What's Really Going On?

The engine of the economy:   The working class people, the self-employed and those employed by both large and small businesses are the real engine of the economy.   The people who actually produce the goods and services are the power people who keep the financial system functioning. --  NOT the financial institutions!  --  NOT the corporate leaders!  --   NOT the politicians!  --   NOT the Government bureaucrats!  --  NOT the Wall Street money managers!   BUT the working class people.  

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Who Pays the Bills 

  No mater what happens, the working class ALWAYS ends up paying the bills.   The bills may not show up directly, but no matter how many degrees of separation²  there are between spending and paying,  the working class ALWAYS ends up paying the bills.   There's nothing magic or sinister about this process.  It's basic, simply Economics 101.     

  Deficit Spending causes the poor to get poorer and the rich to get richer.   

  Deficit spending causes the prices of all goods and services to rise.    Deficit spending is what is causing the prices of gasoline, food, medicine and everything else to rise dramatically.

  People are forced to cut their personal spending because of:
**  The excessive deficit spending on the part of  the federal government, 
** The underhanded money manipulations by major financial institutions, 
** The greed of the leaders of many multi-billion-dollar corporations,  and 
** The "creative  lending and borrowing practices"  of the hotshot wheelers and
      dealers on Wall Street, 

  The result is that local businesses in every community in the country lose customers.    Many of them can't pay their bill.   They lay off workers or go out of business completely.   This, in turn, causes tax revenues for state, county, and local governments  fall drastically.   State, county, and local governments become unable to pay their bills.   Human services are cut; taxes and user fees are increased; jobs are lost; the economy takes another nose dive into an empty pool.   

The above-described loses cause the cycle to repeat itself at a more destructive level.   People begin to lose their homes in foreclosure.   In short, the economic system ceases to function, and if the cycle is not stopped and reversed, the system will collapse completely, as it did during the great depression of the 1930's.  

There are limits to the amount of money that can be exploited out of the working class.   We've have not only reached that limit, we've passed it.   The additional burden is now destroying the working class and destroying our economic infrastructure.   It's destroying our capacity to produce goods and services.  It's destroying people's capacity to take care of themselves and their families.   

  Deficit spending by the federal government and unethical money manipulation by the financial industry are major causes of current the meltdown in the housing market.   People cannot pay their bills.   Out of desperation they borrow money.   When they cannot repay the loans, they end up losing their homes.   For example, 739,714  property owners received foreclosure notices from lending institutions in the second quarter of 2008.   During that same period 220,000 were actually lost their homes to foreclosures.***   Since then, the problem has getting worse not better.

***  Statistics from RealtyTrac.com 

  The above-described problems, include only the obvious costs and only the costs within the United Sates.   If you add the hidden costs (such as those related to  home-land security)  and the global ramifications, and the cost in terms of grief, misery and loss of freedom, and the environmental damage, the cost becomes so staggering that it's almost unimaginable.

The American economic  system is on the verge of collapsing.   On July 28, 2008, Bush and Company announced a plan to deficit-spend another four hundred and eighty two billion.   

This is nothing short of inviting an economic meltdown worse than the crash of 1929 and the great depression of the 1930's  

Economic collapse will result in irreversible environmental destruction at a level the threatens everyone on the planet.   Rich and poor alike will  be equally DEAD!

Bush & Company Deficit Spending  

Squandered surplus from Clinton Presidency  ---------------     $ 236   billion   

Bush 2000- 2008      ---------------------------------------  $ 4,000   billion 

July 28, 2008, proposal is to deficit spend another  -----------   $ 482  billion

September, 2008, AIG bailout   ------------------------------   $    85  billion

September, 2008, Bail out the banks, etc.  deficit spend another $ 700  billion

You can steal a little bit from everybody for a long time and most people will not even know that they are being secretly milked for money.   (That's what the super wealthy have been doing via the The Federal Reserve ²  for almost one hundred years.)   As the rate of theft become larger and larger, there comes a point where the missing money becomes obvious.    That's where we are now with excessive government deficit spending, with the banking industry's usury-level  interest rates and with financial fraud by the Wall Street wheelers and dealers.   

The next step is to ask:

Who has the thousands of billions of dollars that everybody is borrowing?

Nobody!  It's make-believe (fiat) money being created out of nothing and loaned out to collect interest -- interest paid by the working class and paid in real, hard-earned money.   The public often pays exorbitant interest rates, particularly when borrowing using credit cards.

Whose taking in all those real, hard-earned, interest dollars that everybody's paying for the use of make-believe money?

The super-wealthy who own the financial industries.

Is there another way?   Are there any reasonable alternatives?

Yes!     Readers are directed to the five pages listed below:   

 The Financial Bailout    ²  ---   The who, what, when, why, and how of solving America's Financial Crisis.

 How Banks Can Handle Home Foreclosures  ²  --- A way for the banking system to solve the home foreclosure problem all by themselves?

 How to End the Home Foreclosure Crisis ²  --- A proposal for a new home loan lending system that will solve the home foreclosure problem.

http://www.EconomicSanity101.com/
bo-3-how-to-stop-home-forelcosures.html#83

 Creating a Solid Financial Foundation for Corporate Employees ²  ---  From time to time, something comes along that's so good, that you just can't ignore it.  The Arrival of NCW's Win-Win Business Structure is one of those times.

http://www.EconomicSanity101.com/
bo-8-solid-financial-foundation.html#83