From The Baltimore Sun
By Cynthia Tucker

“The Puritan ethos (save first and enjoy later) was not abandoned. It was merely overwhelmed by the massive power of modern merchandising.”

“The Affluent Society,” John Kenneth Galbraith

Henry Ford’s genius lay not just in his technological innovations, such as the modern assembly line, but also in his social wisdom, which led him to pay his workers $5 a day. That doubled the prevailing wage for 1914 and drew the best workers to his factories. The money also allowed those workers to buy the automobiles they made.

For decades, America’s consumer-driven economy purred along on the fuel of good paychecks to regular Joes. Automotive workers could buy Fairlanes and Mustangs, just as Whirlpool’s machinists could buy refrigerators and dishwashers.

But wage earners began to fall behind in the 1970s. As productivity and corporate profits soared - so the rich got richer - pay didn’t keep pace with inflation. Today’s corporate titans have discarded Ford’s example of helping workers to prosper.

So what happens when wages flatten and good-paying jobs disappear?

Consumers buy on credit. It’s no wonder that consumer debt has soared to a staggering $2.5 trillion. Between mortgages, second mortgages and credit cards, many families, especially struggling wage earners, are barely getting by. More than a third of those carrying credit card balances of $10,000 or more earn less than $50,000 a year.

Read more Affluent Society