ANALYSIS/OPINION:
NEW YORK — The adults among us remember the joys we had as children spinning tops — watching an ungainly gadget on a tiny point whir upright against the odds, seemingly rigid, stable and secure.
We also remember that first jerk, when the top fell off kilter, signaling the beginning of the end of its run, its clattering and fall.
After more than five years of stewardship under President Obama, the U.S. economy is well past first jerks now, as we near the start of another summer, simmering in discontent.
What holds each of us up are our after-tax incomes — these allow us to sustain ourselves and permit the fortunate among us to squirrel away savings.
Information just out from the U.S. Bureau of Labor Statistics’ Consumer Expenditure Survey leads to damning conclusions concerning what is happening to after-tax incomes across the full spectrum of the economy.
Among the highest quintile of households, after-tax incomes declined 8.1 percent (from $158,024 to $146,785 per household) comparing the figures for the year ending June 30, 2013 for the same period ending December 31, 2012.
The remaining 80 percent of American households suffered less, but they still suffered — average after-tax incomes dropped 3.4 percent from $39,636 to $38,687 per household in the same period.
What’s far worse is that the bottom 80 percent — 99.5 million households — find themselves earning less than they spent in the most recent 12-month period for which data are available, in deficit by an average of $611 per household.
By comparison, the bottom 80 percent eked out an average of $211 in savings per household in 2012. In neither period is there much grounds for hope that saving for retirement is actually possible.
Whatever presidents and pundits may say, the overwhelming majority of American households know that “progress” does not occur when incomes fall, costs rise, and savings shrink, even as central banks suppress interest rates and governments spend with abandon.
Is America past a tipping point, where fundamental changes wrought by the Obama administration since 2009 cannot be redressed?
The thrill is gone
Spinning false positives only works so long — here on Earth, gravity remains a potent, immutable force.
No one now recalls with fondness the 2012 campaign fable that America’s economy was supposedly roaring back because General Motors was fixed and “alive.”
Meanwhile, in dread, we watch the surging advance of al Qaeda who are not cowed by the dispatch of Osama bin Laden.
Across the Middle East, there is wreckage, starting in Iraq, and there’s more devastation coming soon in Afghanistan.
Somehow, since 2008, the Obama administration has lost America many valiant friends, while emboldening a raft of rising rivals.
Today, we can only guess how well the president will do on his forthcoming trip around Europe — his inept stumbling gives little ground for optimism.
We approach a historic milestone — the 70th anniversary of the D-Day landings and the fierce battles when American and allied military forces turned the tide of history. President Reagan marked the 40th anniversary in solemn, dignified fashion — inspiring realistic hope afterwards for most Americans and across the Western world.
Does anyone sensible truly believe President Obama learned from President Reagan, or that Russia’s Vladimir Putin is fearful watching America “lead from behind?”
Those of us who remember the pain brought on by the inept economic and foreign policies of Jimmy Carter see history repeating itself under Mr. Obama — it can’t be long before dollar-based interest rates rise towards (and possible past) historic averages.
Nothing man-made lasts forever — certainly not a Pax Americana built on shrinking after-tax incomes, a staggering mountain of debt and a president hooked on spin.
• Charles Ortel serves as managing director of Newport Value Partners (newportvalue.com), which provides economic research to executives and to investment firms.
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