a 9 point fix for our Economy.

Mr. President-Elect,

Congratulations on your election, I have great hope for your presidency and our country. Making the Economy your first priority, will lead you to the additional changes our country desperately needs Some of the changes you need to make such as fixing our health care problem also helps fix our economy. Others can only be fixed as you work through resolve our economic problems such as dealing with unemployment and vanishing American manufacturing. Some may look at what I have to say and scoff, after all I am not a college graduate. Others may, as I hope you do, see a fresh, honest look at the problem from the standpoint of someone who is living the problems. I was once struggling to be ‘middle class’, now I am part of the long term unemployed.

Our Economy – the diagnostics

Everybody, including my self, is crying for the economy to be fixed. But as with any repair, you can’t fix a problem without knowing what is broken. I want to take us through some diagnostics to find what is needed, or if it is user error.

The reason someone starts a business is to make money
When they find that the ability to make money is enhanced by additional people doing a task, they bring on employees. Each employee after wages and benefits are paid, is expected to bring the business enough additional income to make it worth while. The employer is in business to make money, not to provide for the employees. The key points are Wages, Benefits Vs Enough additional income and worth while. Worth while is a measure of connivence. Are the employees dependable, trustworthy, and productive? Enough additional income is subjective. If the employees efforts bring you an additional $100 per hour, do you keep $90 and pay them $10 rather than $50/$50? What if that employee brought you an additional $1,000 per hour? Would you still pay them only $10, or less if you could get away with it? How about only $1 per hour?

What does an employee have a right to expect? A safe and dependable place of employment. 40 hours a week ongoing employment at a living wage plus compensation for additional skill they bring to the employer. Paid time off for vacation, holidays, and illness. Medical and other benefits.

The needs of the Employer and the Employee used to match up. What happened?

1. Competition.
There are more people looking for work than there are employers. This allows the employer to be more selective on who they hire. Add to that, the lower cost of foreign wages, both through outsourcing the job or bringing in foreign workers through H-1B visas and immigrant labor. America is in a race to the bottom, always looking for the lowest bidder and paying as little as possible. Cost of living should be a factor, we can not or should not be asked to compete on a non equal footing with those who do not have the costs of living in the United States. An employer has no incentive to pay a fair, let alone a living wage. And if they choose to, they can’t compete with those who don’t. It is human nature that if as consumers we can buy a similar product we always choose the lowest price.

2. Automaton
In the days when we had fewer people looking for work, we also had more jobs for them to take. Gone are the menial jobs of Typing Pool, Elevator operator, (most) Assembly line worker, and pretty much any other job that just required repetitive movement. Automation and computers have taken over these jobs, but none have been created to give work to the people that they replaced. On top of this, employers don’t conducer these types of jobs to be worthy of a living wage.

3. Safe workplace
To provide a safe workplace. To deal with employment law. To deal with environmental laws. Insurance, Payroll taxes and all of the other things American workers take fro granted cost the U.S. employer money. A lot of money. If an employer can get around these things they will. (See competition)

4. A fair wage.
The definition of a living wage has gone up. Housing, Transportation, Food and and other things now cost a lot more. Add to that the constant push for us to purchase things like Cable, HD-TV, Computers and such and it costs much more to live now. With the cost and commitment of higher education, we expect to see the value that this brings to the employer reflected fairly in what we are paid, above the basic cost of living. Now the employer can demand a college degree just to work at minimum wage.

5. Benefits.
The cost of health care has become unbearable. When it was cheep it was a perk that an employer could offer to keep employees loyal. If they had good health coverage, employees tended to stay with the employer. Now the cost of coverage is too high to allow an employer to be competitive with those who don’t offer it. (this will be dealt with in a future analysis letter)

6. Commitment.
It is questionable if the 40 hour ongoing work week is a reality any more. With temporary employment agencies allow people to be hired as needed, when needed. If the employer doesn’t need someone 40 hours a week, 52 weeks a year, they no longer have that obligation to the employee. And since the business has its pick of employees that are always changing, the concept of on the job training is gone. If you are able to find full time, regular employment, you can no longer count on working your way up the ladder with a company. Companies regularly replace long term, higher paid employees with new hires that they can pay less. To be fair, we employees have some blame in this. When jobs were plentiful, we did not give our loyalty to an employer. It was common for a talented employee to job hop, playing one employer against another. We Americans have not embraced the concept of lifetime employment.

7. Greed (It had to be said)
Capitalism encourages it. It is a part of human nature. It is instinctual to want to gather all we can, and keep it safe for the future. This was less of a problem when things were plentiful, but now with more people going after limited resources, it is a real problem. In the animal kingdom when the population gets to big for its environment, part or the heard dies off. In the business world we have executives making multiples of 100 percents over what the workers are paid. Evan if the Unions that people fought and died for had the same strength they once did, what power do they have in the world economy? We have business leaders cheating the system because enforcement is “on the honer system, and we don’t have to be concerned about the rules” (I actually experienced someone saying this) And, this is a quote of someone I have worked under, “I have the Gold, so I make the rules”. I have lived in an area where a good percentage of the residents made more money than the others. The merchants charged more because they knew that most of the people could pay the higher prices, never mind the lower paid ones who had to struggle live.

8. ME-Ism(Actually part of greed)
Everyone can think of changes, until it affects them. Such as… People should learn to live on less money, except me. We should have lesser quality and lower cost housing, except where I live. People should not expect as good of health care, except me….. And so on. Whenever two or more people have something different, there will be envy. Whenever someone thinks they have something better, they will try to prevent others from getting it, even if there is enough to share. Add to that the American motto, “I had to get mine on my own, why should anyone help you?” Americans are a proud bunch, they resist help, and feel ashamed if they need to take it. WE NEED HELP!

So Mr. President, now that you see my diagnosis what do you want to fix first? Mind you, this economy will not work properly until they are all fixed, and who know what else we will find once we start work.

But wait… (again sorry, I had to say that)

Some circular rules that we need to deal with.

Rule 1. This economy will not be fixed until everyone is able to earn a living wage. If we can’t afford to buy goods and services, and pay our fair share of taxes, than there is no economy.

Rule 2 When we finally have enough income to start spending freely, we need products made by American companies, manufactured by American workers. Nothing is accomplished if our money goes to another country rather than supporting the American economy.

Rule 3. U.S. businesses must be profitable enough to hire U.S. workers, and pay them a living wage. (Refer to Rule 1.)

Some more truths.
a. You can not fix the economy by giving money to the Banking industry. We have seen that they continue giving perks to the executives, and change nothing that actually helps the average citizen. The banking problem happened because people don’t have jobs or make enough.

b. You can not fix the economy by giving money to the Auto industry (or any other business) unless it is tied to changes that will benefit the common person. (i.e. Better wages for the workers at the expense of the executive. If it gives us advancement in technology or efficiency.) It doesn’t do any good for a company to be able to increase or maintain production, if nobody can afford to buy what they are making now.

President Obama, you fought your way through a difficult election talking about change. If our country has any hope, we need to have a President with the courage to attempt the impossible. We are past the band-aid stage. The country and the common citizens such as myself are counting on you to take action immediately. In two years you may face gridlock with a different congress. We need a president that is more concerned with rebuilding this once great country, rather than popularity, partisanship, or re-election. I hope my simplistic, outsiders look and recommendations are of help to you, but regardless you need to make the bold and unpopular choices for the sake of our country.

The following are my recommendations for fixing our economy.

1. Put the people back to work.
Even if it has to be paid for by the Government. There is no pride in being unemployed. You will get better results by paying people to fix what is broken in this country, than giving Billions or Trillions of dollars to businesses.

2. Equalize the playing field by enacting tariffs. My right to the pursuit of happiness trumps China’s right to sell me cheep products.

3. Discourage companies from manufacturing overseas, and encourage them to train and hire American workers at a true living and fair wage. This could be in the form of fees for outsourced or H-1B workers, and tax credits or rewards for American employees. The credit or reward should be dependent on full time employees, with the lowest paid employee making no less than a certain percentage of the companies highest paid executive.

4. Bring back the Unions.Workers only gained rights through collective bargaining, and we have lost almost all of them since the unions became weaker. It has been proven that without representation, the employee is taken advantage of.

5. Keep costs down so that everyone has a fair shot. Limit the amount of markup or profit, and require consistent pricing regardless of the location.

6. Do something abut housing! Housing is a necessity, not a way for everyone to make money from each other. The way things are now (or were) is that houses kept going up in value, but our ability to purchase or live in them did not keep up. This resulted in more and more people not being able to buy or rent a place to live, and now we are seeing the result of this in foreclosures.

7. Energy, we need lots of cheep and clean energy. I will get into this in a future letter, but am touching on it because it is part of fixing our economy. Short and sweet, NO Nuclear (Unsafe, waste problems and inefficient) Get off Oil (limited, dirty, and we don’t need to keep paying profiteers until the last drop is pumped). We need clean, renewable energy, and plenty of it. Americans should not be forced to conserve or do without. we need the energy to grow our nation.

8. We need single payer, universal health care. The health of our citizens should not be dependent on how much they can afford. We should not have competing companies trying to make a profit off the health of people. Prices and availability should be based on cost, not brand and profit.

9. Take care of Americans first. I know we are seen as a rich nation and expected to help others, but how can we say we are rich when so many of our citizens are hurting? When people can’t get health care, or are living on the streets? You don’t give to charity when you can not afford to provide for your family.

Nine very difficult, and sure to be unpopular recommendations. But as I see it, we ether take these steps now or suffer a whole lot of pain witnessing the ruin of our economy and trying to pick the pieces up latter. Look at what was needed to get through the great depression. Look at what people had to do for the war effort during WWII. They had to pull together and work for the common good. Americans need to do that again, I hope we still can.

Thank you Mr. President.
S Newkirk

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