I stumbled upon an article on Economyincrisis.org – Awareness For American Economic Problems back in 2008 that I thought was still pretty relevant. Sometimes you have to look to the past to see the future.
America has been for years burdened with deeply rooted and unsustainable economic challenges.
From credit debts and loss of manufacturing nationwide, to foreign nations buying our best companies and propping up the economy with loans, these issues impact every citizen.
Here are the 16 major problems America faced then… and now:
1. Wholesale sellout of core strategic assets to foreign acquirers: according to official figures, more than 8,815 American companies have been sold to foreign corporations in the last 10 years for at least $1.3 trillion. The 2020 Coronavirus plandemic exposed the vulnerabilities we have as a result of dependence on foreign companies to provide our basic health and security products.
2. Subprime Fallout: Millions of Americans took mortgage rates that reset to a higher value, resulting in a steep rise in foreclosures nationwide and over 161 subprime lenders have gone bankrupt as of October, 2007. It also shook the 6.5 trillion mortgage-backed investment market, notably causing two Bear Stearns hedge funds to lose nearly all their value. Worries remain about contagion and subprimes fallout on the housing market and broader U.S. economy.
3. Housing Bubble Burst: market value of residential real estate was inflated to a record-high 38 percent of household net worth. By 2007 the real estate value was in a free fall nationwide. The National Association of Realtors estimated that home sales will drop 10.8%, the lowest level in a decade
4. Decline of vital industries through bankruptcy, foreign predatory competition, and foreign acquisition: examples include steel, publishing, textiles, machine tools, automobiles, electronics, movies and others. In 2021 our access to computer chips produced overseas caused huge disruptions in our supply line and manufacturing of nearly everything electronic.
5. Inability to manufacture competitively: American manufacturers suffer a 22 percent structural cost disadvantage compared to overseas competitors through taxes, health and pension benefits, litigation, regulation, and unequal environmental protection
6. Overdependence on imports: $1 in $4 of US consumption of manufactured goods now goes immediately and directly to imports
7. Massive wealth transfer to foreign ownership: our trade deficit, at $765 billion in 2006, equal to almost $1.5 million per minute
8. Loss of job and career opportunities for people at all educational levels: 3 million high-paying manufacturing jobs lost over past 5 years
9. Outsourcing of foreign manufacturers destroys our domestic industries, takes profits and taxes overseas, and provides only low-skill jobs for American workers: foreign manufacturers operating in the US now account for over 20 percent of our exports and manufacturing assets, and a large percentage of our employment
10. Dependence on foreign financing of vast majority of government debt: foreign countries now control 44% of our total federal deficit and finance nearly 100 percent of all new borrowings – our competitors are now our bankers. Japan and China alone account for more than $1 trillion in loans
11. Outsourcing key manufacturing, research, and design: unchecked offshore outsourcing benefits individual companies and shareholders but destroys entire industries and communities
12. Transition to services-oriented economy: high-paying goods-producing industries have lost net employment over the past 25 years while lower paying non-tradable service-providing employment has nearly doubled. Most new jobs are only in service positions in bars, resturants, hotels and hospitals
13. Lost scientific, engineering, technological prowess: in 2004, China and India graduated a combined 950,000 engineers versus 70,000 in the US. US ranks near the bottom of science/math proficiency
14. Record levels of personal and government debt: household liabilities at record levels, federal government adding record levels of debt each year financed mostly by foreign countries, trade deficits transferring unprecedented accelerating amounts of wealth to foreign hands each year. In 2005, the average U.S. savings rate was a negative 1%
15. Misleading commonly used economic statistics: misleading incomplete statistics like GDP, job creation, and productivity belie our crumbling economic infrastructure. In June 2007, Businessweek reported that 40% of the gains in manufacturing could be non-existent due to a miscalculation known as “phantom GDP.”
16. Proven failed trade policies and other legislation contributing to our demise continue unchallenged: destroying our industry and allowing our assets to be sold or taken from us.
These problems faced in 2008 and still problems in 2022. Only, they are worse and there is little evidence they will improve any time soon.
