During the first 90 minutes of the program, guest host John B. Wells (email) was joined by Dr. Robert Manning for a discussion on the debt crisis in America. Manning maintained that the shift from cash purchases to consumer credit debt over the past few decades has eroded the financial well-being of average families across the country. Purchasing on credit only defers the (often negative) impact of such transactions on one's life, and has led to an enormous redistribution of wealth from the middle class to .5% of the population over the last 25 years, he explained.
According to Manning, consumer reliance on credit has also contributed to a loss of personal freedoms. Credit processing agencies meticulously examine credit and other kinds of transactions in order to monitor the behavior of consumers, he continued. Those extra miles or points many people earn with their credit cards are not free, he alerted. Consumers leave behind electronic fingerprints every time they make a transaction, talk on the phone, or ride on public transportation. Agencies use this information to make (sometimes incorrect) financial judgments about consumers, predict their habits, and potentially even to modify their behavior, Manning suggested.
Like many debt-saddled consumers, America is maxed out as well. What kept the world confident in investing in the country was its ability to borrow beyond its means, Manning revealed. Now other countries are being encouraged to take on the trade that America can no longer fund, he noted. The nation continues to fall behind other countries in production and the consumption of goods and services, and is fast becoming a secondary destination for investment, Manning reported. If the United States cannot recapture foreign capital, its currency will collapse, interest rates will soar, and inflation will skyrocket, he warned.
During Open Lines, several callers phoned in to sound off on the current state of the U.S. economy. George in Apollo, Pennsylvania, offered his solution to America's economic woes. He blamed much of the trouble on corporations moving jobs and headquarters overseas to secure ever higher profit margins. George recommended legislative action to require corporations to stay in the domain (city, county, state, nation) in which they were originally incorporated. Ed from Allentown, Pennsylvania, encouraged listeners to purchase products made in America in order to increase manufacturing and jobs in the country. Fred in Rochester, New York, expressed concern for the average American worker, denounced wasteful government spending, and suggested that most people are not ready for the hard times of a world depression. Fred compared the country to Ancient Rome before it collapsed.