A Promise Kept- but one that ruined America |

It’s virtually complete. The change in America that Ronald Reagan wanted. To make American’s totally distrust their government. (Cut the bullshit. You know what he said: “Government is not the solution to our problem. Government is the problem.” Oh, and for all the crap about his capabilities- the deficit doubled under his tenure. As opposed to dropping deficits for the two Democratic Presidents since his tenure.)

You see, back when I was a tyke (1958), ¾ of Americans trusted their government. Now,that ratio is less than 20%. The graph below from the Pew Research Center (23 November 2015 makes that perfectly clear.)

So, it’s not surprising that we have a total disconnect between the reality of America’s problems and what politicians promise is the solution.

And, according to Drs. Michael Porter, Jan Rivkin, and Mihir Desai (along with Manjari Raman) [Problems Unsolved and a Nation Divided], the key factor behind this disconnect is the 1%- the lack of “shared prosperity”, the fact that the rich are thriving and the middle class and poor are not seeing those gains. Instead, these economists (who were hoping for economic facts and not political situations) see that politicians keep rendering “unsustainable promises” by extending credit and entitlements.

Now, I’ve been following Michael for decades. His “shtick” is competitiveness. Which usually involves productivity. And, productivity means higher value of output per worker and per dollar invested. But, when companies don’t invest in new technologies, don’t choose to include new methods of working, it’s not surprising that productivity has been at best a shallow climb.

While this has been going on, the larger US corporations have been vanquishing the chances for the American Dream. They continually move operations to countries with lower wages, where they can arrange virtually non-existent taxes despite the fact that the bulk of their profits derive from between the American shores.

But, the smaller firms- the ones with fewer than 500 and usually with 100 or fewer employees can’t use such techniques. The smaller firms are the prime driver of job growth in the US. And, since Ronald Reagan’s era, the number of new business formation has shrunk to record lows. And, since the Great Recession, the number of these businesses have shrunk by more than 5%- a rate higher since the “Great Obfuscator” (he never communicated the truth of his actions) got elected.

And, despite record low interest rates, despite the fact that (right after the Great Recession began) small business was starving for revenue, we have not invested in infrastructure, we have not improved secondary education. These are the things we need to truly create “shared prosperity”.

(Maybe now it’s a good time to remind folks that when Tim Kaine was elected governor of the Commonwealth of Virginia, he knew the important thing to do was invest in infrastructure. He took advantage of the low interest rates and the desperate desire for businesses to find work to make a difference in the Commonwealth to the tune of more than $ 1 billion. We need that same effort all over the US.)

And, you wonder why- even though there has finally been an increase in worker’s wages- that we all aren’t feeling better?

Stay tuned for more.