4 Myths About The U.S. Economy

Myth No. 1, the U.S. government bailouts and stimulus led the U.S. out of recession. But massive unemployment, falling real estate prices, the falling dollar, stagnant working class wages and record government fiscal and trade deficits tell you it's not so. The recession continues

Myth No. 2, consumer spending will get us out of recession. U.S. consumers are deeper in debt now than they were in 2006, as mortgage debt, credit card debt and college tuition debt mounts. While at the same time, the equity in their homes is worth far less than it was five years ago.

Myth No. 3, led by "too big to fail" bailed out banks, lending and liquidity will increase sharply, thus helping small businesses to expand. This was supposed to restart the U.S.'s small business job engine to hire people. But the opposite is the case. Lenders are fearful and stingy, even with all the government support they've received. They've tightened credit.

Myth No. 4, as giant U.S. companies grow stronger and the stock markets rise, they will hire en mass. Some giant firms have hired en mass. Wal-mart and McDonald's are prime examples, but at low wages. Some other giant companies have hired but overseas. Most large companies are instead sitting on a cash hoard, knowing consumers are hurting and fearful of the economy.

Reality is, we Americans must confront our problems, something we are very capable of doing. We must end our wars, downsize our military manufacturing machine, establish an energy program, while cutting greenhouse gases, and refocus our national attention through Silicon Valley to building businesses that bring greater benefits to mankind while contributing taxes to our coffers.

Dick
To learn more about the U.S.'s debt problems, please see "Debt Hamstrings Recovery," The Wall Street Journal, 6/27/11 http://online.wsj.com/article/SB10001424052702304314404576410141842025216.html