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Tuesday, September 9, 2014

Why Americans Pay is Stagnant


http://www.gainesville.com/article/20140908/WIRE/140909611?p=1&tc=pg

I laugh when I read "The trend has mystified analysts." The truth is that it shouldn't. Over the last 20 years we as a country replaced every good paying manufacturing job with a low paying service job. Our economy runs on consumer spending and as these good paying jobs have left, the economy has weakened. Now even highly skilled jobs are being offshored which keeps salaries low. You add in inflation of at least 5% per year (it's truly higher) and then $20,000/year in 1994 is now really $10,000/year in 2014. That is why people "make the same money" but everything seems so expensive. The fact is that your dollars are worth less every year due to inflation. If inflation is 5% a year and you get a 3% raise, you really lost 2% and it is compounded every year. Simple and until we stop these "free trade" agreements that are decimating our economy, nothing will change.

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