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Crazy talk -- that’s what any economist might call speculation that our nation is headed into a spiraling depression.
However, considering the economic table that has been set, it’s easy to see why it appears the table is void of the meat and potatoes that equal prosperity for most American families.
Tuesday morning’s announcement that the Janesville General Motors plant was to close, putting 2,800 workers on the streets, is a case-in-point of why America appears already past the brink of a great economic downfall.
Free trade agreements, a lack of fair trade expectations, and the transition of our economy from manufacturing to services, has led to declining job opportunities for the most important segment of those in the economic food chain -- the average high school graduate.
Economists won’t quibble, however, that the service industry is largely supported by the manufacturing industry. It’s simple really. Somebody has to pay for services. When there’s fewer and fewer average Americans earning a living wage, then the service industry collapses.
While enormous amounts of wealth have been gathered in the past two decades, driven by technology and capitalizing on the efficiencies of that technology, America has let go of meat and potatoes jobs for the sake of profit. Those jobs have gone to Mexico, China, South Korea...
According to the obviously partisan AFL-CIO, more than 3 million manufacturing jobs have disappeared since 1998, and the Economic Policy Institute estimates 59 percent -- or 1.78 million -- of these jobs have been lost due to the U.S. manufacturing trade deficit over the period.
The outsourcing of jobs is mind-numbing. Any job that requires telephone support likely has been outsourced to a Pacific-rim country or India. Even state and local governments have outsourced jobs. At least 40 states contract abroad for the administration of electronic benefit cards for their food stamp programs.
Even college graduates have suffered in a depressed job market. It will only get worse. Forrester Research Inc. predicts U.S. employers will move 3.4 million white-collar jobs and $136 billion in wages overseas by 2015.
With gasoline prices skyrocketing and food prices joining them, people are scared. Anybody reading the classifieds knows that the opportunity to find a good-paying job for a high school graduate is nearly impossible.
There are 2,800 people in Janesville who will be leaving jobs that pay more than $20 per hour. What kind of an economic impact is that going to have -- not only on their families, but also the businesses they’ve supported? Ask them if mentioning a spiraling depression is “crazy talk.”
There’s no silver lining. If there would be a magic bullet for our failing economy, it would have been fired long ago. Tough times appear here to stay, and things are going to get much tougher in the future, perhaps more than any of us could guess.
The numbers might say the United States has just entered a recession, but it feels much worse than that.
--Matt Johnson
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