Among the many character flaws Americans scold themselves for these days, our lack of savings is, perhaps, the most understandable.
The more income-constrained we are — income-constrained being the scrubbed-up adjective for “poorer” — the harder it is to squeeze drops of savings from the stones of our cash flow.
I was thinking about this the other day as I greased my tractor. Had I been thinking about what I was doing, I would not have pasted a Dairy Queen curlicue of purple grease on the tip of my nose.
Old farmers understood the need to save. They cached winter food for their livestock and their families. No food, no eat. No woodpile, no heat. No save, no safety net.
In those days, savings depended on thrift—doing without, doing with less, making do.
Well-run businesses continue to press savings out of earnings, which they invest in making themselves better. Many individuals lost this habit during the last 20 years.
In response to unemployment, underemployment and fear, we have begun savings again. April’s personal savings rate rose to 5.7 percent, compared with a 12-month average of 3.3 percent.
Saving amounts to scrimping and hoarding. When you don’t have anything, not spending is not saving. It’s starving.
Saving in a down economy will slow recovery. But once the habit is reacquired, it may cap future willy-nilly, debt-based, consumer spending, which expands the economy under false pretenses and eventually pops its own bubble.
If the citizenry is stashing more of its limited cash into cookie jars, government has to grease the locked-up economy with spending. And now you see how I wandered from doing something useful for my tractor to blathering about macro-economics.
I am the first to admit that I’m a jack-leg economist. I’m not the neatest greaser in the world either, for which I blame the system.
My old-fashioned, low-tech, lever-action grease gun requires two hands to operate, one to hold the cylindrical barrel that contains the grease cartridge, the other to pump the action. My third hand holds the gun’s nozzle against the tractor’s grease fittings. What! you don’t have a third hand? See, the system really is at fault.
Pistol-grip models are available but they have problems. Either they’re cheap and don’t work well or they’re too expensive. A pneumatic system is way more gun than my holster can handle.
I inevitably run out of hands. Then the nozzle uncouples itself, spreading grease around the fitting instead of into it. I scrape up these odd gobs with a finger I can’t spare. One daub job leads to others. I, too, am left adequately lubricated for the summer.
So why, I wondered, doesn’t one of those wonderful unemployed Detroit car guys tinker up a new system?–a simple, cheap, one-handed grease gun that knows the difference between a fitting and a greaser like me.
After all, if we can put a man on the moon, we can certainly figure a way to squirt ooze into a tractor down here.
Invention, I anticipate, will be the easy part.
Could the new clean-hands grease gun be manufactured in Detroit and sold at a profit? The industrial infrastructure is there, the transportation networks, the skilled workforce, the managerial know-how, the support systems.
But the high costs are also there. Southeast Asia is the more likely spot, because it’s cheaper.
What would it take to make Detroit cost competitive in grease guns against the low-wage, low-safety, low-environmental-protection off-shore sites?
If $5 an hour would make Detroit competitive, should we make exceptions to minimum-wage laws in badly distressed areas? Would unemployed individuals work for that little? Would $5 work if something like Medicare covered health costs? Are other ways available to lower Detroit’s costs besides paying below-poverty wages?
As you might expect, the cost of asking too many questions is paying too little attention. In addition to all the fittings, I serviced the tractor’s metal seat, steering wheel, right headlight and fire extinguisher along with several of my comparables.
If globalization and the costs of “free” trade leave this country with a remnant manufacturing base, where do our cast-off millions — the scrap-heap labor, the collaterally damaged — find work?
If U.S. manufactured goods are too costly to find export markets, then it’s only a matter of time before they lose their domestic markets. If it happened to GM, it will happen to any Detroit grease-gun start up unless domestic costs are brought into line or foreign goods are taxed. Bad choices all around.
American farmers export commodities — such as wheat, soybeans and corn — that require relatively little labor for each unit of production. As farmers, capital and machines increased productivity steadily since the 1930s, agricultural employment fell in step even as production increased. That, for better and worse, is the most likely path open for manufacturing, both old-timers and new start ups.
I, for one, will beat a path to the door of the first company that manufactures a better grease gun in Detroit, or any one of its many look-alikes.
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