The Next Crisis; College Costs, Loans & Losses… : ThyBlackMan

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The Next Crisis; College Costs, Loans & Losses…

October 27, 2011 by  
Filed under Misc., News, Opinion, Weekly Columns

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(ThyBlackMan.com) As the title of this post indicates… You can’t keep up with the Joneses anymore. Why: Because that shit is too damn expensive.

Today the DOW jumped nearly three percent to close at 12,209. That’s the first time the Dow has closed above 12,000 since August 1st. The DOW, S&P and the NASDAQ all closed at three month highs. The reason Europe is getting it’s act together hammering out deals to minimize the impact of debt in Greece. The other factor pushing the major indices upwards is today’s report from the Commerce Department that shows in the third quarter the economy grew by 2.5 percent. The Washington Post reports:

“The 2.5 percent growth rate is the strongest in the last year, and shows that the economy, while struggling, is not sinking back into recession.”

The latter part of today’s rally proves that we are indeed in a jobless recovery  as I highly doubt next Friday — when the unemployment report comes out — the Labor Department will report a significant drop.

Today’s rally and report on the country’s economic growth comes one day after the Congressional Budget Office reported that the rich are getting richer — many of them from the rising stock market — and the poor getting poorer. Here’s the break down

  • For the 1 percent of the population with the highest income, average real after-tax household income grew by 275 percent between 1979 and 2007.
  • For others in the 20 percent of the population with the highest income (those in the 81st through 99th percentiles), average real after-tax household income grew by 65 percent over that period, much faster than it did for the remaining 80 percent of the population, but not nearly as fast as for the top 1 percent.
  • For the 60 percent of the population in the middle of the income scale (the 21st through 80th percentiles), the growth in average real after-tax household income was just under 40 percent.
  • For the 20 percent of the population with the lowest income, average real after-tax household income was about 18 percent higher in 2007 than it had been in 1979.

The CBO concludes:

“As a result of that uneven income growth, the distribution of after-tax household income in the United States was substantially more unequal in 2007 than in 1979: The share of income accruing to higher-income house- holds increased, whereas the share accruing to other households declined. In fact, between 2005 and 2007, the after-tax income received by the 20 percent of the population with the highest income exceeded the after- tax income of the remaining 80 percent.”

Basically all incomes increased over the last 30 years but not enough to close any wealth gaps. In fact the expedient growth in income by the richest one percent actually allowed wealth gaps to grow wider.

We can discuss how wealth is inherited therefore Black people — former property and at one time considered the wealth of others — will always be at a disadvantage. We can talk about how the Bush Tax Cuts and lack of a jobs bill is keeping the poor, impoverished, and disenfranchised, poor, impoverished, and disenfranchised. We can say the facts of the CBO prove why people are storming the streets of major cities to Occupy Wall Street. But at the end of the day this is not about wealth gaps between the races, a former administration’s fucked up policies, the lack of legislation to fix said fucked up policies, or protesting because we have nothing more to lose. This is about doing something right now so that this never happens again.

Yes, it is unacceptable for the richest one percent to have such an egregious amount of wealth and not pay their fair share of taxes on it. But it is also unacceptable that the members among the richest one percent are legislating laws that keep the disparity in place. As noted in yesterday’s post there are 3.1 million millionaires in this country. There are 308 million people in this country.  And because of the long sought after American Dream 304.9 million people are left trying to get like the 3.1 million we have failed to learn we will never reach.

Trying to get like the 3.1 million brought this economy to its needs. Banks bottom feeding on people with bad credit and low income, preying on them and putting them into houses the banks knew the people could not afford put this economy into a negative economic abyss. Chasing the American Dream has gotten us into financial crisis after financial crisis since the Great Depression of the 1930?s.

I blame Oprah, rappers, some R&B singers, pop stars, basketball players, VH1, Bravo, MTV, BET, Forbes, Black Enterprise, politicians and bankers for selling dreams that are damn near impossible. There is only one Jay-Z. Every crack dealer is not going to go from corner hustler, to platinum selling rapper, to mogul, to kicking it with President Obama and Warren Buffett. There is only one Beyonce, only one Rihanna, only one Michael Jordan or Lebron James, there are only so many “housewives” and drunken twenty-somethings that will turn a lifestyle of debauchery, minimal talent, or excess talent into multi-million dollar homes and all the essentials of excess money can buy. It’s only 3.1 million of those people in this country. No not all of them are famous some are just your average dentist. (Word to Chris Rock)

But even still there are only so many millionaire dentists or opthamologists. There are only so many Conrad Murray’s making $150,000 a day off the most famous man in the world. The fact that these are the people glorified or villainized on a daily only makes the 304.9 million of us without millions hungry enough to work harder so that we can get on the money train and live high off the hog.

I regret to inform you by way of the CBO that your chances of getting on the come up like Diddy are slim to none. There’s just too far too climb. We’d all be better off trying to win lotto, powerball, mega millions, or McDonald’s monopoly than to think we’re going to hustle our way to the top though skill, talent, charm, charisma and a mean work ethic. These are all great qualities but chances are slim they take us as far as our grade school teachers say they will.

But. But. The President did it.”

Hell yeah, he did and there’s only one of him.”

Herman Cain did it.”

And he’s still hustling selling books while stumping for President.”

We can hustle, hustle, hustle hard all day but unless we’re willing to get ratchet or lay sideways with somebody marginally famous our chances of hitting the million dollar mark — as in having a million dollars on hand liquid to tap into if necessary — just ain’t happening this lifetime if policy continues as is. You’re better off going to a university (like Belhaven College MS ) and getting a professional degree.”

I mean let’s face it Snooki has a book and barely even reads yet I’m giving away these gems for free. Narcissistic much. Yeah maybe, but if you’re reading it you know this shit ain’t right.

Do you still hold out hope that you’ll reach the top 1 percent or are you cynically resigned to knowing you’ll most likely be grouped with the 99?

Staff Writer; Nikesha Leeper

To connect with this sister feel free to visit; Change Comes Slow.

 


Comments

4 Responses to “The Next Crisis; College Costs, Loans & Losses…”
  1. Miss Jane says:

    I think Alfred Edmond put it best. I’d like to add the following insight:

    There are many dangerous manipulations of statistics and the interpretation of them in this piece. What did you expect to accomplish with this very negative rant?

    How does this piece empower the very 99% you seem to be advocate for?

    One can respect an opinion or point of view when it comes with a basis of knowledge that is fair and balanced. You used a bunch of random numbers to support a very pessimistic and unrealistic dotrine on wealth-building and financial security.

    This is the problem I see among many people: That wealth is simply based solely on dollars and cents. Wealth is a lifestyle. It includes asset that appreciate, your intellectual capital, and your ability to affect change in your communities. Its about being financially free, whether you make $2,000 a year or $2 million a year. Its not JUST about veing able to floss cars, homes, and sit at the same table with the Buffets of the world.

    We have to stop it with the woe-is-me attitude and become empowered with a balance of knowlege on how to be financially fit, contribute appropriately to our communities, work with the gifts that we were given, and really become involved in the political processes from local to state. We have to always hold on to faith and the fact that we do have the power to be and create whoever and whatever we want to. Our ancestors, who were not ALL entertainers, politicians, and celebrities DID IT. And there are everyday people who are striving despite the odds. They continue to create opportunities for themselves and others where there seemed to be none.

    Let’s stop with the finger-pointing and spend our efforts on beating the odds. Provide resources, encouragement and opportunities where you can. Apply your talents and skills in enriching the world and soundly critique problem so we can have healthy, balanced dialogue.

    The people of this country need more spotlight on SOLUTIONS.

  2. There are so many half-truths and so much misinformation about the nature of wealth-building (not the least of which the myth that most wealth is inherited)in this post that it would take to much time and space to address them all. But speaking as a long-time editor at Black Enterprise, I must say that anyone believes that we sell “dreams that are damn near impossible” to achieve cannot possible be a Black Enterprise reader, much less a viewer of our TV shows, an attendee of events such as the Black Enterprise Entrepreneurs Conference or a visitor of BlackEnterprise.com. Our coverage of the Jay-Zs, Michael Jordans and Beyonces of the world comprise tiny proportion of the content we deliver; the overwhelming majority of our coverage is focused on regular people who understand that true wealth is not about “kicking it” with a hip-hop mogul, but simply about creating a quality lifestyle built on the core principle of financial planning, professional excellence, entrepreneurship and responsible stewardship of whatever resources you have to achieve your goals.

    There’s a lot of ranting going on in this post, but precious little enlightenment and insightful reporting. To quote the late James Brown, “Like a dull knife, just ain’t cuttin’; just talking loud and saying nothin’.” This writer missed a great opportunity to address what the title of this post seems to promise: the issue of income inequities and the burden of student loans, a critically important discussion and one of the key concerns of Occupy Wall Street.

    By the way, one of the first rules of wealth building: Stop trying to keep up with the Joneses.

    For those who really want to understand how most of the wealthy got that way, I recommend reading “The Millionaire Next Door” by Thomas Stanley and Williamd Danko, and Kenneth Fisher’s “The Ten Roads to Riches.” And of course, you should read Black Enterprise.

  3. James Davis says:

    Your conclusion after rendering numbers describing income is not logical. How could such a conclusion be sound? Using these numbers to draw that conclusion is not sound reasoning. You should have just written an article saying it is unlikely that the average person would achieve great wealth. You talk about about the top 1% of earners as if they are not people like ourselves. You also speak of these entertainers as if they are not people like ourselves. If they can do it, so can anyone else because they are not geniuses whose experiences cannot be duplicated. They are simply people who for whatever reason founded themselves on a track which led to great wealth. Speak for yourself buddy!!! http://www.sslumpsum.com

  4. hoodgirl says:

    Great Article! Things are not as doom and gloom as people seem to think nor do you need to be born with a silver spoon to make it happen! There are many average income earners who have attained the PINNACLE point ie. are debt free including their home and have a high Net Worth mainly consisting of personal savings, 401(k) and real estate investments. They did it simply by working hard, controlling their income and staying away from debt!

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