A significant amount of the U.S. population is of the opinion that a businessman running for president is a new twist to American politics that had never before occurred. In fact, George H.W. Bush, Jimmy Carter, Harry Truman, Herbert Hoover, and Warren G. Harding were all businessmen, but apparently, only those of us who have studied American politics of the Neolithic era could put the election in context. The unusual event of the past presidential election was the spouse of a former president running for the presidency, which never happened before. However, the identity politics of the neo-alt-micro-anti-political class of voters saw the defeat of HRC as an act of massive micro-aggression against whom they considered to be uncaring white elitists and, of course, the neo-targeted neo-political class, who have taken the role as the neo-alt-scapegoat for all that is wrong with government. I will from this point attempt to refrain from the ridiculous prefixes that pepper our analysis and make us think that we come off like some highly-trained political analyst, because the optics simply aren’t favorable at this juncture.
Ross Perot, a Texas billionaire, ran for president in 1992 and 1996. In his 1992 campaign, businessman Ross Perot was unwilling to follow the advice of his campaign managers; does that sound familiar about any recent presidential candidate? The bulk of the Perot supporters (57%) were middle class working voters, sound familiar? I heard a brilliant Perot speech where Perot said “stop blaming the American worker.” It was well before the 1990s that the working-class wages, both blue collar and, to some extent white collar wages began to stagnate. When Perot was saying “stop blaming the American worker” he was explaining that American workers had little control of what they produced, that the management was accountable for the performance of American corporations. As executive wages soared, average workers’ wages stagnated. The computer age, or information age, initiated increases in productivity and efficiency which have been carried forward into the present day. Aside from union leaders, and unions have been in decline since at least the 1980s, who came to defend the working-class as their pay stagnated?
Let me explain a bit further about the 1990s. The 1990s saw the tech boom take off, and the global economy became the universal excuse for why Americans’ pay went down or they lost their job altogether. The American car manufacturers had lost their position as the leader, the American economy was dependent upon foreign oil, and no one could figure out any solutions. The 1970s and the 1980s saw some downturn in the American economy, and blue-collar wages had, for the most part, gone nowhere in those decades. It wasn’t all gloom and doom, though. Executive compensation had risen dramatically, and things like “golden parachutes” where if an executive was fired, they would still receive compensation because, well, they were executives. The executives figured out that they could create contracts that would pay them money even if they left a corporation, or, the golden parachute. Of course, all of this happened as working-class wages stagnated. Who came to defend the working-class as their pay stagnated? There certainly weren’t any golden parachutes for working-class employees laid off during a business downturn, and the 70s and 80s had their share of downturns.
In the 1980s and 1990s, there was no money in small cars, and all of the American car manufacturers knew that. American manufacturers made some attempts at small cars, none of which were noteworthy. General Motors invested billions and their 46% market share in 1980 sank to 35% in 1989. GM created Saturn “from a blank sheet of paper” and it ran from 1985 to 2009; its intention was to compete with the Japanese car manufacturers, with limited success to be kind. According to the then chairman of GM, Roger Smith: "Saturn is the key to GM's long-term competitiveness, survival and success," that key didn’t unlock the door that was keeping GM from getting market share. Billions in investment by GM yielded only decline in market share. Who came to defend the working-class as their pay stagnated?
As the tech boom expanded, more and more data was created, and the digital revolution took hold. The white collar jobs expanded. Where there was before no need for several engineers and software developers, the demand soared. Meanwhile, wages for average American workers stagnated. Quite intentionally, the demand for hard science workers expanded, as did the compensation, which is a lot like supply and demand, the economic precept of how things are valued. Efficiency and modernization actually eliminated more and more jobs, as machines took over many of the jobs previously held by humans. Who came to defend the working-class as their pay stagnated?
As the unions declined, as companies learned that they could outsource, use temporary workers, or simply ship the work overseas after they taught the people outside of America to do the work for fractions of the wages of American workers, who came to defend the working-class as their pay stagnated? There weren’t many politicians willing to create legislation, and maybe there couldn’t have been any made anyway. Of course, there are always laws and regulations that favor industries, but if any were passed they didn’t do much good for the workers.
America has faced many struggles, both internal and external. If you look at those struggles, there has almost always been a leader, someone who appeared and led their fellow Americans to victory. Ralph Nader came to the defense of the environment. Eisenhower led us to victory in World War Two. Who came to defend the working-class as their pay stagnated? Decades went by, and the buying power of the middle class declined. The middle class got smaller and smaller. Jobs became harder and harder to find and keep, as companies discovered that they could “farm out” the work and use temporary workers. As more and more people lost full-time jobs, more and more were willing to work part-time or temporary just to have some revenue coming in. Who came to defend the working-class as their pay stagnated? Who stepped up to the plate, and suggested that the government make changes that favored paying working-class people better wages? What companies took pride in retaining employees, (working-class employees, not so much executives) stating that people were their greatest asset?
Who implemented tax policies to be applied to companies so that they could retain and pay employees’ salaries that were livable? On and on the global economy was a reason that Americans would have to make less money. They (the working class) bought cheaper goods at Walmart, which was a good thing because they weren’t making as much money, and some almost no money at all. Industries died, and then the middle management were squeezed out as well. Millions of blue-collar and white-collar workers were left out in the cold. There is one theory of economics that you don’t read about, and that is lost productivity. When there are massive layoffs, and workers aren’t working, the products and/or services that those workers would have provided are not contributed to the economy; it is lost productivity. What we could have produced, what products that would have been available were never made, and thus never made available. While it could be said that as an individual, it is not healthy to sit around and think of all the things that you couldn’t have, in economics, it is a serious consideration, because it is what was not contributed to the economy versus what was made and contributed.
The executives stood up for themselves. They invented golden parachutes; they invented new methods of payment, such as stock options and other ways to keep the government from taxing their soaring salaries. As executive compensation rose in the 1990s and onward, the IRS began to tax the extraordinary compensation that they and the boards (of which they were members) were voting them. Every time the IRS tried to extract revenue from the executives, they huddled with the accountants and the lawyers and figured out how to get around being taxed. It seemed that there weren’t any meetings about how to pay the working-class employees in ways that would avoid taxes. Of course, the working-class spent their money paying mortgages and car payments, so deferred income from stock options weren’t really in the mix. If you made millions in a year, you could have a few hundred thousand dollars in stocks that wouldn’t transfer to you until certain conditions were met, but that was not an option for the working-class employee.
Here’s the bottom line. There could have been legislation that could have made the incomes of the working-class taxed less. There could have been incentives for companies to pay their employees more, giving tax breaks to organizations that chose to remain in the U.S. and pay their employees considerably more than the minimum wage. There are tax breaks for corporations who build factories in certain states, Ohio and Indiana battled each other for a Honda factory. There could have been executives that said that they valued their employees; in fact there have been a few organizations like that now in the twenty-first century. There could be companies that have training programs instead of insisting that the government train their employees, socializing costs, having the government pay for training, while privatizing profits. There may have been a lot of politicians claiming to represent the working-class, but most just offered lip service; I haven’t seen much of any significant results. The word is that some of the skilled-labor hourly jobs’ pay is going up, and that would be a good thing after several decades of stagnation, several decades where no one much stood up for the people who make things and make things work.