A recent letter to the editor suggested the economy of the country is doing just fine after eight years under Obama, and any change in taxes would upset this excellent situation. And that is basically true. It all depends on the statistics you use. The original letter writer even compared it to the boom of the 1950s.

By all means, the Gross National Product is just fine, approximately $17 trillion. The stock market is doing quite well, too. The problem being it doesn’t look at the big picture.

Compared against the GNP, the Gross Domestic Product is $1 trillion less. The difference is the GNP measures all product sold in the United States, and was begun after the Japanese injection of goods into the U.S. market in the ’70s. The U.S. needed a way to measure the true amount of goods and services purchased in this country, and including foreign goods was the only way to get the true numbers.

Why is the stock market doing so well? Because the companies in the DOW and NASDAQ are doing well. People are buying their goods and services. So, where’s the demon in the details?

Wages. These companies are doing well, and the markets are doing well, because they aren’t entirely paying U.S. wages. The leaders in the stock markets are either retailers who sell goods made mostly elsewhere, or companies that do a lot of manufacturing elsewhere. For example, Ford and GM source a fair amount of parts made in China. By buying and selling goods made in China, they are able to hold prices and costs down and make a larger profit. Profit is good for investors.

But the erosion of wages for U.S. workers is bad for the U.S. People who didn’t go to college face a more limited number of job options. The cozy, well-paying factory jobs of the ’50s are gone for the most part. Massachusetts and other states passed laws raising the minimum wage, but that just shifts things around, and actually costs jobs. So real wages earned decrease. The amount of disposable income decreases. So while people who do work for the large companies fare well, the bottom rung of society is plunged further into poverty.

So, while it’s easy to say the economy is doing well just looking at the numbers, when you scratch the surface you can see the base below is festering.

John Babits

Turners Falls