Situation at Large

I was discussing the Situation at Large with a Saipan resident, an American who has just entered retirement. Like many, he’s had enough of the patronage system, and is planning to move somewhere more accommodating. It’s a common situation with a timeless, even romantic, element about it: A man can wind up trapped between several worlds when his “paradise” isn’t so idyllic.

Herman Wouk’s Don’t Stop the Carnival was comedy noir on this note. P.F Fluge’s The Edge of Paradise is still discussed at Hamilton’s bar.

As for me, I’ve compiled so many notes over the years of our minor and major intrigues that I wish I had the ambition to spin a stemwinder, but my ambition runs in inverse proportion to my bank balance and I haven’t bounced any checks yet.

But I’ll bounce around the Situation at Large, because so many interesting and adventurous people on these shores are discussing it. They have two basic options: They can return to the U.S., or press further into the tropics and wind up unpacking their suitcases in the Philippines, Thailand, or wherever.

We’ll contemplate the U.S. option today.

A lot of folks who have moved to Saipan don’t relish a return to the U.S.; the nation has changed vastly over the recent years, and has economically polarized in the old “the rich get richer, and poor get poorer” gig. Anyone in the tropics trying to buy back into that game now may need $700,000 for a house if they want to be where the jobs are…

…and where the jobs aren’t, well, there are many such places. Real incomes (the “real” means “inflation adjusted”) have fallen in many counties. Overall, Americans are spending more than they are making, the difference being made up in consumer debt. Lots of people are borrowing money just to get by. No wonder: It takes a two-earner couple to keep a household going, and it takes one of those two working full-time merely to pay the taxes!

It’s called the two-income trap, and there is no escaping. Leaping from Saipan into that gig is not an appealing proposition.

Many sense that the American middle class is an endangered species, without the traction to climb higher on the economic ladder, and yet having to support a sprawling, hungry, and demanding class of welfare generations, illegal aliens, and, now, supporting even middle-class pensioners who have cut themselves medical entitlements via the political process.

Little wonder that the U.S. government is facing about $45 trillion in unfunded liabilities for it future obligations. Where will all this money come from? From the struggling middle class; where else can it come from? The welfare moms aren’t going to pay it. On the other end of the spectrum, the fat cats living on capital gains aren’t going to pay it either. All that’s left are the two-income households in the middle, the salarymen and salarywomen who will have no choice but to shoulder any burden that they are told to…they have no options, and no way out.

Of course, with shopping malls and television and Prozac to keep their heads spinning, they’ve come to regard the economic treadmill lifestyle as the envy of the world. Maybe it is. Maybe it ain’t. But the kind of people who gravitated to Saipan tend to be independent-minded, and they feel creeped-out by the whole gig.

And such is one element in the Situation at Large being discussed by Saipan’s Suitcase Squad—the guys who left, and the guys who are leaving. Many are pressing on to other tropical venues, toward different edges, different paradises, and different carnivals. That’s an issue for a different day, so stay tuned.

(Ed Stephens Jr. is an economist and columnist for the Saipan Tribune. E-mail him at Ed@SaipanEconomist.com.)