Oct 14, 2009 0
Disparity Rises
There is alot of talk right now about Tea Party Revolution and Socialism via the Obama administration. However, the thing that these people that are not seeing is that most of what is happening is being inflicted on them via both parties in concert with the banks, health care industry, and the Military Industrial Complex (MIC). I used to be very skeptical of the socialist ideologues and remain skeptical of those that invest all their emotional and intellectual capital in one school of thought or religion for that matter. Such philosophies remove the individual’s personal responsibility. They also allow themselves to be easily manipulated through advertising. The fact is that when you look at two long-term sets of data – income disparity and the MIC – you see the true problem AND to those that blame Obama as a fascist or whatever I say a trend does not 9 months or 1 adminstration make. This guy is clearly overwhelmed but based on the data I will present he is facing an inertia whose depth and scope is quite daunting.
As you can see from the figure to the right when plotting the returns on 10 of the largest military industrial contractors it is clear that they are rapidly overtaking this country’s production sector.
What we are seeing is that those firms with a long-term presence on the Dow Jones Industrial Average (DJIA) have done quite well for themselves from the 94,171% increase in share price of General Dynamics since it’s initial offering in January of 1977. The MIC giants Boeing and United Technologies have since their share prices increase by 21,788 and 18,633%, respectively. Interestingly two new players in the MIC industry KBR a spin-off of Dick Cheney’s Halliburton and DynCorp a leading competitor of Blackwater (now called Xe Services LLC) have declined by 105 and 119% since their arrival on the DJIA in 2006. In summary the MIB has on averaged gained 15,448% relative to the 823% increase on the DJIA.
So, while the economy suffers and jobs are lost at the rate of 250-750,000 per month in the last 2.5 years the MIB is operating at a profit ratio of 15:1 relative to the DJIA. This type of ratio would usually raise red flags, but since these companies are True Patriots their profligacy is viewed as an inevitable result of the War on Terror and the Spread of Democracy. I wonder if these companies are also Too Big To Fail?
The other contention is that Obama is a looking to redistribute wealth at the expense of most Americans. Hand in hand with this argument is the idea that all citizens have access to the American Dream. Well if you look at data from the Census Bureau you will see that redistribution is absolutely happening but it is occurring in the opposite direction. Two correlated trends are quite evident from the data:
1. Every year the Upper 5% of this country increases it’s average income by $2,049, while the income of the lower 2 Quartiles increases by $93-164. This seems unfair yet the common concern amongst those that are benefiting the least is accruing enough wealth to realign themselves with those that benefit the most form the Efficient Capitalist Market. However, those that benefit the most are doing their darndest to insure that they and only they benefit from this increasing disparity.
They are doing this by promoting war in the hopes of keeping this country divided and invoking patriotism as a means to encourage those with nothing to fight for those with everything.
2. The data also demonstrates that the share of this country’s income allocated to the Top 5 Percent has risen from 43% in 1965 to 50% in 2008. If this trend continues this sector of society will account for 60% of this country’s wealth by 2050.
