More Pay is the Only Way

[Crewleader]

Bail Out the Economy? December 22, 2008

More Pay is the Only Way

By MIKE WHITNEY

Wages, wages, wages. It all gets down to wages.

A strong, resilient economy, that can withstand the periodic buffeting of cyclical downturns, must be built on a rock-solid foundation of wages that keep pace with production. If wages stagnate, as they have for the last 30 years, the only way a consumer-driven economy can grow is through the expansion of personal debt, which isn’t so hot in the long run.

Consider this: the US economy is 72 per cent consumer spending. That means the Gross Domestic Product (GDP) cannot grow if salaries don't keep up with the price of living. Low Income Families (LOF)--that is, any couple making less than $80,000--represent 50 per cent of all consumer spending. These LOF's spend everything they earn just to maintain their present standard of living. So, how can these families help to grow the economy if they're already spending every last farthing they earn?

http://www.counterpunch.org/whitney12222008.html

[lostnotforgotten]

1. It's Also About The Stratification of Wages - Hierarchies That Reward The Top

Over all other work groups need to be eradicated and destroyed.

[Double T]

2. Can it be, Growth is dead.?

Wages are stagnant. No Growth here.
Jobs being shipped out of the country. No Growth here.
Manufacturing plants closing here and relocating in foreign lands. No Growth here.
Flooding the market with dollars that continue to decline in value. No Growth here.
Consumers curtail spending while awaiting receipt of their pink slips. No Growth here.
Foreclosures continue upward while credit markets tighten like a hang noose. No Growth here.
Stimulus and bailout economy replaces all other forms of economy. No Growth here.

Yep. Growth IS dead, anti-growth (aka debt) is alive and well.

[Idealism]

3. Individual growth may be dead

Company growth is not. Corporate profits have set records since the late 1990s year after year (although obviously not in 2001 recession or the current mess). Corporations and Transnationals have mopped up, along with the top 0.01% that runs them (sometimes into the ground) but the average worker is forced to live on credit just to maintain the consumerism demanded.

[Double T]

4. The consumer is close to death with barely a pulse.

As the consumer goes, so goes the economy.

[notesdev]

5. What needs to happen

is that the value of labor needs to rise significantly relative to the value of assets.

And that is what is happening, in some sense. While wages aren't rising, the valuation of assets is dropping like a rock.

[Citizen Number 9]

6. I've got a question.

Speaking on a world-wide basis, now.....

And considering the GNI (Gross National Income) per capita

How (in the world) do scores of those other countries who are considered "high income" possibly make do with less than us?

A lot of them have half and a quarter of the per capita GNI that we do.

They must be suffering to the point of extinction.

Don't we have some of the highest wages in the world?