The "Well, Duh" Economy

My daughter taught me "well, duh" many years ago.  It seems to mean, "well, moron, so what did you expect?  Causes have effects and thousands of years of human history keep saying the same thing." 

OK, we are in serious economic trouble.  Most of us are wondering when we'll get out of trouble and return to prosperity.  But it's like the man with a 2-ton weight attached to his neck and his legs being dropped off an ocean-liner mid-ocean, wondering when he'll start to bob up toward the surface again.

Why, you ask, do I seem to suggest that the economy is like a dead weight pulling us down with no end in sight?

One of the greatest successes of the Reagan years was the replacement of Sherman Anti-Trust actions by Mergers & Acquisitions.  Along with the rise of high-tech productivity in business, it fueled the boom of the 90's.  Now it is the dead-weight of the present and the future.  Why?  Stay with me, this is simple, and profound.

Increased worker-productivity combined with corporate mergers and the inevitable down-sizing made for increased net earnings.  Get it?  Read this again until you're sure you have it.  OK, that's step #1.  Step #2 is what happens when mergers and downsizing become the universally accepted way of increasing corporate net earnings.  Ready, dude?   Increased unemployment, fewer available jobs, more small-business startups, more small business bankruptcies, increased personal debt, and reduced demand for goods and services.

What's good short-term may not be good long-term.

What's good for one may not be good for all.

Why has the economy been sinking and why is there no reason to suggest a turn-around?  Because the simple cycle I have just suggested is a cycle that goes in one direction only.  More layoffs cause more unemployment cause reduced demand cause more layoffs.

What can stop the slide?

There's always War.  And prison.

Or seeing that there's a problem, it's people being made jobless and homeless and nothing in place to address the problem.  What am I suggesting we should do?

First, recognize that there is a problem.  Second, stop rewarding and begin to punish corporations for adding to the problem.  One idea: make unemployment insurance indefinite in duration, make it 60% to 75% of its base, and make the downsizing corporation responsible for 100% of its layoffs.  The benefits of technology were not intended to benefit business owners at the expense of its workers.

We're either in this together, or we're not.  Choose!

Back