Why Trickle Down Economics No Longer Works

Minwage3 (Photo credit: Wikipedia)

There used to be this theory that if you poured money into the top of the economy, through loans, tax cuts, and direct investment, the money would trickle down to the bottom of the economy, to the workers, the stay-at home moms, and the children.

While there are arguments about whether or not that theory was ever effective, in today’s economy it simply cannot work as the only way to support the people, and we must think differently.

Decades ago, men were the primary breadwinner, and the minimum wage was enough for the man to support a whole family.  People married young, and married for life.  Businesses hired people for life, and gave pensions.  Apprenticeships and on-the-job training was widespread.   And while business owners have always pursued their own wealth, they usually took care of “their own” when it came down to it.

Fast forward to today, and we have broken families, and a minimum wage that can barely support one person, much less a family.  In most cases, every adult must work to support the family, leaving children without care much of the day or left with expensive day care services.  Workers now have to pay for their own education just to get a job.  Labor is considered expendable, and except for a few industries, pensions are a thing of the past.  It is everyone for themselves.

While it is true that creating incentives for businesses can create more jobs, this no longer addresses all of  the needs of the workers, who must fend for themselves.

Either business must step up to the plate, and take care of the American worker again, or the government will eventually be forced to act, making laws that make it harder to do business.

Small business creates more jobs than big business, and instead of giving handouts to the rich, perhaps we need more programs, incentives and tax cuts for the average guy trying to support a family, get an education and create a career or small business.  Perhaps we need more support for the little guy.

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