Offing the Middle Class Will Kill Small Business Too

Will Offing the Middle Class Kill Small Business Too?

80% living on 20% leftover’s

Déjà vu?

I learned just this year that the CIA (Central Intelligence Agency) publishes a report (link) on the Internet about the United States. I was reviewing the section on the economy that was updated on August 13, 2009. In the middle of the report is this statement, “Since 1975, practically all the gains in household income have gone to the top 20% of households.” Furthermore, “The onrush of technology largely explains the gradual development of a ‘two-tier labor market’ in which those at the bottom lack the education, and the professional/technical skills of those at the top and more and more, fail to get comparable pay raises, health insurance coverage, and other benefits.”

No middle class–no small business

For 34 years the American middle class has been steadily shrinking. Where will we be when the middle class is gone? Will we be safer, healthier, or wealthier? When you think about it, small business, the backbone of the American economy is in serious danger. As the split widens between the haves and the have nots, who will buy the products and services of small business? It won’t be the big corporations, that’s for sure. What will this country be like when the splitting stops and 20% of the population control 80% of the wealth, and 80% have to live on what’s left?

Americans slipping slowly down the drain

The CIA report also says, “Long-term problems include inadequate investment in economic infrastructure, rapidly rising medical and pension costs of an aging population, sizable trade a budget deficits, and stagnation of family income in the lower economic groups.”

Printers probably the first to go

Why do I bring this up? My career has been spent in the printing business. Most printing firms in the United States are small businesses. When the middle class is gone, and small business owners disappear, what will happen to printing? The answer is obvious.

How can government help turn the tide?

Educational Needs. Provide educational opportunities to all citizens who want it. A college education shouldn’t create a lifetime burden of student loans. Free education would benefit us all.
Health Care. Make sure all citizens have access to good health care. We have the most expensive health care in the world and some of the most unhealthy citizens. One reason is because care is delayed until the need is critical.
Ban Lobbyists. Cut access of corporate lobbyists and make sure they have only the same access to lawmakers as any other citizen. Our survival as a nation depends on fairness for all. Special interests cannot be allowed to rule. When special interests rule, the public loses.
Regulate Compensation Packages. Create an Executive compensation commission to review and regulate public corporations. Companies who are vital to the national interest and deemed too big to fail have to be subjected to intense scrutiny. Just as the SEC requires annual reports, compensation must be examined and regulated if necessary, to protect our common interest.
Recover Pension Funds. Create a collection mechanism to recover money from executives of corporations who raided or otherwise harmed vested pension programs. It is unconscionable that an employee be left penniless after working a lifetime for benefits, while the upper echelon retires comfortably.
Banking Transparency. Make sure publicly held corporate executives cannot secrete their fortunes in secret accounts. Transparency in banking is necessary only for those who have the power to wreak havoc on the economy and cause recessions.

I know, some of these suggestions will strike some as being un-American. Maybe you are right, but when any sector has the power to harm the whole, it has to be considered a public threat. The demise of the middle class is a public threat and must be treated as such.

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Tags: Banking Transparency, Benefits, Central Intelligence Agency, CIA, Compensation Packages, Congress, Economic Infrastructure, Economy, Education, Free Education, Health Insurance, Household Income, Internet, Investment, Lawmakers, Lobbyists, Medical Costs, Middle Class, National Interest, Pay Raises, Pension Costs, Pension Funds, Printers, Professional/Technical Skills, Public, Report, Small Business, Special Interests, Student Loans, technology, Two-tier Labor Market, United States

This entry was posted on Wednesday, August 19th, 2009 at 6:41 pm and is filed under Business, General Frustrations, Health Care, politics, Printing Companies, Taxpayer, USA. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

Randy Goldman

Bill,
A lot of what Teddy Roosevelt proposed at the turn of the 20′th Century sounded ‘un-American’ to the lunatic fringe on both extremes of the political spectrum. But, time proved that Teddy was right – and I think you are on the right track as well. What’s good, fair and decent for the general population, is good for the country, as a whole. This nation has to have a strong and vibrant middle class in order to prosper. Otherwise, we will slowly wither and die on the vine.
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http://www.squidoo.com/findingwork Dave aka EditorDave

You sent this to me through LinkedIn… and I thought I’d respond after reading your post.

Unfortunately, this shift to a two-tier economy has been going on for a very, very, very long time. Like you said, in the CIA report–since 1975 any gains have gone to the top 20% of households.

In 1975, I was in college doing what my parents and everyone else I knew said to do: “Study hard, get good grades, go to college, get good grades, and get a good job, and you’ll be successful.”

Well, guess what. It sort of worked and it sort of didn’t work. I’ve NEVER had a job in my degree field (biology major, chemistry minor)–didn’t get a “high-enough” degree to be anything other than a low-paid “lab technician”. I became a public school science teacher. After a bunch of enjoyable years but with no pay raises (and inflation galloping along) we fussed with the government to get raises of at least 5%–but they said there was no money available for raises. Yet, they (the legislature) turned around and gave themselves (who were already making $60,000-$80,000/yr) 50-60% raises. We went on strike (in the middle of a school year). Rather than talk to us, they immediately fired all 800 of us who had the gall to not cross picket lines. The school system/government showed us what they really felt about “education”–they put bus drivers, cafeteria workers, hall monitors, secretaries, and janitors in classrooms to “babysit” the kids. And broke the union and the strike.

I SWORE that I’d never, ever, join a union again. I SWORE that I’d never work in that type of situation again.

I’ve since worked in a wide variety of industries–mostly as a writer/editor, but also as a photographer. I’ve sold cars, I’ve sold insurance, I’ve sold vitamins and soaps. And I’ve learned a lot about business and the “Real World”. But I’ve never gone back to teaching–where it’s a political football and still a low-paid position.

Most of the school teachers out there (who still work in classrooms) have NO CLUE about the real world–or about what ELSE they can do with their degrees (or lack, thereof). They learn academic stuff from universities and colleges that “profess” theories that generally have no relevance in the real world. Most teachers work at low-middle-class and near poverty levels. So how can they teach their students anything otherwise? If the teachers aren’t living well, how can they teach their students to live well?

I don’t think “forced” or “mandatory” education is the key. I think providing public education for all up to at least 8th grade should be required. But all students must learn the basics. BASICS. Namely–”reading, writing, arithmetic (including personal finance)” That’s IT. Stop with the fads, the foolishness, and goofy theories the professorial academic types push on public school systems. Just cover the basics and DO IT WELL! Then, if the students have an aptitude to do anything that requires further mental or technical work, provide a path for them to technical school, colleges, and universities where they can learn not the fringe theories but practical applications that give them valuable and marketable skills. Only those students who have the mental aptitude should be allowed to go for PhDs, M.D.s, and so on.

Our school system has failed. Miserably. This may be the MAIN reason why we’re in such an economic mess. Most of the U.S. population does not understand the paperwork they signed when they applied for mortgage loans, 401ks, IRAs, investments (if they even knew about them), credit cards, and so on. Most of the U.S. population does not know the difference between “defined-benefit retirement plans” and “defined-contribution retirement plans” and why they ought to know. Most of the U.S. population does not know how to maintain their own personal finance, let alone knowing the difference between assets and liabilities or income and expenses. This is basic economics–yet, these concepts are not being taught to everyone. They are presented only to a select few–and even then, it’s evident that they don’t get it either.

The upper 20% of U.S. population DO understand these concepts. The lower 20% will NEVER learn these concepts because they’ve been brainwashed to think they don’t need to learn anything. The middle class better learn these concepts… or they will find themselves at the bottom. The current economy is a “wake-up call” for the middle class. We’ve been screwed. Partly due to our own chosen ignorance.

There are ways out there that we can use to turn this economic mess around (for both ourselves and our country). Unfortunately, they aren’t pretty. They aren’t fun. They aren’t easy. They aren’t glamorous. But they work.

I’ve found out about some of them. And I’m investigating other ways as well.

–Thanks for posting this and giving me an opportunity to rant a bit.

Regards,
Dave (aka EditorDave)
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http://www.tedmagnuson.com Ted

Bill. Thank you for your concerns.
–There is indeed a bizarre blend of concentration of power where the overall trend of history would have us believe power is being distributed to the people. Weren’t Thomas Jefferson’s words ‘All Men Were Created Equal? Of course, it took Abraham Lincoln to clarify the meaning. <>
–Indeed, the internet, the myriad news sources now available, would also support a theory that power has become vastly distributed.
–However, I think you are on to something. not only is power now distributed, it is also diluted. Somehow the ‘New Republicans’ have highjacked the party of Teddy Roosevelt and Abraham Lincoln, filling the gullible with all sorts of gibberish about socialism = Nazism and dumbing-down our media/information network, feeding reality show pablum while reducing ‘freedom of expression to license to be lewd, crude and what used to be labeled socially unacceptable.
–Each of us has only as much power as we chooose to exercise over our own thoughts, words and actions, as well as any influence we have over others.
–History is a great teacher. I have collected the foundations of the Rule of Law we now enjoy on my audio recording “Those Self Evident Truths.” Things were much worse in the Middle Ages when ‘The Divine Right of Kings’ was the law of the land. You can find out more about my project at my website.
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http://stearn.ca/blog/ Will

I have to admit I’ve been having the same thoughts and opinions as you and your other readers have about the diminishing middle class. I myself have been vigorously trying to get myself a little higher than the bottom of the middle class, (or upper edge of the lower class, depending on your view) for quite some time now and I’ve pretty much taken an educated deduction that short of writing the next Opra best seller, it’s just not going to happen. I have completely and unequivocally lost all hope and faith in the american economic and political system and am making serious plans to permanently emigrate. I know this doesn’t help fix the problem but I’m convinced that the problem can’t be fixed and the ultimate demise of the american way of life is just a matter of time not possibility. Writers will continue to write no matter our level of prosperity/poverty, it just means that fewer people will be reading our books.
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Alan

I think it’s a fair statement to say that since the mid ’70s the middle class has been squeezed hard – I refer you Saul Alinsky and the Radical socialists who now are in charge of the executive branch of government. Alinsky wrote rules for radicals in ’71 and it’s been the left’s playbook – and now it’s Obamas. It doesn’t look promising. They have: an education monopoly; near media monopoly; now with Obama – they’ve taken over the financial sector, making a strong play for energy and of course 1/6 of the economy with health care.

Socialism has never been the answer for creating wealth and growing a middle class. It is a tool for tyrants to control the rest of us. The only reason Marxism has taken this long to finally make it’s final control of America is the fact that we have had a robust middle class. So it is quite within their long term strategy to destroy the middle class – so you have the necessary class warfare to control the masses.

Actually the move toward an elitist brand of socialism – from both parties has been going on at least since FDR. I do not think it is necessarily as complicated as people want to make this. Elites from both parties do not represent the middle class – they represent their special interest groups who back their campaigns and get them re-elected. When politicians from both parties sell out their constituency – everyone in the middle gets screwed. There are some basic things that can save this country: Congressional term limits is a start. Returning to the founding principles and holding back the tide of socialism by limiting the control of education and media monopoly – these 3 things will go a long way to putting us in the right direction. Imagine a real education system based solely on merit. No more tenured professors or political brainwashing in the class room. No more brain washed talking heads in the media. No more life time political hacks. Imagine the 10th Amendment becoming stronger than the Federal Government for everything but those things strictly spelled out in the Constitution – namely military. Abolishing the IRS and installing a “fair tax”. Not impossible – but an uphill battle.
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