Esoteric Dissertations from a One-Track Mind

September 4, 2007

Labor Day

Filed under: economy, politics — codesmithy @ 5:21 am

It is labor day, so it useful to reflect on this day off for the working man and reflect where we are going.  The labor movement was successful in establishing a 40 hour work week, child labor laws, and safety regulations.  However, we are experiencing a gradual regression of these principles.  Principles that people died for.

While median household income rose slightly (0.7%), actual full time, year round wages fell.  Simply put, people are working more for less and the gap between the haves and the have-nots is rising.

Americans have a negative savings rate, which partially explains why people are working more to make ends-meet.  Americans have been able to prolong the status quo by resorting to ever more complicated credit instruments.  This works fine when assets continue to rise and people continue to refinance.  However, there are reasons to believe it will come crashing down.  Simply put, energy price increases.

Americans have not only become indebted, but also completely dependent on cheap energy.  American energy policy has not been prudent and it is simply not sustainable.  Technology is unlikely to save us, simply because of  the thermodynamics involved.  We have been expending vast stores of energy (some would argue at a poisonous rate) and alternatives are simply not going to be as plentiful or easy to exploit.  The “assets” of today will be the burdens of tomorrow as we become a more energy conscious society.

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