Back to the Future?

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Flat wages and rising consumption are a bad mix. Together, they mean more debt and less savings, exactly the combination that led us off a cliff during the Bush years. Ryan Avent:

But that’s all over now, right?

Well, perhaps not. Real personal consumption expenditures grew in February, by 0.3%, following on an increase of 0.2% in January. That’s the fifth consecutive monthly increase, which seems like good news; certainly markets are taking it as a positive this morning. The problem is that incomes barely rose in February — by less than 0.1%. And they declined in January. And what happens to savings when spending rising and incomes are flat?

This, of course, encapsulates our current dilemma: in order to escape from the current recession we need more consumption. Government deficits help but aren’t enough on their own. So we need more private consumption even though the recession is constraining wages. It’s a problem. The obvious response is that rebuilding savings can wait, and that’s true. But not forever. Eventually consumption needs to flatten out and wages need to rise. But when?

SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

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SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

payment methods

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