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Wealth Gap 2020: The destruction of the American dream

Is feudalism our future?

By Larry Fedewa Ph.D.DrLarryOnline.com

The closer the 2020 election comes, the more urgent the necessity for understanding the wealth gap which underlies the entire debate.

The fundamental issue at stake in this election is how America will deal with the fact that the American Dream we all pursue has in fact become unattainable for many Americans. With most national politicians in their 70’s – or even older – the reality is that they simply do not understand that too many Americans today face a gloomy future. They are at a loss to explain why the nightly riots and violence can happen at all let alone why the public officials at least tacitly, and some openly, support such chaos.

What they don’t understand is that there is a great deal of anger in our land, that the traditional mantras of the American ethic just don’t work anymore for a segment of the American population. “Work hard, keep your nose clean, and you too can live the American dream” just isn’t true for these folks, and hasn’t been for a long time. 

Who are these people? And why are they so desperate for change?

One of the oldest questions in the American lexicon is, “What happens to the manual workers when the American quest for labor-saving technologies finally succeeds and the need for human labor ends?”

Now we know the answer to that question: The many American workers who have lost their jobs to technology are still there. But now they have nothing – not even their pride.

There is, of course, another segment of our society which has done somewhat better financially through these years. They are the so-called “upper middle class” who have adapted to the technological society, although they are concentrated now in the service industries, since manufacturing has all but disappeared.

Even their children, however, have been affected by their estrangement from two work-alcoholic parents, whose closeness to their children is questionable as is their loyalty to each other. Many of the protesters are white, middle class youths, whose sympathies lie closer to their African American comrades than to their befuddled parents.

It is well known that a coalition opposing this President exists, consisting of the Democrat Party, the Deep State bureaucracy, and the Press, as well as the dedicated Far Left organizers and followers, who have coalesced around the  issues of class and race so prominently featured in the violent summer of 2020.

It is clear that while these players have picked by various names the wealth gap as the key issue in this campaign, their timing of the current crisis was not dependent on their discovery of this issue. They have simply taken advantage of the uproar as it occurred.

So, what did happen?

What happened was the transfer of the asset wealth of the American population from the middle class (approximately 50% of the population) to the super rich (1% of the population). (The term, “assets”, is used instead of “income” because income can go up and down while assets tend to be more stable.)

How did this happen? Many factors came together and finally created one of the worst nightmares Americans have ever faced. The most obvious of these factors are three:

  1. Inflation: between 1971 (when Nixon ended the gold standard) and 2015, the value of the US dollar declined nearly 600%, causing the buying power of wages to become stagnant.
  2. Expansion of the workforce:
  • between 1960 and 2020 the American workforce nearly doubled as women entered the labor market;
  • the globalization beginning in the 1990’s expanded the American labor market to the third world
  1. American foreign policy which allowed, even encouraged, American firms to move production overseas. 

The result of this movement on the US working man was catastrophic. As the factories left American soil, the skilled workers were left behind with no job, no marketable skill, and eventually no hope.

The principle victims of this exodus were American men. Whereas their place in society and the family had always been respected and secure, they lost that place in both as they sought and were forced to take lower paying jobs or welfare.

Their self esteem followed their decline. Divorce rates soared along with family abuse, alcoholism, drug addiction, desertion, homelessness, and suicide and the decline of our cities left social services rare and bankruptcy all too common.

Through all this, the latch-key children bounced around helplessly, caught up in the whirlwind that their life had become. As they grew older, they asked “Work hard?” –“At what?” “College?” — “OK” and then no jobs available. “American dream?” — “What a crock!”

What they want is change. The old system isn’t working for them. Why is socialism suddenly becoming so popular? After all, it has been around since the 1930’s. Franklin Roosevelt’s Vice President, Norman Thomas, was an avowed socialist. Few believed in socialism as long as we had the American dream. People believe in socialism now because for them the American dream is gone. And socialists are the only ones listening to the cries of our suffering youth.

What now?

First, we must all recognize the underlying problem: it is the transfer of wealth! Prosperity for all tends to reduce all social tensions, as the Trump economy was beginning to show before COVID.

Secondly, if we do not want to watch our beloved country go the way of Venezuela, we had better face the realities of our situation and find a solution.

Finally, while some our people were caught in a vortex of tribulation, others were developing a new way, a new path to the American dream.

A third way: Luckily, many of these pioneers of a new capitalism have been not only inventing a new type of business process, but also organizing a potentially vast new movement to what will become, in my estimation, a new America, open to all races, genders and religions.

The most advanced of these renewed American businesses seem to be the Conscious Capitalistorganization, currently with 16,000 member companies, representing 3 million workers.

It aspires to become a new kind of business, one which is driven by its service to the community – whether that be a local factory, a retailer, or a worldwide marketplace.

The idealism of this brand of business is appealing to the young, who may not know socialism from a community swimming pool, but who do know that they are Americans who value their personal freedom and the room to grow into a happy future without a government telling them what they can and cannot do.

The dilemma facing this country is that conscious capitalists see politics, as do most Americans, in the light of partisanship. As a result, they want to be apolitical so that all sides feel welcome.

Nevertheless, in today’s America, you are either a socialist or a capitalist, either in favor of big government controlling the transfer of wealth from the 1% or in favor of devising a solution which is voluntary and based on merit rather than welfare.

Unfortunately, there are no candidates running for national office who present new alternatives to the socialist programs of the Democrats. The Republican alternative stands for continuing to implement Reagan economics, believing that the wealth gap will solve itself in time.

It seems clear that this is a better alternative than the opposition. At least a victory here would buy us time. By 2024 perhaps a “third way” capitalist will come forward.

As Alexander Pope wrote in 1734, “Hope springs eternal in the human breast.”


Workers’rights in the 21st century: Unions and Conscious Capitalism

Is there still a place for labor at the table of a “Conscious” company?

By Larry Fedewa, Ph.D.DrLarryOnline.com

My first experience with a union came when I represented the newsroom’s intention to hold a vote for a union to the publisher of a national weekly newspaper. I had a summer job there after my first year as a high school teacher.

Later, as a training developer, I wrote, produced, and oversaw one of the largest industrial training programs in history for the Railway Labor Executives’ Association (a council of all major rail union presidents). I also executed major projects for the Federal Railroad Administration, AMTRAK, Conrail, and others. Still later, I worked very closely with the National Education Association, the professional teachers’ union in a major joint venture, a national research project, and addresses to two national conventions.

The reason I mention all this background is to establish my position as an ardent supporter of the labor movement. My comments come from a firm commitment to the need for workers to take their place at any table which determines their fate. The purpose of this essay is to explore a possible alliance between unions and “conscious” companies.

The first factor in this dialog would be the fact that “Conscious Capitalism” promotes the most expansive view of workers’ rights ever to be advocated by corporate management in the history of capitalism. At last, workers are accorded the respect due to major stakeholders in the organization, whether a corporate giant or an entrepreneurial start-up. Almost always this means sharing in the profits of the company if not outright stock ownership.

This view of the business flows from an idealistic definition of the enterprise which includes, among other things, the function of profits as a necessary means to a greater good. The greater good is the mission of the firm as providing a community service through the sale of its goods or services. Conscious Capitalism challenges everyone in the organization to contribute to the fulfillment of this mission and provides the resources to do so.

Conscious Capitalists also tend to be anti-union.

Most believe with former Whole Foods CEO, John Mackey, that unions introduce an adversarial relationship between management and labor which detracts from the collegial environment necessary for the Conscious Capitalist company to be successful.

True to that description, the unions argue that underneath the sheep’s clothing, Conscious Capitalists are really hiding their power to dictate and enforce their own definition of workers’ rights. The workers ultimately have to accept that definition or find another job. With every company defining workers’ rights in its own way, no standards will be set or recognized. This is just the same old thirst for power presented in modern dress.

So, what’s the answer? Is there a place for unions in a Conscious Capitalist company or not?

The first element of the answer is: if the employees want a union, there is a place for a union. During a transitional period such as the current one, there will continue to be employers who do not accept the new ways. The old paradigm of management versus labor will be in place and needs to be followed.

Over time. however, more and more companies will join the new movement – particularly since there is much evidence accumulating that indicates “Conscious” companies are substantially more successful financially.

In order to maintain its relevance, therefore, labor will have to adapt. The first step in that direction is to find a new answer to the question of a union’s role in a worker-friendly enterprise. Here are some ideas.

First, many companies will be trying to transition to the new style. Unions could help them succeed. But why not hire a consultant or new senior staff to guide the company in the new direction? These may be useful measures, but no one outside the organization has the same motivation and investment in success as the people working there now. However, they are generally as inexperienced as the owners.

Involvement of a knowledgeable and sympathetic third party can be welcome to all sides. However, the union must be truly invested in the cooperative approach in order to be credible. To achieve this posture, unions should be reaching out to the small but growing body of Conscious Capitalism experts. Honest discussions about sensitive issues will profit both sides.

Another role for unions in the new world of work we face is that of advocating national (and international) standards of what constitutes workers’ rights in this new century. As movements like Conscious Capitalism illustrate, 40-hour-workweeks, paid vacations, pensions and health care are not always enough to keep the economy going in the right direction.

Today’s workers want to be part of the company in new ways, ranging from profit-sharing, to shareholders, to open communication with governing bodies, including full financial disclosure, to a “cooperative culture”, and many other new practices. Workers want to be treated as persons, not robots.

This transitional period is reminiscent of the early days of the TQM (Total Quality Management) movement, which can be seen as an earlier step in this direction. The eagerness of workers to become involved in contributing their ideas and expertise to product development and manufacturing was often almost tangible. It revealed to many of us just how much talent had lain dormant in our workforce.

The contention here is, of course, that unions as well as management must embrace this new style of company culture as the means to solving our wealth gap between the rich and the middle class. The reduction of taxes and regulations of the Trump era are doing much to enhance the wages of the lowest income workers.

But from a macro view, the real challenge is to enrich the middle class, which is responsible for much of the consumer economy on which our national wealth ultimately depends. The Leftists want the government to use the tax system as the instrument for re-distributing America’s wealth from the very rich to everybody else (legal or illegal). That would weaken the individual’s motivation to work hard on which America’s free market capitalism has been built and which has created all this wealth.

Conscious Capitalism is an answer to the question of how we solve the wealth gap without turning to socialism. Union support – with an updated agenda – will help America achieve the right outcomes.


Nobody Is Pushing Thomas Piketty’s Policies to Combat Economic Inequality

By Michael Barone     •     RealClearPolitics

Money Hole TaxLast spring, you may remember, the French economist Thomas Piketty was all the rage in certain enlightened circles. His book “Capital” shot up to the No. 1 spot on bestseller lists, and many economists praised his statistics showing increased income and wealth inequality. Piketty argued that, absent a world war, returns to capital will exceed economic growth, inevitably producing growing inequality in the 21st century.

There are problems with Piketty’s — or anyone else’s — statistics. Reliance on U.S. income tax returns overlooks the fact that tax cuts encourage people to realize income and misses non-taxable income such as welfare and Social Security payments. Continue reading


Not a spending problem, but a “paying-for” problem?

Worse, a veiled liberal threat to correct what they deem a “misallocation of wealth.”

by Scott L. Vanatter

Over the past week liberal House and Senate leaders have spoken openly about how they see America’s spending problem. They don’t see it. They claim that we don’t have a spending problem.

First, Rep. Pelosi (D-CA) relabeled it as a “priorities problem.” Then, Rep. Hoyer (D-MD) redefined it as a “paying-for problem.” Finally, Senator Harkin (D-IA) revealed the usually hidden liberal designs on capital. He turned the equation upside down by describing problem of a lack of funds to pay for what we have spent, not because we do not have a budget, but because we have “misallocation of wealth problem.” Continue reading


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