One of my favorite things about writing a blog and doing a podcast is that I am constantly on the hunt for new information and new sources. I like reputable information sources for facts and figures assuming, perhaps unrightly so, that they have fact checked and their data is trustworthy, even though I know government data is anything but. However at times, when I am thinking more macro, I sometimes like to visit the sites less travelled if you will and I came across a site that I want you to visit for more information if today’s topic interests you. Austerity Jones used to get mad when I would send my visitors away, but I stand resolute in being interesting and sometimes other sites are very thought-provoking, and I will not be selfish about good information to think upon. I liked it and I hope you do too. It comes from the Of Two Minds blog of one Charles Hugh Smith. I have started reading some of his information and I don’t know whether he is a kook or a kindred spirit, but I really liked his post entitled The Decay of Everyday Life.
He made four very thought-provoking points, but I’d rather spin my own yarn at this point about them as I pondered them a great deal this week. First, “The balance between labor and capital has been skewed to capital for 50 years.” We have talked about where this leads, Marie Antionette getting her head chopped off. In the 1970s, labor and unions still had a very big footprint across the American capitalistic structure. In a way it was a good thing they did because the American worker had a larger percentage of the American pie than they do today. Manufacturing and industrial production was still high and many good paying jobs in the middle class could support a much larger family than today.
What happened was this? With the gold standard being abandoned in 1971, the dollar and credit were free to flow and flow freely they did over the next decade with inflation going higher as the baby boomers reached their prime house buying years. They bought washing machines and lawnmowers etc etc. However, companies had high borrowing costs and the costs of labor were unpleasantly high. The times they were a changing though.
Look at a company like Nike. Phil Knight was peddling shoes out of his car in the 70s, but he didn’t start making any real money until he went to Asia and the cheap labor that beckoned. Trade was opened with other countries and workers in other countries were a lot cheaper than in America. There was less regulation and the cost to build factories was cheaper in Asia, and in a blink of an eye Bruce Springsteen’s blue collar army of workers were being replaced by the parents of what would end up being the Gangnam style takeover. Toyota was importing more cars because they produced what the American worker wanted, Sony the same, and eventually most of our manufacturing in electronics and even textiles moved out of this country.
This caused wages here at home to decline as more and more people were laid off from their good jobs, but the executives and capital got richer and richer and their cost of goods sold dropped and margins got better. Interest rates began dropping in the 80s and for the last 40 years capital has gotten bigger and cheaper and the American worker has gotten further and further behind. 93% of all stock market wealth is owned by the top 10%. Privat pensions have disappeared and a 401k plan with limited options and a soon to be bankrupt social security system is all that is left for the American worker to look forward to. Rather than vote the people out who gamed the system and enriched themselves they got distracted by booze, ballgames, and Baywatch.
The second item of note from Smith is “Process and narrative control have replaced outcomes as the operative mechanisms and goals of the status quo.” If you listen to earnings calls with major companies the narrative control is the most valuable asset in the company. They outright lie, fudge the truth, pull your leg, tell you a tall tale, and talk about anything but the crappy numbers their company just put up. The spin is so important, never answer the question, just answer your canned and practiced answer and eventually people will stop asking you and they will lose attention. That’s it, that’s the game. Even our favorites here at the CTPC like Warren Buffet preach stick with the process. Warren famously bought his first stock in 1942 and has become the world’s greatest investor. Now if you dropped me into 1942 and I saw a country on the gold standard, with immense manufacturing capability, clean and respectful cities, an educated workforce bound together by god and culture, I would have bought the market and went into margin for more. Today I see us exporting dollars and war, importers of damn near anything else, a society with cities that border on unlivable and open-air drug den soup kitchens. I see a society that’s high on drugs, prescription and illegal, deeply indebted, morally lost that doesn’t even know what gender it wants to be this week. Buying the market in that long term environment is a little bit different Warren.
Companies used to reward executives at 15-20 to the front-line worker and now it is 250-300 to 1. They use financial engineering and options to reward themselves, so stock buybacks and layoffs are a good thing to their bottom lines. They give themselves raises and bonuses and the American worker gets left further and further behind.
This leads into Smith’s next point. “The dominance of monopolies and cartels has fatally distorted markets and politics, undermining the foundations of every day life.” Wal-Mart creeped across the heartland with better supply chain management and broke the backs of every single downtown in small town America. Abandoned buildings line the downtown while out on the main highway or interstate there is a shiny new Wal-Mart hocking cheap consumer goods from Asia. Always low prices is their mottos and because the American worker was getting left further and further behind every two weeks at payday, Wal-Mart became a standard bearer for Americana. The main street entrepreneur moonlighted with a blue vest for medical benefits. America is now at the pricing mercy of just a few brands. In the last few years, Americans have been forced to pay whatever Wal-Mart has wanted to charge. Target announced they are marking down 5,000 items, which is good for the consumer you would think, until they realize that Target is about the last store standing between Wal-Mart and total world domination. Is that scary enough for you, and I still can’t get them to open enough lines with checkers. I refuse to do self-checkout because I am creating jobs in America damn it.
This is bad enough at the consumer level when everything has become Target or Wal-Mart, Pepsi or Coke, Apple or Samsung. I miss the days of roaming a Woolworth’s with an Mugg’s root beer and checking my pager. Competition is dying a death of high barrier to entry, unbelievable capital disadvantage and political favors. When Wal-Mart is allowed to stay open during Covid, but the local store must close its doors, I became embarrassed for Americans. The great nation that flipped the bird at the British and dumped their tea into the sea just bent over and said, thank you sir may I have another. The whippings will continue until we dissolve into a pile of hair dye, nose rings, and false entitlement or people start demanding better of themselves and their elected officials. They first must pay attention and we aren’t even remotely there yet. Why?
The last point sheds some insight on that. “The dominance of digital communication in everyday life has increased the unpaid shadow work were forced to do and injected new forms of narrative control, digital hypnosis, addiction and derangement into daily life.” Wow! I think he nailed it. The longer we let our brains dissolve into reels, tiktoks, twits, posts, likes, and avocado toast selfies the more it will be a challenge to change. Ivermectin is horse dewormer and anyone taking it should be tarred and feathered said the media. Joe Rogan fought back and said my doctor recommended it, not the air bags with air bags from the view. Oops, now Chris Cuomo is taking it and they are finding out that it performs quite well. The retraction is never as loud as the accusation now is it? I might be surprised in 20 years if we don’t look back at this age of phone use and go , man that was a huge mistake, kind of like we do now at smoking. If we follow these digital dumb downing devices to their bare essence, we see that it is all about selling and moving products. 98% of Facebook’s revenue comes from advertising and they are doing it well. Amazon is selling you so much stuff you don’t need that thieves steal from porches, and no one really bothers to do anything about it. If you were still paying a little more and buying less, you could walk into a store on main street. But no one wants to do that either. This is the narrative control- don’t talk to a cashier be your own cashier and let us cut jobs and save money while we make you our customer work. Narrative control. People you have never met like your photo of your outfit, and it makes your day, but if someone says something mean it can ruin your day or make you suicidal. These digital do nothings are not important people. I’d rather have a couple ride or dies than a passel of likes, followers, and people that hit that little bell icon. That’s why I haven’t asked you to subscribe, follow, like or bored you with advertising. Outcomes matter. Not digital begging. I could sit here all day and blow smoke up your skirt that I have all the answers, but I don’t, I just have lots of questions and I find that the more I ask questions the more I figure out. I hope you do too whether you like me or not. Maybe just maybe we make this this country a better place if we smarten up a bit. It needs it.
My new favorite narrative is tipping in America. I was out getting something to eat. The order came up and I paid with a card which I tend to do at large chains but not Mom and Pop restaurants. I will save Ma and Pa Kettle the 3% fee but the franchise food establishments get me points on my credit card as the trade off, but I digress. The cashier with a nose ring and black lipstick looks at me and doesn’t say a word, I order and say that will be all, she turns the credit card terminal out towards me while another worker brings me my food and doesn’t say a word either. The terminal listed 4 gratuity options:15%, 20%, 24%, 28%. I thought to myself, “the stones on this cashier for even asking.” I don’t get a greeting, a thank you, a smile, any words at all, but she wants a gratuity? Oh mercy me, give me a main street diner where I can get a career waitress named Margaret that has a coffee pot in one hand a green pad in the other and somehow manages to get your order right every time. I will tip her 28%, but the entitled mute sadly for her got the goose egg. I didn’t even feel bad, but resolved not to even frequent the establishment again. Pay your workers more if that is what it takes, but that experience of not being talked to I can get at home for free.
This is how we should be treating politicians and elected officials. Once burned twice shy, but no. We just keep trotting out the same candidates that started eroding the lifestyle of the American worker in the 1980’s. Seriously, some of them are still around, and if you go into a Ben and Jerry’s you might meet one. If you go to a closed hair salon during Covid you might meet another. If you attend a Kentucky Iowa college basketball game, you might meet another pair. These octogenarians keep voting themselves larger and larger examples of largesse and we still don’t take notice much less offense. Ivan Boesky died this week, and he was an 1980s corporate raider and jailed for insider trading, but we watch the stock returns of Congress and just shrug. 82% of Americans want term limits in Congress, but we can’t be bothered with caring. Our apathy is born from our distraction. We are distracted by devices, dumbasses, and deliveries from Amazon. We need places like this oftwominds.com blog to conjure up a conversation with a real friend, maybe discuss something important for a change, and god forbid have a real human interaction. What? That sounds awful, that is because you might be out of practice.
Sincerely Yours,
C Thomas Printer
On this date in history… 64 years ago to be exact, one of the largest earthquakes ever recorded struck Chile killing 5,700 people.
Also born on this date … another deceased corporate raider of the honest variety, T. Boone Pickens.
Thank you for listening today and you can find all of our articles and more on our website cthomasprinter.com.
https://charleshughsmith.blogspot.com/2024/05/the-decay-of-everyday-life.html