Donald Trump shocked America, and triggered social justice warriors everywhere, when he hand-picked Breitbart’s Steve Bannon as his Chief Strategist.

Democrats hate Bannon.  They called him a racist.  A white nationalist.  Even an anti-Semite (despite the fact that it was he who gave  Jewish conservative stars like Milo Yiannopoulos and Ben Shapiro their start).  None of it’s true.

Republicans hate Bannon too.  They say he betrayed Andrew Breitbart’s legacy by turning his site into a populist blog.  They think his economic ideas are antiquated.  Some think he’s basically a less-fat Michael Moore with a Game of Thrones haircut.

Everyone hates Bannon now.  But they will love him tomorrow.  Why?

Bannon’s not a democrat, and he’s not an establishment-brand republican.   He is a nationalist—an American nationalist.  He believes it’s no longer about left and right, conservative or liberal, even democrat or republican.  The old divides are dead.  The new battle lines are drawn between nationalists and globalists.

Bannon told this to the Hollywood Reporter:

I’m a nationalist.  I’m an economic nationalist…the globalists gutted the American working class and created a middle class in Asia.  The issue now is about Americans looking to not get f—ed over

Colorful language.  Passionate about the working man.  You can see why he reminds the prim and proper establishment of Moore.

Bannon’s in his own league, and that why he’s the man for the job.

Fixing the Economy

Bannon’s right, the working class has been smothered by establishment politics.  Right now, at least 22 million Americans are unemployed, income inequality has been rising since the 1970s, and America’s shed 7 million manufacturing jobs jobs.

Worse yet, working Americans haven’t got a pay raise since 1973.

wage-stagnation

In 1973, the median hourly wage was $4.14, while in 2014 it was $20.74.  Looks good right?  Wrong.  Although it went up in nominal terms (the number got bigger), in real terms (what you can buy with it), it went down.

If we convert 1973’s median hourly wage into 2014 dollars, it works out to $22.07—which is 6.4% higher than 2014’s median wage ($20.74).  That may not sound like a lot, but it is: over a year it is almost three grand.  This is a huge blow to the middle class and the working man.

That being said, not all wages went down.  Since 1974 most of the economic gains have gone to the top 20% of earners, which is why inequality has been increasing.  If today’s income was dispersed like it was in 1973, then the average middle class household would earn a whopping $90,943 per year, as opposed to $74,434—an eye-popping difference of $16,509 per household.  You could buy a new car every year with that kind of money.

No matter how hard Americans work, their wages just keep falling.

When wage stagnation meets the real world, the consequences are ugly.

Between 1901 and 1985 the portion of their income that the mean American household spent on wants, as opposed to needs (food, clothing, shelter), increased from 20.2% to 48.6%.  In other words, people could spend more money on things that made them happy, on things they like.  Living standards improved.

Since then it’s stagnated, which is nothing to brag about.  But it’s worse than that.  If we look at median household spending (which is less skewed by rising inequality), we find that spending on wants has actually been declining since the 80s.  In fact, it’s now down at 36.7%—a level not seen since the 60s.

consumption

Look at that chart.  You can literally see our economic progress melt away.  At the end of the day, the middle class is spending less and less on stuff it wants, and more and more on stuff it needs.  That benefits no one.

Bannon, almost alone amongst conservative media commentators, recognizes these economic problems.  Not only that, he doesn’t see them as the inevitable consequences of global free trade—he’s one of the few men who is willing to take a step back and question the system.

This is why we need Bannon.  He gets it, and he will help keep Trump on track.

Next, find out Bannon’s plan to fix America’s economy here.

 

 

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Posted by Spencer P Morrison

JD candidate, writer, and independent intellectual with a focus on applied philosophy, empirical history, and practical economics. Author of "America Betrayed" and Editor-In-Chief of the National Economics Editorial. Say hi on Twitter @SPMorrison_

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