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July 09, 2008

Comments

Will

Good analysis, John. I would go one step further with the corporations. The focus on cost-reduction keeps wages down for the middle class. We have forgotten Henry Ford's lesson of increased salaries fueling expansion.

Your final comment on the effect of the financial world is particularly important, I think. Those at the top play wealth games that have no connection, and no need for connection, to the middle class.

The middle class is superfluous for the power and wealth elite. I'm not sure the middle class is the goose any more. There are artificial eggs elsewhere.

John Robb

Thanks WIll. You are exactly right, corporations did participate in the destruction of labor's bargaining position and replace US workers with illegal immigrants (rather than paying living wages). Henry Ford was a radical. His first car models ran on pure ethanol, which he thought would allow buyers to grow their own fuel.

Based on the numbers, the US MC is still the center of the real global economy. Everything else is derivative or ancillary.

Rob Paterson

Is not the measure of a society's health the size and health of its middle class?

John Robb

t is. However, there isn't a governmental, financial, or business body that is truly focused on that (despite some rhetoric to the contrary). Much of what they do is an anathema to growing the wealth and size of the middle class.

However, that will prove to be the undoing of the system. The health of the middle class is the bedrock assumption upon which the entire US economic, governmental, and financial system is built. That assumption is proving to be invalid.

The current mortgage/credit crisis and the breakdown of BW2 may be the straw that breaks the camel's back --- and introduce us into an era of steady declines in real incomes.

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