Wednesday, November 14, 2007
It’s an “Upside-down” World
By Richard E. Noble
There is a new concept floating around out there in the world of economics. It’s called the “upside-down” people.
If you went down to the new car dealership to trade in that old clunker that you bought four years ago to buy a new one and you found out that you still owe more money on that secondhand car than the car’s current estimated value - you are one of the upside-down people.
If you have a home that you have been making payments on for the last ten or fifteen years and you are trying to sell it but you have found out that you still owe more on the house than you can sell it for - you are one of the “upside-down” people.
These were the only two upside-down situations that I read about but I find that there are many others that I have noticed myself.
For example, you decide that you want to participate in the American dream and you open up your own little business. You will learn very quickly that you had better have some Workman’s Compensation insurance for Billy, Bob, Susan and Arthur, your employees, in case they get injured or hurt on the job; you will also find that you need accident insurance for your customers just in case one of your customers trips over one of your employees, sprains her ankle and damages her expensive Oprah designer high-heels. But if you or your mate - the owners of this business - trip over one of your customers who then falls on top of an employee of yours, more than likely you (or your spouse) will be the only ones who aren’t covered because you can’t afford the personal owner’s coverage. I don’t know but, I think that is slightly “upside-down”.
Now let’s say that you are a patriotic young boy or girl and you want to do your part for your Country in this time of stress - so you join a branch of the armed services. Now I realize that the pay and salaries for servicemen are much better than they have ever been in the history of this country. But if you get a job working for a civilian outfit that has now become a part of the “privatization” of the “new war” concept; you can make considerably more money than any soldier - possibly more than many of the officers and maybe even more than some of the generals. And, I have been told, it is all tax free. Now believe me I am not aspiring or applying for either of the above mentioned positions and I hate to sound like Andy Rooney here but doesn’t that seem somewhat “upside-down”?
Now here’s another one; you decide that you want to become a Doctor. A Doctor has always been a respected profession in this country. And even today I bump into people who brag to me about their millionaire offspring - the “Doctor”. But in the last few decades I have noticed what appears to me to be a new class of “blue-collar” doctors. These people went to college; they studied hard; they put in their internship and whatever but in order to accomplish this dream they are now nine million dollars in debt from college loans. And not only that, they no longer hang out their shingle or open their practice - they work as an employee for some business school management or economics major who doesn’t even know how to take his own blood pressure. As Andy Rooney would say - this seem a little strange?
To continue with this college loan business. I know young people who finally graduated from college at an age where the young people of my generation would have been married for about eleven years and had three kids. They now have a job where they make three times the highest pay that I have ever had in my life. But they still can’t meet their expenses and pay off their college loans. Some loans have actually increased since they graduated from college over thirty percent due to accumulated interest. I have been saying for years that the only hope for a young girl in this situation is to find a Doctor to marry. But she better find an old fashioned white collar Doctor and not one of these blue collar doctors like the ones mentioned above.
And now we come to the American dream of owning your own home. Just a short time ago many home owners were being advised by their economic consultant to sell their home and rent an apartment. The advice was that with the escalating home prices coupled with insurance, taxes and upkeep - you could rent cheaper than you could own. Today the situation has changed a little; now nobody can sell their darn house - partly because between the insurance, the taxes and the upkeep it no longer pays to own your own home. Wow! That really sounds upside-down to me.
And now we come to the biggest upside-down in American history. I hesitate to even mention this but please remember I am speaking economically not patriotically - or even about the current world situation. I don’t even want to get into that.
We have something like three million active duty soldiers. I would guess that we have close to that number in our “privatized” military service. We have thirty million, mostly supportive, retired military. We have tens of millions of workers employed in military procurement and military defense industries here and abroad. If we add up all of our citizens involved in Military in one capacity or another, the percentage would be shocking to most Americans.
Fifty percent of our national budget deals with Military costs and expenditures. If you add in payments on the National Debt which was primarily caused by past wars and military spending and then add in veteran’s pension and medical care (past, present and future), it probably amounts to a great deal more than half our national budget. It is easy to see why many political writers are referring to the United States as a “Fortress” or “Fortress America”. In fact the National Debt is so high most experts agree that it can never be paid off. The only way that it is estimated that we can keep up the payments on the debt (never mind the principal) is if the economy and inflation grow faster than the interest payments and additional borrowing and spending.
If the concept of war would somehow disappear from the human horizon tomorrow, we here in the United States would have to continue producing and manufacturing weapons for another decade or two - even if we just throw them away as opposed to “donating” them abroad - because not to do so would result in a massive economic depression. The economic ship of state, along with the Military Industrial Complex, simply can’t be stopped or turned around that quickly.
There used to be a saying in intellectual philosophical circles. It went something like this. If it is true that a God does not really exist, it would have been necessary for man to have invented Him. Well I have a similar parable. It seems to me in our present economic world, if war did not exist, economics would demand that man invent one.
I say “man” because I do not think this situation is peculiar to the good old U.S.A. I think most countries are in a similar situation - even many third world countries. They are just operating on a smaller scale.
You may notice on your TV that in many a disruptive third world nation, the people may be without shoes or food to eat, but nevertheless nearly everyone has and automatic weapon, machine gun, grenade-launcher, or rocket shooter. I’m not even asking where these weapons are manufactured or who selling them but I would like to know where all these unemployed people get the money to buy them?
Now that is really upside-down. Don’t you think, Mr. Rooney?