The belief of those who should know better is that the American economy is humming right along. This Kafkaesque piece of fiction demonstrates the widespread confusion concerning the economy and the gross domestic product (GDP). To be clear, the GDP consists of the value of all the goods and services produced annually in America. That has nothing to do with scoring the economy. It is merely the size of the pie.

The economy, on the other hand, is evaluated not by size, but by price stability, low inflation and the equitable distribution of all goods and services among the people of the nation. By that last measure, the America economy fails because of the enormous inequity of both income and wealth which has been allowed to accrue. Last September the Census Bureau reported 39.7 million people were poor in 2017, while 95 million lived desperately close to poverty. That is a total of 135 million who live in constant deprivation — almost half of the nation. During the past 30 years, the top one percent have gained about $20 trillion in wealth while the bottom half has lost a trillion. In spite of a big GDP, Americans are poor.

The current euphoria over our chimeric GDP growth is a sugar high based on the pure sucrose of debt instead of the protein of productivity. The deleterious tax cuts were funded by nearly $2 trillion of debt while the ill-conceived tariffs savage broad swaths of the economy. The growth in GDP has thus occurred in spite of this administration's policies and is mostly due to the Fed's questionable handling of the interest rate. What is more, the stomach-churning levels of debt among American corporations is an even greater sugar high added to the mix.

In addition, consumer debt totaled $3.898 trillion in 2018, a 7.6% increase over 2017. Our household wealth is the worst in the OECD, while household debt is over 109% of income and our savings rate is a scant 6.9%. Credit card debt is now at an all-time high of one $trillion, the same as student loans. Moreover, our permanent war economy wastes trillions on unproductive spending which could go to productive areas such as infrastructure, education and health care. Now the Fed intends to cut interest rates even further and add copious more tons of sugar.

America is a nation of three year-olds let loose in a candy store and sickening ourselves with the sugar addiction which is now the norm. The withdrawal is going to be very painful.

Ron Zimmerman,

Scottsdale

(19) comments

johndoe

One sentence into this letter and I could smell the stench of Comrade Zimm. I'm sorry Ron but just because someone else is rich doesn't mean they must share with the poor just because they were too lazy to better themselves. That is the socialist ideal that "Boo Hoo, he has too much and needs to share, but I don't want to work for it." Those of us who have worked to have the wealth we have should not be made to feel guilty for our success just because there are poor people still in the world. I worked hard to be where I am and last time I checked, every American has the same opportunity to do the same. Preach your socialist/communist tripe somewhere else comrade, We aren't buying it here.

2rusty

Well said, johndoe!

Russ_in_WML

[thumbup]

ronzim

Nowhere is Economic ignorance more eloquently on display then in the erroneous claims of American Socialism by those who dislike government and taxes. History, however, shows us that Socialism has failed in nations such as Russia, China, Cuba and North Korea while Capitalism has failed, according to the Heritage Foundation, The Allianz report and the World Index, in such nations as the U.S.A., U.K, Indonesia, Austria and Germany. In neither case did the models result in an equitable distribution of income/wealth(an outcome, not an economic system). The Scandinavian model of economics, however, successfully blends these two models into highly efficient and effective economies. The Capitalist nations of Norway, Finland, and Switzerland are three of the top four most prosperous nations, according to the 2016 Legatum Prosperity Index. All three are near the top of the global development lists when it comes to innovation and competitiveness, and have some of the best GINI coefficients as well. This Nordic model demonstrates the high degree of success of Welfare Capitalism. In the U.S. virtually all production is by privately owned businesses(Capitalism). There is a problem though. The free market, low-tax approach results in massive, debt-funded concentrations of income/wealth in the hands of an ever-decreasing minority and severe constraints on opportunities for upward social mobility. Public programs such as Social Security, Medicare, Medicaid, WIC, SNAP, EITC and TANF provide poverty abatement and are neither Socialism nor Capitalism because, of course, they are not economic systems. Neither Capitalism nor Socialism is determined by who pays the bills, but by who owns the means of producing goods and services.

Johnny D

You put too much faith into Government. You trust bureaucrats, I trust individuals to make choices for themselves in a free market system which we are holding on to by our fingernails. The Scandinavian countries you cited are Capitalist with a massive welfare system. You can't have Socialism without Capitalism. Even Lenin understood this. He coined the term "Democratic Socialism" ( an oxymoron) to soften the concept of Government control of everything. The average home size in Finland or Sweden is 900 Sq ft. An automobile is twice the cost it is here. They're small homogenous societies mostly white. I don't trust any bureaucrat who gets a fat paycheck every month, who doesn't have to live by the laws that they pass for the rest of us to know what's good for me. You also cited poverty in this country. In this country the poor are well off compared to the rest of the world. I've also been around the world and I've seen real poverty. The poor in this country are in the top 1% in living standards compared to the standard in the rest of the planet. Why do you think people are clamoring to get here legal or illegal?

Russ_in_WML

Thank God for Trump

2rusty

You too, Russ, well said!

ArizAl

Good letter Ron [thumbup][thumbup] Unfortunately is went over republican johndoe's head. Certaintly he is not able to comprend the fact that there is no socialism in the United States,we have a social society. There IS a big difference somehow republicans don't have the mental capacity to figure that out. The closest anything comes to socialism in our country would be our military sevices and our veterans healthcare system, which both by the way, were established by our forefathers almost immediately after they established our social/constitutional government for "We the People." Another disturbing fact is that johndoe and republican extremists are not cognitive when it comes to how our capitalist economy works..... it produces wealth and it also produces poverty. Recessions and depressions are the examples of capitalism producing poverty for millions of americans and untold wealth for the Fascists that caused the recessions/depression. That is Fascism, the rich controlling our government to make laws enabling them to get even more wealth. In addition, we should note that johndoe is currently enjoying the hundreds of government services which ..uhmmm are also paid for by the taxes paid by same poor american people that he looks down upon.

johndoe

Oh Al you crack me up, I am not a Republican but a registered moderate. Republicans tend to have this annoying belief in some magic man in the sky who does not exist. I also know that we are not a socialist country, not yet. If AOC and Bernie have their way we will be shortly. And yes I do enjoy to look down upon those who have helped me gain my wealth, if they are too lazy to come join me then they deserve what they have. I have not taken anything but instead earned every penny. A concept the Democrats seem to have forgotten.

ArizAl

Johndoe, I hate to be the one to tell you that a "registered moderate" is not a political party and as such, has never been put on any ballot as a political party. Of course, I do understand that you would not want to be associated with and are ashamed of the current immoral,unethical and unpatriotic republican party. I don't blame you. Question for you Mr. "registered moderate," johndoe: If Bernie or AOC want the American people to have a national healthcare insurance where every american is covered much the same as it is in Canada, France, England, Sweden, Great Britain,Denmark, New Zeland, Germany, Australia,Ireland,Italy, Greece, Spain, South Korea, Isreal,Japan,Portugal, Iceland,Austria, Netherlands, Finland, and many more, is that socialism? Are those nations all socialists, then why they do have free enterprise, capitalism, free trade? Think about that johndoe. Whooops! Again johndoe, you have demonstrated an uncanny republican ignorance of what is the metrics used to determine wealth inequality on a national scale. It certainly isn't calculated on your personal life, johndoe. Moreover, just as you say you enjoy looking down upon those american people who are less fortunate than you and calling them lazy without knowing their circumstances, so too others that are wealthier than you would be justified in looking down on you and calling you lazy for not achieving the same amount of wealth they have achieved. Unfortunately, johndoe you have fallen victim to the republican Fascist, "Trickle Down Theory" of making the rich even more rich so that they can control our government and blame the poor american families for being poor. That shows a complete republican ignorance of economics, government and sociology. No wonder republicans can't govern for the good of the American people, they believe in Fascism.

ronzim

Al: Yes, of course. It is one of the most cherished myths of the prosperous class that the poor languish in poverty due to their indolence and lack of industry. That is the dead-hand of prevarication and a terrible fiction which justify selfishness and a false sense of superiority and accomplishment among the well-off. It is part of our unfortunate history and will be our ignoble legacy. In pre-colonial England, the hereditary aristocracy ruled, along with the wealthy merchant class. The masses of poor were reviled in the extreme and their poverty was wrongly ascribed to their own chosen idleness. They were loathed as lazy, diseased, ignorant scum who constituted a constant drag on proper society. The most common term for the poor was "human waste". Overcrowded England was at great pains to dispose of this human waste except for prisons, workhouses, navy press gangs and indentured servitude. Then, the New World opened up and presented the opportunity to ship England's human waste to America where the English aristocrats and investors could gain massive tracts of land and use the waste people to cultivate it and increase aristocratic wealth. Very quickly, black slaves were added to the population of white slaves and the wealth flowed as planned. The caste system was reinforced. We thus have a long-entrenched practice of inhumanity toward the poor, based on the lies about their laziness and lack of effort. This myth is accompanied by another lie which is the presumption of opportunities for the poor to bootstrap their way up, as a small percentage of Americans have actually done. This "America! Land of opportunity" fantasy blithely ignores the real-world plight of those growing up in a rigid class system of caste where a nearly insurmountable succession of barriers to upward mobility confronts all poor people. Barriers such as parental poverty, poorly policed neighborhoods, domestic violence, racism, ethnic bigotry, failing schools, discrimination in housing, jobs, finance and health care all combine to ensure that almost no poor child rises in society. Che has eloquently noted the societal determination to perpetuate ignorance and poverty to ensure that a large supply of workers are always vying in the marketplace for the minimum wage work available to the poor. “Overcoming poverty is not a gesture of charity. It is the protection of a fundamental human right, the right to dignity and a decent life.” — Nelson Mandela

johndoe

So Al I guess we should all think like Obama and say to people who worked hard to build what they have that "You didn't build that!" I am a registered independent for the record but prefer to call myself a moderate. Simply because I disagree with ideas from both sides, but the left people like you are by far the worst, you love to point fingers, call people names yet offer no solutions. You repeat whatever sound bite you hear from the TV ad nauseam like a deranged parrot and act like you are so high and mighty. You call anyone who disagrees with you a racist, xenophobe, fascist, or whatever buzz word the left media is telling you to use. You act as though you can do no wrong and revel in the smell of your own flatulence. Sorry to inform you but people like Bernie and AOC will never become president because thankfully most of America knows that nothing is free and socialism has never worked anywhere.

ArizAl

Johndoe, again and again, you continue to display an ignorance that knows no end. The quote,"you didn't build this alone,"you refer to was by Hillary Clinton, Elizabeth Warren and President Obama. It is my and everybody's taxes that enable you to travel to work; to sell your services or mechandise through the public roads; the public rails; have police, fire and legal protections. because of everybody's taxes you and your business are able to have the use of public utilities, because of everybody's taxes, you are being protected from being stripped of your freedom and your liberties by authoritarian governments thanks to our nation's military that is funded by all our taxes. Comprende amigo, you didn't build this country with all it's infrastructure and services alone, the collective of all americans did. Nothing is free is correct, we all paid for it. Our forefathers founded a social society not an anarchy. Johndoe because you display a lack of cognition, and a misinformed redundancy, I have to let you know that a "social society" is not the same as "socialism". Look it up! Don't be a dolt.

ronzim

For Al, the crowd cheers. Three biscuits for unraveling johndoe's ill-informed little skein and exposing both his failed grasp of Economics and his illogical argument. I refer specifically to "I also know that we are not a socialist country, not yet. If AOC and Bernie have their way we will be shortly." Any middle-schooler would see through this in an instant. To begin with, neither AOC nor Bernie have proposed that the means of producing goods and services in America should be seized by government. If there is any such proposal, then I ask johndoe to place any such declaration in quotes and cite the source. No? Thought not. Now to the illogical argument: Note that johndoe has agreed that * * * "we are not a socialist country" * * * . He acknowledges that in the face of Medicare, Medicaid, SNAP, TANF, WIC, rent subsidies, environmental regulation, the FLSA, Social Security, progressive taxation, the EITC and so on. Note also that AOC, Bernie, Warren and the rest are proposing only the expansion of those same programs. If Medicare does not now constitute Socialism, then how does the expansion of that same Medicare to cover more people do so? If tuition-free public schooling(now through grade 12) does not constitute Socialism, then how does the expansion of that to a four year college education do so? If food stamps do not now constitute Socialism, then how does the expansion of that to include more people do so? If progressive taxation does not now constitute Socialism, then how does an increase(to far less than prior top levels) do so? If environmental protections do not now constitute Socialism, then how does restoring them to an effective level do so? This fictional, looming threat of Socialism is a stinky little canard made up out of whole cloth for purely propaganda purposes. It deserves no consideration.

che guevara

Franz Kafka's famous story, The Metamorphosis , centers around a young man who is a low - level civil servant , who upon awaking one morning believes that overnight in his sleep he metamorphosed into a cockroach . Resting on his back and unable to move from the hard shell and exit his bed , he attempts to come to terms with his helpless state as a human caught in the mechanizations of society . So yes indeed Ron , Kafkaesque is a quite fitting term for what American society has morphed into - on all fronts . When one considers that the bottom half of Americans , 50 % of our fellow citizens , have a negative net worth we should all be very concerned as to exactly where the ship of state is headed . Further , more than half of Americans earn less than $30K per year , and more than half haven't sufficient enough resources to cover an emergency costing over about $400 bucks . Add to this horrific mix the looming retirement crisis that is now on the horizon , the staggering student loan debt crisis which can no longer be ignored , the obscene levels of consumer debt and the continued losses of jobs from outsourcing , automation , robotics and artificial intelligence . It doesn't take an economist to realize that the totality of this forsaking of the working class has turned America into a large coast - to - coast debtor's prison where the chains are no longer forged out of iron , but rather made of paper and arrive in the mail each and every month . It should be painfully obvious that our entire societal fabric is being torn to shreds before our very eyes . But , much in the same fashion as the farmer cares not what his livestock must endure , so the ruling / political class cares not what the human livestock must endure . As regards the economic " sugar high " you so correctly mentioned Ron , I might suggest that this has actually been in play for some 70 or so years . The Bretton Woods Conference in 1945 open the door to the candy store for the American economic engine by way of enthroning the US Petrodollar as the world's reserve currency . This is what metamorphosed America from being the world's biggest creditor nation into being the world's biggest debtor nation - how Kafkaesque ! . However , as with all binges and rampages there must come a time to pay the proverbial piper . We may well have arrived . This I believe has been evidenced by America's brutal attempts to keep the US Petrodollar alive as the world's reserve currency , and is the ONLY reason why we have been provoking wars around the globe ever since 1945 . The Cold War was a necessary part in this Greek - styled American Tragedy , and is about to become an even Colder War , albeit off script this time around . Systemic inequality , propagated poverty and loss of hope and dignity are indeed the fertile soil from which the Grapes of Wrath are to be sown .

ronzim

Johnny D: Thanks for the comments and a good question. To begin with, nowhere in my letter or subsequent comments have I even mentioned any bureaucrats, nor have I evinced any particular faith in them. On the contrary, it is the failure of those very bureaucrats to legislate effectively, on behalf of the American people, which I condemn. Power must always be viewed with a critical eye, and we must ever be skeptical of the activities of those who wield it in our names. The only conclusion which can be drawn from our present multi-crisis domain is that we, the electorate, have failed in our selections of elected public officials by empowering those who refuse to serve the American people instead of the rich, and the powerful corporations. Second, it follows, then, that I abhor the idea of government control of everything. I too value the judgment of, and will fight for the right of individual citizens to make their own choices. I recoil vehemently from government control of a woman's right to choose; of any citizen's right to decide what he will put into his own body; and of voting rights; as examples. I do not, however, view the use of taxes to enhance the health care, education and prosperity of poor Americans as valid examples of the government being in control of "everything". Third, "The average home size in Finland or Sweden is 900 Sq ft. An automobile is twice the cost it is here. They're small homogenous societies mostly white." These are all off-topic distracters and not relevant to the content of my letter which you have not refuted. Their home size is truly more responsible than our energy soaking big homes(mine included). By the way, the USA does not have any class of vehicles which are the cheapest in the world. For SUV's it's Russia; for large family cars it's Greece; for the city car it's India. According to blogspot.com, Sweden is one of the most diverse nations in Europe. Overall, 15.4% of Sweden's total population was born in a different country. 20% of the Swedish population is foreign-born or Swedish-born to foreign-born parents; in some neighborhoods, over 80% of the population is foreign-born or Swedish-born to foreign-born parents. Compare these numbers to those of the United States--the land of immigrants, and a "hugely diverse" nation: just 12.9% of the population is foreign born from any country of origin. Moreover, the contribution of homogeneity to socio-economic and cultural success is trivial, at best. As for the " * * * mostly white" comment, that is racist because it implies that people of colour are a drag on society. "I've also been around the world and I've seen real poverty. The poor in this country are in the top 1% in living standards compared to the standard in the rest of the planet. Why do you think people are clamoring to get here legal or illegal?" This is another piece of internet ignorance which has no relevance to any discussion of U.S. poverty. Comparing all American poverty to the ABJECT poverty prevailing in other places is capricious at best. Please cite the source for your 1% claim. Finally, the reasons people are clamoring to get here are highly diverse and have changed dramatically in the past decade. Those seeking entry at our southern border have changed from mostly single men seeking employment to mostly families fleeing from conditions of murder, torture and rape in their home countries.

Russ_in_WML

Libtards really hate it when America is doing well

RetAF

By definition an 'economy' is judged by it's broadest sense. if 19 billionaires are making money but the lower 1% aren't... The economy is still doing well but the poor are not. Two different things.

ronzim

RetAF: By whose "definition" would that be? I know of no definition which equates the quality of the economy with the fortune building of billionaires. It is my opinion that if billionaires exist, the economy has failed. "Economics: 1. the branch of knowledge concerned with the production, consumption, and transfer of wealth. 2. the condition of a region or group as regards material prosperity." Moreover, it is the bottom half of the nation who are living in deprivation, not one percent. We are all in the same economy. Any economy which permits three persons to have more wealth than the bottom 150 million is way out of kilter and cannot persist, indeed, must not be tolerated.

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