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--- America -- A Land of Myths, A Path to Perdition

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Headlined to H3 8/19/09

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Myths and legends are as endemic to the human specie as are fish to water. Myths and legends tend to be used interchangeably. Both are characterized as being handed down from generation to generation. Both are non-verifiable and neither has a determinable basis of fact. They differ from folktales in that folktales are, upon maturation of the individual, near universally considered as false.

Paradigms are explanations based upon patterns or models. They may shift with identifiable change; as a new paradigm. In that there are always exceptions to patterns or models, it may be useful to think of a new paradigm as "the truth that is not" and the old paradigm as "the truth that never was".

Whether myth, legend, or paradigm, there continue some American alleged truths that, upon examination, just do not hold water. Yet, many if not most citizens, continue in their belief of them. The four discussed herein deal with the our economic model, small business strength and opportunities, the American dream, and democracy itself.

While now a minority, many Republicans apparently continue to believe in the Friedman-Greenspan paradigm. Friedman went to his grave believing in it. Greenspan now accepts error in his thinking.

The Friedman-Greenspan Paradigm explained in five words is "unfettered unregulated capitalism works best." The fact that it does not work, especially in the Finance, Insurance, and Real Estate (FIRE) segment of our economy, is clearly evident in the bailout costs of trillions of taxpayer dollars and the continuing recession. While new FIRE regulations are legislatively considered, tremendous special interest and turf battles are clear indications that all do not yet agree with Greenspan despite the evidence of absolute failure. Regulation related to near monopoly and too big to fail corporations in non-FIRE segments of our economy needs consideration and implementation as well.

Small Business Strength and Opportunity, a belief described by the Center for International Policy and Research (CIPR) as, "thanks to lower taxes and limited regulations, unfettered labor market, and a natural spirit of entrepreneurship - the United States offers an environment for small business that is unmatched anywhere else in the in the world". America's small businesses -- some 25 million strong -- are the strength of our nation's economy, right? Wrong! Were it true, there should be a higher percentage of both small business owners and small business workers in American than elsewhere. But there are not.

The CIPR study, An International Comparison of Small Business Employment, which compared the rate of employment in United States to eighteen Western European countries, Australia, and New Zealand, the United States ranked:
""". 20th in Self Employment Rate
""". Employment in Small Enterprise
"""""". 19th in Manufacturing - Less than 20 employees
"""""". 21st in Manufacturing - Less than 500 employees


The study compared two high tech and three combined low tech industries with fewer than 100 employees in fifteen countries. The United States ranked:
""". 14th in computer related services
""". 13th in research and development
""". 15th in "restaurants", "real estate", and "equipment rental"

These data suggest entrepreneurial opportunities may be better served elsewhere. If the pull from small business employment is the strength that creates normalcy from the recession, Western Europe is going to reach normalcy before the United States.

Pursuit of the American Dream may, perhaps, be best pursued in Australia, New Zealand, or Western Europe,

The American Dream, is not a nightmare yet but we are looking more and more like a banana republic rather than an economic workhorse pulling the world to prosperity. Corporations and the mega-wealthy literally run the country through their control of Congress. Not surprisingly, Congressional policies and legislation favor the rich. Our middle class is ever slimmer and the working class has a growing dependency on food banks.

Wikipedia ranks countries by income inequality based on United Nations and Central Intelligence Agency data. The income inequality in the United States is more like Mexico than it is of Canada. It is the same as Ghana and Turkmenistan. Georgia and Sri Lanka are slightly better, Senegal and Cambodia are slightly worse. These are not the countries Americans typically associate the United States with.

Education and hard work no longer assure a step up the economic ladder. While higher education is increasingly unaffordable for more and more American families, college and university training is free in the Scandinavian countries. Germany pays its college and university students a monthly stipend whether or not they have served in the military. Obama's dream of the United States leading the world with the highest college graduation rate looks like "castles in the air" when compared to Western Europe's higher education efforts.

The likelihood that a child born into a poor family will make it into the top 5 percent of income earners is just one percent, according to "Understanding Mobility in America," a study by economist Tom Hertz from American University. By contrast, a child born in a rich family had a 22 percent chance of also being rich as an adult. In other words, the chances of getting rich are about 20 times higher if one is born rich than if one is born into a low-income family. Even for children born in middle-class families (family incomes of $42,000 to $54,300), they had about the same chance of ending up in a lower quintile than their parents (39.5 percent) as they did of moving to a higher quintile (36.5 percent). Their chances of attaining the top five percentiles of the income distribution were just 1.8 percent. This is lower than in most other democratic countries. For example, intergenerational mobility in the United States is lower than in France, Germany, Sweden, Canada, Finland, Norway and Denmark. Among high-income countries for which comparable estimates are available, only the United Kingdom had a lower rate of mobility than the United States. It is as if the shadow of King George III has returned to haunt us.

Democracy, simply put, we don't have one, never did. As Edward Dowling said, "The two greatest obstacles to democracy in the United States are, first, the widespread delusion among the poor that we have a democracy, and second, the chronic terror among the rich lest we get it."

As my senior Senator, Richard Burr, put it to me, our "Founding Fathers .. recognized the danger and instability of pure democracy.. (which) amounts to mob rule on a grand scale, and sought to protect the rights of every citizen from the mob, who, .. would seek to deprive someone of their rights."

But someone is denying some of our human rights. In our democracy, it is the few that deprive rights of the many. Article 25 Section 1 of the Universal Declaration of Human Rights, of which the United States is a signatory, and has been for more than six decades, states:

"Everyone has the right to a standard of living adequate for the health and well-being of himself and of his family, including food, clothing, housing and medical care and necessary social services, and the right to security in the event of unemployment, sickness, disability, widowhood, old age or other lack of livelihood in circumstances beyond his control."

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A retired MBA, I am a former corporate ideologue, former 3rd party advocate and current curmudgeon. While a continued supporter of a 3rd party, I have concluded their efficacy cannot be demonstrated until our form of Government is changed to (more...)
 
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