From An Industrial Economy To A Paper Economy – The Stunning Decline Of Manufacturing In America, by Michael Snyder.
Why does it seem like almost everything is made in China these days? …
Back in 1960, 24 percent of all American workers worked in manufacturing. Today, that number has shriveled all the way down to just 8 percent. …
No wonder the middle class is shrinking so rapidly. There aren’t too many cooks, waiters or retail salespersons that can support a middle class family. …
At this point, the total number of government employees in the United States exceeds the total number of manufacturing employees by almost 10 million…
You might be thinking that government jobs are “good jobs”, but the truth is that they don’t produce wealth. Government employees are really good at pushing paper around and telling other people what to do, but in most instances they don’t actually make anything.
In order to have a sustainable economy, you have got to have people creating and producing things of value. A debt-based paper economy may seem to work for a while, but eventually the whole thing inevitably comes crashing down when faith in the paper is lost. …
This is true of Australia as well as the US:
Right now, the rest of the world is willing to send us massive amounts of stuff that they produce for our paper. So we keep producing more and more paper and we keep going into more and more debt, but at some point the gig will be up.
If we want to be a wealthy nation in the long-term, we have got to produce stuff.
The financialization of the economy and the huge run up in debt/money since 1982 is not going to end well.
Just as well interest rates are near zero throughout the western world. With all that debt and a slow economy, normal interest rates would immediately plunge the world into a stiff recession or worse.
Maybe not just as well. There is a school of thought that we would be better off getting the inevitable over with as soon as possible — one or two years of collapse and strife then start again with a fresh economy. The alternative is a debt-laden moribund economy for …. well Japan went into this situation when their bubble popped in 1990, and 26 years later they are still there with a sucky economy, bubble debt still unresolved, while they prop up banks, print money, and follow crackpot Keynesian economics. Would you like your pain quickly or slowly?
