Robert Reich recalls Henry Ford’s decision to pay his employees enough to buy his cars, then remuninates on refusing to learn from the past. A snippet:
In the years leading up to the Great Crash (1929–ed.), most employers forgot Henry Ford’s example. The wages of most American workers remained stagnant. The gains of economic growth went mainly into corporate profits and into the pockets of the very rich. American families maintained their standard of living by going deeper into debt. In 1929, the debt bubble popped.
Sound familiar? It should. The same thing happened in the years leading up to the crash of 2008.
The latest data on corporate profits and wages show we haven’t learned the essential lesson of the two big economic crashes of the last 75 years: When the economy becomes too lopsided – disproportionately benefiting corporate owners and top executives rather than average workers – it tips over.
In other words, we’re in trouble because the basic bargain has been broken.