Have we outsourced our economy to the rich?
Our stock market is up almost a thousand points as I write this. The Dow is around its late February numbers. Lets talk about what is different since February and now. Unemployment claims are higher, mortgage deferrals/defaults are higher, potentially millions are under 30 days away from being evicted. As it stands around 9% of mortgages are in forbearance. For the majority of Americans, they are not in a better place than they were in February, and yet our stock market seems to rise. I understand that our markets are an indicator of future events, but consumer confidence is lower than February. Does our spending and transactions no longer matter to the market?
Can the wealthiest in the world alone sustain a growing economy? Have we reached a time where the middle and lower class control so little of the global wealth that our market participation no longer matters? My largest concerns revolve around the consolidation of business. Larger firms have been gobbling up smaller, cash strapped companies like a all you can eat buffet pre-coronavirus.
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If the average consumers spending power no longer matters in the grand scheme of things, a small business soon will no longer exist. As soon as a small business gains traction a larger corporation will acquire them or price them out. The tactics used by Amazon to obtain Diapers.com is a case study in this. For those of you who are unaware, Amazon wanted to buy Diapers.com, who chose not to sell. To force this transaction, Amazon began undercutting Diapers.com’s prices until Amazon took away their ability to sell their products for a profit. I fear that this will become much more common as we move forward.
Corporations and publicly traded companies are meant to be efficient and profitable. Eliminating redundant jobs through automation is the next largest nail in the coffin that once was a robust middle class. We aren’t 50 years away from these changes, they happen every day and with this pandemic I fear that fuel has been poured on that fire. Corporations spend billions annually to kill jobs while small business can only grow from hiring more Americans.
Every time you purchase something from a larger corporation, you work to destroy the middle class. I know that the luxury of convenience is appealing and usually you can even save money, but you have to support your local economies more. Go for a drive instead of waiting for Amazon to drop it off. Don’t go to Walmart for your groceries when you have a smaller local chain. Eat at a single location restaurant versus a national brand. If we don’t make these changes now, our buying power won’t affect the economy anymore.
As new policies are made in government, our voices will no longer be heard. Think back on how many laws were passed to benefit corporations, with many having side effects that included something beneficial for the middle class. Wouldn’t it be great for laws to be passed to benefit the middle class, where a side effect helped corporations instead? If we continue to no longer impact the economy, our voices will continue to be drowned out. We have to matter in the economy again to make sure that all Americans have an opportunity to prosper.
