Welcome to the New American Economy: A Living Nightmare for 80% of the Population

The stunning new statistics released by The Associated Press point to an economic and social disaster of epic proportions in America. Four out of 5 U.S. adults struggle with joblessness, near-poverty or reliance on welfare for at least parts of their lives. Given Republican obstructionism, there is little the President can do about it.
Avatar:
Ben Cohen
Author:
Publish date:
Social count:
30
The stunning new statistics released by The Associated Press point to an economic and social disaster of epic proportions in America. Four out of 5 U.S. adults struggle with joblessness, near-poverty or reliance on welfare for at least parts of their lives. Given Republican obstructionism, there is little the President can do about it.
Screen Shot 2013-07-29 at 1.58.01 AM

Screen Shot 2013-07-28 at 7.37.40 PM

The stunning new statistics released by The Associated Press point to an economic and social disaster of epic proportions in America. According to the report, "four out of 5 U.S. adults struggle with joblessness, near-poverty or reliance on welfare for at least parts of their lives."

It is a shocking indictment of the prevalent economic philosophy and a warning call for very serious change. It should now be clear that the economic philosophies espoused by Ronald Reagan and the Republican Party are bankrupt and an utter failure. The mass deregulation of the economy has created a polarized society where 1% of the population own almost 40% of the wealth, and 5% own almost 75% of the wealth:

/wealth-change-epi.jpg

The AP report points to the globalization  of the US economy and the deterioration  of manufacturing as the reasons behind the trend - all byproducts of neoliberalism that places profit above all. Corporations have been allowed to chase higher margins by outsourcing labor abroad, and labor regulation at home have been destroyed driving wages down for working Americans and forcing them into poverty. The reality of the modern economy is now certifiably a living nightmare for most of the population - chronic instability, lack of benefits, lower pay, over bearing debt and reliance on charity when times are particularly hard. And these fears are no longer predominantly working class - the middle class, now in terminal decline, is also subject to the cruel hand of the free market that has smashed benefits and eroded job security over the past few decades.

The solution, according to Republicans, is for more of the same. Less government, less regulation and more power to corporations to draft the country's economic policies. Given the hard evidence that this has led to catastrophe, why are they peddling the same destructive nonsense?

The answer is of course, money.

The Republican Party should not be confused with being a political party. It is now a lobbying wing of big business in America that exists solely to further the interests of the wealthy. There is a good argument to be made that the Republicans are essentially economic terrorists, dedicated to ransacking the wealth from the majority and filling the coffers of their wealthy backers. Their purpose is not to represent people, but corporations and the interests of Wall Street.

The current incarnation of the GOP means that change within the current political climate is close to impossible. With Congress blocking everything the President attempts to do to stem the drastic wealth inequality tearing the country apart, the remedies simply aren't available to make the necessary changes to create a more equitable, sustainable economy for all Americans. Obama is set to embark on a tour of the country pitching his new economic agenda that includes investing in green technology, rebuilding infrastructure, creating new manufacturing jobs and job training for the unemployed. Said Obama in his speech at Knox College in Galesburg Illinois last week:

The first cornerstone of a strong and growing middle class has to be an economy that generates more good jobs in durable, growing industries.  Over the past four years, for the first time since the 1990s, the number of American manufacturing jobs hasn’t gone down; they’ve gone up.  But we can do more.  So I’ll push new initiatives to help more manufacturers bring more jobs back to America.  We’ll continue to focus on strategies to create good jobs in wind, solar, and natural gas that are lowering energy costs and dangerous carbon pollution.  And I’ll push to open more manufacturing innovation institutes that turn regions left behind by global competition into global centers of cutting-edge jobs.  Let’s tell the world that America is open for business – including an old site right here in Galesburg, over on Monmouth Boulevard.

Tomorrow, I’ll also visit the port of Jacksonville, Florida to offer new ideas for doing what America has always done best: building things.  We’ve got ports that aren’t ready for the new supertankers that will begin passing through the new Panama Canal in two years’ time.  We’ve got more than 100,000 bridges that are old enough to qualify for Medicare.  Businesses depend on our transportation systems, our power grids, our communications networks – and rebuilding them creates good-paying jobs that can’t be outsourced.

The plan, although devoid of specifics yet, sounds about right - a classic, tried and tested Keynesian approach to economic growth that requires an active government. It is what the country needs if it wants to maintain a middle class and avoid major social and political upheaval. But there isn't a chance in hell the Republicans are going to get behind it.

Masters at the art of distraction, the Republicans will get to work hammering at Obama for proposing to spend money when the country is still running huge deficits. They'll talk about 'crippling debt' and 'excessive government spending' as the reasons behind the current economic crisis, even though it has no basis in reality. We know that the country has faced worse debt crises in its history and spent its way out of it (the national debt after World War Two was significantly bigger as a percentage of G.D.P. than it is today). The Republicans want everyone to forget that their economic philosophies created a banking system that brought down the economy. It's far more convenient blaming the current crisis on welfare recipients and medicare costs, particularly given they are paid handsomely to ignore the facts.

Perhaps Obama's plan will succeed if the Democrats manage to take back the House in 2014, but sadly that isn't very likely given the current numbers. Is there a solution?

There is always a chance a mass popular movement could bring about real economic change in America - after all, stranger things have happened. But it is clear it isn't going to happen in Washington.