The American Productive Class Is Withering Away: What Is to Be Done?

AmericanProductive

We’re all seeing the stream of statistics concerning America’s productive “middle” class (i.e., people who work real jobs): their net worth is down 40 percent, barely half of Americans have $500 in savings, there are more Americans on welfare than have permanent, full-time jobs, more American businesses are failing than being created, and so on.

While all of these things may be true, and while they do help us to see the problem, they don’t help us move forward. Worrying and complaining, no matter how ardently we engage in them, leave us standing in the same mess where we started.

But let’s start by getting some bearings.

The American Economy Since World War II, in Large Strokes

World War II was a reset for the American economy. With the other industrial powerhouses (Germany, England, France, and Japan) in rubble, the US, Canada, and Australia were the least damaged modern economies, and of those, the US was by far the largest. So, the 1950s and ‘60s were great times for productive Americans, particularly in any field associated with manufacturing.

But those other economies didn’t remain in rubble for long. Soon enough, their factories were rebuilt, and by the 1970s, they were competing with the biggest American manufacturers (particularly automotive and steel), who had grown complacent and arrogant. The car companies, as some of us will recall, were so arrogant that they developed policies of “planned obsolescence.”

During the ‘70s, Nixon and Kissinger re-founded the dollar, moving its base from gold to the oil trade. But still, inflation raged and manufacturing declined badly. By 1980, interest rates had been pushed to 20 percent in an effort to kill inflation, and so many factories had closed that there was talk of a “rust belt” running from Chicago to New York.

Then came something new… something called the FIRE economy. (FIRE stands for Finance, Insurance, and Real Estate.) And this new economy worked quite well between 1980 and 2007. The problem was, it was based almost entirely upon the temporary advantage held by the US dollar.

For economic success to endure, it must ultimately be based on production. You must produce things that other people are willing to pay for.

The FIRE economy did produce some things worth paying for. For example, online investment technology had real value, but it was value that didn’t extend very far. The first few products were very attractive to people, but adding a third and a sixth and a tenth online broker didn’t create much additional value. (Whereas a tenth automobile has almost as much value as the first.)

And even more basic than that is the fact that the FIRE economy was ultimately based upon debt. You can see this illustrated in this graph:

141010image1

In essence, the US economy from roughly 1980 to 2007 depended upon people (mainly foreigners) buying dollars, even though they were declining in value. Obviously, this is not a viable long-term strategy.

Since 2007, the Federal Reserve has been printing money (wildly) to prop up Wall Street, while Main Street slides toward oblivion. It is supremely clear that the US government—regardless of the smooth words we hear from politicians—has defended the bankers and kicked the productive class to the curb.

So, this is where things stand. The question that faces productive Americans is this: What are we going to do about it?

What Is to Be Done?

The great trap embedded in the democratic ideal is to imagine that complaining will conjure magic; that if you complain enough and in the right ways, some ‘great leader’ will rise up and fix your problems for you. Let me be clear on this: All such thoughts are sucker-bait.

Your politicians—both Blues and Reds—have already sold you out. They’ve picked their sides, and they’re going with Wall Street. You’re on your own. I’m sorry if that’s hard to accept, but it’s true all the same.

So, if you actually work, your first challenge is accepting the fact that you’re on your own. Without succeeding at that, there can be no progress; you’ll remain on the ship while it goes down.

Once past that point, however, a world full of possibilities opens up to you.

The truth is that the American productive class is composed mainly of decent, capable people. They’re not suffering because there’s something wrong with them—they’re every bit as talented as their parents and grandparents were—but because Washington controls their lives and considers them fit only to vote, fight in wars, and to create more debt (aka buy stuff they don’t need).

But once you decide to ditch that script, as terrifying as it may seem, life gets fun. There are dozens of options to consider, and you don’t have to pick just one:

  • Start growing your own food. You’ll get better quality and save money.
  • Start side businesses. Become a part-time entrepreneur, run a business out of your garage, sell things at local markets, become a free-lance welder, etc.
  • Start driving for Uber or Lyft, or start renting out spare rooms on Airbnb. And these three are only the best-known names; there are many others like them, and some of the others may be even better for you.
  • Get into the Bitcoin economy. This is where some of the hottest action is, especially if you have a bit of technical aptitude.
  • Start 3D printing. They call this “a factory on a desktop,” and it’s starting to revolutionize the world. Or join the related “maker” community.
  • Start building drones. It’s actually cheap and fairly easy to do nowadays, and they don’t have to be used for spreading death and slavery, like military and surveillance drones.
  • Start building robots. Technology has advanced to where custom robots are possible and effective.
  • Join or create an intentional community. Intentional communities have a long and fascinating history. It has been a checkered history, but not a dull one. (I covered this in issue #16 of my newsletter.)
  • Offshore your businesses. Most of the big corporations do it, so why not you? Sure, you’ll need some professional help, but it’s probably worth it. The big thing about offshore structures isn’t saving on taxes, nice as that may be, it’s escaping the paperwork that tortures small business owners: tax accounting, dozens of forms, endless reports, etc.
  • Stop wasting your valuable time on the TV habit.
  • And while we’re at it, stop being afraid of everything, including yourself. Consider homeschooling your children. Take your life back into your own hands.

Getting help is easy. There are Casey Summits, offshore conferences, prepper shows, shows with a slice of everything, and more. On top of that, there are dozens of good books, magazines, and websites.

Gathering information is mainly a matter of time; that’s easy enough. The real magic lies in the next step: Breaking your inertia and acting.

Nothing changes until you act. Everyone is uncertain, and everyone is scared, but only those who climb into the lifeboats will make it safely away from danger. Mere thinking and talking will solve nothing. You have to act.

So, Ms. And Mr. Productive American, pick your spots and stop going down with the ship.

Paul Rosenberg
www.freemansperspective.com

This article was originally published by Casey Research.

A Report from Middle America

middle americaI was recently involved in a day of meetings with small business owners in the American Midwest. It was both encouraging and sad at the same time.

What I Found First

Overall, I found a large room full of productive human beings. It was uplifting. Most of these people were between thirty and seventy years old, more men than women, and they were all productive people, the kind who get up early every day, make sure that complex systems are producing properly, fix anything that is broken or near breaking, plan for the future, cooperate with large numbers of other people, and then go home at the end of the day and love their families.

If all the world lived like these people, we’d be halfway to a paradise by now. And that was a thought that made me sad.

Why? Because these people – by any standard of decency – should be left alone to create their better world. But instead, they are forcibly tied to wasteful, parasitic, and destructive systems. Half or more of their earnings are taken from them every year. Their actions are restricted by their moral inferiors. They live less than half the rewarding lives they should be enjoying, and for no defensible reason.

The Other Things

Beyond my overall happy/sad impressions, I found quite a few particular things:

  • These people would have preferred to discuss the practical particulars of their businesses – tools, materials, technical obstacles and solutions, and so on. But instead, they were forced to discuss government compliance. Almost every subject discussed from the front of the room dealt with government regulations. Most of the subjects discussed on the sides involved tools, equipment, business strategies and so on.
  • Dealing with employees is a major issue, especially involving the immigration police. These people are justifiably concerned with fines and indictments, just from hiring employees who are clearly long-time Americans. (That is, not Hispanics or other recent immigrants.) A few of the comments I heard:

“Good luck trying to explain that to an ICE agent.”

“Do NOT waive the 72 hour waiting period.”

“Do NOT allow them to enter your facility or inspect anything without authorization from counsel.”

  • Nearly all of these people agreed that government in America is out of control, abusive, and oppositional to their happiness. I think that’s a positive opinion, since it reflects reality, meaning that they have stopped looking at the world through myth-colored glasses. The sad part of that is…
  • These (good) people don’t know what to do about it. The system they grew up believing was their friend has turned against them. They’ve gathered the considerable courage required to face that, but they don’t know what to do next. They are working within the system as they can, trying to avoid its hazards, but don’t see any clear alternative – and no path of escape. They’d like to do other things, but they also need to feed their kids, and don’t know what to do about it all.
  • Bitcoin is spreading everywhere. One of these business owners, in a very rural area, has built a Bitcoin mining operation. And not only Bitcoin, he is also mining for the other cryptocurrencies. And, he’s telling everyone else about it. I was surprised (and pleased) by this, since this meeting had absolutely nothing to do with computers, economics, or anything else that usually connects to cryptocurrencies. This man simply saw a great opportunity and jumped on it.

All In All

All in all, I came away from the day more confident in the future than I had been the day before.

We are exposed to so many horror stories every day. The images thrust upon us show a world filled with danger and discouragement. The reality, however – once you remove yourself from the newsfeed – is that there are a lot of very decent people who are generally doing the right things.

Our job now is to define newer and better ways to live and to spread that information to as many good people as we can. And to remind them they DO have the right to live good, happy, prosperous lives.

Please do everything you can along these lines. Thanks.

Paul Rosenberg
FreemansPerspective.com

How to Fix Detroit in 6 Easy Steps

detroit
Abandoned automobile factory in Detroit.

The news is full of stories of Detroit, and understandably so. It’s an unmitigated disaster. But I know how to fix it.

Seriously, I do!

I have a plan that would cost the state of Michigan nothing – not a cent. It wouldn’t cost DC anything either, and it would turn Detroit into the most thriving city in North America. As a bonus, it would give the remaining property owners in Detroit a financial windfall.

Here’s the plan:

  • The federal government (in writing) forbears taxes, regulations, laws, and impositions for a hundred years to the area of the current municipality of Detroit and to all persons and commercial entities resident there.
  • The government of the state of Michigan forbears taxes, regulations, laws, and impositions for a hundred years to the area of the current municipality of Detroit and to all persons and commercial entities resident there.
  • All municipal government agencies within Detroit are disbanded.
  • All state and federal offices within the city of Detroit are disbanded.
  • The federal government guarantees that entry and exit to/from Detroit will remain unchanged from the current conditions, and that no obligations will be placed upon residents of Detroit in any other place.
  • Federal and state governments immediately cease all payments to residents of Detroit. (They may resume payment to those persons if and when they are no longer resident in Detroit.)

The final legal document would be more complex than this, but those are all  the main points necessary.

What this plan does is to return Detroit to its natural state – to the way it was managed when the first settlers arrived. (In other words, not managed at all.)

And think of the money that will be saved by Michigan and the feds. Billions per year.

And Then…

And then we have a free for all… and a good one. Think of Hong Kong, but easy to get to.

Businesses would begin to relocate the next morning. Hundreds of them, thousands of them. The people who still owned and lived in their homes would be offered lots of money for their properties.

Libertarians and conservatives, disgusted by the gang in DC, would load up and drive to Detroit. Productive former residents would return. Thousands of opportunity-seekers, anarcho-capitalists, and pot-smoking hippies would be gathering their money and buying property.

Detroit would, within only a few years, become the coolest city on the planet – by FAR.

But, But…

“But there won’t be any police!”

“There won’t be any courts!”

“It will be non-stop murder, death, and mayhem!”

You wanna bet? Do ya? (And you don’t think Detroit has non-stop mayhem already?)

The people who come to Detroit would be coming to escape from their chains and to be productive. These are precisely the kinds of people who clean up a town. And with no taxes to pay for a hundred years, they’d have plenty of extra money to spend on whatever services (security or otherwise) that they wanted.

The Truth

The truth, of course, is that the state and fed guvs will never agree to a plan like this one, for a single reason:

Because they fear it would succeed.

They’ll let every last person in Detroit rot before they’ll let a group of producers live free of their chains.

Detroit returned to its natural state would expose the great lie of the government game – that we can’t survive without them.

Paul Rosenberg
FreemansPerspective.com

Featured image courtesy of Albert duce, wikipedia.org