Common Sense Economics

Ok, so as soon as I can get blogger to let me download pictures on here, I have some fun posts to do.  Otherwise you're all stuck with posts like this.  Just some more of my thoughts.  Rock on!

Economically speaking, things get pretty complicated.  So complicated, in fact, that I think we have completely lost the thread of things.  The fact of supply and demand is simple enough.  However, beyond this concept many people are lost or choose not to think about it.  I think that this lack of interest and desire for ignorance has become a major detriment to our society.  Consider for a moment the distribution of wealth.  It stands to reason that we all must have money.  It is a necessity to live.  That being said it is indisputable that there is not enough money to go around, thus the unemployment, homeless, and starving right here in our nation, in our states, in our cities, and in our towns.  What is the problem?  One reason, and I just assert that this is one reason, may be that much of the wealth is being held by the few.  

With the industrial revolution many things became possible.  Mass production, increased supply for the increased demand.  Also unemployment.  Machines were now able to do the jobs that men and women once had to do.  A simple solution was just to change professions, but as time went on more and more jobs were cut and given over to machines and computers.  It therefore became the owners of these machines that benefitted monetarily from these machines and not the masses, even though we were told that it was better because now a shirt only costs ten dollars instead of fifteen.  For five dollars we sold our ability to make a decent living because we thought we were better off.  Now we face a thing which has never happened before.  The goods Americans buy are now less expensive than ever and yet we find we cannot afford them without putting it on the credit card. 

This increased use of credit, this need to buy the things we want, and the unequal distribution of wealth has caused a terrible thing to happen.  Americans are now making less than any previous generation due to inflation.  What has gone wrong?  Inflation is supposed to match the increasing value of the dollar, and yet, now, it has far outstripped it.  I certainly am not calling for a leveling, or a socialistic rebelion.  That would be complete madness.  Rather, I am just saying that perhaps it is time we pay a little more so that, in the long run, we can afford a little more.  We have to give a little to get a little.  

The presidents of these corporations have every right to the wealth they have earned.  But nothing above that.  There was one situation I was familiar with where the plant manager of a printing company, the spine of a small towns industry, received a $200,000 Christmas bonus while the workers only received a five cent raise that year.  The problem here is not just the bonus, but rather the fact that if that was the bonus, how much more was that man making just for himself?  And how much more were the actual owners of the company making?  Perhaps this is a bad example.  A hundred years ago, my family owned an apple orchard in Illinois.  This orchard earned them a very good living and the family was very well off.  However, the family also provided jobs for many of the people in the community.  The bare hands of human beings was needed to pick these apples.  The apple pickers were paid a fair wage for a fair days work and my great great grandfather helped feed several families with his need for willing workers.  These men were far better off having this job than losing it to a machine that did it for them.  Yes, perhaps this raised the price of apples.  But there were at least one group of men who could afford to buy them, the same group that had picked them.

When Henry Ford first began to mass produce the Model T he needed a large number of workers.  He was mass producing a car before robots were around to do the work of men.  He further paid his employees enough and set the price of the Model T at a point which his workers were able to purchase a Model T.  Rather than lose money Henry Ford made a fortune, he made affordable cars, and paid his employees a wage anyone would have been proud of.  Just a few years later Ford was able to drop the price of the Model T several hundred dollars without lowering (but rather raising) the wage of the worker.  Once again, Ford never lost a dollar in this, but rather gained because he provided jobs for many and paid them the wage they needed to purchase the product. 

This is what I am saying.  We need to be willing to pay a little more for our products so that more people can be employed and fewer machines and robots.  Level out this distribution of wealth and a drastic difference in the economy will be noticed and it will not be ignored.  Stands to reason.  Pump a little into the economy, and there will be a return.  No denying that.  Just think about it.