Why The Obama-then Trump Rural Area White Voters Are So Angry?

What’s not for average hard working Americans to be enraged against both political parties. Since 1973 until 2018, the US corporate increase in productivity has been around 77% while the average Joe voter wages have been stagnate at less than 13%.

The major reason for the American workers’ stagnant wages has to do mostly with corporate greed but some causes have to do with more US goods being manufactured in other countries where the hourly pay for workers is much less; corporations developing a greater reliance in technology; and there being changes in the culture, like a greater usage by utility companies of renewable sources of energy versus fossil fuel.

But guess who the culprits are making these decisions. They are the corporation executives who recently benefited from a huuuuge 2017 GOP tax cuts bill, and not the other bogeyman (fill in the blank). It was easy pickings for a the republican President Donald Trump to sell these voters on taking a chance on him as he stoked their fears and anger towards the others like a Honduran caravan of refugee seeking asylum as the reason for being unfairly treated.

It’s time for the Democrats to start to educate these voters with accurate information and by actually providing them with some concrete help like increasing the hourly wage rate to $15.00 per hour and to enact an infrastructure bill.

When the GOP start to complain, the Democratic legislators can wipe the floor with the 2017 GOP tax cuts bill which was a boondoggle to corporate executives.

THIS IS DUE TO CORPORATE GREED/ NOT THE OTHERS LIKE IMMIGRANTS

It used to be that after WWII until 1973, corporation executives shared the spoils of increased productivity, revenues, profits with their workers.

As per the EPI Economic Policy Institute, “From WWII Until about 1973, when US corporations productivity numbers increased to about 95.65%, the average workers’ pay wages increased to about 91%. There was this consensus that as corporations increased its productivity, revenues, profits, the workers also participated in the division of the spoils.

But after 1973, corporate productivity increased by 77% but workers’ pay increased by only 12.4%.

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So these Americans are being squeezed financially to where most Americans are not in a financial position to send their children to at least a public state college. Then their young folks are saddled too frequently with a mortgage type student loan as they start their careers. Finally, when the average American retires, fewer and fewer have enough to retire on as corporate pensions have gone the way of the Dodo bird. They are reliant on 401ks which do not provide the security of pensions.

Towers Watson study found that from 1978 to the end of 2013, only 24% of Fortune 500 companies offered any type of defined benefit plan.

In short, the non stock owners (about 50%) of Americans have been systemically shut out of the American dream and they have every right to be furious as neither the Democratic Party or the Republican Party lawmakers have done much to give these folks even a glimpse of hope.

As per a Bloomberg 11/8/2014 report, Since 1978, college tuition and fees have increased by a whopping 1,120%. During that same period, the price of food has increased 244% and medical expenses 601%. In fact, tuition prices have gone up four times faster than the consumer price index.

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1973 template law by ALEC (Koch brothers)

As per a 2/9/2018 Forbes report, “The year is 1965, and Mr. Smith has worked for the same company for 35 years. Mr. Smith is set to retire in the next year and is looking forward to receiving his full pension, which will guarantee him an income stream for the remainder of his life. It’s the reward and benefit he receives from his company for his loyalty and hard work for all those years.”

“This pension payment will give him the comfort of a regular paycheck plus Social Security benefits during retirement.”

“Many of today’s retirees are not as fortunate. The days of working at a company for 20+ years and receiving a hefty pension for your retirement years are all but over unless you work for the government or a select few companies that still offer them. A Towers Watson study found that by year-end 2013, only 24% of Fortune 500 companies offered any type of defined benefit plan.”

“Have you ever wondered why? Why don’t companies, for the most part, offer pension plans anymore? Let me explain.”

“In 1978, Congress approved The Revenue Act of 1978, which allowed for 401(k) plans. This act was implemented in the spirit of the government giving employees options for retirement outside of the standard pension plan. Sounds pretty reasonable, right?”

“In reality, large corporations were lobbying Congress to shut down their pension plans because they were too expensive to administer, and the employer held all of the investment risk. Corporate America needed a way to reduce costs and transfer the risk from the company onto the employee. Congress was determined to create additional options in order to shift funding away from pension plans, hence the birth of the 401(k).”

Image result for cartoons on wage stagnation

“The 401(k) allowed companies an alternative to pension plans so that they were no longer responsible for paying their retired employees. In addition to continuing to create a paycheck for the retired employee, the employer had a large amount of investment risk. If the underlying investments of the pension plan did not perform well, the company would have to add money to the pension plan to make sure it was properly funded. Without appropriate funding, the plan would fail, and the paychecks would stop.”

“The implementation of the 401(k) has allowed retirement planning to be on today’s retirees and workforce. It is now more important than ever for retirees to create solutions for their own dependable, sustainable income during retirement. Most retirees will have to count on the money in their 401(k) to create this income stream.”

Image result for cartoons on wage stagnation

“For a while, creating that income from a lump sum was easy. From 1986-2000, the market was up over 1000%, so having a big pile of money and “picking at it” sufficed. Experts called this the 4% rule, which states that if you take out 4% from your portfolio, you should be able to generate returns from the market to replace the 4% and grow your portfolio to hedge against inflation and, hopefully, never run out of money.”

“However, with the market volatility we have experienced over the last few years, we have seen the 4% rule start to be contested. Wade Pfau, a Princeton-trained economist and professor of retirement income at the American College of Financial Services, has said that the 4% rule should be adjusted to the 3% rule.”

“The 4% (now 3%) rule can leave a lot to question, since it’s not as predictable as a pension. Having a pension while creating income can create a sense of confidence, as the checks will continue for the rest of your life, regardless of the market.”

“A pension was one less thing people had to think about during their retirement years, which begs the question: Can a plan be created with the same sense of confidence and certainty?”

13 comments

  1. Excellent. Great information. Totally agree. The Dems need to have clear objectives and a plan, especially now that they have Congress in a majority. Trickle down has not worked. Everytime their is a minimal wage increase, the price of food, meds and other essentials are increased as well. It’s a no win situation for the bottom of the ladder. Let’s continue to make our voices heard. Thanks again for a great post.

    Liked by 2 people

    • Dear Lindi Roze,

      Thanks for your gracious feedback.

      Once you view the landscape from the rural workers’ perspective, it’s a wonder that they are not more angry. The democrats need to start helping them by increasing the minimum wage rate and by enacting an infrastructure improvement bill.

      Hugs, Gronda

      Liked by 3 people

  2. Gronda, for the longest time, most of the rural GOP voters have been voting against their economic interests and had no idea. Then along comes Trump who visited the rural areas and blamed simple (and overstated) causes for their lot and said he would be their champion.

    Little did they know the man was a “professional liar,” per the words of his former economic advisor. Since that time he rolled back a change that would have decreased mortgage insurance premiums for 1 million homeowners who could not put a lot down on their house, pass a tax bill that helped corporations and wealthy people with a token gesture to middle class people, cut payments to insures to help people in need with deductibles and co-pays, tried to repeal healthcare for 20 million people and introduce tariffs that hurt consumers and producers, especially farmers. And, there is more….

    As the sugar high wanes on the economy over the next two years, people will realize that his words ring hollow. Of course, he will blame everyone else, but it is clear the tariffs avid trade policy are hurting the global economy and stock market. Keith

    Liked by 4 people

    • Dear Keith,

      President Trump has done virtually nothing to improve the lot of average US workers.

      In 2018 he did away with the rule requiring financial advisers to act in their clients’ best interests when it comes to managing retirement accounts. This rule is officially dead.

      In 2018, US Department of Education Secretary Betsy DeVos eliminated Obama administration safeguards that protected students from for-profit career programs that left graduates with poor job prospects and unmanageable student debt. The courts have pushed back but she’s still trying.

      Like you have pointed out, there are many other instances where he has done harm to average Joe workers.

      By the way, General Motors plans to let go of up to 15,000 workers and to close down several manufacturing plants.

      Hugs. Gronda

      Liked by 3 people

      • Gronda, I am glad you brought up the financial advisor regulation he did away with. This action harms investors and protects managers. Most people are advised by people not qualified to do so. This would have helped. Keith

        Liked by 2 people

    • Dear Steve Herzfeld,

      Welcome!

      Thanks for your gracious feedback and don’t sweat over any mistakes. I make then all the time.

      Doesn’t this attack by the GOP Party corporate members look orchestrated? What happened is that around 1973 a bunch of corporate big wigs got together with Koch brothers to start an entity called ALEC (American Legislative Exchange Council) to represent the interests of its corporate members.

      The organization ALEC has assisted republican legislative bodies with the creation of many conservative model legislative templates such as: 1.)Promoting ways to dismantle public worker unions in states with Republican majority led legislative bodies as these are the only big money contributors left who can seriously compete with the big money interests who donate to the Republican party. 2.) This includes the promotion of school choice even if the school choices have not been vetted for financial solvency and /or demonstrate a plan for real improvement modeled after current charter schools with outstanding records in impoverished areas around the country such as the Success Schools in New York City; 3.) Promoting voting rules and systems designed to reduce the number of minority folks who vote heavily democrat from having access to the voting booth including the requirement of picture voter identification cards; 4.) Gun rights advocacy including the “Stand Your Ground” Law. This “Stand Your Ground” law which originated in the State of Florida in 2005 has spread to over several Republican congressional led states. (5.) Promoting the interests of the oil and fossil fuel industry including the discounting of scientific evidence regarding the issue of climate change.

      A lot of major companies withdrew from ALEC over the Trayvon Martin case around 2012 where the ‘stand your ground’ law became controversial. But their tentacles live on even today. The Koch brothers now support heavily the conservative tea party type organization, ‘Americans for Prosperity’ and other right wing entities.

      Incidentally, it is around 1973 when corporations executives stopped sharing their spoils with their front-line employees.

      Thanks a million for sharing this post with your readers via this reblog.

      Hugs, Gronda

      Liked by 2 people

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