My Fellow Compassionate Capitalists:
It was the best of times… It was the worst of times… Oh wait wrong story. Mark Twain’s first attempt at historical fiction was The Prince and the Pauper. It was first published in Canada in 1881 and then in the US a year later. It tells the story of Prince Edward and Tom Canty who accidentally switch places due to a misunderstanding. Over the course of the novel the boys must find their way back to the lives in which they belong while learning to cope with each others “new lifestyles”.
Whether you want to go with A Tale of Two Cities or The Prince and the Pauper… it seems as if the plot of these two stories is pushing the replay button. Is this a commentary on socioeconomic injustice or simply cyclical events of Capitalism? As we round out 2021 and gear up for the new year… this is the question that we must answer in order to plan our next steps.
While housing prices have begun to stabilize and even come down a little bit in some places….there still remains a shortage of over 3 million homes in America. The greatest contributor to personal wealth in the past two years has been the increase in the value of homes.
The housing market was not a bubble due to the fact that supply still has not caught up with demand. This may be the case for quite some time due to the new work landscape and the gig economy. Remote work appears to be here to stay while many office buildings that held hundreds or even thousands of employees are now being re-purposed.
Inflation is also a huge factor in today’s economy. Gas is up 51% and 2021 cost the average American $3500 more to live and have the basic necessities.
Add to all of that the fact that we have become victims of “skimpflation“. Skimpflation is where restaurants and companies not only raise the prices of their goods and services but then save money by producing a product or service of lesser quality than before. This is especially true when it comes to our food supply. No it is not your imagination if the same food you’ve been eating for years seems to taste different and you are gaining weight because your body cannot process all of the preservatives and chemicals being pumped into the food we eat.
Is it any wonder that so many people have become part of “The Great Resignation“? This is what happens when government tells you to take a paid vacation from work on the tax payers dime……and by the way the government will actually pay you more than you made before while taking your “vacation”. This has given many a distorted sense of job value when it comes to those who had jobs that paid around or barely above minimum wage.
While we are at it….why stand for Capitalism and American values and freedom when we can participate in “The Purge” where almost all crime is now legal. We are defunding police departments so that it’s harder to catch and prosecute people for the crimes that still are illegal. All you have to do to justify it is to cry injustice and that you’re part of some group that just needs to have their voice heard.
With so many people choosing to not participate in the workforce but still have money due to government subsidies as well as mooching off of mom and dad…… we have months long backlog‘s and bottlenecks in all of our major sea ports. The turnaround on shipping containers has fallen off the cliff and there is a massive shortage of truckers to bring products in locally. Many who were participating in the workforce got frustrated with the idiocy and government regulations and simply retired early.
All of these factors are brewing for the perfect storm that will not elevate the poor into prosperity… but rather eliminate the middle class completely. That my friends is the real danger and tragedy. Throughout history we’ve always had the wealthy as well as the poor. However it is not until the advent of the middle class that society as a whole truly advanced.
The middle class have made up the majority of the workforce that has livable wages and better. The middle class is who buys the average home in America. The middle class is whose kids go to college. The middle class fuels the automobile industry. The middle class fuels the electronics and computer booms as well as eats at restaurants and attends sporting events and concerts. The middle class pays the most in taxes. The middle class has incentive and self motivation. The middle class remembers what it’s like to be poor while at the same time progressing as they have had a taste of what life could be like with more.
A Tale of Two Cities and The Prince and the Pauper set the stage of the differences between those who are wealthy and those who are poor. The underlying themes and conclusions that they come up with is societies need for a middle class. The middle class is what bridges those two groups. The middle class is also the infant as far as it’s time here in modern society.
My fellow Compassionate Capitalists….. A correction is coming. The most powerful force in the universe…… The ECONOMY will call out once again. Participation by all is MANDATORY for anyone who wants to survive. Capitalism unbridled is as bad as Socialism. This time around we must rebuild the middle class bigger and better than ever. A middle class that has compassion for the poor while at the same time the ambition for wealth and improvement. A middle class that was created by and will continue to grow and prosper by its ability to “NEVER awake from the American Dream”.