We have lived in Santa Barbara California for more than 25 years. We saw and felt the enormous social and economic changes that happened in this town and its environs during that period. I just returned from walking up and down State Street, which is the main drag here. What I just saw and felt is what prompted me to write this essay.
Many of the stores we loved in Santa Barbara are no longer there. Those that remain have reduced their stocks significantly, particularly in luxury items. We see "for rent' or "for lease' signs hanging over many storefronts. Scores of beggars are lining the street. Several accosted me asking for small change. These were not the familiar older winos with unkempt beards who are looking for money just to buy more beer, these were younger people and looking for work. Some even asked me if I knew where they might for apply for jobs. These people are desperate and hopeless. Their plight is heart-wrenching.
Clearly, the economy has deteriorated in Santa Barbara. Many other small towns all across America are experiencing a similar state. Yet, the stock market is at its peak and corporate profits are the highest since the 50's. Our economy is also, supposedly, experiencing a turnaround. But where is it happening? I saw few signs of that on State Street. This town, and many others like it, is in economic trouble. The United States maybe the world's greatest economic power, but it is clearly not doing well by its people.
Something is really wrong here. How can we have corporate profits at a 50-year high and at the same time a 50-year high rate of unemployment? How can that be? The corporations are clearly making great profits while employing fewer and fewer people. Anyhow, they clearly are not employing many Americans. The encouraging economic numbers are clearly disguising deep problems.
From the available economic data, it is also clear that the people at the top of the economic pyramid are doing very well while the rest of us are still in an economic recession. The share of income for the richest 1 percent has tripled since 1980 while the income of the rest remained stagnant; real wages in the US stopped growing in the 1970s. The economic pie has clearly shifted with the biggest slice going to the very rich. In short, the rich have sucked the country dry, leaving little crumbs for the rest of us. It also appears that the rich are not interested in solving our problems or employing more Americans; they are mainly interested in renting their money where they can get the most for it.
All you get from the news media these days are great speeches, including a recent one by President Obama, celebrating our economic recovery and how many new jobs are being created. But most of these are part-time jobs not enough to pay the family bills. Often, you also hear concerns about the disappearing middle class. The so-called economic recovery appears to be mostly due to the rise in the stock and bond markets; you don't see it anywhere else. It does not reflect rises in consumer purchasing power or increases in retail sales.
The stock market is reaching record levels but bulk of the American public is not feeling any relief. The stock market is increasingly driven by the banking industry. The real economy is wracked by consumer fears, falling wages, joblessness, and low-level jobs for a growing number of people who ar e lucky enough to be working. The stock market figures are clearly reflecting the financial status of the wealthy. Most Americans are barely paying their bills and have had to significantly "downsize" their lifestyles.
Unbelievably, many commentators and talking heads are discussing, at length, whether President Obama should appoint a man or a woman to head the Federal Reserve. Such talk is really disgusting. It shows callousness on the part of our leadership towards the needs of the American people. In reality, who gives a care about the sex of the Federal Reserve chairperson or even what that institution does? Clearly, it is not helping the bulk of the American people.