The Economic Collapse – January 15, 2012
Have you ever heard of the dodo bird? Once upon a time, dodo birds lived on the island of Mauritius in the Indian Ocean. But if you go there today you won’t find any because they are extinct. Well, if you are a blue collar worker in America today it looks like you are headed for a similar fate. Blue collar workers are truly becoming an “endangered species” in the United States. In the old days, the balance of power between business owners and labor was more even because they both needed each other. But today that has all changed. Thanks to robotics, automation and computers there is simply not as much of a need for physical laborers anymore and nothing is going to reverse that trend. Big employers will continue to look for ways to replace men with machines, and there is nothing wrong with that. But there is another major trend that is also destroying blue collar jobs in America that we should do something about. Right now, it is perfectly legal for big corporations to shut down manufacturing facilities in the United States and send the jobs over to nations on the other side of the globe where it is legal to pay slave labor wages and where there are barely any regulations. As you will see later on this article, this has been the biggest reason for the shocking blue collar job losses in America over the past decade. The big corporations don’t care that you need to pay the mortgage and put food on the table for your families. All they care about it the bottom line, and if dramatic changes are not made soon, the number of blue collar jobs leaving the United States will continue to increase.
Once upon a time, almost everyone who wanted a job in America could get one. If you go back a few decades, you will find that about 95 percent of all men between the ages of 25 and 54 had a job. Today that figure is struggling to stay above 80 percent.
If you are a blue collar worker in America, you are simply not valued. Your bosses are constantly trying to think of ways to replace you or send your job overseas.
According to Reuters, 23.7 million American workers are either unemployed or underemployed right now. The more “blue collar” you are, the more likely you are to be unemployed. The following chart that shows the unemployment rate during 2010 broken down by level of education comes from the Bureau of Labor Statistics….
If you are an unskilled worker in America today, you simply are not needed. Yes, once upon a time nearly anyone could go out and get a factory job, but those days are over. Neither major political party seems the least bit interested in trying to keep manufacturing jobs in America.
Back in the year 2000, more than 20 percent of all jobs in America were manufacturing jobs. Today, about 5 percent of all jobs in America are manufacturing jobs.
To have that huge of a shift in a little over a decade is absolutely mind blowing.
Many Americans had been hoping that Barack Obama would stand up for the working man like he promised to do. But just like so many of Obama’s other promises, that one was totally worthless as well.
The Obama administration has been pushing hard for even more “free trade” deals that will allow big corporations to ship even more of our jobs out of the country. The Obama administration simply does not value blue collar jobs at all. In fact, U.S. Trade Representative Ron Kirk is running around telling the press that there are lots of things that “we don’t want to make in America” anymore.
If you are a blue collar worker, Barack Obama does not care about you.
He never cared about you.
In fact, the vast majority of the politicians in both major political parties do not care about you.
What they do care about is winning elections and taking care of the big donors that keep helping them win elections.
Many of those donors are systematically shipping huge numbers of our jobs overseas.
In addition, now that labor has become a “global commodity”, wages for the jobs that remain in America are being steadily driven lower.
A recent White House reported entitled “Investing in America: Building an Economy That Lasts” actually bragged that our trade policies have driven wages in America down. The following chart is from that report….
We were told that the “one world economy” would be great for America, but the truth is that it has only been great for the giant corporations. For the average working man, it has been a disaster.
But we should have all seen this coming. It didn’t take a genius to figure out what was going to happen once you put American workers into the same labor pool as slave laborers on the other side of the world. After all, what greedy corporate executive really wants to pay U.S. workers ten to twenty times as much compensation just because it is the “right” thing to do?
Today, formerly great cities all over America are being transformed into hellholes while shiny, new industrial cities are popping up all over China.
For example, a couple of decades ago the Chinese city of Shenzhen was a sleepy little fishing town.
In 2012, it is a teeming metropolis of over 13 million people.
Foxconn (the builder of iPhones, iPads and many other products that we buy) runs a factory in Shenzhen that employs over 400,000 people. Most of those people work for about a dollar an hour.
A recent article posted on Business Insider described the incredibly long hours and the nightmarish working conditions that those workers must endure. The following is a brief excerpt from that article….
A Chinese working “hour” is 60 minutes–unlike an American “hour,” which generally includes breaks for Facebook, the bathroom, a phone call, and some conversation. The official work day in China is 8 hours long, but the standard shift is 12 hours. Generally, these shifts extend to 14-16 hours, especially when there’s a hot new gadget to build.
At Foxconn, they don’t really care about the health and safety of the workers. Workers are expected to do the same repetitive tasks as rapidly as they can for as long as they can. When their bodies break down, they are fired….
Some workers can no longer work because their hands have been destroyed by doing the same thing hundreds of thousands of times over many years (mega-carpal-tunnel). This could have been avoided if the workers had merely shifted jobs. Once the workers’ hands no longer work, obviously, they’re canned.
But the Obama administration insists that allowing big corporations to ship our jobs over to countries with working conditions like that is “good for the economy”.
Well, it might be good for the profits of the largest corporations, but it is a total nightmare for the rest of us. Just consider the following stats….
*The United States has lost an average of 50,000 manufacturing jobs per month since China joined the World Trade Organization in 2001.
*Between December 2000 and December 2010, 38 percent of the manufacturing jobs in Ohio were lost, 42 percent of the manufacturing jobs in North Carolina were lost and 48 percent of the manufacturing jobs in Michigan were lost.
*According to U.S. Representative Betty Sutton, America has lost an average of 15 manufacturing facilities a day over the last 10 years. During 2010 it got even worse. Last year, an average of 23 manufacturing facilities a day shut down in the United States.
*In all, more than 56,000 manufacturing facilities in the United States have shut down since 2001.
*According to one study, between 1969 and 2009 the median wages earned by American men between the ages of 30 and 50 dropped by 27 percent after you account for inflation.
*According to Professor Alan Blinder of Princeton University, 40 million more U.S. jobs could be sent offshore over the next two decades.
Are you starting to get the picture?
If you are a blue collar worker that cannot find a job, it is not because you have failed as a human being.
Rather, the truth is that you cannot find a job because of the failed trade policies of the federal government.
We are experiencing the bitter fruit of a “one world economy”. Globalization was never intended to make the lives of American workers better, and now many are finally waking up and realizing this.
Hopefully, as Americans wake up on these issues they will fight to turn this nation in a more positive direction.
Unfortunately, way too many Americans are giving up hope completely. The following comes from a recent article in the Guardian….
The year 2011 will be remembered as the time when many ever-optimistic Americans began to give up hope. President John F Kennedy once said that a rising tide lifts all boats. But now, in the receding tide, Americans are beginning to see not only that those with taller masts had been lifted far higher, but also that many of the smaller boats had been dashed to pieces in their wake.
As I have written about so many times, we are watching the middle class in America be systematically destroyed.
The economy is not getting better. There may be moments when the economy seems like it is improving, but the reality is that we are mired in a nightmarish long-term decline. If you are not yet convinced of this, please see this article and this article.
Even those running our economy are saying that things are not going to be getting much better any time soon.
For example, the President of the Federal Reserve Bank of Chicago, Charles Evans, recently admitted that the employment picture is not going to be much brighter than it is now by the end of 2012. He recently said that “at the end of the year, we’re not going to be very different from 8.5 percent unemployment.”
And remember – history has shown us that most pronouncements by Federal Reserve officials are usually far too optimistic.
If you are a blue collar worker in America, there is simply not too much to be optimistic about right now.
You might want to think about how you and your family are going to survive without any work.
The millions of jobs that have been sent overseas are not coming back. Even if you still have a decent job, now is the time to be developing a side business or developing other alternative streams of income.
What you don’t want to do is to just sit there and hope that somehow things will “magically” turn around if we just vote in the “right” politician.
If you want to get a really good idea of what is really going on with the U.S. economy right now, just go tour some of the formerly great industrial cities in the “Rust Belt”.
In Cuyahoga County, Ohio one out of every five houses is sitting vacant. It is not that those homes are not needed – it is just that there are not nearly enough people with good jobs available to buy up all of the foreclosures.
So thousands of perfectly good houses are being torn down. The following comes from a recent CBS News report by Scott Pelley….
Across America, recession-fueled foreclosures and plummeting home values have left countless properties abandoned and vulnerable to looting. As Scott Pelley reports, the problem has gotten so bad in Cleveland, Ohio, that county officials have demolished more than 1,000 homes this year – and plan to demolish 20,000 more – rather than let the blight spread and render nearby homes worthless.
Can you imagine that?
20,000 homes being demolished in one county alone?
Of course Detroit is in even worse shape than Cleveland. If you can believe it, the median price of a home in Detroit is now just $6000.
For much more on all of this, please read my recent article entitled “Formerly Great Cities All Over America Are Turning Into Open, Festering Sores“.
It would be great if I could tell you that hope is just around the corner, but it is not. The plight of the blue collar worker in America is going to get worse and worse.
But just because blue collar workers in America are an endangered species does not mean that you have to be a victim.
We should all seek to become less dependent on the system.
If you are completely and totally dependent on having a “job” (just over broke), then you have put yourself in a very vulnerable position.
That job could disappear at any moment.
Over the next few years, the number of good jobs is going to continue to decrease. Things are going to be really tough. But those that have prepared and that have tried to become more independent are going to be in much better shape than those that have not.