We Killed The Goose That Laid The Golden Egg And Now The Number Of Americans Receiving Long-Term Unemployment Benefits Has Risen A Whopping 60 Percent In Just One Year

For middle class Americans, the new global economy has provided mountains of cheap products made in China, India and dozens of other nations, but it has also killed the goose that laid the golden egg.  Millions of American workers have been discovering that the price for all of those inexpensive foreign-made goodies is their jobs.  Now we have so many long-term unemployed workers in the United States that we are inventing new terms (such as “the 99ers”) to describe them.  Unemployment is on the rise again (we’ll get to the figures in a minute) and everyone seems perplexed at the continuing inability of the “greatest economy in the world” to provide jobs for everyone.  But the truth is that this has been coming for a long time.  The debt-fueled prosperity of the past couple of decades allowed us to live far beyond our means and provide very high levels of employment for a while, but now economic reality is setting in.  The millions of middle class jobs that have been shipped overseas are never coming back.  Unfortunately, the existence of a large class of chronically unemployed Americans that are struggling just to survive is going to quickly become “the new normal”.

This week the U.S. Labor Deparment announced that for the week ending August 14th, new applications for unemployment insurance benefits reached the half-million mark.  That was the first time since last November that the psychologically important 500,000 threshold had been hit.  Most economists had predicted that unemployment claims would actually decline, but instead they experienced their fourth increase in the past five weeks.

But the increase in new applications for unemployment benefits is only part of the story.  It is not such a bad thing to be unemployed if you can find another job in a couple of weeks or a couple of months.  But in 2010, there are millions of Americans that cannot seem to find a job no matter what they do month after month after month.

In fact, the number of Americans that have exhausted their state unemployment benefits and that are collecting long-term federal unemployment benefits has increased 60 percent over the past year.  The following is how a recent article on CNBC recently described the situation….

“Claimants under the Emergency Unemployment Compensation provision—who have exhausted their state benefits—surged 260,105 to 4,753,456 for the week ended July 31 (the data lags the weekly claims by two weeks). While that represents a weekly increase of 0.5 percent, the total is 60.5 percent higher than the 2009 figure of 2,961,457.”

So what will the figure be at this time next year?

6 million?

7 million?

And what happens if the U.S. Congress finally decides to cut off the long-term unemployment benefits at some point?

The truth is that things are getting really frightening out there.

“There’s a red flag being waved right now that says ‘Danger,’” Bloomberg quoted Mark Vitner, a senior economist at Wells Fargo Securities LLC as saying recently. “Growth is going to slow in the second half and we might face something a little more ominous than that.”

The reality is that there are not nearly enough jobs out there for everyone.  According to one recent survey, 28% of U.S. households have at least one member that is looking for a full-time job.

Just think about that.

Almost 30 percent of all U.S. homes have someone who is looking for a full-time job.

That is not just a problem.

That is a national crisis.

But it is not just those who are unemployed who are suffering.  The reality is that this economic downturn has hurt most of us in one way or another.  A recent Pew Research survey found that 55 percent of the U.S. labor force has experienced either unemployment, a pay decrease, a reduction in hours or an involuntary move to part-time work since the recession began.

Millions of Americans are putting up with increased workloads, pay decreases and benefit cuts right now because the alternative is joining the hordes of jobless Americans that are fighting tooth and nail over the few jobs that are actually available. 

Once you lose your job in this economy there is no telling when you are going to be able to get another one.  In America today, the average time needed to find a job has risen to a record 35.2 weeks.

Could you imagine being unemployed for 35 weeks?

The truth is that in 2010, it is employers that have all the power and all the leverage.

In fact, when you really analyze it, it is a wonder that companies are hiring new workers at all.  It is a massive pain in the rear end to hire a new worker in America today.  The thousands upon thousands of regulations that must be complied with, the big pile of forms that need to be filled out and the elaborate bookkeeping that must be maintained make hiring someone a major headache.  One top of that, tax contributions, benefit packages and health insurance premiums make each worker a very expensive proposition.

There is a reason why so many companies are trying to squeeze more out of the employees that they already have or are only hiring temporary employees right now.

But the biggest reason why there is such a lack of jobs is because millions upon millions of good jobs have been shipped overseas.  Globalism and “free trade” have put middle class American workers into a situation where they are in direct competition for jobs against the cheapest labor in the world.

Why in the world should U.S. companies hire American workers when they can hire very willing workers on the other side of the world who will do the same job for less than one-tenth the cost?

Those who once warned us about “the great sucking sound” that globalism would create were right, and the truth is that the U.S. has already been bleeding good jobs for years.  According to one analysis, the United States has lost 10.5 million jobs since 2007, and the truth is that unless something is done things are going to get even worse.

But what can get lost in all of these statistics is the very real pain that so many millions of Americans are now experiencing.

Losing a job and watching everything that you have worked for crumble can be extremely soul crushing.  In fact, this economy is pushing some Americans completely over the edge.

The following is an excerpt from an actual letter to U.S. Representative Anthony Weiner….

“My dad, S, killed himself March 16, 2009 because he ran out of money and could not find work. My whole family had been devastated by the economy. He was 61 years old and could not take it anymore. He could not figure out how to keep the electric on, buy food, or keep a roof over his head. A day before his electric was to be shut off, and 2 weeks away from eviction, my dad took the hardest walk of his life. He left a note on the dining room table for my sister and I. His suicide letter said ‘I love you. I had to do this. I ran out of money. I wish you both luck in your lives’. He left the door unlocked with the door key left in the lock. He carefully laid out two suits for us to pick from to bury him in.”

Could you imagine if that was your father?

As the economy continues to deteriorate, many more Americans are going to be pushed to the edge of despair.

Life is not about paying our bills or about the things that we own, but there is no denying the pain that comes when you run completely out of money and you feel totally helpless.

But nobody should ever give up.  There is always hope.  Things can always be turned around.

Unfortunately, we have entered a time when there are always going to be a large number of unemployed Americans because there are just not nearly enough jobs to go around.

Anyone who thought that we could merge American workers into a massive global labor pool and still be able to maintain our middle class lifestyles was living in fantasy land. 

No, the truth is that globalism has killed the goose that laid the golden egg and now tens of millions of Americans are going to pay the price.

It’s A Great Time To Be A New College Graduate: High Unemployment, Crappy Service Jobs And Crippling Student Loan Debt

Today, America’s best and brightest are graduating from college full of hopes and dreams, but cold, hard economic reality is rapidly crushing many of them.  Record numbers of college graduates cannot find jobs.  Hordes of others have been forced to take very low paying service jobs.  At the same time, student loan debt loads have become more crushing than ever.  The truth is that it is a really, really bad time to be a fresh college graduate.  After spending tens of thousands of dollars and investing four (or more) years of their lives in an education, millions of recent college graduates find themselves waiting tables, tending bar, delivering pizzas and working next to (or subordinate to) people who never even went to college.  At one time, a college degree was an automatic ticket to the middle class, but now for many Americans all a college degree means is crushing loan payments, sleepless nights and mind-numbing frustration.   

We were always told that a college degree was supposed to prepare us for life in the real world.  But today, the vast majority of college graduates end up moving back in with their parents.

In fact, a recent survey of last year’s college graduates found that 80 percent moved right back home with their parents after graduation.  That was up substantially from 63 percent in 2006.

So why are 80 percent of our college graduates moving back in with their parents?

Well, because they can’t get jobs.

Two million recent college graduates are unemployed, and millions of others are working in fast food joints, at big box stores and in other very low paying service positions.

The stories that some recent college grads tell are so bizarre that they border on the unbelievable.

The Huffington Post recently featured the story of Kyle Daley – a highly qualified UCLA graduate who has been unemployed for 19 months….

I spent my time at UCLA preparing for the outside world. I had internships in congressional offices, political action committees, non-profits and even as a personal intern to a successful venture capitalist. These weren’t the run-of-the-mill office internships; I worked in marketing, press relations, research and analysis. Additionally, the mayor and city council of my hometown appointed me to serve on two citywide governing bodies, the planning commission and the open government commission. I used to think that given my experience, finding work after graduation would be easy.

At this point, however, looking for a job is my job. I recently counted the number of job applications I have sent out over the past year — it amounts to several hundred. I have tried to find part-time work at local stores or restaurants, only to be turned away. Apparently, having a college degree implies that I might bail out quickly when a better opportunity comes along.

The sad thing is that so many of these recent college graduates can’t even get hired for retail jobs.  A reader of my column on The American Dream blog named Kate is a recent college graduate who is experiencing the kind of extreme frustration that so many new graduates are going through right now….

I just graduated college in May… Moved to a new state and am now living with my boyfriend who should not and cannot continue to have to pay everything because i just plain can’t get a job.

I’m over qualified for retail survivor jobs… so I lie on my application. But then retail stores just plain don’t hire full time. So even if I could get a job as a cashier someplace… I’d only work enough hours to maybe pay for my car payment/ car insurance/ gas…. and my half of rent/electric and such is out of the question… not to mention charged to the limit credit cards from being unemployed and student loans that will hit in just a matter of months.

Any other jobs either don’t exist or they just ALL want 5 years professional experience…. which is impossible for someone who just graduated and has been working part time retail jobs since high school.

But it just isn’t college graduates that are suffering.  The truth is that this economic downturn has been hurting everyone….

*According to a recent Pew Research poll, approximately 37% of all Americans between the ages of 18 and 29 have either been unemployed or underemployed at some point during the recession.

*A different Pew Research survey found that 55 percent of American workers have experienced either unemployment, a pay decrease, a reduction in hours or an involuntary move to part-time work since the recession began.

*According to another survey, 28% of all U.S. households have at least one member that is currently looking for a full-time job.

For many U.S. households, the person looking for a job is a recent college graduate.

As you read this, hordes of highly qualified college grads are out applying for jobs as waitresses, pizza delivery men, grocery checkout clerks and hamburger flippers.

Even those who are able to get decent jobs are finding themselves disappointed.  Starting salaries for college graduates across the United States are down in 2010.

But why shouldn’t starting salaries be down?  It is the employers that hold all the leverage – not the new graduates.

Meanwhile, many of these college graduates are graduating with crushing student debt loads.  Today, many students borrow 10, 20 or even 30 thousands dollars per year while they are in school.

Federal statistics reveal that only 36 percent of the full-time students who began college in 2001 received a bachelor’s degree within four years.

That is a very sad statistic.

The truth is that college courses have become so “dumbed down” in 2010 that even the family dog should be able to graduate from most U.S. colleges in four years.

Even after 6 years, that same group’s graduation rate was still only 57 percent.

Very sad.

But getting back to the point, every single one of those years most college students are racking up huge amounts of debt.

Today, approximately two-thirds of all U.S. college students graduate with student loans

Student loan balances of over $50,000 are becoming quite common among our college grads.  In fact, some students end up with over $100,000 in student loan debt by the time they are done.

Unfortunately, student loan debt is some of the cruelest debt out there.

Federal bankruptcy law makes it nearly impossible to discharge student loan debts, and many recent grads end up with loan payments that absolutely devastate them financially at a time when they are struggling to get on their feet and make something of themselves.

So what do you think?  Can you identify with this article?  Are you a recent college graduate or do you have a recent college graduate living back at home?  If so, please feel free to share your story in the comments section below….

Economic Pain

For decades, most Americans have enjoyed an extremely high standard of living.  In fact, most of us have been “enjoying the high life” and “living the dream” for so long that we have assumed that it is just always going to be that way.  But now a rapidly growing percentage of Americans is getting the chance to experience some very serious economic pain.  Today, over 40 million Americans are on food stamps and over 20 million U.S. children are living in poverty.  Tens of millions of Americans are unemployed, and personal bankruptcies and foreclosures continue to set all-time records.  For many people, all of this economic turmoil was completely unexpected.  Millions of people now can’t sleep at night because they are constantly stressed about finances.  More couples than ever are being torn about by arguments over money.  Unprecedented numbers of Americans have experienced a sinking feeling in the pit of their stomachs upon the realization that they are going to lose the homes that they have been raising their families in.  Money may not buy happiness, but as tens of millions of Americans are finding out, the lack of it can bring a whole lot of pain.

Now, the truth is that there have always been a small percentage of Americans that have struggled to get by, but today we are seeing more Americans who are “down on their luck” than at any other time in recent memory.  According to one shocking new survey, 28% of all U.S. households have at least one member that is looking for a full-time job.

It seems like almost everyone has a family member or a close friend who is looking for a job.  The truth is that there are not enough jobs for everyone, and there certainly are not nearly enough good jobs. 

A recent Pew Research survey found that 55 percent of the U.S. labor force has experienced either unemployment, a pay decrease, a reduction in hours or an involuntary move to part-time work since the recession began.

55 percent?

That is incredible.

That means that over half of all American workers have been unemployed or have been forced to take a reduction in pay since the recession started.

Things are getting really tough out there.

Millions of Americans are wondering why their husbands or wives suddenly can’t find jobs.

In fact, the average duration of unemployment in the United States has risen to an all-time high.  The declining economy has created a new class of chronically unemployed Americans who would love to work but can’t seem to find anyone to hire them.

Millions of Americans have been forced to turn to part-time work.  In fact, one recent survey found that approximately 8.6 million American workers are working part time because they can’t get full-time jobs.

In this economic environment, there is significant competition for even the lowest paying jobs.

You never know – this holiday season the friendly gentleman greeting you down at the local Wal-Mart may actually have several advanced degrees but just cannot find anyone else who will hire him.

As the economic situation continues to deteriorate, record numbers of Americans are going bankrupt and are losing their homes.  In fact, banks repossessed a record number of U.S. homes during the second quarter of 2010.

So it is really no wonder why so many Americans are feeling so negative about the economy.

According to one new survey, U.S. consumer sentiment weakened in early July to its lowest in 11 months.  In addition, one recent poll found that 76 percent of Americans believe that the U.S. economy is still in a recession.

But sometimes what gets lost in all the numbers are the individual stories of the very real pain that so many Americans are going through.  Today, I thought that I would share just a few of the stories of economic pain that my readers have been sharing with me.

A reader of my column on The American Dream blog named Kate recently graduated from college but now finds that she can’t even get a retail job….

I just graduated college in May… Moved to a new state and am now living with my boyfriend who should not and cannot continue to have to pay everything because i just plain can’t get a job.

I’m over qualified for retail survivor jobs… so I lie on my application. But then retail stores just plain don’t hire full time. So even if I could get a job as a cashier someplace… I’d only work enough hours to maybe pay for my car payment/ car insurance/ gas…. and my half of rent/electric and such is out of the question… not to mention charged to the limit credit cards from being unemployed and student loans that will hit in just a matter of months.

Any other jobs either don’t exist or they just ALL want 5 years professional experience…. which is impossible for someone who just graduated and has been working part time retail jobs since high school.

AND internships are unpaid or only for college students so thats out of the question….

But the fact of the matter is that jobs don’t care about education in the least bit if you don’t have the real professional work experience to back it up.

A reader of this column named David ended up taking a very low paying job overseas because he simply couldn’t find anything here in the United States….

I have been looking for a job since June 2009. I am a prior Army officer who knows four foreign languages and has lived around the world. I have sent out over 100 resumes over the past year. Finally, I got a job offer to teach English in Russia for $720 per month. Yes, $720 per month. Luckily my housing is paid for. So, I took my tax return and left for Russia to teach English. The American economy is broken and it will get worse. We are in the early stages of a total meltdown in America. Yes, if you are an American, you better prepare yourself for the worst is still to come.

But even those who do have jobs are facing some very difficult circumstances as one of my readers named Ana recently described….

I am a cop’s wife. My husband currently works for a Sheriff’s office who is extremely understaffed and the county wastes money like there is no tomorrow. They threaten the Sheriff with more layoffs if they don’t write more tickets on the highway. My husband has often had to patrol the entire county by himself for a full 12 hour shift. It is a bad situation for everyone.

The truth is that there are millions of stories like the ones above.  Economic pain is everywhere, and the American people are becoming increasingly frustrated.  Most Americans don’t understand why the economy is suddenly in the toilet – all most of them know is that things are broken and they desperately want someone to fix things. 

A lot of this frustration is coming out as anger towards the government.  People are waking up and are starting to realize that the American ruling class has been doing an incredibly bad job of running things.  The American people are hungry for a real change.  In fact, a new Rasmussen Reports national telephone survey found that just 23% of voters nationwide believe that the U.S. government has the consent of the governed.

But will we start to see some real changes in the years ahead?

Unfortunately, that is quite doubtful.  The reality is that the American ruling class has a stranglehold on both political parties, and they are not going to release their grip easily.

Meanwhile, our leaders continue to perpetuate the same failed policies that got us into this mess in the first place.  But unless some fundamental changes are made soon, the economic pain that Americans are experiencing is going to continue to get even worse.

So do you have a story of economic pain to share?  Feel free to share your thoughts in the comments section below….

The U.S. Economy Is A Dead Horse And The American People Are Starting To Get Really Pissed Off And Frustrated

The economic frustration of the American people is reaching a fever pitch.  Millions of Americans can’t seem to get a good job no matter what they do.  Millions of others are working as hard as they can but find that they keep coming up short at the end of the month.  Record numbers of Americans are still going bankrupt.  Record numbers of Americans are still losing their homes.  Meanwhile, the U.S. economy is a dead horse at this point.  It just doesn’t have any more to give.  At this point the U.S. economy is like an aging rock star that requires larger and larger doses of drugs each night just to be able to perform.  The U.S. economy is addicted to “drugs” such as debt and government stimulus, and years ago those things really supercharged the U.S. economic system, but at this point they aren’t provoking much of a response at all.  In fact, the things that once “stimulated” the economy are now slowly killing it.  But the vast majority of the American people do not understand this.  All they know is that the economy is broken and they want someone to “fix” it.

For most Americans, all we have ever known is tremendous prosperity.  All our lives we have been taught that America is the richest and most prosperous nation on the planet, and that while there will always be times of “recession”, things will always bounce back and be better than ever before.

But this time things aren’t bouncing back.

And Americans are starting to become extremely frustrated.   

A couple of quotes that appeared in a recent article in The New York Daily News really embodied the growing frustration that so many are feeling at this point….

“My husband and I are fortunate to be able to move in with my 81-year-old mother-in-law. But how sad is that? I apply for jobs and nothing happens,” writes Gayle Hanson. “Who wants to hire a 59-year-old woman? My answer is nobody. [I] have years of experience, excellent references. And nothing to show for it.”

“I am soon to be 57 and considered too old, too expensive, etc. I can’t get an employer to hire me at any salary,” writes Mike Stiller. “I am BOILING MAD.”

But Gayle Hanson and Mike Stiller are far from alone.

Millions upon millions of Americans are “boiling mad” about the economy at this point.

The truth is that the United States has lost 10.5 million jobs since 2007.  Many of those jobs have been shipped off to countries like China and India where labor is much cheaper and they are never coming back.

There just are not enough jobs for everyone in America at this point.  The number of “chronically unemployed” has been rising at a frightening pace.  In fact, the average duration of unemployment in the United States has risen to an all-time high

If you have never been unemployed and unable to find a job, then you just don’t know how soul crushing it can be.  This is especially true when you have a family to support.

Right now, there are 9.2 million Americans that are unemployed but are not even receiving an unemployment insurance check.  It is easy to tell those unemployed workers that they should “get a job”, but as the chart below shows, the gap between the number of unemployed workers and the number of job openings has increased dramatically over the last couple of years….

But in this economy, even many of those who do have jobs are still struggling mightily.  According to a poll taken in 2009, 61 percent of Americans “always or usually” live paycheck to paycheck.  That was up significantly from 49 percent in 2008 and 43 percent in 2007.

And Americans are still losing their homes in record numbers.  Banks repossessed an average of 4,000 south Florida properties a month in the first half of 2010, which was up 83 percent from the first half of 2009.

Meanwhile, demand for homes is dropping through the floor.  The Mortgage Bankers Association announced on Wednesday that demand for loans to purchase U.S. homes sunk to a 13 year low last week, and refinancing demand also plummeted despite near record-low mortgage rates.

So considering all of these statistics, is it any wonder why so many Americans are so pessimistic?

According to a recent poll conducted by Bloomberg, 71% of Americans say that it still feels like the economy is in a recession.

But the truth is that we haven’t seen anything yet.

Things are going to get much worse.

Already, Federal Reserve policymakers are discussing what steps they might take to stimulate economic activity “if the outlook were to worsen appreciably”.

So can more economic stimulus help?

To a limited extent.

The Federal Reserve and the U.S. government will likely try to inject more debt and more “economic stimulus” into the system to try to shock the economy back to life.

But the more debt the U.S. government takes on the worse our long-term problems are going to get. 

The reality is that the U.S. economic system is broken, and there is simply not any “quick fix” that is available that is going to get things back to normal.

So on an individual level, what should we all do?

Well, we all need to start becoming a lot less dependent on the system.

We should all consider how we can start our own businesses, grow our own food and trade within our own communities.

If the entire system is starting to break down, it is those who are the least dependent on the system that will have the best chance to prosper during the times ahead.

So what do you think?  Do you agree?  Do you disagree?  Feel free to leave a comment with your thoughts below….

No Jobs

Everyone knows that the United States is bleeding jobs.  According to one new study, the private sector in the United States has lost 10.5 million jobs since 2007.  The U.S. economy lost 125,000 more jobs during the month of June.  Approximately a million frustrated American workers have simply dropped out of the employment market altogether over the past two months.  But the question not enough people are asking is why so many jobs are being lost.  Yes, the large global corporations have been sending millions of jobs overseas where labor is far, far cheaper.  And yes, the U.S. government has accumulated so much debt that it is absolutely suffocating the U.S. economy.  But there is another very important factor that has been largely overlooked.  Traditionally, about 75 percent of all new jobs are created by small businesses.  But today, hundreds of thousands of small businesses are being strangled out of existence by all of the oppressive taxes, fees, rules, regulations, paperwork and demands that government keeps imposing on them.  In such a repressive environment, it is getting close to impossible for small businesses to thrive, and if our small businesses can’t succeed, then we simply are not going to see a lot of jobs being created.   

You see, the truth is that over the past several decades the game has become dramatically stacked in favor of large businesses.  Big corporations have the money to lobby Congress and other governmental institutions, they get almost all the tax breaks and they are the only ones who get bailouts.  They even “help” write legislation on the federal level. 

Many times large corporations will even lobby for more regulations for their own industry because they know that they can handle all of the rules and paperwork far easier than their smaller competitors can.  After all, a large corporation with an accounting department can easily handle filling out a few thousand more forms, but for a small business with only a handful of employees that kind of paperwork is a major logistical nightmare.

When it comes to hiring new employees, the federal government has made the process so complicated and so expensive for small businesses that it is hardly worth it anymore.  Things have gotten so bad that more small businesses than ever are only hiring part-time workers or independent contractors. 

So what we actually have now is a situation where small businesses have lots of incentives not to hire more workers, and if they really do need some extra help the rules make it much more profitable to do whatever you can to keep from bringing people on as full-time employees.    

Can the U.S. economy thrive in such an environment?

Of course not.

Small businesses are slowly being strangled out of existence.

Unless something changes quickly, small businesses are going to continue looking for ways to shed employees rather than hire them.

The U.S. government has become like the 500 pound fat guy who jumps on a horse and then gets angry when it won’t move.

Passing even more ridiculous regulations and raising taxes even higher is not going to fix business in America.

The burdens we have placed on our small businesses have gotten worse under every single presidential administration of the past several decades.  Now our great economic machine has become so overburdened and so tired that it is simply refusing to move.

And this is not a short-term problem either.  Yes, we have lost a ton of jobs since the beginning of the “Great Recession”, but our problems go back a lot farther than that.  The reality is that the U.S. population has grown by about 25 million people since they year 2000, and we needed to create millions upon millions of new jobs to support that increased population.  Instead, we have lost a total of 3 million jobs since 2000.

Needless to say, that is not a good trend.

There are simply not enough jobs for everyone.

Today, there are more than 5 unemployed Americans for every single job opening.

It is becoming harder and harder to find a job, and the number of Americans who are chronically unemployed is absolutely exploding.

In America today, the average time needed to find a job has risen to a record 35.2 weeks.

There are millions of Americans out there tonight who feel like punching the walls or drinking themselves under the table out of frustration because they can’t find a job.

And many of those who are “chronically unemployed” are about to experience even more pain.

So far, the U.S. Senate has refused to extend long-term unemployment benefits for about 1.3 million Americans.  Without this assistance, these Americans and their families will be forced to survive on food stamps and whatever else they can scrape together.

The tent cities that are popping up all over the United States are about to get a lot more crowded.

So is there much hope that this is going to turn around any time soon?

Unfortunately, no.

Big corporations are not going to pay U.S. workers ten times more money than what they are paying employees in Malaysia, China or the Philippines just because they feel sorry for them.

Small businesses are not going to hire a lot more workers as long as things stay the way that they are.  In fact, many small businesses are going to continue to look for ways to cut employees.

The public sector is the one place that had been hiring more workers, but due to growing concern about exploding budget deficits, there isn’t going to be a lot of additional hiring in the public sector either.

The truth is that there is not a lot of reason for optimism right now.  The U.S. economy is being battered by a host of economic problems, and with each passing week even more economists warn that we are likely headed for the second half of a double-dip recession.

So if you still have a job, be thankful.  If you don’t have a job, you are probably going to have to get really creative. 

Times are tough and they are going to get even tougher.  But it is in the midst of challenging times that we find out who we really are.

What Do You Believe Is America’s Biggest Economic Problem?

Today there are literally dozens of major threats to the U.S. economy.  Each one of these threats alone could cause a major economic implosion.  The Gulf of Mexico oil spill, the derivatives bubble, the housing crisis, the exploding U.S. national debt and the burgeoning European debt crisis all threaten to push the struggling U.S. economy over the edge.  But which one is America’s biggest economic problem?  Below, 16 of America’s greatest economic threats are listed in no particular order.  The goal of this article is to hear what all of you readers believe is the worst crisis the U.S. economy is facing.  If you would like to vote, please choose one of the 16 economic problems listed below (or nominate one of your own) and leave a comment explaining your choice….

#1) The Gulf Of Mexico Oil Spill – The Gulf of Mexico oil spill is already the worst environmental disaster in U.S. history.  Is it also about to become the worst economic disaster in U.S. history?   

#2) The Derivatives Bubble – The total value of all derivatives worldwide is estimated to be well over a quadrillion dollars.  In fact, the danger from derivatives is so great that Warren Buffet has called them “financial weapons of mass destruction”.  Will the derivatives bubble end up being the major cause of the next depression?

#3) The Housing Crash – Last month, sales of new homes in the United States dropped to the lowest level ever recorded.  Also, the number of U.S. home foreclosures set a record for the second consecutive month in May.  Very few Americans are buying houses right now.  The subprime mortgage crisis brought the U.S. financial system to the brink of ruin in 2007 and 2008.  Is it about to happen again?

#4) The Federal Reserve – Instead of printing and issuing their own currency, the U.S. government actually has to go into more debt before any new currency is created.  But the problem is that the money to pay the interest on that debt is not created at that time, so in order to pay that interest the U.S. government will need to create even more currency in the future.  That means going into even more debt.  Thus the U.S. government is caught in an endless debt spiral that has now become impossible to escape.  By basing our economy on mountains of debt and paper money that is backed by nothing, have we essentially guaranteed that our economic system will totally fail someday?     

#5) The European Sovereign Debt Crisis – Greece, Spain, Italy, Portugal and a number of other European nations are in real danger of actually defaulting on their debts.  If a wave of national defaults starts sweeping the globe, will it end up wiping out the U.S. economy as well?

#6) The Growing Welfare State – For the first time in U.S. history, more than 40 million Americans are on food stamps, and the U.S. Department of Agriculture projects that number will go up to 43 million Americans in 2011.  More than 1 in 5 American children now live below the poverty line.  Nearly 51 million Americans received $672 billion in Social Security benefits in 2009.  How many people can the U.S. government possibly support financially before it finally collapses under the weight?

#7) Illegal Immigration– There are an estimated 30 million illegal immigrants now living in the United States.  Not only is this a very serious economic burden, but it is a huge national security issue as well.  Federal agents and local law enforcement officials along the border are now openly telling the media that they are outgunned, outmanned and are increasingly being shot at by the Mexican drug cartels that are openly conducting military operations inside the United States.  There is now significant Latin American gang activity in almost every large and mid-size city in the United States.  Meanwhile, Barack Obama continues to leave the border wide open.  

#8) Corruption On Wall Street– The corrupton in the financial system that has been revealed in 2010 has been absolutely mind blowing.  Goldman Sachs, Morgan Stanley, Bank of America, Citigroup, JPMorgan Chase, Lehman Brothers and Wachovia are all being investigated by the government at this point.  The rampant manipulation of the gold and silver markets was completely blown open by an industry insider, and the U.S. government has finally been convinced to take a look at it.  It seems like the more the layers are peeled back, the more corruption we find in the financial community.  So how long can the U.S. financial system survive when corruption is seemingly everywhere? 

#9) War In The Middle East – The U.S. government has spent hundreds of billions of dollars fighting the war in Iraq.  The U.S. government has spent over 247 billion dollars on the war in Afghanistan, and yet June 2010 has now become the deadliest month of the Afghan war for coalition troops.  Now there is a very real possibility that war could erupt with Iran.  How long can the U.S. government continue to afford to pour hundreds of billions of dollars into wars in the Middle East?  Not only that, but if a war with Iran cuts off the flow of oil from the Persian Gulf, what would that do to our economic system that is so highly dependent on oil?

#10) Barack Obama’s Health Care “Reform” – Barack Obama’s pet project is actually the biggest tax increase in U.S. history, it is going to cause the premature retirement of thousands upon thousands of American doctors, and it is going to drive health insurance premiums through the roof.  Health insurance companies are going to do very well (they actually helped write the bill), but the rest of us are going to be absolutely crushed by this brutal legislation.  So what will happen when the U.S. healthcare system implodes?

#11) Barack Obama’s “Cap And Trade” Carbon Tax Scheme– Rather than focusing all of his attention on fixing the massive oil leak in the Gulf of Mexico, Barack Obama has been busy playing golf and figuring out how he can use this crisis as an opportunity to get his “cap and trade” carbon tax scheme pushed through the U.S. Congress.  But will Barack Obama’s obsession with “global warming” end up totally wrecking the U.S. economy?

#12) Globalism – Most American workers had no idea that free trade would mean that they would suddenly be competing for jobs against workers in the Philippines and Malaysia.  Today, corporations often find themselves having to choose whether to build a factory in the United States or in the third world.  But in the third world workers often earn less than 10% of what American workers earn, corporations are often not required to provide any benefits to workers, and there are usually hardly any oppressive government regulations.  How can American workers compete against that?

#13) The Moral Decline Of America – An economy stops working efficiently when people stop feeling safe and when they stop trusting one another.  As greed, selfishness, lust, pride, theft and violence continue to explode, how much longer will the U.S. economy be able to function normally?

#14) Genetic Modification – Scientists around the globe have now produced “monster salmon” which grow three times as fast as normal salmon, corn that has been genetically modified to have a pesticide grow inside the corn kernel, cats that glow in the dark and goats that produce spider silk.  Is it possible that all of this genetic modification could unleash an environmental hell that could destroy not only the economy but also our entire society?

#15) Unemployment – Tens of millions of Americans are out of work and nearly a million people have lost their unemployment benefits because the U.S. Senate has once again failed to pass a bill that would extend those benefits.  In some areas of the United States unemployment has been pushing up towards depression-era levels.  For example, a while back the mayor of Detroit said that the real unemployment rate in his city is somewhere around 50 percent.  So is the biggest problem that the U.S. economy is facing the fact that so many millions of willing American workers simply cannot find work?

#16) The U.S. National Debt – As of June 1st,  the U.S. National Debt was $13,050,826,460,886.  According to a U.S. Treasury Department report to Congress, the U.S. national debt will top $13.6 trillion this year and climb to an estimated $19.6 trillion by 2015.  The total of all government, corporate and consumer debt in the United States is now about 360 percent of GDP.  The United States has piled up the biggest mountain of debt in the history of the world.  So how long will it be before this mountain of debt collapses?

So of the 16 economic problems listed above, which one do you believe is the biggest threat to the U.S. economy?

Please feel free to leave a comment with your vote….

Bad Economic News

It seems like almost everywhere you turn these days there is bad economic news.  Foreclosures are setting records, unemployment remains depressingly high, poverty is exploding, U.S. government debt is wildly out of control and Europe is on the verge of an economic collapse that could send the entire globe into a devastating financial panic.  If all that wasn’t enough, the oil spill in the Gulf of Mexico has destroyed the seafood and tourism industries along the Gulf coast and threatens to push that entire region into a depression for years to come.  The truth is that the more you look at the economic statistics coming in from around the globe the more it becomes obvious that we are headed for a complete and total economic nightmare. 

Just consider some of the most recent economic news…. 

*The number of U.S. home foreclosures set a record for the second consecutive month in May.  How can the U.S. housing industry be recovering when the number of Americans being foreclosed on continues to set all-time records?

*As of March, U.S. banks had an inventory of approximately 1.1 million foreclosed homes, up 20 percent from a year ago.  Instead of working their way through the huge backlog of unsold homes, U.S. banks continue to pile up a massive inventory of foreclosed homes at a staggering pace.

*According to figures from the U.S. Commerce Department, housing starts in the United States fell 10 percent in May, the biggest decline since March 2009.  The data also revealed that single-family home starts suffered the biggest drop since 1991.  There is already a massive glut of unsold homes on the market, so builders simply do not think it is profitable to build many new homes right now.

*Officials now tell us that the cost of “fixing” Fannie Mae and Freddie Mac, the government-backed mortgage companies that last year bought or guaranteed the vast majority of all U.S. home loans, will be at least $160 billion and could grow as high as $1 trillion.  The twin pillars of the U.S. mortgage industry have become financial black holes that the U.S. government endlessly pours massive amounts of cash into.  That is not a good sign.

*Fannie Mae and Freddie Mac are to be delisted from the New York Stock Exchange because their stock prices have been trading under $1 per share for more than 30 trading days.  The truth is that Fannie Mae and Freddie Mac would have completely imploded by now if the U.S. government had not decided to step in and bail them out.

*The average duration of unemployment in the United States has risen to an all-time high.  Not only are a ton of Americans out of work, they can’t find work for a very, very long time once they are unemployed.

*For Americans younger than 25 years of age, the unemployment rate is 18.8%.  But even those young Americans that can find employment often find themselves working in very low paying service jobs.

*Federal Reserve Chairman Ben Bernanke says that the U.S. unemployment rate is likely to stay “high for a while”.  Considering how badly Bernanke has been doing his job, it would be really nice if we could add just one more person to the unemployment rolls.

*According to one new study, approximately 21 percent of children in the United States are living below the poverty line in 2010 – the highest rate in 20 years.  There are hundreds of thousands of American children on the streets each night, and yet we continue to insist that we are the greatest country in the world. 

*For the first time in U.S. history, more than 40 million Americans are on food stamps, and the U.S. Department of Agriculture projects that number will go up to 43 million Americans in 2011.  How many tens of millions of Americans have to be on food stamps before we officially say that we are in a depression?

*According to the Wall Street Journal, the debates have begun inside the Fed about what it should do in the event of a “double dip” recession.  If they are already debating what to do during the next economic downturn that means it is probably a foregone conclusion. 

*If you were alive when Christ was born and spent one million dollars every single day from then until now, you still would not have spent one trillion dollars by now.  But somehow the U.S. government is now over 13 trillion dollars in debt.  According to a U.S. Treasury Department report to Congress, the U.S. national debt will top $13.6 trillion this year and climb to an estimated $19.6 trillion by 2015

*It is being projected that the U.S. national debt will grow to surpass our gross domestic product in 2012.  Needless to say, that is a really, really bad sign.

*The total of all government, corporate and consumer debt in the United States is now equal to 360 percent of GDP.  At no point during the Great Depression did we ever even come close to such a figure.

But things may be even worse in Europe right now.  Unfortunately for the U.S., when Europe experiences an economic collapse it will devastate the American economy as well. 

The economic news coming out of Europe lately has been extremely alarming….

*George Soros says that a European recession next year is “almost inevitable”.  Considering how much access George Soros has to inside information, the fact that he is so pessimistic about Europe is a very troubling thing indeed.

*A report by the Bank for International Settlements says that the debt crisis hitting southern Europe resembles the 2007 subprime mortgage crisis.  Is history about to repeat itself?

*Moody’s has downgraded Greece government bond ratings into junk territory, citing the risks inherent in the rescue package that the rest of the eurozone has put together for them.  Soon Spain, Portugal, Italy, Ireland, Romania and a number of other European nations could have their debt downgraded as well. 

*The U.K.’s  new Office for Budget Responsibility has announced that the U.K. economy was more damaged by the recent financial crisis than previously admitted, and that it may never fully recover.  But the same could be said for many other nations across the world as well.

*21.5% of all working-age people in the U.K. do not have a job.  It seems like almost every country has a shortage of jobs these days.

*New U.K. Prime Minister David Cameron is warning that Britain’s “whole way of life” is about to be significantly disrupted for years by the most drastic public spending cuts in a generation.  In fact, severe austerity measures being implemented all across Europe could make this one of the most “interesting” European summers in ages.

*Spanish banks are borrowing record amounts of money from the European Central Bank as Spain’s financial institutions are finding it increasingly difficult to acquire funds in international capital markets.  But the truth is that it isn’t just Spanish banks that are facing a liquidity squeeze – the entire world is heading for a massive credit crunch.

But the biggest piece of bad economic news of all is the nightmare that is unfolding in the Gulf of Mexico.  There is no way that the southeast United States is going to be the same after this.  Hordes of businesses and entire industries have been literally destroyed over the past two months.  The total economic damage from this unprecedented disaster will easily run into the hundreds of billions of dollars.  This is an economic blow that the teetering U.S. economy simply could not afford right now.  Once the oil finally stops flowing the crisis will not be over.  In fact, the aftermath from this oil spill could end up echoing for decades.

So are things bad out there?  Yes, things are incredibly bad and they are about to get a whole lot worse.  In fact, there are so many cancers eating away at the U.S. economy that it would take an entire book to detail them all. 

What we are dealing with is not “just another recession” or “just another economic downturn”.  What we are witnessing is the fundamental unraveling of the monstrous debt spiral that our economy is based upon.  Any economy that is built on a foundation of debt and paper money is inevitably doomed.

So yes, the bad economic news is going to continue.  Things may get better for a while here and there, but the truth is that we are caught in a long-term spiral of economic decline from which there is no escape.

So what do you think?  Do you believe that there is hope for the U.S. economy?  Feel free to leave a comment with your opinion….

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