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'General Motors, Sears and Toys R Us: Layoffs Across America Highlight Our Shredding Financial Safety Net' (nbcnews.com)
New submitter Bruce Henry shares a story: Today's aging workforce faces an uncertain future. The announcement this week that General Motors will lay off 15 percent of its salaried workforce and shutter multiple plants in North America was a sobering reminder of how far the American worker has fallen. Unlike most large private sector corporations today, thousands of employees at GM still enjoy some union benefits. The company has reportedly set aside $2 billion for layoffs and buyouts. It's not much, but it's something -- many workers, if they are laid off en masse, will be far less lucky. Some older Americans are lucky enough to have been grandfathered into generous pension plans and others hope social security and personal savings will be enough to sustain themselves. But for millions of younger people, the outlook is bleaker -- an ever-diminishing social safety net, with retirement dependent almost entirely on how well they manage savings. Two-thirds of millennials have nothing saved for retirement.
The private sector pension as we once knew it is all but dead. Public sector pensions, meanwhile, are under attack at the state level. "Companies don't offer pensions anymore. Social security, when it was established, was meant to be one leg of a stool," says Gerald Friedman, an economist at the University of Massachusetts at Amherst. "One leg would be the private pension through employment, a second leg personal savings, and a third leg social security. Social security is now the only source of income of a lot elderly have." What, if anything, are our politicians doing about this? Progressives rail against President Donald Trump, but real retirement security has not been a big enough part of the conversation on either side of the political spectrum. Millions of Americans are in danger of entering their final decades unable to afford ballooning medical bills and cost-of-living expenses. This is a huge problem, and one that liberals in particular should have capitalized on this election cycle.
The private sector pension as we once knew it is all but dead. Public sector pensions, meanwhile, are under attack at the state level. "Companies don't offer pensions anymore. Social security, when it was established, was meant to be one leg of a stool," says Gerald Friedman, an economist at the University of Massachusetts at Amherst. "One leg would be the private pension through employment, a second leg personal savings, and a third leg social security. Social security is now the only source of income of a lot elderly have." What, if anything, are our politicians doing about this? Progressives rail against President Donald Trump, but real retirement security has not been a big enough part of the conversation on either side of the political spectrum. Millions of Americans are in danger of entering their final decades unable to afford ballooning medical bills and cost-of-living expenses. This is a huge problem, and one that liberals in particular should have capitalized on this election cycle.
A colleague from Germany was visiting our office recently. He was quite perplexed as to why on a lunch walk we all were discussing the stock market. Basically everyone has to be both investor and worker here. Over there there is a reasonable pension system and people focus on their jobs.
It is also clear from various lunch walks with well educated co-workers that steady investing is beyond the grasp of many otherwise smart and rational people. Some want to have "my guy" handle their stuff (cue Berny Madoff flashbacks), others have been on the sidelines waiting for prices to be "right" while insisting they are not timing the market (they are). It is saddening that this is where we expect most folks to draw their retirement from.
So while I don't suggest there should not be a system with zero responsibility, the current system is akin tossing baby seals into a shark tank and wishing them the best. I would like to see an expansion of social security to help fill the gap that has widened into a chasm between what people need and what they have to retire at a reasonable age.
In the past, a single house hold earner could provide for a family. Now it takes two.
Median household income in the US is around $44K per year. Given that most people manage to get by just fine obviously that is more than enough to provide for a family. No it won't by you a house in Beverly Hills but it's plenty enough to put food on the table and take care of necessities.
Government regulations and their impact on manufacturers.
I work in manufacturing and have made my career there. Your argument that government regulations have much to do with the problems in manufacturing highlights the fact that you don't know much about the economics of manufacturing. Manufacturing is doing just fine in the US. The US manufacturing sector is worth about $3 TRILLION annually which by itself would be among the 6 largest economies in the world. What has changed in the US is that wages have risen to among the highest in the world so all the labor intensive manufacturing left for places with low labor costs. Capital intensive manufacturing has remained because the US has the lowest cost of capital in the world. Government regulations are if anything helping by keeping cost of capital low.
The only major problem US manufacturing has right now is we have an idiot president (and cronies) who think that raising the cost of everything we buy is somehow going to magically going to benefit us. Tariffs will solve no problem that currently exists in manufacturing. They will not bring manufacturing jobs to the US (actually the opposite is what will happen) and they will not force China to play nice.
What really gets me, was around 2004-2006 Ford, Chrysler and GM cut development in their smaller car lines, and went into Trucks and SUV's. Then Gas Prices Skyrocketed and a Recession hit. So companies like Toyota and Honda were doing much better because they had small fuel efficient cars ready in their pipeline. It took years for the big 3 to get a good car lineup. However once again Americans want the big ones again. So they are not making small cars.
If something is so important that you feel the need to post it on the internet... It probably isn't that important.
Stuffing a dollar under your mattress in 1920 and pulling it out in 1965, it has lost roughly half it's value. Stuff a dollar under your mattress in 1965 and take it out in 2010, it has lost 85% of its value.
Guess when we went off the gold standard? Trick question; we actually went off the gold standard under FDR when he made it illegal for Americans to own gold, so that they couldn't redeem the notes that the government was no longer actually backing with gold (this is a thing that actually happened). But we admitted we were no longer on the gold standard in the 60s.
The standard savings vehicle for most Americans for a long time was a savings account at a bank. It kept up with and exceeded inflation in many cases netting very modest but real gains. Now they must gamble on the stock market with their money to stay above inflation, despite record low inflation rates for much of the early part of this decade.
Beyond a few month's savings for emergency, loaning money to banks is just a bad plan. A savings account has never been a way to stay ahead of inflation - that's not what it's for. Ownership of the means of production, via some broad-based index fund, takes the purchasing power of the dollar out of the picture. Year-by-year the stock market is effectively random, but over multiple decades it's dependable. It gets harder when you near retirement, as you need bonds (though own your house outright by then), but at that point you'll have something worth talking to a financial advisor about.
Socialism: a lie told by totalitarians and believed by fools.
Actually, a big part of the problem with the Honda transmissions isn't outsourcing the development, but rather that they insisted on designing and building their own transmissions rather than using someone else's design (or even just buying someone else's transmission). Like a lot of NIH syndrome, this resulted in a crappier product for no real good reason. Note this really is only a problem for their automatics - their manuals are fine.
Nissan's problems are mostly related to their CVT's. They've gotten better as the technology has matured, though the other option they've used is also dumping the CVT option on some models and going back to a conventional automatic which they've usually done a decent job with.
The biggest problem is "bigger is better" attitude when it comes to the number of gears, part of which is driven by MPG requirements. After about 6 gears you really hit the point of diminishing returns for a regular car and after that you're just making the transmission more complex and fragile for only a very modest improvement to mileage and bragging rights.