It never ceases to amaze me that we continue with the charade of watching how the economy performs. Last week, we learned that the American economy grew by a whopping four percent during the last quarter.Whoopee shit!
Am I supposed to fall off my chair thinking about what a great job those in charge are doing in managing the economy?
Yeah, pretty much. That way you don't give much thought to what really matters: for the last 35 years the vast majority of Americans have been shafted royally.
Think about it. Since 1980 the US economy has grown roughly 4% annually.
Yet, during the same time the population at large faces what is at best an uncertain future.
Three things strike me to be a lot more important than the rate of annual economic growth.
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First, the percentage of workers that have defined-benefits pension plans has shrunk from 60% in 1980 to about 11% today. This represents a massive reduction in the quality of life for an aging population, especially when we consider the vast wave of baby boomers that are and will be retiring in the next 25 years.The Unlanded Gentry Have Captured North America's Political Economy
Second, the cost of a university education has created an emerging generation of wage slaves. Since 1985, the overall consumer price index has risen 115% while the college education inflation rate has risen nearly 500%. Pursuing the American dream by obtaining a higher education has become a debt trap. Indeed, low paying, precarious employment does not generate the revenue to pay down the debt and to provide for a middle class lifestyle. Consequently, a great many millennials do not have the means to move of their parents' basements in order to make it out on their own.
Third, income growth has stalled for most Americans. At $51,017, the real median household income in 2012 is even less than it was at the end of the eighties ($51,681) and down from 9% from its high in 1999 ($56,080). Conversely, during this period (2009 to 2012), 95 percent of all income growth went to the top 1 percent of income earners.
Clearly, something is amiss and it what needs to be pointed out is that the scale of the problem suggests that it's not just a question of not following the right economic policies as would the progressive economists like Paul Krugman and Robert Reich would have us believe.
What's really at issue is that the super rich, those who make it on the Forbes list of the top 400 wealthy Americans, are no longer dependent on the performance of the American economy to increase their wealth.
Yes, there is still a great amount of money to be made from selling goods and services to the top 20% of American income earners, more so since production can be sent off shore where wages are significantly less, and corporations can be inverted so that on paper they appear to be owned in jurisdictions where the tax rates are lower.
But over and above these ploys that leave the majority of Americans out of the wealth generating loop, even greater returns can be had in the financial sector. After all, it makes much better sense to pursue a greater return on investment in a sector that is not exposed to the risks of unfavorable economic performance and, in fact, has the risk of failure (too big to let fail) underwritten by the government and the American taxpayer.
What a sweet deal!!!
Seen from this perspective, the latest economic reports are of little or no significance. What matters is what happening in the investment portfolios of those at the top of the food chain.
And let's face it, the game is rigged in their favor. Hedge fund managers can only make billions if they are able to make even more for their clients while the little guy is left to fend for himself, trying to sell his labour in a market in which there are less and less buyers.
So why bother?
In short, it keeps the natives from getting restless. As long as progress can be shown on the economic front widespread financial difficulties within the population can be dismissed as nothing more than personal failure.
In other words, as long as the majority of Americans give credence to the existing economic discourse they remain effectively sedated.
So much so, they are unable to oppose the massive wealth extraction that is taking place by means of sustained wealth redistribution enacted through the political process.
As well, the population through their tax dollars continue to fund the largest military force ever assembled to protect American interests (American capital) abroad.
The overclass in America has never has it so good.
All it takes is a little statistical smoke and mirrors.
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