The vicious cycle of our new economy – why the poor stay poor and the rich get richer – Part 2

The economic structure ruling the western world have a very simple set of principles, promising the survival of the system and its rulers. In many ways, the only way the elite could promise the continuation of such an unequal mechanism, is to maintain a certain level of ignorance in the masses. For the sake of truly understand why the rich get richer while the rest stay poor, I believe it is time to open our eyes to some simple and logical principals. As I’m limiting myself in the length and the complexity of each posts, the next 3 posts will be dealing with this subject.

The foundations of our current economic system require the existence of 3 different models, functioning simultaneity and supporting each other. “The Single income model”, “The multiple income model” and “The socio-economic separative model”. At this post we will concentrate in the first one.

The Single income model can be defined in the following manner – A model in which an individual is supporting his existence by the creation of only 1 source of income while committed to a multiple channel of spending. As you could figure out yourself, the majority of the population is surviving based on this model.

This kind of living is unstable and fragile. The income of the individual is the only mean of survival, while a massive imbalance exists between the channels of income/expenses. In many cases, the commitment of an individual (by contracts) to rents, bills and services put a high minimal price tag on the monthly required income of the person in questions. In many ways, in case a mathematical equilibrium exist between the income to expenses (Income= expenses), a need to maintain a specific job will be required for the sake of not defaulting the obligations. In such a model, the worker become oblige to continue his employment regardless of the terms he will get.

As you can see, I did not put here costs as free time hobbies, alcohol, cigarette, kids, vacations unexpected expenses and so on. The fragility and inflexibility of this model is clear. Logically, to maintain such a system for a long period in a safe manner, will require that the income will be constantly higher than the total expenses and that the employment will be secure for all the period of life of the individual.

Looking on the market of our days, the capacity of an individual to keep his job for a long period is limited. The general expenses are constantly rising due to inflation and our growing need for consumerism. In the reality, the amount of time the a person are will require to save enough money to be considered rich surpass their lifetime. The idea of taking a loan is not a solution, as it is adding a momentary income for the sake of taking it back with interest in the expenses side.

This model promise survival, as one will manage to live in many cases comfortably as long as he cooperates with the system. From the other side, it is exactly this long-term cooperation that is needed for the sake of promising the survival of the elite and their enrichment. In this equation, the rich have created a perfect system in which the majority of the population will be enchanted to the system, while they control it from the tower of their riches.

Does it make sense to you? Can you identify your self-working based on this model?

Share with me your thoughts. Awareness and open conversation are the keys for the creation of a better future.

Related article – the vicious circle of our economy, part 1

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