Sunday, September 6, 2015
Why We Need A Raise - How Wall Street and Main Street Have Diverged
by Brian T. Lynch, MSW
I've been saying it for years. Bernie Sanders, who is running for President, has apparently been saying it for decades now... American Workers Needs a Raise!
The graphic above speaks louder than words. When I first posted a similar version of this over two years ago a leader in the Occupy Movement said of it... "This is why we occupy!"
The growing gap between the economy on Main Street and Wall Street, a declining standard of living, the shrinking middle class, the rise in the need for government subsidized supplemental income and social services for so many, the sense that our children won't be better off than we are today, all of this has a common origin. They are all connected! They are all the result of wage stagnation (or suppression as I see it.)
In the period of just a few short years, beginning in 1973, employers stopped giving workers productivity raises. Since then, almost all the raises workers have received were merely inflation adjustments, not rewards for their growing productivity. All those rewards suddenly went to those at the top. The effects of this on the economy are compounded over time. Forty years of this nonsense has brought us most of the economic ills we experience today.
The fact that "growing the economy" no longer results in rising worker compensation has been lost on politicians in both political parties. In fact, almost every policy initiative to "grow the economy" has made matters worse. It has often meant slashing taxes for the wealthy (trickle down theory), granting tax breaks for big businesses, and creating tax loopholes for the "job creators" so they can do their thing. Well, their thing is to get substantially wealthier. Almost all new wealth has gone to the top while the wealthy hide more and more of their assets in tax havens. State and local governments can hardly manage to patch up the potholes on our streets because of the combination of tax breaks for businesses and subsidies for the expanding numbers of working poor families.
The Economic Policy Institute has released yet another report on why most of us are not feeling the love from the Wall Street economy. I have take liberties with their findings to condense them a bit so their impact is clearer. For the full report, go to: