Thursday, April 29, 2004
HOW'S YOUR ECONOMY?
Umm.. not so good.
"Henry Ford fathered the notion that workers should at least earn a wage high enough to enable them to buy the products they build. Ford's industrialist contemporaries thought he was nuts to pay workers more than the prevailing wage. History, however, proved Ford a visionary whose egalitarian notion spurred the most vibrant, self-sustaining economy in history. The current trend of driving wages down reverses that logic, threatening to reverse the result as well.
While American consumers currently benefit from lower prices by feeding on foreign-produced goods, it is a short-term benefit. Over time, more well paying U.S. jobs will be lost and replaced by lower-paying jobs. Eventually American workers will be less and less able to fuel the product-consumption continuum that has been the engine of the American economy for the past 60 years.
And then begins the death spiral. Fewer companies will be paying U.S. taxes. Those still domiciled in the U.S. will have lower profits, resulting in less tax revenue. American workers will be paying less in withholding taxes as well since they will be earning less. It is a downward spiral that feeds on itself; a kind of black hole from which no energy or light -- or economy -- can escape."
Umm.. not so good.
"Henry Ford fathered the notion that workers should at least earn a wage high enough to enable them to buy the products they build. Ford's industrialist contemporaries thought he was nuts to pay workers more than the prevailing wage. History, however, proved Ford a visionary whose egalitarian notion spurred the most vibrant, self-sustaining economy in history. The current trend of driving wages down reverses that logic, threatening to reverse the result as well.
While American consumers currently benefit from lower prices by feeding on foreign-produced goods, it is a short-term benefit. Over time, more well paying U.S. jobs will be lost and replaced by lower-paying jobs. Eventually American workers will be less and less able to fuel the product-consumption continuum that has been the engine of the American economy for the past 60 years.
And then begins the death spiral. Fewer companies will be paying U.S. taxes. Those still domiciled in the U.S. will have lower profits, resulting in less tax revenue. American workers will be paying less in withholding taxes as well since they will be earning less. It is a downward spiral that feeds on itself; a kind of black hole from which no energy or light -- or economy -- can escape."
