraps mentality. Millions of Americans and billions worldwide do indeed work their butts off so that they can keep a handful of rapacious pigs in the luxury to which they feel entitled. Obama did not lower tax rates to current level which at the United States greatest level of overall achievement and prosperity was 93% for the upper bracket. Sorry to interrupt you're fantasy. Go read some real history before you come back with more of your bloated, copious nonsense. One more thing before you go on your fox hunt.Were hedge fund managers making millions A MINUTE working that much harder than everyone else. It's comments like yours that make a lot of us glad we'll never be rich. Now go curl up with a packet of stock dividends.
 
 
+2 # Kab 2010-11-08 11:27
Oh, puleeze. "Why don't you work your butt off so you can be Rich" doesn't pan out these days. I don't believe I personally know of any "Rich" people, though my friends and family work extremely hard--some of them in more than one job or in their own businesses. Three have been laid off due to "reorganization ". One of my friends, a small business owner, working about 60 hours/ week and without health insurance, owes about $30K in medical bills following an emergency hysterectomy a few years ago. Sure labor unions generally support Democrats as most people will support the polical party that favors their needs. Do some research into how well-lined the pockets of the politicians of the Bush Administration and off-shore and non-tax paying corporations are.
 
 
+7 # Activista 2010-11-06 12:08
It is military stupid - military-indust rial complex - USraeli wars in the Middle East - this is why we are bankrupt - tanks and bombs do not create any human value - just terrorism, death, misery - and deficit.
This is my issue with "economists" - take more systemic and global view. We do not have capacity to out produce Chinese - we must feed military - going way of CCCP.
www.warresisters.org/pages/piechart.htm
 
 
+1 # Felicia Alongi 2010-11-06 12:22
I teach financial literacy to my middle school students, and it is difficult because even their parents have trouble grasping even the basics. I appreciate your blog. Yesterday, I watched this macro-economics explanation that really resonated with me. It is my sense that $ will collapse. What is your reaction to this synopsis? http://www.chrismartenson.com/crashcourse

Our school discussion has shifted from disturbing to calm after we worked on our own partial solution. This is a trailer for our short student film we try to encourage the world to follow: http://www.youtube.com/watch?v=vjXfpJZGlog

This feels like a valuable hedge that in its own tiny way contributes to the world.
 
 
+3 # Bry 2010-11-06 12:42
I see the two Americas every day on TV via rich pundits, talk show hosts $ celebs who all talk through their azzes as if they know what we're all living through & are like us, but are so clueless. They (the gov't, big business & the banksters) have raped us & left us for dead while they now roll in the $ & court business abroad & let us bleed & choke to death. I've been waiting & can't wait until the day that hopefully is coming very soon when the proletariat explodes violently & gives them that hell Reich speaks of in ways that send them reeling through the roof & to the ground in a resounding thud where they can't get up again! Sadly, it seems this is what it is going to take to stop them & help ourselves. We are now living in the "democratic", "capitalistic" version of Orwell's "Animal Farm" & it really is time for a revolution! When Obama stands with the banksters against the homeowners & major economists who are calling for a foreclosure maratorium (and throws even more taxpayers' billions via this new QE, "quantitative easing", new term for another corp handout TARP/stimulus). ..he is not with & for Main St regardless of his line of con to the contrary.
 
 
+4 # Rayzor 2010-11-06 12:46
Two more years will demonstrate perfectly
that Republicans are even more incompetent,
and then we'll do what should have already
been done:BREAK OUT THE PITCHFORKS AND
TORCHES.It's the only thing any of them
understand
 
 
+1 # becba 2010-11-06 14:52
maybe the payout to hell is the only way forward at this point- as long as there is something paid out.
 
 
+4 # Elaine Cimino 2010-11-06 15:15
I was told that after the first of the year most of the entertainment industry will be doing business aboard--outsour cing more and more jobs. Even the ones I am now training for. Most of the business now is done in Europe, with Asia coming in second and India third. Which means America is on the slippery slope downward.
How do we keep jobs here? I am trying to get printing quotes on a children art education book that has been frustrating.
My quest to find a local printer is not at the 9th quote, their quotes leave no room for distribution never-mind profit. My entrepreneur venture has been eye opening. This is Capitalism??? What are our children going to do, work live?
.
 
 
+2 # wfalco 2010-11-06 18:03
Reich claims"there will be hell to pay." I agree with everything in his article but that. Hell to pay to whom? If we were European we might be out in the streets en masse ("we" meaning those in the Average Worker economy.)
Average Worker doesn't do that. Unless Mr Reich is referring to the increased popularity of voting Republican since Average Worker may be equating to white-angry America.If we have lost minorities and young adults to apathy and alienation then perhaps we are already in hell.
 
 
+1 # charsjcca 2010-11-07 10:01
I agree that there are two economies that are reflected in the disparities. Nearly 50 years ago I first read that America was headed toward over-population . It was assumed that a portion of our fellow citizens were to be wards from cradle to grave, not necessarity the same folks. We have arrived there. Please take note.
 
 
+5 # darius 2010-11-07 11:32
The other place you can see the two economies are in the war.

I have found a way to understand statements such as "US is spending X millions per month on war in say country Y". What they are actually saying is that to conduct the war, one US economy is paying X million to the other. Using terminology of this article, it is saying that the "Average American Economy" is paying X millions per month to the "Big money economy".
 
 
+1 # Stanley 2010-11-08 12:09
So Lord Wraith thinks rich people pay 34% of their income in taxes? Hilarious.
Everyone needs to watch (or record it for later) the Dylan Ratigan Show on MSNBC. It comes on in Texas at 3pm weekdays (4pm in Calif?). He's been having MTV's Jenks on recently, and has gently suggested that the average young person is quietly allowing their future to be ruined by the banksters while they do nearly nothing to try to stop it. There is no one on TV anywhere making the powerful, authoritative statements about how Wall Street and big corporations are destroying this country for their own personal benefit than Dylan Ratigan. His remarks would be slanderous if they weren't true. (Note that the top 25 hedge fund managers in America averaged $1 billion in income in 2009 while most of us were in recession.) He dares them to prove him wrong. We are in for total gridlock over the next two years. Then we'll see if people will finally get off their asses and seriously try to change our whole system to give at least some---any---he lp to the Average Worker.
 
 
0 # SAR 2010-11-08 15:15
There will be Hell to pay, but the average worker is going to go through HELL first before it gets better, if ever. Once again the 10 million dollar a year club managed to get a portion of the populace to believe they were in the same club, and vote against thier own best interests. The Russians use to call us Stupid American capitalists, now its just Stupid Americans...... .
 
 
0 # giraffe 2010-11-10 15:11
SOLUTIONS - one is to redo the TRADE Contracts we have with foreign countries. Example: We allow some countries to sell their cars in USA and they don't allow us to sell our cars in their countries. Another example: If an American company manufactures their product in a foreign country - tax them on the difference (I'm not sure how this works but that would level the playing field.) I just read Harley Davidson moved all manufacturing to some other country so their profits will sky rocket.

I'm sure the loop holes are clear and "we the people" say nothing.
 

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