As one "on the ground" in the "real economy," I can attest to the truth in Ms. Ehrenreich's observations and conclusions. The once-middle class, former bastion of sensible savings plans, has been conned by the Corporate American Advertising Machine into spending its way into prosperity. Now, we debt-ridden declining middle-class citizens are being pushed down in to the realm of "the poor," so that money sloughs off us, too. The cost of living has risen and our salaries have stagnated, the amount we can contribute to our 401-Ks (since employers stopped providing pensions) has fallen and the amount we must pay for such staples as milk and gasoline has skyrocketed. We'd rather ditch the gasoline requirement entirely, but the places where we've been told it's best for us to live (for the sake of our children's quality of life and education) aren't served by public transportation, except for the older Northeastern urban metro areas. And our employers require us to work such longer hours (to make up for all those layoffs), so unpredictably, that we're unreliable as carpool partners. This article tells the truth. Remember Nicholson in A Few Good Men? "You can't handle the truth!" Unfortunately, we have to handle this truth.
That said, even my clitoris laughed a few times during this article. One question: If the economy "starts acting like a nymphomaniac junkie in withdrawal," does that mean it'll be screwing us even worse than before? I just want to know because we'll have to handle that truth, too.
Trude Diamond
Tampa, FL
01/23/2008 @ 11:03am
Another outstanding column by Barbara Ehrenreich! We will need all her suggestions to avert the humanitarian disaster that will indeed accompany this financial debacle.
This will not be an economic recession, that is just a symptom of
a much more malevolent imbalance in the structure of the
economy. What we are seeing is a credit collapse that will starve our
economy of cash, and there's really nothing we can do about it.
Adding insult to injury is the degradation of our productive
economy into a service economy that adds little or no value at
all.
We have a Health Care Industry that consumes 15 percent of GDP
whereas other nationalized health care systems consume 8 percent or
much less. Our financial service industry accounted for over 30 percent
of the profit for the S&P 500, whereas twenty-five years ago it was just
6 percent. The Military Industrial Complex takes 9 percent of the economy and
produces no real goods.
Between just these three sectors over 20 percent of our GDP is waste,
fraud and abuse. Then we can start talking about CEO, CFO and
CIO compensation.
But back to the credit collapse. The debt-based fractional
banking system can only survive with ever-increasing debt, but
the consumer is tapped out and business is cutting back. With
no new debt being written, a tsunami of bad loans, systemic risk
model failure and mistrust between banks, the die is cast, a
meltdown that will shake our country to its core.
Is there a way out? Sure, but it is medicine we will only take as
a last resort, if then.
First we fire the Federal Reserve, install a central public bank
and use only government-created money, money that bears no
interest payments, a "greenback monetary policy." Then
reregulate the financial sector.
Second, we provide single-payer health care to all Americans.
This will relieve states, counties, cities, industry and small
business of healthcare costs, leaving jobs intact and making our
products more competitive. It will also relieve people who pay
for their own healthcare and insure some 47 million that
currently go without, more money left in the system.
Third, we slash the military budget by half, using those funds for
infrastructure projects.
Fourth, we declare an energy emergency whereby automakers are
ordered to reduce engine sizes and weight immediately and
introduce within three years battery electric and hybrid battery
electric vehicles. These vehicles should get at least quadruple
our fleet average eliminating our foreign oil dependence within
fifteen years.
Fifth, we add tariffs until we are below a 2.5 percent trade deficit.
Sixth we fix our income tax system and begin by raising rates,
eliminating loopholes and declaring capital gains and dividends
personal income for the mega-rich. Then we go after
corporations for loopholes, set asides, off-shoring and all other
non economic BS they currently practice.
Without these measures we could become another Japan: years
of deflation and a stalled economy.
Michael McKinlay
Hercules, CA
01/22/2008 @ 5:21pm
The feminine perspective certainly adds a new dimension to economic theory. However, economic stimulus has traditionally been applied in such areas as public works. The building of bridges, buildings, dams and roads provides contractors with business,; they buy the materials and equipment to do the job. They also employ the workers who spend their money for food, housing and other necessities. Let's not forget the retail stores and their employees who supply the products or the medical personnel who keep them healthy. Indeed, a single-payer health plan would also stimulate the economy. In other words, a stimulus plan must benefit every level of society. It has to have a ripple effect, or one could say it floats all boats.
It would provide good-paying jobs, that give people the money to support the American market. No jobs, no money--and no American market. Call me boring, because I will say it again. You must have tariffs in place to protect American industries, farms and workers, and the American market. You must have regulations that control the insanity of private enterprise, protect the public health and insure the quality of American products. You cannot control what another country does with their exports. You can control what is produced in your own country.
"Free trade" reduces workers in every country to the lowest level. National economies can develop every country for its citizens.
Pervis J. Casey
Riverside, CA
01/22/2008 @ 4:45pm