There is a problem in this country that neither the incumbent president nor the new contender for the presidency seems prepared to address: American capitalism doesn’t work. It hasn’t worked properly for decades, but now it is even more so out of whack.
Americans are on a road to serfdom, and it isn’t due to socialist tyranny. The Bureau of Labor Statistics recently released its report for unemployment in September. Approximately 114,000 jobs were added in September, the unemployment rate fell to 7.8 percent and fewer people applied for unemployment benefits.
It is an improvement. President Barack Obama and his allies, who would like for him to be reelected, have made this into a point of pride.
And the Obama administration does deserve credit for the recovery, no matter how slow. It also deserves credit for the results of the recovery.
An August 30 aricle by Catherine Rampell of The New York Times detailed a study by the National Employment Law Project, which said,“While a majority of jobs lost during the downturn were in the middle range of wages, a majority of those added during the recovery have been low paying. ”
NELP is a national advocacy organization for employment rights of lower-wage workers.
The study, which used data from the U.S. Labor Department and tracked hundreds of occupations, found the two areas that added the most in employment were retail sales and food services.
Jobs that don’t pay much, with median hourly wages of $7.69 to $13.83, accounted for little over 20 percent of job losses during the recession. These positions have since driven the recovery; they have accounted for over 50 percent of all job growth.
After the crash on Wall Street in 2008, the economy suffered severe losses. Hundreds of thousands of jobs were lost every month and gross domestic product was in the red. However, after the president enacted the American Recovery and Reinvestment Act of 2009, that February GDP started to rise and the economy stabilized.
Unfortunately, most of the wealth created in this slow recovery went to the richest Americans. In fact, in most of the growth of incomes that took place in 2010, 93 percent flowed to the top 1 percent.
As Americans have continued to become more productive, they have received less and less. Liberal magazine Mother Jones detailed this in a series of charts and data sets last year.
“If the median household income had kept pace with the economy since 1970, it would now be nearly $92,000, not $50,000.” The chart showed a distinct bifurcation between American productivity and wages.To be clear, we work harder but are paid less.
Meanwhile, in 2010 and 2011, corporate profits hit record levels and are expected to rise to $1.9 trillion, as reported by Forbes. And “under Obama the stock market has put in the second best performance in the last 65 years – up an average of 16.1 percent annually (from 832 to 1,406 in the S&P 500 average).”
Our system is not only about free enterprise and the savvy go-getter, it’s about an honest day’s pay for an honest day’s work. At least that was the dream.
American capitalism was not always so broken; there was a golden era after the Great Depression. It in fact can be fixed, but neither candidate has said how they will do this other than with tax cuts for businesses.
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