Texas and The American Economy

Summary: There is no single American economy. The middle-class pie is shrinking while the Wall Street pie grows. Texas needs to think for itself about national and international economic conditions and trends. If we cannot find a way to restart the middle-class economy then the middle-class will disappear and our children will suffer. If anybody is going to fix the problems facing America, it's going to be us Texans.

The American Economy

I remember hearing Warren Buffet discussing the economy and saying that "the pie is always growing" and thinking, "Whose pie?" A couple of minutes earlier he explained the unfairness of American tax law by telling us that the lady who empties the trash in his office pays a larger percentage of her income than he does. So we could say that America has different economies distinguished by the taxes paid by each sector of the economy. There is no single American economy.

Instead of saying, "the pie is always growing," Warren Buffet should have said his pie is always growing.

The Shrinking Middle-Class

People at the bottom of the middle-class have been falling out of the middle-class as their jobs have disappeared. The middle-class can barely pay it's bills. Dr. Elizabeth Warren explains in the Huffington Post article, America Without a Middle-Class, that expenses have been increasing faster than wages. If you look at the article, the 2nd chart compares expenses in red against income. You will see that in the decade of the 2000's that average income went up only 1.6% and yearly average income exceeds household expenses by only $794. This means that one bad car accident, a broken furnace or air-conditioner and the average middle-class family has to borrow money for necessities. The middle-class pie is shrinking while the Wall Street pie grows.

A Texas Economic Forum

If we want our children to have a future, we better wise-up fast about economics. If the TV tells us the American economy -- the Wall Street economy -- is booming, while the economy we live in is dying, then we cannot trust what TV news tells us about the economy and we need to find a better source of news about the economy.

Since the federal government allowed Wall Street to crash the economy, we cannot trust federal agencies to inform us on the state of the economy. We need to think for ourselves. A this time the World Economic Forum is meeting at Davos, Switzerland. Since international banking drove the entire nation of Iceland into bankruptcy, there is no international source of economic wisdom, so Davos is worthless.

Texas needs to think for itself about national and international economic conditions and trends. We need a Texas Economic Forum that focuses on a true understanding of economic realities. We should invite neighboring states to share the experience of examining economic data and planning to survive.

If we do not get smarter, we will continue to get fleeced. If we cannot find a way to restart the middle-class economy then the middle-class will disappear and our children will suffer.

We have to think to ourselves, "If anybody is going to fix the problems facing America, it's going to be us Texans."

Robert Canright

PS: I was asked by a reader to write an action plan, which is in this separate post: the Texas Economic Forum