Commentary

The Death Of The Rust Belt

Their names are familiar to all of us: Cleveland, Flint, Youngstown, Saginaw, Gary, Toledo, Reading, Akron, Flint and Buffalo were all once booming manufacturing cities that were absolutely packed with thriving middle class families. But now most of the manufacturing jobs are gone and all of those cities are just shadows of their former selves. When you drive through many of these communities, you will notice that a lot of people have a really hollow look in their eyes. Decades of slow, steady economic decline have really taken a toll, and even the architecture in these cities looks depressed. But despite all of the decay, there is still evidence that there was once something truly great about these communities. Will we be able to recapture that greatness before it is too late?

A lot of writers make economics really complicated, but the truth is that it does not have to be. For example, if you want your country to have a great economy it has got to produce wealth. And one of the primary ways to produce wealth is to make stuff. Immediately after World War II, the United States had the greatest manufacturing base the world had ever seen and we outproduced the rest of the planet combined. Great manufacturing cities sprouted up all over America and the middle class thrived. It was truly a great time to be an American.

But then we decided to start shipping in cheaper products from overseas. At first it didn’t create too much of a problem for our massive economy, but eventually the floodgates opened up and we lost tens of thousands of manufacturing facilities and millions upon millions of good paying jobs. Our labor pool was merged with the labor pool of countries such as communist China where it is legal to pay slave labor wages to manufacturing workers. Needless to say, our workers could not compete with that and our middle class started to shrink rapidly.

Today, there are many American cities that were once truly great that are now truly frightening to visit. For example, a recent CNBC article detailed the plight of Reading, Pennsylvania…

In August 2008, factory workers David and Barbara Ludwig treated themselves to new cars—David a Dodge pickup, Barbara a sporty Mazda 3. With David making $22 an hour and Barbara $19, they could easily afford the payments.

A month later, Baldwin Hardware, a unit of Stanley Black & Decker, announced layoffs at the Reading plant where they both worked. David was unemployed for 20 months before finding a janitor job that paid $10 an hour, less than half his previous wage. Barbara hung on, but she, too, lost her shipping-dock job of 26 years as Black & Decker shifted production to Mexico. Now she cleans houses for $10 an hour while looking for something permanent.

They still have the cars. The other trappings of their middle-class lifestyle? In the rear-view mirror.

I once had an aunt that lived in Reading. She is dead now, and so is most of the city. At this point, more than 40 percent of those living in Reading are impoverished and the city government is flat broke.

But similar things could also be said about the rest of the Rust Belt…

Perhaps no other region in the country has more eerie examples of urban decay than the once dominant industrial region known as the Rust Belt. Covering the Midwestern states of Illinois, Indiana, Michigan, Ohio and Pennsylvania, the region is plagued by a number of abandoned factories, houses and buildings that lay in crumbling ruins.

You can see some incredible photographs by Seph Lawless of the decay in the Rust Belt right here. The pictures are incredibly depressing, but it doesn’t take too much imagination to see that these cities were once truly impressive.

Just take Gary, Indiana for instance. It was once known as “the Magic City” because it was doing so well, but now it is a rotting, decaying hellhole. The following is from an excerpt from a Daily Mail article about Gary…

Gary, a struggling city 30 miles south of Chicago along the shores of Lake Michigan, is a prime example of the trend.

Known as the ‘Magic City’ in the roaring 1920s for its spectacular growth, Gary is still home to U.S. Steel’s largest plant, but the number of mill jobs has shrunk to 5,000 from 30,000 in the 1970s.

Gary’s population in 1960 was more than 178,000, but it disintegrated to just 79,000 by 2012.

Some one-third of its residents live in poverty and the home and business vacancy rate is about 35 percent. Gary recorded 43 murders in 2012 – three times as many per capita as nearby Chicago.

At one time, Gary was the envy of the rest of the globe.

But now very few people would ever want to willingly live there.

The following is how James Kunstler described what he saw when he traveled through Gary, Indiana…

Between the ghostly remnants of factories stood a score of small cities and neighborhoods where the immigrants settled five generations ago. A lot of it was foreclosed and shuttered. They were places of such stunning, relentless dreariness that you felt depressed just imagining how depressed the remaining denizens of these endless blocks of run-down shoebox houses must feel. Judging from the frequency of taquerias in the 1950s-vintage strip-malls, one inferred that the old Eastern European population had been lately supplanted by a new wave of Mexicans. They had inherited an infrastructure for daily life that was utterly devoid of conscious artistry when it was new, and now had the special patina of supernatural rot over it that only comes from materials not found in nature disintegrating in surprising and unexpected ways, sometimes even sublimely, like the sheen of an oil slick on water at a certain angle to the sun. There was a Chernobyl-like grandeur to it, as of the longed-for end of something enormous that hadn’t worked out well.

Sadly, what is happening to Reading and Gary is just a preview of what is slowly happening to the entire nation as a whole.

Since 2001, the United States has lost more than 56,000 manufacturing facilities.

That is absolutely astounding.

Most of those jobs have gone overseas. That is why it seems like most of our products say “Made in China” these days. They are getting rich while our communities suffer, and then we have to beg the Chinese to lend our money back to us.

Meanwhile, we have a permanent epidemic of unemployment in this country. Back in the 1980s, over 20 percent of the jobs in the U.S. were manufacturing jobs. Today, only about 9 percent of the jobs in the U.S. are manufacturing jobs.

And an astounding number of our young men are just sitting at home instead of doing something productive. As I wrote about the other day, one out of every six men in their prime working years (25 to 54) do not have a job at this point.

Also, the percentage of working age Americans not participating in the labor force is up to 37.2 percent – a 36 year high.

Not only that, but the quality of our jobs has also steadily declined as we have lost good paying manufacturing jobs to overseas workers.

Right now, half the country makes $27,520 a year or less from their jobs.

No wonder the middle class is dying.

And of course there is so much more that could be said about this. For even more numbers about our manufacturing decline, please see my previous article entitled “Shocking Facts About The Deindustrialization Of America That Everyone Should Know“.

These problems were not created overnight, and they are not going to be solved overnight either.

But as a nation, we have got to understand that we cannot consume our way to prosperity. That is only going to result in even more debt.

Instead, we have got to make the decision to produce our way to prosperity.

In other words, we have got to start making stuff in this country again.

That may sounds “crazy” to a lot of people, but it is possible. We have just got to have the willingness to do it.

15 Quotes From Our Founding Fathers About Economics, Capitalism And Banking

Why have we turned our backs on the principles that this nation was founded upon? Many of those that founded this nation bled and died so that we could experience “life, liberty and the pursuit of happiness”. And yet we have tossed their ideals aside as if they were so much rubbish. Our founders had experienced the tyranny of big government (the monarchy) and the tyranny of the big banks and feudal lords, and they wanted something very different for the citizens of the new republic that they were forming. They wanted a country where private property was respected and hard work was rewarded. They wanted a country where the individual was empowered, and where everyone could own land and start businesses. They wanted a country where there were severe restrictions on all large collections of power (government, banks and corporations all included). They wanted a country where freedom and liberty were maximized and where ordinary people had the power to pursue their dreams and build better lives for their families. And you know what? While no system is ever perfect, the experiment that our founders originally set up worked beyond their wildest dreams. But now we are killing it. Why in the world would we want to do that?

Most people are under the illusion that the United States has a “capitalist economy” today, but that simply is not accurate. At best, we have a “mixed economy” that is becoming a little bit more socialist with each passing day. We pay dozens of different types of taxes each year, and some Americans actually end up giving more of their earnings to the government than they keep themselves. But that is still not enough, and so our state governments have accumulated astounding amounts of debt, and our federal government has amassed the largest single debt that the world has ever seen. If future generations of Americans get the chance, they will curse us for the chains of debt that we have placed upon their shoulders.

So what do our government officials do with all of this money?

Well, today approximately 70 percent of all federal government activity involves taking money from some Americans and giving it to other Americans.

Despite this unprecedented wealth-redistribution program, poverty is absolutely exploding in this country and 49 million Americans are dealing with food insecurity.

Meanwhile, the bankers have been getting fabulously wealthy from all of this debt. The Federal Reserve system was designed to trap the U.S. government in an endless spiral of debt from which it could never possibly escape, and that mission has been accomplished. In fact, the U.S. national debt is now more than 5000 times larger than it was when the Federal Reserve was first created a little more than 100 years ago.

Most people like to think of big banks as “capitalist” institutions, but that is not really accurate. In the end, giant corporate banks like we have in the United States are actually collectivist institutions. They tend to greatly concentrate wealth and power, and socialists find those kinds of banks very useful.

In fact, Vladimir Lenin once said that “without big banks, socialism would be impossible.”

While there may be a bit of animosity between big government and big banks once in a while, the truth is that they are usually very closely tied to one another. We saw this close relationship very clearly during the financial crisis of 2008, and it is no secret that there is a revolving door between the boardrooms of Wall Street and the halls of power in Washington. The elite dominate both spheres, and it is not for the benefit of the rest of us.

In America today, government just keeps getting bigger and the banks just keep getting bigger. Meanwhile, the percentage of self-employed Americans is at an all-time low and the middle class is steadily dying.

What we are doing right now is clearly not working.

So why don’t we go back and do the things that we were doing when we were extremely successful as a nation?

In case you don’t know what those things were, here are some clues…

#1 “A wise and frugal government… shall restrain men from injuring one another, shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned. This is the sum of good government.” — Thomas Jefferson, First Inaugural Address, March 4, 1801

#2 “A people… who are possessed of the spirit of commerce, who see and who will pursue their advantages may achieve almost anything.” – George Washington

#3 “Government is instituted to protect property of every sort; as well that which lies in the various rights of individuals, as that which the term particularly expresses. This being the end of government, that alone is a just government which impartially secures to every man whatever is his own.” – James Madison, Essay on Property, 1792

#4 “Banks have done more injury to the religion, morality, tranquility, prosperity, and even wealth of the nation than they can have done or ever will do good.” – John Adams

#5 “To take from one, because it is thought his own industry and that of his fathers has acquired too much, in order to spare to others, who, or whose fathers, have not exercised equal industry and skill, is to violate arbitrarily the first principle of association, the guarantee to everyone the free exercise of his industry and the fruits acquired by it.” — Thomas Jefferson, letter to Joseph Milligan, April 6, 1816

#6 “The moment the idea is admitted into society that property is not as sacred as the laws of God, and that there is not a force of law and public justice to protect it, anarchy and tyranny commence. If ‘Thou shalt not covet’ and ‘Thou shalt not steal’ were not commandments of Heaven, they must be made inviolable precepts in every society before it can be civilized or made free.” — John Adams, A Defense of the Constitutions of Government of the United States of America, 1787

#7 “I place economy among the first and most important virtues, and public debt as the greatest of dangers to be feared. To preserve our independence, we must not let our rulers load us with perpetual debt. If we run into such debts, we must be taxed in our meat and drink, in our necessities and in our comforts, in our labor and in our amusements.” – Thomas Jefferson

#8 “Beware the greedy hand of government thrusting itself into every corner and crevice of industry.” – Thomas Paine

#9 “If we can but prevent the government from wasting the labours of the people, under the pretence of taking care of them, they must become happy.” – Thomas Jefferson to Thomas Cooper, November 29, 1802

#10 “All the perplexities, confusion and distress in America arise not from defects in the Constitution or Confederation, not from a want of honor or virtue so much as from downright ignorance of the nature of coin, credit and circulation.” – John Adams, at the Constitutional Convention (1787)

#11 “The principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale.” – Thomas Jefferson

#12 “Liberty must at all hazards be supported. We have a right to it, derived from our Maker. But if we had not, our fathers have earned and bought it for us, at the expense of their ease, their estates, their pleasure, and their blood.” – John Adams, 1765

#13 “If ever again our nation stumbles upon unfunded paper, it shall surely be like death to our body politic. This country will crash.” – George Washington

#14 “I wish it were possible to obtain a single amendment to our Constitution. I would be willing to depend on that alone for the reduction of the administration of our government to the genuine principles of its Constitution; I mean an additional article, taking from the federal government the power of borrowing.” – Thomas Jefferson

#15 “When the people find that they can vote themselves money, that will herald the end of the republic.” — Benjamin Franklin

Greed Is Good? Where Will America’s Sick Obsession With Wealth And Money End?

Everywhere you look, Americans appear to be extremely obsessed with wealth and money. These days, networks such as CNN endlessly run “news stories” with titles such as “Best cars for the super rich“. We have television shows where people proudly show off how wealthy they are, and it seems like Hollywood is putting out an endless parade of movies that glorify the lifestyles of the elite. We have hordes of motivational speakers and “life coaches” that will teach you how to be “more successful” in life, and every small movement in the stock market is carefully monitored by the mainstream news media. Even in the world of faith, we have an entire class of ministers known as “prosperity preachers”, and many of those ministers wear that label quite proudly. Yes, those that grew up in the 1980s may have been the “greed is good” generation, but the truth is that they didn’t have anything on us. As a society we love money, and we are not ashamed to admit it. In fact, there are times we absolutely revel in it. For example, Time Magazine published an article this year entitled “Science Proves It: Greed Is Good” and hardly anyone even raised an eyebrow. But where will America’s sick obsession with wealth and money end? Could it end up destroying us?

I got the idea for this article when I was browsing through CNN’s website. The following are eight “news stories” about wealth that were featured on CNN just on Thursday alone…

#1 “The richest Americans in history”

#2 “How much do you need to be happy?”

#3 “Where are the super rich?”

#4 “From broke to billionaire”

#5 “Homes: What $25 million buys around the world”

#6 “Best cars for the super rich”

#7 “America’s homes are bigger than ever”

#8 “Mega yacht with a movie theater”

This is what passes for news these days?

It has been said that we tend to talk about the things that we are obsessed with.

And CNN is clearly obsessed with wealth.

Not that there is anything wrong with having money.

If none of us had any money, we would all be homeless and starving. So the truth is that money can be very useful. But when it becomes an idol, that is when it becomes a problem.

And because we have taught entire generations of Americans that becoming wealthy is one of the primary goals in life, it is creating a tremendous amount of envy, jealousy, frustration and anger among those that have not been able to become wealthy.

In recent years, the level of bitterness and resentment that the rest of the nation has toward the very wealthy has risen to an unprecedented level. It has become exceedingly apparent that the system is designed to funnel wealth to the very top of the food chain, and many of those at the bottom of the food chain are starting to become extremely upset about this.

Since the last financial crisis, almost all of the income gains have gone to the top one percent of all income earners. The following comes from a recent Huffington Post article…

Economic statistics show that incomes for the top 1 percent of U.S. households soared 31 percent from 2009 through 2012, after adjusting for inflation, yet inched up an average of 0.4 percent for those making less. Many economists are sounding alarms that the income gap, greater now than at any time since the Depression, is hurting the economy by limiting growth in consumer spending.

And income inequality has become such a hot topic that it has even produced a New York Times bestseller by a French economist named Thomas Piketty. This is what CBS News recently had to say about his book…

His book has landed on that debate like a bomb. Piketty’s thesis: that the rate of return on capital, such as real estate, dividends and other financial assets, is racing away from the rate of growth required to maintain a healthy economy. If that trend continues for an extended period of time — if wealth becomes ever more concentrated in the hands of a few — then inequality is likely to get worse, says Piketty, 43, who started his academic career as an assistant professor at the Massachusetts Institute of Technology and who now teaches at the Paris School of Economics.

Another reason “Capital” has caught the public’s attention is that inequality is evident in what are by now a host of familiar symptoms. Stagnant pay, except among the super-rich. Soaring health care and education costs. The diminished expectations commonly found in young, especially those lacking college degrees, and old alike, as retirement becomes something to endure rather than to enjoy.

It would be foolish to deny that the gap between the rich and the poor is growing. Even as the stock market reaches unprecedented heights, the middle class is dying and one out of every five children in America is living in poverty.

On a global scale, the wealthiest one percent now have 65 times more wealth than the entire poorest half of the global population does.

That is an astounding figure.

Most people don’t realize this, but the ultra-wealthy have approximately 32 trillion dollars (that we know about) stashed in offshore banks around the planet. That amount of money would almost be about enough to pay off the entire U.S. national debt and buy every good and service produced in the United States for an entire year.

Meanwhile, the poorest half of the world’s population only owns about 1 percent of all global wealth, and about a billion people throughout the world go to bed hungry every night.

If greed was going to save the world, it would have done it by now. At this point, the wealthy have accumulated more wealth than they ever have before. For example, according to Zero Hedge the total amount of wealth in the U.S. has just hit a brand new record high…

Earlier today the Fed released its latest Flow of Funds report, which showed that in the first quarter household net worth rose from last quarter’s $80.3 trillion to a new record high of $81.8 trillion, driven by a $1.5 trillion increase in total assets while household liabilities were virtually unchanged in the quarter. And since the Fed is onboarding all the liabilities why should households bother with debt: that’s what the central bank balance sheet is for.

As for the proceeds, they go to the mega rich: of the $81.8 trillion in net worth, 70.4% of the total amount or $67.2 trillion, was in financial assets: the higest it has ever been courtesy of just one person: Ben Bernanke, and to a far lesser extent Janet Yellen who however is tasked with picking up Bernanke’s pieces.

But of course most people who are rich are only rich on paper.

As noted above, 67.2 trillion dollars of the total of 81.8 trillion dollars of wealth in this nation is made up of financial assets.

So what happens if there is a major financial crisis (such as the derivatives bubble bursting) which causes the total amount of financial wealth in the United States to drop by 50% or more?

What would such an event do to our country?

We are so obsessed with wealth and money that it is truly frightening to think about how we would react as a society if it was taken away.

But this current financial bubble will not last forever.

At some point it will come to an end.

When it does, will our society throw a massive temper tantrum?

Half The Country Makes Less Than $27,520 A Year And 15 Other Signs The Middle Class Is Dying

If you make more than $27,520 a year at your job, you are doing better than half the country is. But you don’t have to take my word for it, you can check out the latest wage statistics from the Social Security administration right here. But of course $27,520 a year will not allow you to live “the American Dream” in this day and age. After taxes, that breaks down to a good bit less than $2,000 a month. You can’t realistically pay a mortgage, make a car payment, afford health insurance and provide food, clothing and everything else your family needs for that much money. That is one of the reasons why both parents are working in most families today. In fact, sometimes both parents are working multiple jobs in a desperate attempt to make ends meet. Over the years, the cost of living has risen steadily but our paychecks have not. This has resulted in a steady erosion of the middle class. Once upon a time, most American families could afford a nice home, a couple of cars and a nice vacation every year. When I was growing up, it seemed like almost everyone was middle class. But now “the American Dream” is out of reach for more Americans than ever, and the middle class is dying right in front of our eyes.

One of the things that was great about America in the post-World War II era was that we developed a large, thriving middle class. Until recent times, it always seemed like there were plenty of good jobs for people that were willing to be responsible and work hard. That was one of the big reasons why people wanted to come here from all over the world. They wanted to have a chance to live “the American Dream” too.

But now the American Dream is becoming a mirage for most people. No matter how hard they try, they just can’t seem to achieve it.

And here are some hard numbers to back that assertion up. The following are 15 more signs that the middle class is dying…

#1 According to a brand new CNN poll, 59 percent of Americans believe that it has become impossible for most people to achieve the American Dream…

The American Dream is impossible to achieve in this country.

So say nearly 6 in 10 people who responded to CNNMoney’s American Dream Poll, conducted by ORC International. They feel the dream — however they define it — is out of reach.

Young adults, age 18 to 34, are most likely to feel the dream is unattainable, with 63% saying it’s impossible. This age group has suffered in the wake of the Great Recession, finding it hard to get good jobs.

#2 More Americans than ever believe that homeownership is not a key to long-term wealth and prosperity…

The great American Dream is dying. Even though many Americans still desire to own a home, they are losing faith in homeownership as a key to prosperity.

Nearly two-thirds of Americans, or 64%, believe they are less likely to build wealth by buying a home today than they were 20 or 30 years ago, according to a survey sponsored by non-profit MacArthur Foundation. And nearly 43% said buying a home is no longer a good long-term investment.

#3 Overall, the rate of homeownership in the United States has fallen for eight years in a row, and it has now dropped to the lowest level in 19 years.

#4 52 percent of Americans cannot even afford the house that they are living in right now…

“Over half of Americans (52%) have had to make at least one major sacrifice in order to cover their rent or mortgage over the last three years, according to the “How Housing Matters Survey,” which was commissioned by the nonprofit John D. and Catherine T. MacArthur Foundation and carried out by Hart Research Associates. These sacrifices include getting a second job, deferring saving for retirement, cutting back on health care, running up credit card debt, or even moving to a less safe neighborhood or one with worse schools.”

#5 According to the U.S. Census Bureau, only 36 percent of Americans under the age of 35 own a home. That is the lowest level that has ever been measured.

#6 Right now, approximately one out of every six men in the United States that are in their prime working years (25 to 54) do not have a job.

#7 The labor force participation rate for Americans from the age of 25 to the age of 29 has fallen to an all-time record low.

#8 The number of working age Americans that are not employed has increased by 27 million since the year 2000.

#9 According to the government’s own numbers, about 20 percent of the families in the entire country do not have a single member that is employed at this point.

#10 This may sound crazy, but 25 percent of all American adults do not even have a single penny saved up for retirement.

#11 As I noted in one recent article, total consumer credit in the United States has increased by 22 percent over the past three years, and 56 percent of all Americans have “subprime credit” at this point.

#12 Major retailers are shutting down stores at the fastest pace that we have seen since the collapse of Lehman Brothers.

#13 It is hard to believe, but more than one out of every five children in the United States is living in poverty in 2014.

#14 According to one recent report, there are 49 million Americans that are dealing with food insecurity right now.

#15 Overall, the U.S. poverty rate is up more than 30 percent since 1966. It looks like LBJ’s war on poverty didn’t work out too well after all.

Sadly, it does not appear that there is much hope on the horizon for the middle class. More good jobs are being shipped out of the country and are being lost to technology every single day, and our politicians seem convinced that “business as usual” is the right course of action for our nation.

Unless something dramatic happens, it is going to become increasingly difficult to eke out a middle class existence as a “worker bee” in American society. The truth is that most big companies these days do not have any loyalty to their workers and really do not care what ends up happening to them.

To thrive in this kind of environment, new and different thinking is required. The paradigm of “go to college, get a job, stay loyal and retire after 30 years” has been shattered. The business world is more unstable now than it has been during any point in the post-World War II era, and we are all going to have to adjust.

So what advice would you give to people that are struggling out there right now? Please feel free to share your thoughts by posting a comment below…

America’s Insatiable Demand For More Expensive Cars, Larger Homes And Bigger Debts

One of the things that this era of American history will be known for is conspicuous consumption. Even though many of us won’t admit it, the truth is that almost all of us want a nice vehicle and a large home. They say that “everything is bigger in Texas”, but the same could be said for the entire nation as a whole. As you will see below, the size of the average new home has just hit a brand new record high and so has the size of the average auto loan. In the endless quest to achieve “the American Dream”, Americans are racking up bigger debts than ever before. Unfortunately, our paychecks are not keeping up and the middle class in the United States is steadily shrinking. The disparity between the lifestyle that society tells us that we ought to have and the size of our actual financial resources continues to grow. This is leading to a tremendous amount of frustration among those that can’t afford to buy expensive cars and large homes.

I remember the days when paying for a car over four years seemed like a massive commitment. But now nearly a quarter of all auto loans in the U.S. are extended out for six or seven years, and those loans have gotten larger than ever…

In the latest sign Americans are increasingly comfortable taking on more debt, auto buyers borrowed a record amount in the first quarter with the average monthly payment climbing to an all-time high of $474.

Not only that, buyers also continued to spread payments out over a longer period of time, with 24.8 percent of auto loans now coming with payment terms between six and seven years according to a new report from Experian Automotive.

That’s the highest percentage of 6 and 7-year loans Experian has ever recorded in a quarter.

Didn’t the last financial crisis teach us about the dangers of being overextended?

During the first quarter 0f 2014, the size of the average auto loan soared to an all-time record $27,612.

But if you go back just five years ago it was just $24,174.

And because we are taking out such large auto loans that are extended out over such a long period of time, we are now holding on to our vehicles much longer.

According to CNBC, Americans now keep their vehicles for an average of six years and one month.

Ten years ago, it was just four years and two months.

My how things have changed.

And consumer credit as a whole has also reached a brand new all-time record high in the United States.

Consumer credit includes auto loans, but it doesn’t include things like mortgages. The following is how Investopedia defines consumer credit…

Consumer credit is basically the amount of credit used by consumers to purchase non-investment goods or services that are consumed and whose value depreciates quickly. This includes automobiles, recreational vehicles (RVs), education, boat and trailer loans but excludes debts taken out to purchase real estate or margin on investment accounts.

As you can see from the chart below, Americans were reducing their exposure to consumer credit for a little while after the last financial crisis struck, but now it is rapidly rising again at essentially the same trajectory as before…

Have we learned nothing?

Meanwhile, America also seems to continue to have an insatiable demand for even larger homes.

According to Zero Hedge, the size of the average new home in the United States has just hit another brand new record high…

There was a small ray of hope just after the Lehman collapse that one of the most deplorable characteristics of US society – the relentless urge to build massive McMansions (funding questions aside) – was fading. Alas, as the Census Bureau today confirmed, that normalization in the innate desire for bigger, bigger, bigger not only did not go away but is now back with a bang.

According to just released data, both the median and average size of a new single-family home built in 2013 hit new all time highs of 2,384 and 2,598 square feet respectively.

And while it is known that in absolute number terms the total number of new home sales is still a fraction of what it was before the crisis, the one strata of new home sales which appears to not only not have been impacted but is openly flourishing once more, are the same McMansions which cater to the New Normal uberwealthy (which incidentally are the same as the Old Normal uberwealthy, only wealthier) and which for many symbolize America’s unbridled greed for mega housing no matter the cost.

There is certainly nothing wrong with having a large home.

But if people are overextending themselves financially, that is when it becomes a major problem.

Just remember what happened back in 2007.

And just like prior to the last financial crisis, Americans are treating their homes like piggy banks once again. Home equity lines of credit are up 8 percent over the past 12 months, and homeowners are increasingly being encouraged to put their homes at risk to fund their excessive lifestyles.

But there has been one big change that we have seen since the last financial crisis.

Lending standards have gotten a lot tougher, and many younger adults find that they are not able to buy homes even though they would really like to. Stifled by absolutely suffocating levels of student loan debt, many of these young adults are putting off purchasing a home indefinitely. The following is an excerpt from a recent CNN article about this phenomenon…

The Millennial generation is great at many things: texting, social media, selfies. But buying a home? Not so much.

Just 36% of Americans under the age of 35 own a home, according to the Census Bureau. That’s down from 42% in 2007 and the lowest level since 1982, when the agency began tracking homeownership by age.

It’s not all their fault. Millennials want to buy homes — 90% prefer owning over renting, according to a recent survey from Fannie Mae.

But student loan debt, tight lending standards and stiff competition have made it next to impossible for many of these younger Americans to make the leap.

This is one of the primary reasons why homeownership in America is declining.

A lot of young adults would love to buy a home, but they are already financially crippled from the very start of their adult lives by student loan debt. In fact, the total amount of student loan debt is now up to approximately 1.1 trillion dollars. That is even more than the total amount of credit card debt in this country.

We live in a debt-based system which is incredibly fragile.

We experienced this firsthand during the last financial crisis.

But we just can’t help ourselves.

We have always got to have more, and society teaches us that if we don’t have enough money to pay for it that we should just go into even more debt.

Unfortunately, just as so many individuals and families have found out in recent years, eventually a day of reckoning arrives.

And a day of reckoning is coming for the nation as a whole at some point as well.

You can count on that.

Dust In The Wind: Dust Bowl Conditions Have Returned To Kansas, Oklahoma And North Texas

In early 1978, a song entitled “Dust in the Wind” by a rock band known as Kansas shot up the Billboard charts. When Kerry Livgren penned those now famous lyrics, he probably never imagined that Dust Bowl conditions would return to his home state just a few short decades later. Sadly, that is precisely what is happening. When American explorers first traveled through north Texas, Oklahoma and Kansas, they referred to it as “the Great American Desert” and they doubted that anyone would ever be able to farm it. But as history has shown, when that area gets plenty of precipitation the farming is actually quite good. Unfortunately, the region is now in the midst of a devastating multi-year drought which never seems to end. Right now, 56 percent of Texas, 64 percent of Oklahoma and 80 percent of Kansas are experiencing “severe drought”, and the long range forecast for this upcoming summer is not good. In fact, some areas in the region are already drier than they were during the worst times of the 1930s. And the relentless high winds that are plaguing that area of the country are kicking up some hellacious dust storms. For example, some parts of Kansas experienced a two day dust storm last month. And Lubbock, Texas was hit be a three day dust storm last month. We are witnessing things that we have not seen since the depths of the Dust Bowl days, and unless the region starts getting a serious amount of rain, things are going to get a whole lot worse before they get any better.

Over the past two months, very high winds and bone dry conditions have made the lives of ordinary farmers in the state of Kansas extraordinarily difficult. Just check out the following excerpt from a recent article posted on Agriculture.com…

The dust has settled, but for how long no one can be sure. At any moment, the winds may blow, moving the topsoil — soil that took Mother Nature generations to craft — even farther from its origin.

One farmer reckons that precious topsoil, native to his farm in Kearny County, Kansas, now sits in a field at least 200 miles away, blown there by the relentless winds of March and April 2014.

Affecting counties in western Texas, Oklahoma, and Kansas, and eastern Colorado, it was reminiscent of what folks in the same region faced 80 years ago.

“There were several days we couldn’t see 100 yards in front of us,” says Tom Hauser, a farmer near Ulysses, Kansas. “We didn’t know where the dust was coming from. It was moving in here from somewhere else, just like it did back in the 1930s.“

When heavy winds blow day after day but there is no rain, it creates ideal conditions for dust storms. According to the same article that I just mentioned, the average wind speed in the little community of Syracuse, Kansas has been over 50 miles an hour so far this year…

Since the beginning of 2014, the average maximum daily wind speed in Syracuse, Kansas, is 50.6 miles per hour, according to the Kansas State University Weather Data Library. In that same time, Syracuse has received just 1 inch of total precipitation.

That is a recipe for disaster.

“I’ve had to chisel more ground this year than the last 20 years put together,” says Gary Millershaski, who farms near Lakin in Kearny County. Chiseling the ground roughs it up, and helps prevent soil from blowing – at least for a little while.

I couldn’t imagine living somewhere with such high winds day after day.

But this is what farmers in the High Plains have to deal with on a constant basis.

And needless to say, when things are this dry those kinds of winds can kick up some immense dust storms. In fact, a dust storm in late April was so large that it covered most of the region…

Monday’s dust storm was so large it covered most of Kansas, western Oklahoma, the Texas Panhandle and eastern Colorado, said weather service meteorologist Jeff Hutton in Dodge City. Tuesday’s dust cloud was more localized, only found in some parts of Kansas.

“That is what happens when you get drought, a lack of vegetation and you have wind,” Hutton said. “I mean, that is just the nature of the High Plains. And then that dirt that was lofted is eventually carried into eastern Kansas.”

When one of these dust storms strikes, you want to get indoors and stay there. It isn’t even safe to be driving. When you can’t even see five feet in front of you, the odds of getting into a fatal accident rise exponentially. Just check out what happened earlier this year near the little town of Liberal, Kansas…

At least 12 vehicles were involved in an pileup accident near Liberal, Kansas.

The accident happened around 1:40 p.m., nine miles southwest of Liberal. It appears that blowing dust limited visibility so severely that it cause vehicles to not see each other until it was too late and they collided. One report states that visibility was less than five feet.

According to Chief Anthony Adams of the Tyrone Fire Department in Oklahoma, six of the vehicles involved were cars and trucks, the other six were tractor trailers.

As bad as things are in Kansas right now, the truth is that things are probably even worse down in Texas. Amarillo has had 10 dust storms so far this year, and Lubbock has already had 15 days of dust storms in 2014…

The number of dust storms seems to rise with the length of the drought. Amarillo has had 10 this year; it had none in 2010. The city is about 10 percent drier now than the 42 months that ended April 30, 1936, and drier than the state’s record drought in the 1950s.

Lubbock already has seen 15 days with dust storms this year, the National Weather Service said.

And remember, we haven’t even gotten to the summer months yet.

As conditions get even worse in the heartland of America, it is going to end up deeply affecting all of us. The farmers and ranchers that live there provide a tremendous amount of food for the rest of the country, and food prices are already starting to rise at an alarming pace.

So what is going to happen if this drought extends for several more years or even longer?

Some experts such as paleoclimatologist Edward Cook have suggested that we could be in the midst of a “megadrought” that could last for decades or even centuries.

Many of those that were convinced that we could never see a return of the Dust Bowl days are now being forced to reevaluate their beliefs. According to the National Weather Service, parts of Kansas, Colorado, Texas and Oklahoma are already drier than they were in the 1930s. The following is an excerpt from a recent National Geographic article entitled “Parched: A New Dust Bowl Forms in the Heartland“…

Four years into a mean, hot drought that shows no sign of relenting, a new Dust Bowl is indeed engulfing the same region that was the geographic heart of the original. The undulating frontier where Kansas, Colorado, and the panhandles of Texas and Oklahoma converge is as dry as toast. The National Weather Service, measuring rain over 42 months, reports that parts of all five states have had less rain than what fell during a similar period in the 1930s.

It is hard to put into words how incredibly serious this all is.

A few years ago, when I wrote articles with titles such as “20 Signs That Dust Bowl Conditions Will Soon Return To The Heartland Of America“, a lot of people laughed.

Not that many people are laughing now.

The truth is that we are now in the midst of the worst drought crisis since the days of the Great Depression.

Fortunately, over the past week or so there has been some rain in some of the hardest hit areas. Let us hope that this is a sign of better things to come.

Because if this drought does not come to an end, it is going to become much, much more expensive for Americans to feed their families.

And considering the fact that 49 million Americans are already facing food insecurity, that is a threat that should not be taken lightly.

Obama Should Apologize For Treating Military Veterans Like Garbage For The Past 5 Years

This Memorial Day, Barack Obama and members of Congress will honor our veterans by wearing ribbons and laying wreaths, but what they should really do is apologize to the entire nation for treating them like human trash for the past five years. You see, the truth is that this VA scandal is nothing new. The problems at the VA hospitals have been documented over and over again for years. When Barack Obama was a U.S. senator, he served on the Veterans Affairs Committee. So as he entered the White House, he was supposed to be an expert in this area. And back in 2008, he pledged to “make the VA a leader of national health care reform so that veterans get the best care possible“. But of course that never happened. And now Obama is claiming that he only learned of the “secret waiting lists” at VA hospitals by “watching television“, and his staff says that he is “madder than hell” about it. So now that he has been publicly shamed, will Obama actually do something about it? Because our military veterans deserve far better care than what they have been getting.

Most Americans don’t realize this, but members of al-Qaeda detained at Guantanamo Bay actually receive far better medical treatment than our military veterans do. Just consider what former Pentagon spokesperson J.D. Gordon had to say about the matter…

Doctors and medical personnel are at their beck and call. Got a cold, a fever, a toothache, a tumor, chest or back pain, mental health issues, PTSD? No problem, come right on in. Military doctors are waiting to see you.

The VA and Gitmo eligible patient-to-health care provider ratios speak volumes.

While the Gitmo ratio is 1.5 to 1, for America’s 9 million veterans receiving VA health care and 267,930 VA employees, the ratio is 35 to 1.

Because there are not nearly enough doctors for our veterans, many of them end up waiting for months just to get an appointment with one. It was CNN that blew the lid off this story when they reported that at least 40 military vets had died while waiting for appointments in the Phoenix area…

At least 40 U.S. veterans died waiting for appointments at the Phoenix Veterans Affairs Health Care system, many of whom were placed on a secret waiting list.

The secret list was part of an elaborate scheme designed by Veterans Affairs managers in Phoenix who were trying to hide that 1,400 to 1,600 sick veterans were forced to wait months to see a doctor, according to a recently retired top VA doctor and several high-level sources.

For six months, CNN has been reporting on extended delays in health care appointments suffered by veterans across the country and who died while waiting for appointments and care. But the new revelations about the Phoenix VA are perhaps the most disturbing and striking to come to light thus far.

CNN was reporting on this for months, but Obama only learned about this just recently?

Considering that he is the chief executive of the entire system, how in the world is that possible?

And of course this has not just been happening in Phoenix. The following is an excerpt from a news story about a vet that died in Houston while waiting for the VA system to take care of him…

George Barraza love two things in this life: playing the electric guitar with all his heart and this country.

During the Vietnam War, Barraza proudly served in the U.S. Army.

But on April 16, Barraza, a father of three girls, a chef and an American veteran, died waiting for an appointment at the VA Medical Center in Houston.

At the time of his death, Barraza was battling heart disease, high blood pressure, diabetes, cirrhosis of the liver and liver cancer. But his problems became much worse in September when he went to the Michael Debakey VA Medical Center in terrible pain and unable to move his hands at all.

“They said, ‘Oh, that looks like it hurts, let me give you some pain medication and send you on home,'” said Barraza’s daughter, Georgia Barraza who complains the VA staff did not treat her father’s problem that day by admitting him and caring for him, but instead gave him pain medication and an appointment to come back.

You can read the rest of this incredibly sad story right here.

And here is an example from Seattle…

Donald Douglass had a small spot on his forehead when he went to the Seattle Veterans Affairs hospital in 2011.

A biopsy confirmed it was cancerous. But it was four months before the hospital scheduled an appointment for him to have it removed — and by then, it had spread, wrapping around a facial nerve and eventually getting into his blood.

The delay proved fatal, his lawyer said — and it mirrors concerns being raised about the VA system nationally.

In fact, veteran deaths like this have been documented all over the nation. After sacrificing so much, our vets are being horribly neglected.

It is a national disgrace.

And of course the problems go far beyond waiting times. For example, down in Miami illegal drug dealing is rampant at VA facilities…

When asked why he would risk his job and speak publicly, Detective Thomas Fiore considered the question carefully before answering.

“People are dying,” he finally said, “and there are so many things that are going on there that people need to know about.”

Fiore, a criminal investigator for the VA police department in South Florida, contacted CBS4 News hoping to shed light on what he considers a culture of cover-ups and bureaucratic neglect. Among his charges: Drug dealing on the hospital grounds is a daily occurrence.

“Anything from your standard prescription drugs like OxyContin, Vicodin, Percocet, and of course marijuana, cocaine, heroin, I’ve come across them all,” he explained.

And what one whistleblower at a VA hospital in North Carolina says is going on is beyond repulsive…

The whistleblower, who wishes to remain anonymous for obvious reasons, works at a large 250 acre VA hospital in North Carolina. He presented his credentials to us which checked out. The VA employee lifted the lid on a number of shocking details during an interview with Sgt. Joe Biggs.

“Recently there’s been a very rapid race to move records, boxes, change labels, whatever it may be, they’re putting them in rooms that nobody would look in….and there’s multiple times that I have seen in the past week or so them moving boxes….so apparently they’re hiding their tracks somewhere,” stated the VA employee, adding that the activity preceded an inspection of the facility, suggesting it was part of an effort to conceal evidence in the aftermath of the secret waiting list scandal.

Even more chilling was a warning sent out to VA employees at the facility which, according to the whistleblower, was meant to get across the message, “Do you see what happens to the people that try to get things straight around here, they’re not here anymore,” a tone the whistleblower described as “pretty telling.”

The employee also revealed the shocking attitude of one supervisor at the hospital towards older veterans, who asserted that older vets “should be taken outside and shot in the head because they’re worthless.” The individual still works at the hospital and was not disciplined for his comments.

What is happening to this nation?

How can we treat our military veterans like this?

The respect for veterans has gotten so low in this country that sometimes it takes more than a year to bury their dead bodies…

The bodies of 28 veterans at the L.A. County Morgue were finally moved Friday for burial to the Riverside National Cemetery.

CBS2/KCAL9 pressed the L.A. County Coroner’s Office Thursday to find out why the bodies had not yet received a proper burial after a source indicated there may have been as many as 60 veterans at the morgue for the past year and a half.

The morgue says the bodies were unclaimed and they don’t know how long the veterans were there.

The law states veterans are supposed to receive a proper burial.

Barack Obama is acting like all of this is a huge surprise to him.

Even though he worked on these issues as a U.S. Senator, and even though he has been the top executive in charge of the system for five years, he claims complete ignorance about what has been going on.

I find this very hard to believe.

The truth is that the news media has been reporting about these kinds of abuses for ages.

And personally, I have been writing about these things for years. Here are some examples…

2013: “There Already Is A Government Health Care System In America And It Is The Medical Version Of Hell”

2013: “25 Signs That Military Veterans Are Being Treated Like Absolute Trash Under The Obama Administration”

2012: “Why Does The U.S. Government Treat Military Veterans Like Human Garbage?”

2010: “Memorial Day Shocker: How The U.S. Government Really Handles Veterans Benefits – Deny, Deny, Deny Until They Die”

So how is it possible that so many people could have been talking about these things for so many years and yet Obama knew nothing?

Come on.

The truth is that Obama does not want to take any responsibility for this scandal or any other scandal.

He wants to continue to be a teflon politician that nothing ever sticks to.

But now he has absolutely no excuse for not taking action.

Military veterans are dying right now, and they need medical attention.

Hopefully Obama will step up to the plate and do the right thing.

But I wouldn’t count on it.

The Robots Are Coming, And They Are Replacing Warehouse Workers And Fast Food Employees

There are already more than 101 million working age Americans that are not employed and 20 percent of the families in the entire country do not have a single member that has a job. So what in the world are we going to do when robots start taking millions upon millions more of our jobs? Thanks to technology, the balance of power between employers and workers in this country is shifting dramatically in favor of the employers. These days, many employers are wondering why they are dealing with so many human worker “headaches” when they can just use technology to get the same tasks done instead. When you replace a human worker with a robot, you solve a whole bunch of problems. Robots never take a day off, they never get tired, they never get sick, they never complain, they never show up late, they never waste time on the Internet and they always do what you tell them to do. In addition, robotic technology has advanced to the point where it is actually cheaper to buy robots than it is to hire humans for a vast variety of different tasks. From the standpoint of societal efficiency, this is a good thing. But what happens when robots are able to do just about everything less expensively and more efficiently than humans can? Where will our jobs come from?

And this is not something that is coming at some point in “the future”.

This is already happening.

According to CNN, there will be 10,000 robots working to fulfill customer orders in Amazon.com warehouses by the end of 2014…

Amazon will be using 10,000 robots in its warehouses by the end of the year.

CEO Jeff Bezos told investors at a shareholder meeting Wednesday that he expects to significantly increase the number of robots used to fulfill customer orders.

Don’t get me wrong – I absolutely love Amazon. And if robots can get me my stuff faster and less expensively that sounds great.

But what if everyone starts using these kinds of robots?

What will that do to warehouse jobs?

PC World has just done a report on a new warehouse robot known as “UBR-1″. This robot is intended to perform tasks “normally done by human workers”…

The UBR-1 is a 4-foot tall, one-armed robot that could make warehouses and factories more efficient by performing tasks normally done by human workers.

Unlike the industrial robots widely used in manufacturing today—usually large machines isolated from people for safety reasons—this robot can work alongside humans or autonomously in a workspace filled with people.

This little robot costs $50,000, and it can work all day and all night. It just needs a battery change every once in a while. The creators of this robot envision it performing a vast array of different tasks…

“We see the robot as doing tasks, they could be dull, they could be dirty, they could be dangerous and doing them repetitively all day in a light manufacturing environment,” said Melonee Wise, Unbounded Robotics CEO and co-founder. Those tasks include stocking shelves, picking up objects and assembling parts.

The UBR-1 isn’t designed for small component assembly, but it can manipulate objects as small as dice or a Lego piece, Wise said. Unbounded Robotics is targeting companies that want some automation to speed up their manufacturing process, but can’t afford to fully automate their businesses.

To many people this may sound very exciting.

But what if a robot like that took your job?

Would it be exciting then?

Of course you can’t outlaw robots. And you can’t force companies to hire human workers.

But we could potentially have major problems in our society as jobs at the low end of the wage scale quickly disappear.

According to CNN, restaurants all over the nation are going to automated service, and a recent University of Oxford study concluded that there is a 92 percent chance that most fast food jobs will be automated in the coming years…

Panera Bread is the latest chain to introduce automated service, announcing last month that it plans to bring self-service ordering kiosks as well as a mobile ordering option to all its locations within the next three years. The news follows moves from Chili’s and Applebee’s to place tablets on their tables, allowing diners to order and pay without interacting with human wait staff at all.

Panera, which spent $42 million developing its new system, claims it isn’t planning any job cuts as a result of the technology, but some analysts see this kind of shift as unavoidable for the industry.

In a widely cited paper released last year, University of Oxford researchers estimated that there is a 92% chance that fast-food preparation and serving will be automated in the coming decades.

It is being projected that other types of jobs will soon be automated as well…

Delivery drivers could be replaced en masse by self-driving cars, which are likely to hit the market within a decade or two, or even drones. In food preparation, there are start-ups offering robots for bartending and gourmet hamburger preparation. A food processing company in Spain now uses robots to inspect heads of lettuce on a conveyor belt, throwing out those that don’t meet company standards, the Oxford researchers report.

Could you imagine such a world?

When self-driving vehicles take over, what will happen to the 3.1 million Americans that drive trucks for a living?

Our planet is changing at a pace that is almost inconceivable.

Over the past decade, the big threat to our jobs has been workers on the other side of the globe that live in countries where it is legal to pay slave labor wages.

But now even those workers are having their jobs taken away by robots. For example, just check out what is happening in China…

Foxconn has been planning to buy 1 million robots to replace human workers and it looks like that change, albeit gradual, is about to start.

The company is allegedly paying $25,000 per robot – about three times a worker’s average salary – and they will replace humans in assembly tasks. The plans have been in place for a while – I spoke to Foxconn reps about this a year ago – and it makes perfect sense. Humans are messy, they want more money, and having a half-a-million of them in one factory is a recipe for unrest. But what happens after the halls are clear of careful young men and women and instead full of whirring robots?

Perhaps you think that your job could never be affected because you do something that requires a “human touch” like caring for the elderly.

Well, according to Reuters, robots are moving into that arena as well…

Imagine you’re 85, and living alone. Your children are halfway across the country, and you’re widowed. You have a live-in aide – but it’s not human. Your personal robot reminds you to take your medicine, monitors your diet and exercise, plays games with you, and even helps you connect with family members on the Internet.

And robots are even threatening extremely skilled professions such as doctors. For instance, just check out this excerpt from a Bloomberg article entitled “Doctor Robot Will See You Shortly“…

Johnson & Johnson proposes to replace anesthesiologists during simple procedures such as colonoscopies — not with nurse practitioners, but with machines. Sedasys, which dispenses propofol and monitors a patient automatically, was recently approved for use in healthy adult patients who have no particular risk of complications. Johnson & Johnson will lease the machines to doctor’s offices for $150 per procedure — cleverly set well below the $600 to $2,000 that anesthesiologists usually charge.

And this is just the beginning. In a previous article, I discussed the groundbreaking study by Dr. Carl Frey and Dr. Michael Osborne of Oxford University which came to the conclusion that 47 percent of all U.S. jobs could be automated within the next 20 years.

47 percent?

That is crazy.

What will the middle class do as their jobs are taken away?

The world that we live in is becoming a radically different place than the one that we grew up in.

The robots are coming, and they are going to take millions of our jobs.

So what do you think of this robot invasion? Please feel free to share your thoughts by posting a comment below…

Is The Mainstream Media Dying?

Ratings at CNN, MSNBC and Fox News have all been plummeting in recent years, and newspaper ad revenues are about a third of what they were back in the year 2000. So is the mainstream media dying? Despite what you may have heard, the mainstream media is certainly not completely dead just yet. The average American watches approximately 153 hours of television a month, and as I pointed out in a previous article, about 90 percent of the “information” that is endlessly pumped into our heads through our televisions is controlled by just six gigantic media corporations. However, there are a whole host of signs that things are changing – especially when it comes to news. More Americans than ever are losing faith in the establishment-controlled media and are seeking out alternative sources of information. Is this a trend that the big media companies are going to be able to reverse at some point?

For years, the “news business” has been dominated by CNN, Fox News and MSNBC. But now all three channels are rapidly losing viewers. According to a recently released Pew Research study, the number of prime time viewers for all three networks combined fell by 11 percent last year…

In 2013, the cable news audience, by nearly all measures, declined. The combined median prime-time viewership of the three major news channels—CNN, Fox News and MSNBC—dropped 11% to about 3 million, the smallest it has been since 2007. The Nielsen Media Research data show that the biggest decline came at MSNBC, which lost nearly a quarter (24%) of its prime-time audience. CNN, under new management, ended its fourth year in third place, with a 13% decline in prime time. Fox, while down 6%, still drew more viewers (1.75 million) than its two competitors combined (619,500 at MSNBC and 543,000 at CNN).

And the decline is far more dramatic when you look at just the key 25 to 54-year-old demographic.

From November 2012 to November 2013, CNN’s ratings for that demographic dropped by a staggering 59 percent, and MSNBC’s ratings for that demographic dropped by a staggering 52 percent.

Is this a sign that Americans are finally getting fed up with the endless propaganda being spewed by those establishment mouthpieces?

A recent survey conducted by a liberal polling firm would indeed seem to indicate that this is the case. That survey found that only 6 percent of Americans consider MSNBC to be their most trusted source for news…

NBC News and sister cable network MSNBC rank at the bottom of media outlets Americans trust most for news, with Fox News leading the way, according to a new poll from the Democratic firm Public Policy Polling.

In its fifth trust poll, 35 percent said they trusted Fox news more than any other outlet, followed by PBS at 14 percent, ABC at 11 percent, CNN at 10 percent, CBS at 9 percent, 6 percent for MSNBC and Comedy Central, and just 3 percent for NBC.

And of course it is not just the big mainstream news networks that are in decline.

A recently released Pew Research study discovered that the decline of America’s newspapers continued in 2013 as well…

The Newspaper Association of America has stopped compiling quarterly reports on advertising revenue. According to its annual numbers, which were released in April 2014, overall revenue for newspapers in 2013 was $37.6 billion, a decrease of 2.6% from 2012. Within that total, combined print and digital ad revenue decreased by 7%—to $20.7 billion.

Seven percent may not sound like much, but you have to realize that these declines have been happening year after year. When you look back over a longer time frame, it really puts the massive decline that we have witnessed in advertising revenues in perspective…

It took a half century for annual newspaper print ad revenue to gradually increase from $20 billion in 1950 (adjusted for inflation in 2013 dollars) to $65.8 billion in 2000, and then it took only 12 years to go from $65.8 billion in ad revenues back to less than $20 billion in 2012, before falling further to $17.3 billion last year.

Even when revenues from digital advertising and other categories described by the NAA as “niche publications, direct marketing and non-daily publication advertising” are added to print ad revenue (see red line in chart), the combined total revenues for print, digital and other advertising last year was still only $23.56 billion in 2013 dollars, which was the lowest amount of annual ad revenue since 1954, when $23.3 billion was spent on print advertising alone.

Yes, you read those numbers correctly. As you can see from this chart, newspaper ad revenues are now about a third of what they were back in the year 2000.

That is not just a “shift” – that is a massive tsunami.

Needless to say, the big newspapers are quite distressed by all of this.

For example, “the Grey Lady” herself is essentially in a state of panic at this point. Just recently, a 96 page internal New York Times report was obtained by BuzzFeed that basically skewers the company’s current strategy when it comes to the Internet…

A 96-page internal New York Times report, sent to top executives last month by a committee led by the publisher’s son and obtained by BuzzFeed, paints a dark picture of a newsroom struggling more dramatically than is immediately visible to adjust to the digital world, a newsroom that is hampered primarily by its own storied culture.

But they still don’t understand the true cause of their decline.

It isn’t the fact that they haven’t adapted to the Internet very well that is the primary reason for their decline.

Rather, it is the fact that the American people are losing faith in the New York Times and other similar establishment mouthpieces.

News magazines are also experiencing a dramatic multi-year decline. Ad revenues are way down across the entire industry, and any publication that can keep their yearly losses to the single digits is applauded for it…

For a third year in a row, news magazines faced a difficult print advertising environment. Combined ad pages (considered a better measure than ad revenue) for the five magazines studied in this report were down 13% in 2013, following a decline of 12.5% in 2012, and about three times the rate of decline in 2011, according to the Publishers Information Bureau. Again, hardest hit was The Week, which suffered a 20% drop in ad pages. The Atlantic fell 17%, The Economist 16%, and Time about 11%, while The New Yorker managed to keep its ad pages losses in single digits (7%).

Mainstream media executives appear to be optimistic that they can reverse these declines at some point, but they simply don’t realize that there has been a fundamental paradigm shift when it comes to the news media in the United States.

The general population has lost a tremendous amount of faith in the mainstream media. They are increasingly becoming aware that it is deeply controlled by the establishment.

At this point, the charade is so out in the open that even reporters are talking about it. For example, former CBS reporter Sharyl Attkisson says that the “influence on the media” by political and corporate interests is “unprecedented”…

“There is unprecedented, I believe, influence on the media, not just the news, but the images you see everywhere. By well-orchestrated and financed campaign of special interests, political interests and corporations. I think all of that comes into play.“

Wow.

Remember, this is not just some outsider that is saying these things. Attkisson worked in the industry for more than 30 years.

And the American people know that they are getting very little truth from the establishment media these days. A recent Gallup survey found that only 23 percent of Americans have a great deal of confidence in the mainstream media at this point. Increasingly, Americans are turning to other sources for news and information.

This is fueling an unprecedented alternative news boom, and more Americans than ever are relying on the Internet as their main source of news. If you doubt this, just check out this chart.

30 years ago, you would have never been able to read this article. It never would have gotten past the gatekeepers that had almost total control over what Americans read, watched and listened to.

But now things have changed. The Internet has allowed ordinary Americans to communicate with each other on a scale that has never been possible before. As we share information with each other, we are increasingly becoming aware that we don’t need the mainstream media to define what reality is for us after all.

If the mainstream media really wants to keep from dying, they should at least try to start telling us the truth.

Unfortunately, that simply is not going to happen. The political and corporate interests that control the big media corporations have way too much to lose.

So we will have to continue to learn to think for ourselves and to share news and information with each other over the Internet.

In the end, we will all be much better off being unplugged from “the matrix” anyway.