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The Urgent State of American Labor |
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A $149 trillion transfer from labor to capital… The 1971 end of the gold standard unleashed money printing and globalization, flooding America with cheap foreign labor that crushed domestic wages forever Robert Kiyosaki's new warning reveals the shocking truth about the economy they don't want you to know. Don't be left behind. Click here to get his urgent action plan now!
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Dear Reader, |
Today is Labor Day. Let us reflect upon the state of American labor. |
My concern is not the month-to-month variation in labor statistics — themselves likely the botch work of government data-manglers. |
I take instead the long view, the overall view. And so let us take that view. |
Labor's share of Gross National Income came in at 51% in 1970. |
And by 2022? Labor's share of Gross National Income sunk to 43%. |
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Source: Charles Hugh Smith www.oftwominds.com |
A $149 Trillion Transfer |
Eight percentage points may not appear vast across 52 years. It may appear that labor absorbed a setback — but not a trouncing. |
Have another guess, says economics commentator Charles Hugh Smith: |
If wage earners' share of Gross Domestic Income had remained at 51% instead of declining to 43%, wage earners would have received an additional $149 trillion over those 52 years. That's roughly $3 trillion a year, which works out to an additional $22,000 annually for America's 134 million full-time workers or an additional $18,000 annually for the nation's entire work force (full-time, part-time, self-employed, gig workers) of 163 million. |
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Is it coincidence that Mr. Smith selects the year 1970 to draw a contrast? |
I hazard it is no coincidence whatsoever. |
The Fiat Dollar and Globalization |
In August 1971, old Nixon slammed shut the gold window. |
America no longer had to produce goods to exchange for other goods… or fear for its gold. |
Scraps of paper, rolling off an over-labored printing press, were its primary production. |
Ream upon ream went abroad in exchange for goods — real goods. |
The international division of labor was suddenly opened to the world's sweating and heaving masses. Many were peasants from the labor-rich fields of China. |
The competition depressed average American wages — wages that have never recovered. |
Here in 2025… never has the gap between stock market and economy stretched so broadly as today. |
Is there a way out of the maze? Yes, argue the technologists... |
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Technology Will Save Us! Won't It? |
The technologists insist automation, robotics and artificial intelligence (AI) will soon catapult the economic system into vastly more productive realms. |
I am unconvinced automation will proceed at the rollicking gallop its drummers project. |
Yet let us suspend all assumption for the moment... and drive on to the inevitable question: |
What happens when robots acquire the brains to perform nearly all human labor? |
Innovation and technology have always allowed humans to mine fresh sources of productive employment. |
The 19th-century farmer became the 20th-century factory worker… became the 21st-century computer programmer. |
Now introduce an omnipotent robot... |
A robotic brute that can drive home a rivet is one thing by itself. Yet a genius robot that could do anything a human can do — only better — is another entirely. |
This robot would tower above the human as the human towers above the beasts of the field. |
An Aristotle, a da Vinci, an Einstein would be pygmies next to it. |
What human ability would lie beyond this unnatural beast? Artistic expression, perhaps? |
A 900-IQ robot might run its circles around the human antique, you say. But it could not appreciate beauty, much less express it. |
The robot is all brains, that is… but no heart, no soul. The kingdom of the arts belongs to man — and to man alone. |
Well, I would simply inform you that artificial intelligence "artists" and "musicians" have already proven superior artists. |
Not even the oldest profession is safe from robotic invasion — yet I let it pass for now. |
But what about technology's impact on the general community? |
Winners and Losers |
Capitalism puts out its tongue at tradition. It yanks the roots out of communities. |
Capitalism swings its human captive around hairpin turns of social and technological change… for which he is unprepared. |
Within a generation, the centuries-old farming community has given over to the assembly line and the punch clock. |
A generation later, the factory goes dark as creative destruction blows the jobs clear to China… or Vietnam… or wherever labor is cheapest. |
Americans must often rip up their families to follow the jobs. Thus, they can sink little root in the local topsoil. |
Meantime, advancing technology makes today's job obsolete tomorrow. |
Not all the displaced can take up new lines. Many are simply left behind, broken… and can never catch up. |
Capitalism, Progress, Must Advance |
The river of progress must carry forward. Do you reject progress? |
Then you must believe the man who tamed fire should himself burn eternally... that the inventor of the wheel should be broken upon the very same wheel... |
That Franklin should have fried in an electric chair for discovering electricity… that Ford should have been flattened by his auto... that Salk should sulk in endless miseries for scotching polio. |
If this is what you believe, please drive on. But let us recognize: |
The advancing river of progress sometimes takes the human note with it. And not all change is progress. |
Within cold and lifeless economic data, behind dense forests of statistics, exist living human beings with beating hearts. |
And often with broken hearts. |
To these, my fellow Americans — to all who hew the nation's wood and draw its water — I hoist an acknowledging toast today. |
Regards, |
Brian Maher |
for Freedom Financial News |
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