Income polarization caused financial crisis
Thursday, October 2nd, 2008
By Staff
The current financial crisis isn’t due to subprime mortgages, but to the fact that millions of Americans can’t afford their houses. The reason can be summed up in two words: income polarization. The economic structure of taxes, regulations and subsidies takes from the middle class and gives to the rich. Here’s a quick example: the fact that a 30 percent interest rate on credit cards isn’t legally defined as usury.
Big Business forgot something about the American middle class: It’s the world’s most significant customer base. If this critical business asset isn’t nurtured, it will soon exhaust itself and discretionary income will run out.
Under the current administration, the middle class has been milked without being fed. What we’re witnessing is the exhaustion of that asset. Without this asset, no one’s wealth is safe because all businesses need customers. (more…)
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