Friday, November 14, 2008

The Shape of the Economy

While channel surfing through the various news and business channels, I heard the argument that we should not work on bailing out the auto industry. The argument was, since every one is hurting and 3/4ths of the jobs come from small business we should be helping small business. I had heard that 1/6th of the jobs are related to the auto industry. So it seems to be suggesting that you help in the area where more jobs exist. It made me wonder what is the shape of the economy.
I am not talking about the physical health (i.e. strong or weak) but what it looks like. Is the economy a pyramid or a table. Pyramid shape would mean that a lot of small businesses and the 3/4ths of jobs it provides are supporting the larger industries, which provide fewer jobs. Or is it a table? The legs represent industries providing fewer jobs but supports the table top (i.e. small businesses which provide 3/4ths of the jobs in America). Or maybe the table is holding that pyramid, and as we get higher on the pyramid we find ourselves reaching back to the legs of the table. A very strange looking object! In the economy there may be no true bottom. If one part is hurting all other parts are going to be hurting.

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