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The big problem with the US economy

Posted on July 26, 2007 at 5:10 pm .
Filed under: General — Zafar Ahmed

American citizens now face an age where the middle class is no longer considered the “average” American. In fact, high class and middle class society now ranks to be approximately 1/6 of the American population. So what caused this change? Many small things contributed to it, but a few large things, that can still be fixed, are also to blame.

The most obvious reason, is corporate america. Big companies, like Wal-Mart, have long been the cause of many small businesses closing their doors. Unfortunately, that hurts not only the business owners, but our economy as well.

When there are many small businesses, there are many places to buy the same product. When there are many products, there are many places earning income. And while there are many places earning income, there are many places hiring employees at decent rates. So now, with these choices, money is being exchange into many different hands, which is good. The man who owns the grocery store. The lady who owns the computer store. And so on. But what has happend?

Corporations like Wal-Mart, Target, K-Mart, and many others, have stepped into the picture and taken over. They buy in such bulk, that they can price their items much lower than small business, so any other stores, are forced to close. This now starts a problem because with each store closing, you have unemployed people that are now searching for a new job, and people with less money.

Now, it wouldn’t be so bad but, these corporations don’t compensate their employees as much as they should. The average employee at a big corporation makes less than 10.00/hr. Working 40 hours a week that’s 400.00/week, and only 1,600.00/month before taxes. That’s less than 20,000.00/year before taxes. Now if you take into consideration that the average american has atleast a few hundred dollars in mortgage or rent, plus more in utilities, food, gas, car, it adds up! People no longer work for nice things, they work to live!

Now here is where it gets worse. The money, never really goes to the employee. No I don’t mean they don’t get paid. What I mean is, if Sam is working for WalMart making $10.00 an hour, and gets a paycheck for $400.00, she then is likely to need to buy food, possibly clothes, or some small item for herself like a movie, book, anything. And where is she likely to shop? Well, considering her lack of funds, she is going to shop at the ever so known WalMart with their always low prices.

So there in lies the biggest problem, instead of money changing hands many times over, it stays in the hands of a select few. There is no longer a true “middle” class. You either have money, or you don’t.

But it is not a lost cause. If somehow, someway, we can get corporations to pay their employees a more fair amount, then it will lead to options. And if people have options in their purchases, they may do business elsewhere. And if people do business elsewhere, money will begin to exchange hands again, and with hope, keep expanding.

Any comments?

Original Writer : Nick Wrasse

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