ECONOMIC ANALYSIS FROM THE LOWER MIDDLE CLASS

I was reading an article about poverty in America and was startled to discover that my wife and I were precariously close to the bottom end of the lower middle class. In other words we were just one or two percentage points above poor. So from that humble position I decided I should do an analysis of the state of the economy. Please note that this analysis will be based on nothing more than personal observations, unsubstantiated data and non-objective opinion. I know the election season is over but I decided to borrow the methodology of politicians anyway. And all of my opinions and observations will be couched in the language of political correctness so that no one is ever offended by statements that might be true.

First of all I need to justify my claim to the lower middle, almost poor class. Since I retired a year and a half ago we have had only the income from my wife’s job. So I am a senior citizen earning less than a dollar a year. My wife’s income is modest and barely covers our basic cost of living. Do you feel sorry for us yet? How about if I tell you that we have been unable to take a European vacation or visit a health spa? Well that’s true and we also haven’t been able to go to Disney World. In order to pay for our cell phones we had to cancel our cable service. We pretty much stay home and read library books by candle light to keep the electric bill down. So there you have it, near poverty personified.

Now I’ll look at the economic picture from this lowly perspective. The way I see it there are three big parts to the American economy. There is the economy of everyday people which involves people working and earning money, buying things they need and don’t need and trying to improve their position financially. This part of the economy is struggling and maybe doing a little adjusting to cover higher prices and lower or stagnant incomes. It isn’t in deep trouble except for the folks who got into stupid house buying deals without thinking about the possible consequences. So stupidity is contributing to economic hardship. There’s nothing much new about that. The second part of the economy is that big paper one we label as Wall Street. It’s true that a lot of the money that is the underpinning for what happens on Wall Street comes from the people who are in the first part of the economy. But they won’t really be affected by what happens until some day in the future when they need to stop work. The Wall Street economy is extremely cyclical and driven by real business, rumor and innuendo and government reports and pressures. Basically we can’t be bothered with Wall Street until the government raises our taxes to cover the cost of screw-ups and cover-your-ass moves that politicians and political bribers make. That day will come, sooner than you think, but we in the first part of the economy will adjust and figure out how to get by.

That is unless we happen to be a part of that first part of the economy that has come to depend on the care and nurturing provided by the third part of the American economy, the government in all its forms and permutations. The people who depend on the government too much will probably not make it because the government is the part of the economy that is really in trouble. The government takes in money and spends more than it takes in. This happens in pretty much all American governmental bodies from local to national. Common sense should dictate that eventually spending what isn’t there will lead to collapse. Unfortunately politicians don’t seem to grasp that little bit of logic. Politicians feel that if things get too bad then they, acting as the government, can expand the money supply and make things go on. But it’s all paper. Sooner or later the paper becomes valueless. We’re pretty close to that right now.

If the whole governmental economy falls apart then a lot of folks will not survive, literally. Those of us who don’t depend on the government will have to be wary and may actually have to physically defend our lives and property. And we will because we have the strength of character and sense of responsibility that will be needed in those times. And if we’re believers in Constitutional rights we have a few guns stashed somewhere. There is the conspiracy minded viewpoint lurking in the back of some minds that the government and its dependents will organize to take the resources of non-dependent people. In other words there would be an economically driven civil war. But only a few nut cases could possibly believe that, right?

So what’s the point here, other than a cynical, sarcastic and simplistic look at economics? I see people who are poor all around. They don’t appear to be starving although they may not be getting proper nutrition. Those folks are possibly making poor choices out of ignorance or apathy. Plenty of those poor folks smoke, drink and use drugs. The hidden few that may actually be living in hunger are probably the victims of the drug using community, and they deserve our help and compassion. Huge efforts are made towards educating and aiding the poor in our country. Billions of dollars are thrown at the problems every year and there is little progress in evidence. Some poor folks just can’t seem to grasp the fact that there is life beyond the government handout. I just saw an article that gave the cities where the most job opportunities existed and the job categories where work is available. It seems that New York City, San Francisco, Oakland, Los Angeles and Atlanta have lots of jobs available especially in the service and retail sectors. It’s interesting that those cities also have extremely high public assistance and unemployment rolls. Oh well, I’m sure by now you get my point. You probably got my point before I did. And my point is probably moot in light of the recent election. Change is in the air. Poor folks will get jobs. The rich will handle the tax bill. Government will rein in those greedy corporate capitalists. Energy will come from just about every alternative source imaginable. There will be war no more. And we’ll all just get along together fine. Believe it and it will be so.

Have a fine day.