Making Connections Between the video, “Capitalism Hits The Fan” and the Coontz article, “We Always Stood On Our Own Two Feet.”

        Within the video, the speaker discusses that the United States is not in a financial crisis, this is not temporary, and the situation is not easily and quickly fixable.  This crisis comes out of our economic system because it never started with banking and will never be limited to banking.  The crisis in the past lasted ten years, from 1929 until 1939 and involve policies that are now current today which never worked then.  In 1989 Japan encountered a fall and they presently remain in it.  In the past, every policy that was created, failed and now the United Stated is re-creating similar policies.  Within the Coontz article, it is discussed that the majority of Americans agreed that the self-reliant family was the social standard of our society, prior to the 1930s.  The dependencies used to occur from within the family and even presently, the most sufficient families are ones that “stand on their own two feet.”

            Americans were more successful in the earlier years because there was a rising level of wages which increased productivity.  From 1820-1970 it was known that individuals measured their own worth by the objects that they could purchase and the US is still known as that today.  During that time, we became the country of advertising and the society of consumption.  In 1970 the rising level of wages halted and individuals had to do more work and put 20 percent more hours in order to maintain their level of income.  More hours in work led to more work to do outside of work which meant, less money being earned.  Coontz discusses that the depression did not only affect the poor but the middle-class as well.  They became dependent upon the public support.

            The drop in wages led to individuals borrowing money and using collateral such as borrowing against their own home.  They soon attained credit cards so they wouldn’t have to use collateral; instead they subsided to interest.  Individuals attained credit cards and borrowed money so they could continue to consume.  After little time, the US reached its limits of capitalism.  Businesses were thriving with rising productivity because they were making a large profit.  Employers started to lend their workers money instead of raising the wages so the workers would have to pay back with interest which left people to be very dependent.

            In 2000, the market crashed and banks decreased interest rates so people could continue to borrow money.  In that time, many people spent money on housing which caused real state to rise, followed by a crash.  Coontz points out, the purchasing of real state absorbed over 100 percent of savings in the US.

            Now, in 2013, the president wants to live in regulation because he thinks it worked through the 40s and mid-70s.  In reality, regulations give corporations incentive to defeat it, avoid it, weaken it, and to get rid of it.  To decrease the suffering, the speaker says a possible solution could be that individuals at enterprises become their own board of directors in which everyone is equal.  Coontz states, “as long as we pretend that only poor or abnormal families need outside assistance, we will shortchange poor families, overcompensate rich ones, and fail to come up with effective policies for helping families in the middle.”