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America's Real Job Creators Are Broke
Despite the GOP's ideological claptrap about corporate executives being "job creators," it's ordinary Americans who actually create jobs.
As narrators used to say in Western movies: "Meanwhile, back at the ranch..."
Our policymakers in Washington have totally lost sight of what's happening at the ranch. John Boehner's GOP-controlled House and Barack Obama's White House have agreed to slash trillions of dollars from the federal budget, as though that's America's most important need.
Bovine excrement! If they'd lift their vision to the countryside, even they could figure out that our great economic urgency is for the creation of good, middle-class jobs to get America moving again — moving upward and moving together.
Today, we are a dangerously disunited society. Elite CEOs and big investors are grabbing all the gains, leaving the vast majority mired in recession and facing falling incomes. Since the recession technically "ended" 18 months ago, corporate profits have zoomed, sopping up an unprecedented 88 percent of America's economic growth. Meanwhile, only one percent of the growth that we all help produce has gone to wages and salaries, the primary sources of income for 90 percent of us.
Yet, those same CEOs say they won't invest in new jobs or raise wages until consumers start buying again. That's like saying, "The beatings will continue until morale improves." Hello? The consumers whom CEOs are waiting on are the workers whose jobs and wages the CEOs won't increase.
You see, despite the GOP's ideological claptrap about corporate executives being "job creators," it's ordinary Americans who actually create jobs by spending from their paychecks. This is why our obtuse policymakers need to quit pampering the rich and fussing over budgets.
Instead, they should launch a national, FDR-style jobs program that will immediately increase paychecks, perk up consumer spending, and generate grassroots economic growth.
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70 Comments so far
Show AllHenry Ford figured out long ago that a trickle up economy works. He did the unthinkable and raised his workers pay to $5 an hour so they could buy the cars they produced. When all the jobs started leaving this country because of so called Free Trade deals, it should have been obvious what would happen to our economy.
No Money, No Spending.
Small businesses, not megacorporations create the most jobs, especially during the first few years after a crash.
Unfortunately Obama AND the GOP, with the 2009 pseudo stimulus, Obamacare, Dodd-Frank, Bush tax cut extensions, defcit deal, and upcoming regressive legislation put small businesses in a box that will prevent them from creating the jobs needed to create a Main Street economy recovery.
Uh, what about war, war, war, wonderful war.
Why do people fail to mention war when talking about this?
Can't cut taxes while increasing spending on war. It's like taking a lower paying job then celebrating by buying a boat on credit.
Because at heart JT is in love with empire. Just like all of 'em. War and violence is what makes us what we are. Its patriotic and its pathetic.
War? thats just entertaniment for the plebes... So they don't realize the entire fake economy is pumped up by free money they keep shoveling out the back door of the fed!
Turn off or turn down the free money and it all falls flat as a pancake! not to worry though they are back on the gravy train till 2013 at the earliest.
What small businesses? The ones on Main Street that are all boarded up because welfare-for-Wal-Mart drove them out of business? Or the ones zoned out of existence (owner-operator Mom & Pop ventures) by zoning boards trying to create 'bedroom' communities that would appeal to people who wanted McMansions with an uncluttered view? Gee, these are the same people who can't make their mortgage payments anymore - now their lovely view is cluttered by 'for sale' or 'foreclosure' signs...
I've been watching the death of American cities and towns ever since the farmers were driven off their land by 'corporate farming' and 'agri-business' conglomerates. It won't be long before we find out what the 'Great Depression' had over ours - lots of small farms and fewer zoning restrictions. You can't eat grass - and you're not allowed to have any animals that can... real smart planning, I'd say. (And those 'gated communities' for seniors - and those escaping 'riff-raff' - don't allow gardens or even clothes lines, let alone a few chickens...)
Henry Ford was also a literal Nazi, and received a medal from Hitler for his support. Ford was also a heavy-duty anti-Semite, helping publish the rotten "Protocols of the Elders of Zion." The leaders of the corporations of today don't even come up to his high level, preferring simple greed over any ideology, good or bad.
Henry Ford was not only a Hitler worshiper and rabid anti-semite, he broke the workers in their big strike and tear gassed them with his famous goon squad security
thugs. The workers were beaten savagely,gassed,and every possible method to prevent the workers from organizing was employed. I lived through this period and before Unions this was not a rare occurence.
The CIO/AFL and autoworkers were organized, but many heads had been broken and families destroyed by Mr Ford until the workers prevailed and were able to find strength through hangin' together.
I think it was $5/day, but still more than common labor of the day, and in no way is your point diminished.
"The beatings will continue until morale improves." Says it all really - we are screwed especially since many still believe that Oblahblah is gonna stand up for us any day now . . . and they'll reward him with their votes in 2012. Beats me.
And you think we would be better off with mcCain and Palin, may I remind you, bomb, bomb, bomb, bomb Iran! Death to Grandma, the biggest lie of last year, I too am disappointed that Obama hasn't stood up for us more but he is the lesser of the two evils.
At Least with a republican president the dems would fight back against insane rightwing policies - instead we have a democratic president pushing insane rightwing policies and the dems sit on their hands, saying Nothing and going along w/ the very same policies we all spent 8 long years complaining about.
Democratic apologists are either complicit or damn stupid.
Go ahead and vote the teabaggers into the white house, may as well just vote the Koch brothers and The Murdock mafia into office.
constitutional - aka "damnliberal", since I know you use both names - you are SO correct.The Dems are WAY better than the Republicans.
Now why don't you put your money where your mouth is and back that statement up? How, exactly, are the Dems better than the Repubs? Be specific now - no BS, no guessing. Give me some examples. The Dems, recall, had the WH and both houses of Congress for 2 years. And what did they do that was "Better" than the Repubs? Ah yes - expanded our illegal wars, continued the torture regime, didn't close Guantanamo, gave a few $Trillion to Wall Street, didn't restore habeas corpus, declared the President has the right to kill anyone anywhere on the planet without due process, rejected any regulations on Wall Street including the derivatives which helped wreck the economy in 08, refused to create any Jobs Program, gave more tax breaks to the wealthiest 1%, defunded Social Security through the "tax holiday," gave more tax breaks to the most profitable corporations, refused to overturn the Supreme Court's United Citizens' decision through legislation, allowing unlimited, undisclosed spending by corporations to influence elections, increased the war on whistleblowers by over 800% of any previous administration, gave the insurance industry a huge giveaway through the horrifying Obamacare legislation, refused to allow Medicare to negotiate volume pricing with Big Pharma for drugs, increased the military budget every year instead of cutting it....gee, I could go on for pages.
But you're right, constitutional/damnedliberal. Republicans would be SO much worse than if the Democrats controlled the government!
I would only take issue with your suggestion that Congress alone could have unwound the fascistic SCOTUS decision equating throwing cargo containers of cash around with free speech, and their toxic construct that corporations are persons.
The citizens united decision would unfortunately require a constitutional amendment to repair, a notoriously fraught and serpentine process that could take decades to enact.
Are you sure One Marxist? I thought Congress could pass legislation that states that corporations can NOT donate unlimited amounts of cash to candidates, effectively neutering the SCOTUS decision. Balance of powers and all that. I know there are precedents, I just can't think of any right now, darnit. I'll have to look into that....but thanks for raising it.
Are you saying the Democrats would stand up to insane rightwing policies like they did during the Bush years?? They did NOT fight back against anything!!
Same old thinking that got us to this awful place. The lesser of two evils is still evil. An opinion I read recently said we would have been better off with McCain because when the Repubs are in office, the liberal / progressives fight for things they care about like protecting social security and medicare. When our guy Obama gets in we give up that fight and unfortunately, so did he - from day one. Besides, the lesser of two evils, Obama, is really a right wing Repub regardless of what he or we may call him. His total lack of courage/backbone and willingness to give the Repubs everything they want has left us in a very bad place. He has protected the elite interests, continued Bush tax policy, diminished our civil liberities, cut social programs . . . my fingers are getting tierd - aren't you getting tierd of the promises not kept ? We deserve what we get when we give our support to Obama; how many more lies does he have to tell before you and other Obamabots get it ? He has not and never will stand up for the majority of the people who like me were conned by his sweet lies.
If the Repugs take power in 2012, I'll bet the first thing they do is bomb Iran in order to get the focus off the debt so they can resume spend-and-don't-tax. If the Democrats turn the tables and try to cap their debt, then they'll cry, "not in a time of war!!"
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"The beatings will continue until morale improves."
New photo ID is required from any person whose appearance beating has altered.
The USA is a deflated Zombie. A successful program of job creation would reanimate it to a bipedal slouch, just enough to stagger and lurch aimlessly with no goals and dark holes for eyes - - - - as this deflated Zombie Lifeboat takes more trips around the sun, patiently waiting for Supernova Day - the day it won't matter what the level of your wealth or power over others.
Except for the Works Progress Administration ("We Putter Around") where the government hires people directly to do something or other, ordinary people create jobs.
We need ordinary people to become the bosses. That implies a four year curriculum in High School on being the boss, similar to high school training to be a secretary, to be in construction, and college prep.
Right now, we have apprenticeships of the boss's kids. One business owner says that she learned to service the customer at her dad's restaurant from the age of 6, and that all of her 5 brothers and sisters also own businesses today because they learned the skills in their dad's restaurant. The Boss class is quite hereditary, just as the Farmer class is quite hereditary in this country.
Next, we need a solid mentorship program for potential bosses, with technical resources for young bosses. All young bosses need business mentors. Most need legal mentorship, accounting mentorship and engineering mentorship for those bringing out new products to market. Nobody is doing all of this. That's one reason why creative people don't create jobs. The deck is stacked against them.
Next, we need small business-starting contracts from the government to ordinary people, without outrageously stifling regulations. Some people want to strangle "big government" simply because the government strangled them first. The government always, always does its best to strangle the little guy with regulations because the big guy pays off the congresscritters to keep competition down.
The other reason is that nobody but the vultures will fund the little guy. Society loses. Good luck with those permanent oligopolies, citizens.
Good post, although I think you're being pretty naive to expect the schools to train people to be bosses. They are designed to make employees--do what you're told, sit down and shut up types. Read some John Taylor Gatto, or watch one of his many speeches on Youtube. He's researched carefully what the public schools are designed to do and why.
Gatto has many stories about high-school dropouts who somehow retained the capacity to think creatively and believe in themselves, despite years of institutionalized boredom and the usual indignities inflicted on the noncompliant in school, and went on to be highly successful. One of my students offered one of his own, about his two cousins, who at ages 15 and 16 decided to quit school. Their grades were atrocious. So they decided to start a business. They taught themselves how to run one--getting up early every day to go to the library, to find out information from city hall, to talk to people running various businesses, and finally decided a junkyard would work out. Their father, a high-school drop-out himself, quit his factory job to join them. They scraped up enough to put $8000 down on a property in the ghetto, and started out. Somehow these "dumb" kids taught themselves and became millionaires in a few years.
The schools aren't the solution. They're the problem.
"Somehow these "dumb" kids taught themselves and became millionaires in a few years."
I don't know if this is admirable or not. Were the junkyard workers paid a living wage for their dirty and dangerous work? How well did he pay the poor, often-homeless people for their scrap metal and cans versus what they made selling the scrap? How mich of their gains were ill-gotten from buying copper plumbing stolen from people's vacant homes?
And you seem to be implying that the purpose of educaition is to get rich, and that being a millionaire is a sign of intelligence, rather than just a desire to get rich. As a scientist/engineer, I find that the technical skills to run a business are pretty simple. But I'm mot about to sell my soul by being a businessman.
But if they really ran the junkyard as a worker-owned cooperative, where compensation is based only of effort and sacrifice rather than ownership or position in a heirarchy, I stand corrected. But then, they would merely be living comfortably, rather than as millionaires, if they did that.
I expected a reply such as yours, and don’t think it’s invalid. I have no idea how they ran their business, how fair they were to their workers, whether they bought stolen copper, etc. That wasn’t really my point—I certainly don’t think becoming a millionaire is a great vision.
My point is rather my usual one about schooling. The schools tell us how smart and capable we are, but that’s usually a lie. The story I provided tells the lie to the fact that we need schooling to educate ourselves to do whatever we decide to do. In this case, some drop-out kids decided what they wanted to do, and did it. They saw that if they stayed in school it would be nothing but failure, possibly a degree, and then further failure. The possibilities they represent extend far beyond getting rich.
The question is, do we want a bunch of empowered people running around? Do we want kids to understand that they don’t need an authority figure to learn whatever they want to and to tell them the measure of their worth?
If people stay in school even if they don't earn high grades, they still might learn some humanities that would serve themselves and society in the long run. They would be exposed to art and at least hear some ideas, history, and more. The purpose of education is not merely to learn how to be a boss or get rich.
There's plenty of time after schooling to go get rich. I'd rather live in a society where most people are educated, which is really about learning how to educate themselves.
Authority figures and grading are a separate although valid issue. Our society unfortunately measures the worth of people by the size of their wallets. We need to start telling another story about ourselves and what kind of society we want.
"I'd rather live in a society where most people are educated, which is really about learning how to educate themselves."
Exactly my point, donnalou. That's the problem: I don't see most of my students having any idea of how to educate themselves. They've been schooled to believe that education is having a teacher tell you facts, and if they're only opinions, teach them as facts. And if they find a few classes that catch their imagination, they've sat through 20 that have bored them half out of their minds.
Somehow, though, you're stuck on this idea that this schooling must take 12 years. There's no reason to assume that. Findland, consistently ranked with the best schools, does it in 9, with 4 hour schooldays. Try to unstick yourself from a few assumptions.
I think you missed the point of my story, so I'll say it again. The moral of the story is NOT that these boys got rich. It's that they proved to be very capable, educating themselves, and that there was probably little good that would have come of suffering through two or three more years of it, and quite likely much bad.
As for hanging around for some humanities or art, the art teachers do often ignite the students: they did mine. Yet frankly, the rest of it was a waste of time. As for learning some humanities, I can't help but be skeptical, looking at the amount of value my students have nearly always found in that. Pretty much the only students I ever get who have any appreciation of reading took up the habit outside of school.
The problem is, we are doing a really bad job teaching most people to read anything more sophisticated than the local newspaper. There are reasons for that, like whole word recognition, a most devastating means of keeping people stupid.
I'm not saying that this blogger strikes me as a possible Elizabeth H clone or anything, but when I happened to check it out I immediately thought of you:
http://worstprofessorever.com/blog/
As a survivor of the education system, luckly I took to reading almost automaticly, I don't see how the way they were teachng was supposed to help, unfortunatly I don't have such a gift for maths, and barely scrapped by. By the time they got to my sisters time 20yrs later, they were strictly teaching to the test, and education was a dirty word,, replaced by self-esteem! after gradiating UC Davis she can barely spell and won't read except under gun point~ but she likes herself alot :( >^^<
"We need ordinary people to become the bosses. That implies a four year curriculum in High School on being the boss,"
I disagree, we have plenty of people with management degrees but not enough people who have actually done the job. For example, Nurses and Doctors should be leading health care reform not politicians and insurance companies.
>>> CEOs say they won't invest in new jobs or raise wages until consumers start buying again. The consumers whom CEOs are waiting on are the workers whose jobs and wages the CEOs won't increase.
Yep. That's just the way they want it. This isn't happening by accident.
"This isn't happening by accident."
It certainly isn't, wanked. And Hightower, the CEOs and most politicians must be smart enough to know that.
The country is being brought down by design, by both parties in collusion. Is this being done simply to enrich the already rich, and to impoverish the rest, as has been done in exploited undeveloped countries for centuries, or is there something less obvious at play here?
Traditionally, empires have maintained a much higher standard of living at home than in their exploited colonies.
True, but the "home" is in whatever private enclave--the Bitteroot forest in MT, Dubai, etc., while the proles are expendable worldwide.
The non-rich come in three classes: facilitators (politicians and lawyers and accountants);
The working class, which is rapidly becoming the third class: Useless eaters.
People are either a resource to be exploited or a parasite to be eliminated.
Through that lens, our "leaders'" behavior makes perfect sense. The gears are being placed to grind the population down to a billion or so--
Then it isn't an American Empire, is it? FINALLY, someone else recognizes this. Thank you. Next question; what Empire was the USA born fighting?. THAT empire is what has morphed into the global/feudal monstrosity the whole world now faces. THAT empire is just the 3rd re-incarnation of the old Roman Empire, via a Venetian relocation project in the 16th/17th centuries (2nd=Venetian merchant/financiers, 1st= Byzantine/east roman, original=roman empire). And the Roman Republic caught the disease from the ancient Greeks/Macedonians, who caught it from the Persians, who caught it from the Babylonians. This is a VERY old enemy we face. And the lifeblood of this Empire? Money, and its' exclusive control by those intent upon empire-building to capture the REAL wealth; PEOPLE (whom they command via money). What would kill this EMPIRE? Glass-steagall (which says "your money's no good 'round here").
Were pretty good at empire,, not even the British can say the sun never sets on their flag... But we can, with our flag in every nation and the moon, we can truly say the sun never sets on the Stars&Stripes. >^^<
To LookOut: Yaaah! Someone gets it. Global unified currency on the horizon!
While you might be right, doggone, unified currency is not what I had in mind.
If we agree that both parties are working together to bring the country to its knees, would it necessarily follow that both parties have the same motivation for doing so?
Agreed, wanked.
The article says “Our policymakers in Washington have totally lost sight of what's happening at the ranch.”
Oh, bullcrap, Jim Hightower, and I wish you and your cohorts would stop saying so, because it is perhaps one of the most pernicious lies out there. You haven’t noticed that are policymakers in Washington are Wall Street creatures? And they may be crazy, but they’re crazy like a fox. I really don’t think they’ve “lost sight” of anything.
The problem is this magical word “conspiracy,” which most would shudder to think the elites in this country are capable of. So instead we must talk about how Washington is befuddled. One series of mistakes after another, all of which by some coincidence have looted the US citizenry. It just happened that way! Right. Outsourcing was paralleled by all that easy credit, the dot.com and housing bubbles, the lifting of usury laws, etc., etc. All big mistakes. Now it’s time for austerity!
It seems pretty clear that the large corporations, who have easily strangled most small business, don’t need us anymore. Henry Ford needed us, but hey, it’s a global economy with all the growth elsewhere. How well do you think Ford would have paid his workers if he didn’t need them as customers?
This is, indeed, class war. The think tanks have been thinking. They’ve been thinking that it would be more profitable by far to have a crippled economy where workers would lick their shoes for minimum wage, and that that minimum wage is too high. We must do something about that: expect a fight to lower it on the horizon.
Part of the problem with this debate is that we frame the issue, "How can they be so dumb?" We think it should be obvious that raising the burden on the middle class, and giving some wage increase to the poorest would increase spending, profit, and quality of life. How can they not see it? While it's not that they are dumb, but we need to frame it correctly they are EVIL.
Agreed.
I believe that firms with less than 50 employees hire about 50% of all labor in America. And firms with less than 250 employees account for over 75% of all new jobs.
The largest and wealthiest companies are net Job Losers and their business model is Consolidate, Lay off Americans, Outsource to slave labor countries, Lobby for tax breaks, Capture the political process, hide profits offshote, cook the books driving up stock prices, pay out huge bonuses as Long Term Capital Gains and use corporate cash to buy up their own stocks AND use that Capital to buy up their competitors -
Then rinse and repeat until the same 400 people and families OWN EVERYTHING.
Well, yeah. Beats me how shrinking the economy grows it....
Okay everyone one more time. The only thing that creates jobs is demand. Period! If you aren't hungry or not cooking for someone who is you don't jump into the kitchen and prepare a 3 course meal just to have a job to produce something. No demand for a good or service, no work required to provide the good or service, NO JOB! I don't care how much money you have, you are not going to pay someone to filp rocks over so the other side can get sun just to provide someone a job. Anyone who thinks a corporation will create a job that doesn't profit the corporation is drinking some pretty strong kool aid.
OK, Ace...please explain how "demand" is created.
new "fossil" fuels from the mediceased? okay its early ;(
We had eight years of insane republican mass murdering, lies and debt, and your saying we are better off with them? We are recovering but G.W. Dug us so deep that it will take a while, along with the party of no blocking anything that helps. The right is making Obama look bad no matter what it takes, including running our economy completely broke. The bush tax cuts are destroying America and giving the country back to these thieves will just make things worse. Fox news lies, hey republicans where the hell are the jobs you promised!
We are NOT recovering and Obama IS the right. You don't get that, I realize, but look at his actions, not his words. Want more war? Obama and the republicans are just your ticket. Want to see Social Security and Medicare reduced or terminated? Obama and the Republicans are just the ticket. Want to be bled white being forced to pay for useless health insurance? Obama and the republicans!! The man's a right wing wet dream.
Jim Hightower is absolutely right, and I can prove it with a simple set of questions. First let's assume that all of your answers have to use the 80/20 rule.
1. For the past several decades what has been the most important driver of the American economy? 80% consumer spending and 20% other.
2. Which group within America's population does the most consumer spending? 80% middle class and 20% other.
3. When 14 Million jobs left America for overseas, which group within America's population was hurt the most? 80% middle class and 20% other.
4. When stocks lost 45-50% of their value TWICE in the past decade, which group within America's population suffered the most? 80% middle class and 20% other.
5. When the America banking system collapsed and tens of millions of people lost their homes, which group within America's population suffered the most? 80% middle class and 20% other.
6. As we implement massive cuts in Federal spending to satisfy the Tea party and Standard & Poor's, which America's population will be hurt the most? 80% middle class and 20% other.
As the middle class suffers job cuts, decreases in income, and loss of limited wealth, they WILL spend less. America's economy will suffer because it is primarily DEPENDENT on consumer spending.
Either we have to create a new economy that's not based on consumer spending, or we have to get (80% of) the middle class back to work. America's economy will NOT be the engine of global growth unless that happens.
"4. When stocks lost 45-50% of their value TWICE in the past decade, which group within America's population suffered the most? 80% middle class and 20% other."
Your other points may or may not contain varying amounts of veracity. However, on point #4 you are incorrect. 80 to 90 percent of stocks are owned by the top 10%.
The richest 400 Americans own more than 150 million do.
Time to Nationalize these predators wealth - anything less is NOT ENOUGH.
When you're diagnosed with Cancer you don't cut out the healthy tissue and Leave the Cancer.
And the ultra weathy are The CANCER.
The middle class should be on the endangered species list.