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This memo will discuss the Citizens – Corporate financial symbiotic relationship.
We hear a lot of talk about the 1% and the rest of us.
The 1% couldn’t exist without revenue from the 99%.
This relationship used to be equitable.
In the 1950s, families needed only one income, usually the dad’s, and moms could raise their children and keep the house.
Corporations’ quality of life was booming, while the 99% also boomed and realized the American Dream. Americans got dollars back while giving dollars and labor.
The Middle Class grew and so the American Dream became a reality.
Home ownership exploded for couples in their early twenties.
It was a very equitable deal.
That dad had a pension waiting for him at 62 years of age.
Pensions were part of your compensation package that augmented your wages. Pensions secured your income for your retirement years.
Social Security was not meant to support people fully in their retirement.
The loss of vested pensions was a dramatic reduction of wages and salaries.
I will explain.
Let’s say a GM worker in the 1950s made $4,500 per year. Over 30 years, their vested monthly pension benefit was $150 for the rest of their lives.
Today, even if annual wages kept up with inflation, the loss of a pension dramatically reduces their real compensation.
That $150 per month, or $1800 per year in the 1950s equals $24,000 today annually for life.
Let’s say that retiree lived 15 more years, in today’s dollars, that is $360,000. Plus, they had health benefits.
This is why I say losing pensions was a severe pay cut.
401ks were created to be a substitute, but they are not.
HOUSING PRICE AVERAGE WAGE ANALYSIS
1965 income extrapolated to 2024 based on housing prices:
- 1965: The median sale price was about $20,000.
- 2024: The median home value reached $420,800.
- Inflation-adjusted: Even after adjusting for inflation, home prices have risen significantly. For instance, the average cost of a new home was $21,000 in 1965, which is equivalent to approximately $214,361 in 2024 dollars.
- So adjusted for the value of the dollar, home prices are double those of 1965.
How much does an average earner need to earn to afford a free standing house for his four kids and stay at home wife?
House value increase multiplier ($421,000 ÷ 20,000 = 21)
1965 $3.25 per hour, or $6,760, qualifies for a $20,000 home.
2024 $68.25 per hour ($3.25 per × 21 = $68.25), or $145,000, qualifies for a $420,800 home.
This means a 25 year old father of four with a wife at home should be earning $145,000 to have parity with his 1965 counterpart.
|
Year
|
Avg. New Car Price
|
Avg. Annual Wage
|
Months Of Work Needed
|
|---|---|---|---|
|
1965
|
~$2,700
|
~$6,200
|
5.4 months
|
|
2024
|
~$48,700
|
~$75,000 (household median)
|
≈ 7.8 months
|
So, to buy an average car in 2024, we must work 44% more.
(Months Of Work)
7.8 — 5.4 = 2.4 then
2.4 ÷ 5.4 = 44%
So in 1965, a new car was significantly more affordable relative to wages than it is today.
Today, we have this:
Corporations’ quality of life is booming, while the 99% cannot realize the American Dream.
Americans are only getting pennies back while giving dollars.
Most wages have been stagnant when adjusted for inflation since the 1970s. But wages actually plummeted when pensions were eliminated as we just learned a moment ago.
Some home ownership stats.
Married & Homeowners by 30
1950: 50%
1960: 52%
1970: 48%
1980: 45%
1990: 43%
2000: 35%
2010: 25%
2025: 12%
The American Dream has disappeared, the gap between rich and poor is growing at a swift pace.
The past two generations have been lied to. They are much worse off than their parents and grandparents.
People are not voting for socialism as much as they have woken up to the truth of how both national parties, RNC and DNC, have abandoned their birthright.
So, how do we get things back to an equitably balanced financial relationship?
My Plan:
Extract the inequitably hoarded wealth from corporations and transfer it back to the citizenry.
1% tax on gross revenue for every company making over $50 Million. That tax revenue goes into:
- Universal healthcare, mental healthcare and addiction treatment.
- Low Income Housing
- Housing grants for married couples with children.
- Increased funding for police in highest crime areas.
- Make corporate funded pensions mandatory on top of 401Ks.
The Fortune 500 companies average gross revenue of $188 Billion.
That 1% looks like this:
| Average Gross Revenue Fortune 500 | $188,000,000,000 | $188 Billion |
| × 500 | $94,000,000,000,000 | $94 Trillion |
| 1% | $940,000,000,000 | $940 Billion |
The financial pendulum now needs to swing back towards families.
$940 Billion Dollars per year is a good start.
The differences of the past 70 years are apparent.
We need to get back to 52% home ownership for married couples, just like the high in 1960.
It is clear what has happened to the Middle Class. And very clear how to easily and equitably correct it.
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