Are Americans Really Getting Poorer?

Bait and switch

The American people have been the victims of several "bait-and-switch" schemes since the 1970s:

In the 1970s, we were told that manufacturing and heavy industry were passe; America would be a far better "post-industrial" society of knowledge workers in high-tech offices. Now we're seeing what can go wrong with that, with nearly permanent trade deficits.

In the 1970s, we were told that the newfangled "Health Maintenance Organizations (HMOs)" were just an alternative option to traditional fee-for-service medicine, a reasonable option for healthy young people. Now they've totally replaced fee-for-service medicine, even for elderly people battling chronic illness, for which their own proponents had said they were not really suited.

In the 1970s, we were told that IRA and 401(k) plans would be just a nice option to have for one's retirement nest egg, alongside traditional defined-benefit pension plans. Now the 401(k) has largely replaced the pension plan, adding a huge amount of risk to each worker's retirement planning.

Each time, the American public has lost a little bit more of the job security and "social contract" it once enjoyed.

SteveL of MA @ Jul 26, 2008 11:24:01 AM

Umm, Fatesrider, why wasn't the regulator that was supposed regulate Fannie and Freddie not regulating them? Why is the Fed not doing its job of regulating the value of the dollar and inflation? Regulation does more harm than good, even when it is designed with the best of intentions. You are exactly right that government is reactive as opposed to proactive. Why do you think that is? And you're naive if you think regulation does not hurt consumers.

Chris of AZ @ Jul 25, 2008 17:39:22 PM

Oh, you think?

From my perspective, a LACK of regulation and oversight are what have cause all of the bubbles in the last thirty years. Perspectives change, and policies change as well, but government is usually reactive as opposed to proactive, tweaking things where they shouldn't be tweaked and going along with the things that should. Businesses, of course, want NO regulation at all, which hurts other businesses, consumers and America in general.

Prudent regulation is the order of the day. You can't strangle business, nor can you let it run rampant and roughshod over the economy. It's not a prescription our financial markets need, it's a leash - one long enough to allow them enough freedom to do business, but not so much they abuse that freedom.

But because regulation comes from government, and government is elected based on business donations, it's highly unlikely that we will ever get out of the bubble, bust, repeat pattern anytime soon.

Fatesrider of CA @ Jul 25, 2008 16:28:07 PM