Bankruptcy vs Free Trade: The US Dilemma

Yahoo Finance has a very interesting and thought provoking article: The Middle Class in America Is Radically Shrinking. Here Are the Stats to Prove it

The title perhaps says it all. It is not a good time for the middle class people in USA. Most people in USA belong to this earning group and the sad reality is that nearly 40 million people are now dependent on food stamps. The condition is terrible for children.

A few months ago, New York Times reported:

With food stamp use at record highs and climbing every month, a program once scorned as a failed welfare scheme now helps feed one in eight Americans and one in four children.

So, things are really tough for many people especially for children. Of course, it is difficult to single out one reason or factor behind the problem. One of the basic problems is that USA has become a consumer nation and they want everything cheaper.

Naturally, most of the things have been outsourced in different countries. So, US workers look expensive compared to the workers in Asia.

In many countries of Asia, factory workers first of all get a very low wage and in many cases do not get other benefits like health or retirement. The same can be said about BPO and technology outsourcing.

This may turn into a very bad mess for the US economy within the next 5 years.