Weak Dollar: Airbus, VW Plants in U.S.?
A rising euro and high labor costs are leading at least two European manufacturers to consider building new plants in the U.S. [...]Wonderful. Jobs are being created in this country because we have cheap labor and our dollar isn't worth much. Neither are our homes:
A recent study by the Center for Automotive Research, completed prior to the recent fall of the dollar, found that autoworkers in Western Europe make almost $10 more per hour than their colleagues in the United States make.
Home prices see biggest drop in 25 years.
Add into that mix the financial crisis and the costs associated with the Iraq war and the picture looks pretty gloomy. It doesn't look like conditions will improve anytime soon. So, who's to blame? Danny Schechter @ AlterNet nails it:
Its probably truthful but not helpful to say that the mismanagement of our economy is an outgrowth of the very corporatist policies that will haunt this country for decades to come, including costly wars, and obscenely high levels of corruption and the list goes on.Greed, Republican corporatism, free market ideology...there's plenty of blame to go around. The American consumer shares part of that blame too. We drank the Kool-Aid. We kept spending. We closed our eyes and ears when good paying jobs were sent out of the country. We voted for politicians who tricked us into believing abortion was the most important issue we faced. Then we voted for them again when they told us terrorism was the most important threat. We were enablers and now we're feeling the pain.
This crisis, however is a bit different because it has built in intensity for years without much visibility or attention. It speaks to structural problems in an economy built on the quick sand of debt and delusion.
In order for the economy to function, in order for consumption to continue and profits to keep flowing, people have to believe that everything's all right. They want remedies modeled after Alka Seltzer. Put one tablet in water. It fizzes. You drink and feel better in minutes.
The truth is that confidence is eroding not because "the masses" hate capitalism but because our brand of unregulated capitalism is increasingly not working for them. They know that because prices keep rising and good paying jobs are harder to find. They know that because crime is going up in many cities, and it's harder to make ends meet.
And some even know that the very concept of the masses has been replaced by highly stratifies classes built on growing income inequality.
So, what's the prognosis? We shouldn't expect a full recovery:
The pessimism, moreover, isn't momentary but reflects voters' worries beyond the current business cycle. Early last month, a sobering consensus emerged from a focus group of a dozen Republican-leaning voters in the Richmond, Va., area, sponsored by the nonpartisan Annenberg Public Policy Center at the University of Pennsylvania. The participants unanimously agreed that they didn't think their children's generation would be better off than their own -- breaking with traditional American optimism -- largely due to the debt future taxpayers will inherit.And we have reason to believe things will get worse before they get better:
"Who's buying our loans?" said former secretary June Beninghove, 67. "Who's going to own us? We are going to give ourselves to another country because of debt."
There is a conflict coming, as this problem turns into an issue. It could lead to an economic civil war. Its won't be just a working class led class war either. Says credit expert Robert Manning:This is what happens when politicians run our country like America, Inc. instead of a Republic. I hope our country can survive the mess they've made.
"What we've seen with this kind of financialization of the American economy, where the democratic system and so many democratic institutions have been co-opted and literally bought by the financial service industry, is that we're seeing a big backlash from the American people.