A Lie That Serves the Rich — the truth about the American economy


By Paul Craig Roberts, John Titus, and Dave Kranzler

Source: PaulCraigRoberts.org

The labor force participation rate has declined from 66.5% in 2007 prior to the last downturn to 62.7% today. This decline in the participation rate is difficult to reconcile with the alleged economic recovery that began in June 2009 and supposedly continues today. Normally a recovery from recession results in a rise in the labor force participation rate.

The Obama regime, economists, and the financial presstitutes have explained this decline in the participation rate as the result of retirements by the baby boomers, those 55 and older. In this five to six minute video, John Titus shows that in actual fact the government’s own employment data show that baby boomers have been entering the work force at record rates and are responsible for raising the labor force participation rate above where it would otherwise be. http://www.tubechop.com/watch/3544087

It is not retirees who are pushing down the participation rate, but those in the 16-19 age group whose participation rate has fallen by 10.4%, those in the 22-14 age group whose participation rate has fallen by 5.4%, and those in the 24-54 age group whose participation rate is down 2.5%.

The offshoring of US manufacturing and tradable professional service jobs has resulted in an economy that can only create new jobs in lowly paid, increasingly part-time nontradable domestic service jobs, such as waitresses, bartenders, retail clerks, and ambulatory health care workers. These are not jobs that can support an independent existence. However, these jobs can supplement retirement incomes that have been hurt by many years of the Federal Reserve’s policy of zero or negative interest rates. Those who were counting on interest earnings on their savings to supplement their retirement and Social Security incomes have reentered the labor force in order to fill the gaps in their budgets created by the Fed’s policy. Unlike the young who lack savings and retirement incomes, the baby boomers’ economic lives are not totally dependent on the lowly-paid, part-time, no-benefits domestic service jobs.

Lies are told in order to make the system look acceptable so that the status quo can be continued. Offshoring America’s jobs benefits the wealthy. The lower labor costs raise corporate profits, and shareholders’ capital gains and performance bonuses of corporate executives rise with the profits. The wealthy are benefitting from the fact that the US economy no longer can create enough livable jobs to keep up with the growth in the working age population.

The clear hard fact is that the US economy is being run for the sole benefit of a few rich people.

This entry was posted in culture, Economics, Financial Crisis, History, Labor, propaganda, Recession, Science, Social Control, society, Work and tagged , , , , , , , , , . Bookmark the permalink.

5 Responses to A Lie That Serves the Rich — the truth about the American economy

  1. Nolan says:

    Of course Obama has to lie, because the truth is something no one wants to hear. The truth is we(liberals) chased good paying manufacturing out of this country by enacting laws that have had a very chilling effect on hiring. Employers can be sued for rightfully terminating employees. They have to pay unemployment for a year for employees that no longer work and produce for them. Add the high taxes, industry regulations, etc., what businessman in their right mind would take on the risky liability of hiring someone in this country? Who here reading this blog even owns a business? and of those, who has hired a single person for a “living wage”? I haven’t, so I cannot fault those who don’t either, that would be hypocritical. Easy to point fingers, but we really should look in the mirror first.

    • Self described “liberals” and “conservatives” in government have both played a part in the destruction of the economy. One can argue whether corporations outsource because of labor policies, taxes, regulations (and the lack thereof), etc, but the bottom line is that they do it for their bottom line, and corrupt politicians will continue to protect such profitable policies of corporate cronies at the expense of the solvency of average citizens.

      • Nolan says:

        What “profitable policies” are you referring to specifically?

        I 100% agree with you that corporations outsource jobs for their bottom line, that the only reason corporations exist, to create a profit. I think what we really should consider is how corporations can make products overseas, pay for transportation of their goods to docks in said foreign countries, pay those dock workers, pay for the cranes on those docks, ship it thousands of miles overseas, all the while paying for fuel, ships crew and the ship itself, dock workers and cranes on our side, and still get it to store shelves cheaper than making it at home. Continuing the narrative that corporations are just greedy does not solve this. Continuing the narrative that corporations are exploiting foreign workers does not solve this. To me, Americans need to take an honest look at themselves. We expect 14 holidays a year, 2 more weeks of vacation time, sick days, maternity leave, paternity leave, all paid. In addition to unemployment benefits, workmans comp, etc. On top of that, companies need liability insurance for their workers, risk getting sued by their employees, etc. In addition to of all that, let’s be totally honest, when you finally get an American worker to actually work, we just move slower than their Asian counterparts. That’s where this whole”foreign factories are sweatshops” mentality comes from. Indeed, they are expected to and do move quicker than Americans. Its no wonder any logical manufacturing businessman opts for foreign labor. I don’t believe its a conspiracy between politicians and business. I would argue that Americans workers simply have demanded too much, and actually got what they wanted from their politicians, making us uncompetitive. Business doesn’t care at all whether products are made here or offshore, they just want it cheap as possible. Business(“conservatives”?) did not put these additional costs on themselves(why would they?), workers(“liberals”?) did, that’s a fact.

        • I would argue that (some) corporations are greedy is not a “narrative” but reality. If governments can be greedy and power hungry, so can the corporations which pay them off. And some foreign factories are indeed sweatshops which should not be allowed in America or anywhere else. Does anyone but greedy politicians and corporate CEOs really want working conditions in the US to be more like Bangladesh?.

          • Nolan says:

            Ah, now that I thought about it, yes, “conservatives”/republicans have extracted massive resources from our economy to fight useless wars, built unnecessary prisons for drug offenders.They have indeed contributed to the destruction of our economy.

            I honestly don’t know the conditions inside Bangladeshi factories. Are their workers there voluntarily, or forced to work at gunpoint? If the former, I have little problem with the conditions there, if its the latter, then I agree, ban their products. I have a question though, are those Bangladeshi workers better off with their crappy pay and lousy working conditions or with no job at all? I would argue the former. Btw, even US made luxury brand clothes is made by exploited workers in Saipan(definitely an under reported story).

            Anyways, back to the point of the article, unemployment due to off shoring. Maybe we don’t need to reclaim the low paying textile industry, but perhaps we could give up a few of our benefits(a few days of the over 1 month of paid days off every year, for example?), to make us competitive again in heavy industry like mining, steel and auto. Just like the Bangladeshi’s, US workers are better off with less pay and benefits than no job at all. The politicians and CEO’s will get even richer regardless of what country gets the work, so I say let it be ours.

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