The sky is falling! The sky is falling! But this time Chicken Little is correct. The sky really is falling and in this context, the sky is our economy. The two big questions on everyone’s mind are: (1) Why is this happening? And (2) what can we do to remedy the problem?

Actually, I need to amend that last statement. These questions are only on the minds of those who are willing to be honest about the economic plight of your average American. All you have to do is watch the Republican candidates answer the economy question in the Simi Valley Republican debate which took place just last week. You'll find out real quick who wants to be honest and who wants to lie and obfuscate.

The question was asked, “Are Americans better off than they were eight years ago?” The answer is generally, no. But I sat in shock as two of the four candidates running for the Republican nomination skirted the question (in Romney’s case) or just plain lied (as in McCain’s). The only two individuals on that platform who were willing to tell the truth were Huckabee and Paul. The irony is that probably neither one of these guys has a hope of getting the nomination. So much for being honest. But I suppose it really doesn't matter with those two either, since both of them are big believers in free trade. More on that later. What I'd rather focus on now is the unwillingness of media whore politicians and their pimps to be honest about not only our predicament, but some of the major factors influencing the current economic climate.

This is a significant point, because the big story coming out of all the major media outlets a mere two days after the debate was the loss of 17000 jobs in January, the biggest loss since 2003. The news was also remarkably consistent in reporting the symptoms of our economic decline. Curiously absent was any reporting on why this is happening, much less what we can do about it?

The media attributed the "cause" of our economic downturn to gigantic job losses in construction, manufacturing/goods producing, and retail. They also point out that soaring fuel costs are crippling the trucking industry, as well as taking an ever bigger bite out of the average person’s budget.

Interestingly, those loses in jobs were punctuated by gains in the service industry, especially the food service industry. Ever hear the saying that we’re becoming a service oriented economy? Better get used to that; because thanks to the politicians who think your vote is a mandate to ensure free trade, NAFTA , and reckless spending, more and more of us are going to be lining up at Wendy’s to beg for a job and we’ll feel damn lucky to get it, too. That’s because if Bush and others like him (McCain, Kennedy, etc.) have their way, it’ll be open borders and amnesty for illegals. Illegals which you, my amigo, will be competing with for that top tier job down at Burger King.

Guest contributor, Tom Powers, has written an excellent piece which underscores this shift in the U.S. from a self sufficient manufacturing/goods producing economy to a dependent service and so-called consumer economy. It makes for interesting reading in light of the loss in manufacturing jobs and the gains in service jobs, which just happen to be at the low end of the pay scale.

I've compiled a list of excerpts from various media outlets for your consideration. Notice how, with few exceptions, those reporting on our economic woes are utterly impotent to point the finger at free trade, our unwritten "open borders policy" and the $9 trillion deficit, a deficit which we are trying to hold at bay by borrowing money, in effect, from foreign countries like China, Japan, and the E.U.

From BUSINESSWEEK.COM: And then there are the staggeringly large Chinese trade surpluses. For years, economists reassured themselves that China's trade with the whole world was pretty well balanced, even if the country had a big surplus with the U.S. Those days are over. Now, China's trade surplus has more than tripled, to an annual rate of about $70 billion a year.

That $70 billion surplus is exactly that — the extra income that China takes in from exports and that isn't used at home. It's all recycled as savings into the global economy, in the form of purchases of U.S. Treasury bonds and, lately, as stepped-up direct investment in U.S. companies. Analysts say CNOOC's bid for Unocal could herald a wave of Chinese takeovers of U.S. companies.

From THEATLANTIC.COM: The U.S. budget deficit is financed by borrowing. More and more of that money comes from China, now the United States' second-largest lender, after Japan. China's investment in U.S. government debt has more than tripled in the past five years, from $71 billion in 2000 to $242 billion in 2005.

From GOVEXEC.COM: Humming the same tune he's been singing in a tour of the nation, Government Accountability Office chief David Walker warned senators Tuesday that the federal budget is spiraling out of control and that little time remains to steer it to safer ground. Driven by a combination of soaring healthcare costs and the demographic swell of baby boomers on the cusp of retirement, Walker told the Senate Budget Committee that "the federal budget is on an imprudent and unsustainable path" and that "the passage of time only serves to worsen this situation."

From WSWS.ORG: The Labor Department report indicates that jobs were eliminated in the construction, manufacturing, and government sectors, while job growth continued, albeit at a reduced pace, in the service and retail sectors.

This same article went on to say:

The rise in consumer prices – driven largely by increases in essential goods like food and fuel – coupled with greater rates of unemployment and falling real incomes, will have the effect of further driving down economic growth.

From NY.TIMES.COM: …the January employment report cast the job market in a startlingly darker light. Jobs disappeared across a broad spectrum of activities, with the steepest losses coming in the manufacturing, construction and goods-producing industries.

From UPI.COM: WASHINGTON, Feb. 1 (UPI) — Declines in construction and manufacturing contributed to a loss of 17,000 jobs in the United States, a Friday release from the U.S. Department of Labor said.

The drop in jobs is a critical measurement of the economy, due to the expected decrease in consumer spending.

But some sectors experienced losses. Construction lost 27,000 jobs in January and manufacturing, which has lost 269,000 jobs since January 2007, lost 28,000 last month.

Food service, gaining 16,000 jobs, and healthcare, gaining 27,000, helped offset losses in other sectors.

From NEWSVINE.COM: "…the unexpectedly low figure indicates that problems arising in the housing and financial sectors are spreading to other sections of the economy, including retail and manufacturing.”

The Labor Department report indicates that jobs were eliminated in the construction, manufacturing, and government sectors, while job growth continued, albeit at a reduced pace, in the service and retail sectors. Professional service jobs – including those in finance, banking, and real estate, fell by 11,000, due largely to slowdowns arising from the collapse of the housing bubble and consequent losses in the financial sector.

In concurrence with the Federal Reserve, Congress and the White House have been putting together a $150 billion fiscal stimulus package. Both of these measures aim to avert negative growth in the short term, but as ominous economic indicators pile up, it is becoming increasingly unlikely that these actions will have a significant impact on the slide into recession.

Somebody stop the madness!