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Throughout history, a common thread is that human beings want life to be better for those who follow. Our generation (the Baby Boomers) is no different. What is unique, perhaps, is the gnawing feeling that life may not indeed be better (at least from an economic perspective) for those who follow.
We have noted in the past the underlying cause for many of the problems in contemporary American society is that people all over the world clearly are willing to work for much less compensation. That no doubt has always been true, but the global nature of our economy today brings that reality more to the forefront.
We are competing against economic structures such as China in which unskilled laborers are paid somewhere in the range of $100 a month. The compensation is even less in some other countries, such as India.
Similar trends exist in more skilled trades, leading to the huge outflow of jobs from America over the past several years.
As one plant manager told us several years ago, "I don't care how successful you think a service-based economy can be, the fact is that you are going downhill when nothing is being produced in your country."
We certainly are seeing the effects of the disappearance of production in the United States as it becomes increasingly difficult to find goods manufactured here.
America has taken great pride in being able to adapt to changing conditions in the world and the history of success in that regard is mind-boggling. We truly are a society in which innovation and adaptability have been second to none. And we are sure that tradition will continue into the future.
What has changed in recent years -- and especially recent months -- has been the scope of the challenge faced by our people. The collapse of the housing market, the continuing borrowing of funds from foreign sources and the casino-style gambling that has taken over our investment and mortgage system are all factors which have shaken our society to its financial core.
According to the Johnson Foundation, in 1933, 17 Americans were employed for every Social Security recipient; by 2020, the ratio will have dropped to 3-to-1. The Ford Motor Co. employed 62 active workers for every retiree; by 1993, the ratio dropped to 1.2-to-1.
"A generation ago, our society was affluent, richer than it had ever been," the Foundation notes, "with the prospect that its wealth would be more widely and deeply shared than ever before. The American economy -- our assembly lines, our banks and farms, our workers and managers -- dominated the global economy. Ours was the only major economy to emerge intact from World War II. Trade barriers limited global competition. Our industrial plant and national infrastructure were the envy of the world. As a people, we believed we could afford practically anything, and we undertook practically everything.
"These days are behind us," the Foundation continues. "Global competition is transforming the economic landscape. Fierce competitors from abroad have entered domestic markets, and one great American industry after another has felt the effects. We have watched with growing concern as our great national strengths have been challenged, as the gap between rich and poor has widened, and as the nation's economic energy has been sapped by budget and trade deficits. We have struggled -- so far unsuccessfully -- to set the country back on the confident, spirited course we took for granted a generation ago."
Those words describe the problem, and the mood, of our country as we begin a new year. The challenges are vast, but we remain optimistic that the great historic strength of the American people once again will rise to the occasion and overcome. We may never relive some of the "glory years" that have been enjoyed in the past, but we trust those who follow us will step forward and find a way to restore much of what has been lost through this generation's failings and mistakes.
--REK
