08/09/2004: It seems pretty simple to me....
The Century Foundation, in a recent study, addressed the problem of outstanding debt. For many families borrowing has morphed from a tool that, used judiciously, can enhance their standard of living into a nightmare that threatens to destroy their economic viability.She then comments:
"Debt burdens," the study said, "are at record levels because families have been stretched to the limit in recent years. With more income going to housing and other rising expenses related to medical care, education, vehicles, child care, and so forth, families are relying on credit as a way to meet everyday needs. Remarkably, a family with two earners today actually has less discretionary income, after fixed costs like medical insurance and mortgage payments are accounted for, than did a family with only one breadwinner in the 1970's."
Bush tax and financial policies favor wealth over work, increasing the pressure on working households, privileging the employer above the worker. Since 2/3 of the economic "growth" in this cycle has been consumer spending, as the consumer runs out of cash, the "growth" runs out of gas.A while ago, at one of the Memphis blogger bashes, one of our "red bloggers" was crowing that the economy was rebounding, saying that there were more jobs. I expressed some concern that while there might be more jobs, they weren't paying near as much as the old ones that were lost. My acquaintance's reply? "So what?"
Of course, he's a business owner; I assume lower wages are good for him. But what happens to the economy when nobody can afford to buy things? Does anyone seem to care anymore?
Len on 08.09.04 @ 12:26 PM CST