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Repairing the Economic Elevator

I recall in elementary school reading the words of Emma Lazarus that are inscribed on the base of the Statue of Liberty in New York Harbor: “Give me your tired, your poor, your huddled masses yearning to breathe free…I lift my lamp beside the golden door.” These stirring words that once encapsulated the promise of America now ring hollow to millions of Americans who are unemployed and / or trapped in economic stagnation. The economic colossus of America, in which the wealth of a nation was widely distributed to a degree not known before in human history, was built on a foundation of faith, freedom and free markets. Millions of immigrants came to America in search of the freedom that provided peasants in third world countries the opportunity to live like kings in America. The American commitment to earned success, hard work and principles of personal rights and responsibility built a society that was defined by upward mobility.

So, what has happened to America’s economic elevator?

According to the Federal Reserve Bank of Boston, upward economic mobility has been declining in recent decades. Information compiled on the number of Americans who moved from the lowest income brackets to the middle and upper income brackets indicate that we are at a low point for upward economic mobility in America. Incidentally, but not coincidentally, this coincides with the rise of collectivist economic and cultural policies in our country. The high-water mark of upward mobility in the last thirty years occurred during the Reagan Presidency, during which nearly 21% of folks living in the lowest income brackets moved to middle income and beyond. That number has steadily declined ever since, and is roughly 10% at present. With such staggeringly low numbers of economically upward Americans, our politicians should stop decrying the economic stagnation of Europe, whose economy is less stuck-in-the-mud than our own.

Arthur C. Brooks recently wrote an article in the Wall Street Journal in which he provided the most poignant word picture about our present predicament that I have ever read. He refers to the American economy as an apartment building with the various floors representing successively improving economic conditions for the American People. In the penthouse, of course on the top floor, people are living rather well, even though those Americans on the first floors are in the throes of a horrible flood. Normally, when the waters rose, those living on the first floors would ride the elevators (representing upward economic mobility) to take-up apartments on the floors in the middle-income range, and keep riding until they, too, could reach the penthouse level. Such a word picture well illustrates a healthy economy where those that are struggling to get by on the first floors find better economic opportunities (represented by the elevators) and hop on up to a better place in the apartment building.

What happens, however, when the elevators stop working? Brooks argues that those on the lower floors can either throw rocks at the upper echelons, at the urging of people like Barack Obama, or they can find a way to get the elevators working again. Now, here’s where my poetic license kicks in on this word picture: I believe that the property managers of such an apartment complex represent the leaders of our states and nation, our political leadership. These managers have two clear choices on how to respond when the elevators stop working, leaving tenants trapped in flooding apartments. They can either blame the people on the floors above those who are hurting, or they can take responsibility for the apartment complex they were hired (or elected) to improve, and get to work getting the elevators working again. Because, anybody with common sense knows that throwing rocks at those above you doesn’t do anything but ensure that glass and the rock you threw to break it will come crashing back on your own head.

Some of you, who are otherwise supportive of my extending of Mr. Brook’s word picture, are still scratching your head about what to do with the flooded apartments on the first floor. While you may agree with the importance of getting the elevator working again, you have the good sense to know that we should work to remove the flooding from the first floors for those who aren’t ready to get on the elevators just yet. I agree. The flooding of those first floor apartments represents the rising costs of living that are hurting the most vulnerable among us. These cost of living increases are driven by high energy costs, falling wages due to a stagnant economy and the collapse in the purchasing power of our dollar brought about by $ trillions in debt.

In order to dry up the flood that is overtaking the lower income earners, America must pursue a path of domestic energy independence, complete with drilling here and now, deregulation to free up entrepreneurs who can help create millions of new jobs for those that desperately need them and a serious effort to cut, cap and balance the Federal budget to bring back a strong and stable dollar. As it turns out, this recipe to end the flood on the first floors is the exact same recipe that will get the elevators working again.

The American economy is built by the American people, not meddling central planners in Washington and state capitals across the country that try and tell us that Uncle Sam knows best. By freeing up the genius of the American free enterprise system, and rebuilding cultural conviction that rights come with personal responsibility, we can ensure that all Americans have the opportunity to pursue the penthouse once again.

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