So CNBC said today with Liesman "not getting it."

Or, if you prefer a wider view:

CNBC doesn't understand why this happened?  Their guests don't?

Do come on.  That's either a lie or none of their guests have ever run a company.  Ok, maybe the latter is true - it must be nice to have a silver spoon in your mouth when you're born.

First, let's look at why we had the move upward from the 1960s through the 1990 time frame.  That was pretty simply - two-income households.  No more "Beaver Cleaver" stuff.

Good or bad, that's what it was.

But today's loss is involuntary.

Why?

It's pretty simple, really. 

Health care expenses, H1Bs and youth productivity.

Really?

Yes, really.

Look folks, I used to run a company.  And I can tell you you from all the people I talked to them and now that there are three issues that are overwhelmingly the source of this problem:

Health care expenses for older workers.  It's illegal to discriminate against someone on the basis of age in employment.  I can tell you it happens every single day.  There's no surprise why it happens either.  Every company in one way or another that offers health benefits and pays some part of that absorbs part of the cost.  Federal Law prohibits an employer from deducting a different amount from different employees' checks.  Further, in order to qualify for tax purposes the employer must cover at least half of everyone's premium (from highest to lowest.)

But premium differences between workers are often five hundred percent or more.  That's not made up folks.  I used to see these statements every month.  It's real.  The 20-year old in good health who doesn't smoke and is male often costs one-fifth of what the 55-year old female overweight smoker does to insure.  But the employer cannot legally set up the plan so that he pays the same for each employee - he must deduct the same for each employee, and he cannot deduct more than half of the 20 year old's premium or he loses the tax preference.

Right or wrong, this is the law.  This is what you must do.  So when you have two people in for an interview, who gets the job?  The 20 year old or the 53-year old, all other things being equal?

Youth sense of entitlement.  It's everywhere.  And it's a huge problem.  It's not true for every kid, but it's true for a lot of them.  They don't want to come to work, they don't want to work hard, they don't see a future with the company and advancement.  They want a job with their friends that's "cool" and a great place to hang out - for which they should get paid. 

Ever see an episode of "Jersey Shore"?  That's not far from the truth (the T-Shirt shop.) 

No, it's not every kid.  But it's a lot of them.  And it's a serious problem. 

I fault the "easy money, easy life" mentality that most kids these days grew up with.  They never had a rough economy to deal with.  Ever.  The 1970s were before their time of sentience, and the mid-80s and forward have been good.  They didn't bother with basic skills in school - like arithmetic - because they didn't need it.  As long as everything is "on plan" it's all ok.  As soon as it's not they're cooked.

Let me give you one example from the 2000 time frame.  I was driving back from doing some door-banging on legislator doors in DC.  In the middle of Virginia somewhere, there was a train wreck (a real one) and I was diverted off the highway by the cops.  I drove into the little town down the road and stopped at a gas station.  The power was off, but the clerk was in there.  Cute young lady, maybe 22 or 23?  I bought a map.  Well, I tried to.

See, she didn't know how much the sales tax rate was, or how to compute it on the map I wanted.  The register was dead as there was no power.  She literally couldn't sell me a map.

I left an extra dollar on a $5 purchase with her and walked out to her protests that she wasn't sure that was enough.  Twenty percent sales tax wasn't enough?

How does someone get a cashier's job if they don't know the sales tax in the place they work?  If they can't work the sales tax on a sale with a piece of paper and a pencil?  Really?  4th Grade math - at worst?

Think this is unusual?  It's not.  And it's sad.

Third, we have a monstrous H1B problem.  These are "tech visas" for foreign workers.  And they're destroying the American base of technology workers and engineers.

Here's why - the Indians coming here with those H1Bs are not burdened with $100,000 worth of college debt.  They can (and do) take jobs at 20, 30, 40% less than an American can reasonably work at the same task.  There's no way for a graduate from an engineering school to compete with this if there's any debt in the picture.  Someone with $100,000 in school debt comes out with a P&I at a 6% blended rate of about $1,100.  That comes off your net income which means your salary demand to keep even with someone who doesn't have that debt (like an Indian immigrant) must be roughly $18,000 a year higher. 

The American loses - every time.

How do you fix these problems?  None of them have immediate solutions.  We have to solve the health care and college cost (not "financing") problems to resolve two of them.  The third is going to take the school of hard knocks being applied to some of the kids, which means cutting off the entitlement teat.

Here's the challenge, from a policy perspective: If we don't fix the above we can't get the participation rate back up.  And without that, we can't fund the federal budget, including paying down the debt.  Ever.

We have a window to do this, but it's not very large and it's closing 

If we don't act on these points - especially the first and last - our neck is going to be under the blade when it descends.