Corporate health doesn’t assure economic health

Conditions for businesses are improving, but ordinary people aren’t seeing the benefits

Reading Robert J. Samuelson’s recent column “Signs point to recovery in 2014,” I was struck again by how we define a strong economy from the standpoint of business and ignore the implications for people.

He lists four points to illuminate his optimism about our economic recovery, all of which are true and all of which are negative for Joe Public.

His first point is that the job market has strengthened. It has, but he does not point out how many people are underemployed because the new jobs are low-paying and how many people have to take two or more of those jobs to support their families.

His second point is that household debt is down, one of the reasons being that home prices are up, so equity is up. But home prices have not fully recovered, So, while wealth is up, it is not as far up as it was.

Besides, that kind of wealth doesn’t put food on the table.

Point three is the housing recovery isn’t finished. He seems happy that new housing starts are relatively low. He doesn’t mention that low housing starts means fewer construction workers employed.

Point four is an important one. He says,” Corporations are awash in cash.” He is happy that they have been hoarding (his word) cash, keeping the economy from recovering more rapidly. He is happy that they are finally showing an interest in investing in “buildings, equipment and infrastructure,” all tax deductible and most available already, without building new things.

What he neglects to mention is that those same cash-bloated corporations have no intentions of hiring more workers or giving raises to existing workers, all the while demanding, and getting, increased productivity.

Wouldn’t it be wonderful if, when evaluating our economy, we looked past Wall Street, which is completely out of touch with Main Street, and corporations, and focused on how our citizens are doing?

Wouldn’t it be wonderful if corporations gave a thought to their workers’ welfare?

Wouldn’t it be wonderful if corporate pay raises went to the workers before the CEOs, or at least in addition to the CEOs?

Wouldn’t it be wonderful if corporations and governments hired enough people to actually accomplish the work that needs doing?

Ah, now that might make even me optimistic about our economy’s recovery.