What Can Be Done?

It makes me very upset to continually hear about how the 99% can barely pay for a turkey this year for Thanksgiving, yet Saks is having record-breaking sales (there are more $1000 shoes in inventory than $200 shoes).

This should piss you off.  It’s not a new thing, but it has gotten substantially worse in the last few years.  The net worth of the top 20% of the US population has been increasing and the net worth of the bottom 80% has been decreasing.

The bottom 80% has 75% of the debt, with less than 50% of the deposits, pension accounts, and insurance and less than 25% trusts and non-home real estate and less than 10% of the financial securities and business equity.

Let me remind you that this isn’t on a per person basis.  This means that two hundred forty million people (240,000,000) COMBINED! have that much more debt and less stability than the other 60 million (60,000,000) COMBINED!

Let’s look at this in real numbers.

The approximate net worth of all the people in the US combined is 58 trillion dollars ($58,000,000,000,000,000)

Of that, those 60 million people have about $49 trillion of that net worth.  Of that, the top 1% (3 million people in the US) have $20 trillion of it.  Yep, more than a third of the entire amount of money in individual hands in the US is being held by 1% of the US population.

Let’s look at the other side of the coin, debt.

The total US debt for households is about $36 trillion dollars.  Of that, 6 million people (the 1%ers) have about $1.8 trillion dollars of that debt.  The top 20% (not including the 1%ers) have another 7.5 trillion dollars of debt.  Leaving the rest of the 240 million people in the US with $26.7 trillion dollars of debt.

And we thought the US government was in bad shape.  The people least likely to be able to pay the debt is being crushed by it.

Now debt is in an individual thing.  Per capita, the 1%s have about $600,000 in debt each.  The next 20% (not including the top 1%) have about $125,000 each.  The rest of us are burdened with about $112,000 each.  When you consider the ration of net worth to debt, the results are just painful.

The wealthiest 3,000,000 people in the US have less than 10% of their average worth in debt, while the bottom 80% have the same amount of debt ($112,000) as the average net worth ($111,000).

There is one other thing… taxes.  Just read what Warren Buffet has to say about taxes.  This isn’t numbers that can be fiddled with, this is the way it really is.  Just look at that a minute.  Almost 20% of the 400 richest people in America HAD NO REPORTABLE INCOME.  That’s right, no income tax if there is no income.

Interesting isn’t it?

Fuck no, it’s not interesting.  It fucking sucks.

No, I freely admit that there are some people who have worked their asses off to get where they are, in that top 1%.  But there are many that have never produced a product in their entire lives.  Personally, I don’t consider being a CEO producing a product and I don’t think that someone whose company is crashing around them should get bonuses or someone who’s company killed a bunch of people get a safety bonus. Hell, these people get millions of dollars when they are fired.

But I digress.  It just ticks me off.

The problem is, what do we do about it?  Work harder?  In what job?  My wife has been looking for work after graduating with her master’s degree in May.  She’s substitute teaching right now.

Save more money?  Invest more money?  Like those 1%ers do?  With what money?  The average US household that’s not in the top 20% of the wealthiest households has $9,000 more debt per year than they make (including ALL assets, not just income).

Take it to the government?  The government doesn’t care.  You have never bought a $1000 plate at a fundraiser.  You have never paid for a national TV ad campaign.  You have never gotten a politician’s child into Harvard.  You have never given a politician a major job when he left office. etc.  You are nothing to politicians.  You have no money.  Duh.

Steal it?  Oh that’s awesome.  Heck, some of the US billionaires might even voluntarily give up some of their money.  It won’t help.  The wealth is so concentrated that if EVERY US billionaire gave up half of his/her money and distributed it equally to every one of the 80%ers… it would end up being less than $1,000 per person.  Awesome, that won’t pay off my house, my car, my loan, my wife’s student loans, and it’s not even a full month’s rent for where I’m living.

At this point, there is very little that can be done.

If you are not born into money or, by some happenstance, develop a product or service that is desperately needed, then you are pretty much stuck.  It really sucks.  (BTW: I need to note that there is not a single sports star or musician (of any kind) in the list of US billionaires.  George Lucas is a billionaire and so is Oprah Winfrey… and neither of them are close to the Bill Gates and Warren Buffets).

Personally, I think that debt is the biggest killer here.  Those billionaires and the other top 20%ers need the 80%ers.  They need us to buy their products and services.  They need us to work for companies that make products and services, which also buy products and services.  If we could get rid of the debt that the 80%ers have to deal with, I think that would be a HUGE help.

First to go is student debt.  Education is NOT an option.  If the US wants to remain competitive and be anything other than the world’s farmer and military police, then we must make sure that every student that can get a college education… can get a college education.  This DOES NOT mean that every kid has to go to college.  I hate that everyone thinks that every kid is going to college to be a doctor or lawyer.  It won’t happen.  In the same way that not every kid will be a football star or a professional rapper, most of them will not make it through college… or if so, only by the barest of margins.

That is what community college is for.  Technical training.  There is nothing wrong with being a plumber or a nail technician or an auto mechanic (heck, most of them make more than I do).

The next thing we have to deal with is a toss-up between housing or credit cards.  I think people need to quit thinking of homes as investments and start living in them.  I also think that credit cards are pretty much evil and a complete scam.  (BTW: I have 1 credit card.  I paid it off several months ago and I haven’t used it for more than a $10 purchase no more than once a month in almost three years.)

I seriously think we need to go back to thinking of cars and homes as purchases, not debt bombs.  My grandfather paid cash for every car he ever bought.  His last car was a 1967 Mustang that he bought in 1984 and drove for another 20 years when he died.  He paid cash for every house he ever built (yeah, he bought the materials, then built the house himself).

We consumers need to stop living in such a disposable society.  Yes, that does kind of counter the economy needs money to flow and therefore purchases to be made.  But buying something that you have saved for is not the same thing as buying something and paying for it for 5 years… or 30 years and then getting another one.

I honestly don’t know what to do.  I know something must be done, whether it be government regulation or a shift in the consumer paradigm… I don’t know.

I do know that this could become a revolution in the real sense and I don’t want that.  That’s bad for everyone.  And before you think I’m crazy, just look at the reports of police actions against the Occupy movement.

As has been said around the internet…



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