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A new commentary every Wednesday   -  July 8, 2015


WHY WE HAVE GOOD REASON TO FEEL UNCOMFORTABLE WITH OUR PERSONAL ECONOMIC SITUATION

     Labor Day, September 7th, might have been a better time to publish this, but a case before the Supreme Court: Friedrichs v. California Teachers Association, caused me to think about the history of labor unions in America.

    I'll begin this by asking if you feel that you deserve a raise today?  Better yet, are you comfortable or uncertain about the prospect of retirement... or if retired, whether you believe that the promise of the Social Security Act, will, in your case, be fulfilled? Will your savings suffice to last you through retirement years, or is it according to that great Native American philosopher Tonto who asked "Quien Sabe" (who knows), Lone Ranger?*  These questions are, I admit, unsettling.

        Doing nothing, hoping for the best or placing your trust in any political party, is going to lead to a disaster, as great, if not greater than the long-feared collision with a gigantic meteorite.

        I admit to a familial bias. I am a union man. My maternal grandfather was a regional organizer for the United Mine Workers of America. My father and seven paternal and maternal uncles, as well as dozens of cousins, were lifelong members of the UMWA.  I once held two union cards: the UMWA and International Union of Theatrical State Employees and Motion Picture Machine Operators of the USA and Canada, affiliated with the AFL-CIO.

    Much of what you read herein, I attribute to a study published in Fortune magazine about Wealth Inequality. It was done by Emmanuel Saez and Gabriel Zueman, economists who dedicated their lives to compiling and analyzing wealth and income data. 

    Their study shows that the gap in the wealth that different households have accumulated is more extreme that at any time since the Great Depression. I've witnessed the swing upward, from 1930 through 1970 (a tipping point), a substantial democratization of wealth. Since then, the gap between the wealthy and the less wealthy has widened, at an ever accelerating pace.  In 2012, the top 0.1 percent of U.S. households, 160,000 families, held assets of more than $20-million each. Looking at it in another way, those 160,000 households own as much of the nation's wealth as the next 145-million families combined.

    The principal reason given by Saez and Zueman for wealth inequality is the stark fact that the changing job market has forced millions of blue-collar workers to attempt to compete with cheap labor abroad. Therefore, wealth inequality has severely affected the task of saving. Stagnant wage growth makes it difficult, if not impossible for lower class wage-earners to save. 

    In the past decade, financial deregulation encouraged predatory lending. More ominous: necessary economic pressures forced universities to increase tuitions, limiting the ability of young people in breaking the poverty cycle. When the poor stay poor, it is bad for business.

    In brief, we are heading toward a economic black hole; a death cycle, if we cannot bring about change. Good old American Free Enterprise is not going to get the job done. As far as I could tell, Saez or Zueman don't have an answer.

    Let me suggest one. Punch up http://www.aflcio.org See how America's Unions brought about necessary changes in the past century; did for the common people what no other organization could. Learn about the AFL-CIO. Get involved. A union is a democratic organization of people who choose to join together to achieve common goals, such as legislative and political action.

    Sure, like any social endeavor, unions have had some bad actors, unfortunate incidents and outright criminals in their histories, but they did make a beneficial difference in the lives of all Americans. As far as I can fathom, active membership in a union is the only available solution for the intractable financial challenges with which we are confronted today. Placing your trust in either political party (or Greece), will only culminate in a not-too-far distant doomsday. 

 -Phil Richardson, Observer of the human condition and storyteller    

*Yes, it actually was "Kimo Sabe, Lone Ranger" - You got me there! 


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