Sound advice to the Billionaire’s Club
I’ve noticed several CEOs, political pundits and so-called economic experts saying they’re confused as to why Americans are so down. Consumers should be out buying stuff, they say, for the economy is humming again. Just look at the key indicators: GDP is growing, corporate profits are high, the stock market is soaring, jobs are being created, the unemployment rate is steadily dropping, and people’s disposable income is up. Yet, as the CEO of The Container Store recently grumped, consumers are in “a retail funk.”
That’s so cluelessly wrong, sir. Consumers (unlike you platinum-card members of the CEO Club) are in an income funk, meaning we have very little of the green stuff coming in. The bottom line is that Americans are down, because ... well, because most of us are down. Yearly income for the typical household is $3,300 lower today than in 2007, when Wall Street barons crashed our economy. Or look at what’s happened to the typical American family’s net worth. It was nearly $88,000 10 years ago, but today it’s down to $56,000 – that’s more than a one-third drop, even though we’re told that America is enjoying “a strong recovery.”
And the picture is not getting any brighter, because a new normal has been imposed on America’s workforce. Senor CEO has been gleefully slashing both jobs and pay, reducing the future of work to a low-wage, no-benefits, part-time, grind. One more number for you: 48. That’s the percentage of adults who now hold full-time jobs – leaving more than half of us trying to make ends meet on part-time work.
The lesson for the Powers That Be is that there is no species called “consumers.” Rather, that creature is just a worker with a decent-paying job. Eliminate the job or shrivel the pay and – Poof! – consumerism goes away.
Here’s an uberrich guy who actually gets that. What’s even better is he’s talking about it and saying something worth hearing – especially since he’s directing it at his fellow one-percent-of-the-one-percenters.
Nick Hanauer has made billions as an Internet entrepreneur, yet his head has not bloated like a blimp fueled by his own ego. “The true job creators,” he recently wrote in an open letter to other uberrichies, “are middle-class consumers, not rich businesspeople like us.” Indeed, he adds, “The middle class creates us rich people,” for their purchases power the economy. “I earn about 1,000 times the median American annually, but I don’t buy thousands of times more stuff,” he said, noting that his family has three cars – not 3,000. So rather than holding down the poor and knocking down middle-income families, Hanauer says it’s in the self-interest of America’s corporate and financial elites to do all they can to lift wages – starting with a $15-an-hour minimum wage.
Yet, we’re told that paying workers more will destroy small businesses and job growth. No, he argues, it’ll only destroy the insidious myth that helping the rich get richer is good for the economy, but helping the poor get richer is bad for it. Hanauer points out that “The two cities in the nation with the highest rate of job growth by small businesses are San Francisco and Seattle” – which also happen to have the highest minimum wage in the country.
One final point: For the ideological Koch-headed billionaires who see the minimum wage as “Big Govmint In Action,” this member of the Billionaire’s Club says that the soundest way to shrink government is to decrease the need for it by paying decent wages so people don’t need food stamps, rent assistance and other subsidies for life’s basics.
Hanauer concludes with this sobering warning to obtuse, narcissistic billionaires: No society can survive the glaring inequities you are building into the American economy – stop your feudal economic policies and bridge the widening divide, or “the pitch forks are going to come for us.”
Jim Hightower is national radio commentator, columnist and author.