To: Serious reformers on several mail lists. Hi Folks, In a 99-07-07 series of five insightful posts to list <[EMAIL PROTECTED]>, Thomas Lunde writes in the fifth post: >> "What to me is surprising is the failure to recognize that the natural structure of capitalism is towards monopoly. Monopoly is attained and maintained by the concept of profit. Mergers, stock ownership, credit, all fall to those who have been the beneficiaries of large consistent profits which give them the surplus to absorb more of any given market area or product area or as in the case of stocks, holding massive amounts of wealth, much like a cow that can continually be milked. There is no social benefit to this, no moral value that can be extrapolated from this, it just is a nice byproduct of a system design." << WesBurt writes in reply: What to me is surprising is the failure, of the intellectually gifted members of society, to recognize that the natural structure of capitalism towards monopoly, which they deplore, is attained and maintained by bringing young people into the workforce as financial cripples, not by the natural depravity of bankers, employers, and wealthy people. By financial cripples, I mean young people who are either under nurished, under educated, deep in debt, or all three. I doubt if we could find a Polish pig farmer, in this day and age, who was stupid enough to do that to his most valuable cash crop, but that has been the public policy of English speaking employers since they enclosed the common lands in the 16th and 18th century to increase the landlord's money income. Now this public policy was mentioned in some detail in Isaiah 5:8-15 and later by such English authors as N. S. B. Gras, Harriet Bradley, R. H. Tawney, and A. H. Johnson according to my copy of THE COLUMBIA ENCYCLOPEDIA, so this public policy was not invented by English speaking employers, but they seem to truly believe that it remains their only salvation. Here are two examples of the best solutions our intellectually gifted folks have to offer: Example # 1 ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ >From URL <http://simedia.org/main/jltobin.html> The Tobin Tax — and a new era of global economy by John Laird (Snip) Yes, globalization requires action beyond merely the trade and investment spheres, but here is the hard part: effective global regulation requires governments to give up portions of their national sovereignty and to designate that surrendered sovereignty (along with the required resources) to international conventions and institutions. (Snip) (WSB: If each nation stabilized its own economy and established justice in its own society, the global problematique could be handled easily by cooperation between nations, without giving up any part of their national sovereignty. WSB) Example # 2 ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ >From <http://www.intellectualcapital.com/issues/issue247/item5327.asp> A Review of The Stakeholder Society by Bruce Ackerman and Anne Alstott Yale University Press, 296 pages Years after Tom Paine helped spark the American Revolution with his essay Common Sense, he advised the revolutionary government of France to cement its newly won political equality with economic citizenship. The means to true commonwealth, he wrote, was universal stakeholding. Paine’s plan: Grant every youth turning 21 a cash grant of 15 pounds sterling to get started in life; later, at age 50, every surviving worker would receive an annual retirement allowance. The Stakeholder Society No less revolutionary is the proposal today by Bruce Ackerman and Anne Alstott to promote equal opportunity by giving every American, at age 21, an $80,000 grant to spend as he or she sees fit. The amount reflects the average cost of a private college education, which Ackerman and Alstott -- both professors at Yale Law School -- clearly hope will expand access to higher education. Yet this is no mere college scholarship program. The authors expect that the primary beneficiaries of these start-up grants would be the millions of “forgotten Americans” who decide that even a two-year college is not for them. More than anything, this book is a battle cry for the rapidly receding American value of equal opportunity -- not equal outcomes, but a level playing field to compete in the game of life. The authors note that the 25% of today’s 20-somethings who get their tickets punched with a B.A. or professional degree are, by and large, born on second base. Income and wealth inequality is rising rapidly as the New Economy rewards the sort of education, skills and connections that accrue disproportionately to those born on the right side of the tracks. Giving Joe Six-Pack a stake “Rich kids get a big head start in life,” they write. While only 60% of high school grads from low-income families go on for any higher education, 93% from high-income households go on for at least some college. This already-privileged group is then showered with public grants and subsidized loans -- not just at university, but later as owners of the most expensive homes (since mortgage interest is tax deductible) and as retirees (since the top 20% of earners receive two-thirds of the tax incentives for pension saving). (Snip) ~~~~~~~~~~~~ End Example # 2 ~~~~~~~~~~~~~~~~~~~ (WSB: Authors Bruce Ackerman and Anne Alstott failed to mention the social security payroll tax with its 15% rate, with no exemptions, on income under $63,000/year, and, its 0% rate on all income above $63,000/year. WSB) You may easily visualize this river of young people who are either under nurished, under educated, deep in debt, or all three when they enter the workforce, by looking at Figure 8b of the global model at url <http://www.freespeech.org/darves/>. Most of them will increase their income until they reach their peak capacity at age 45 and then retire at age 65 without ever figuring out how good it could have been if the economy had been operating at its full potential efficiency since the frontier closed in the 1890s One measure of how much ground we have lost under the prevailing public policy of 4-10% unemployment and 2-3%/year inflation is implied by the trend of Figure 10 of the global model since the 1890s. If the dollar was worth $1.00 in 1900 and lost 2.5% of its value each year, as it has, what is its value now, in 1999? Ans: 7.75 cents. The Wealthy, Healthy, Intelligent, and Powerful members of society, the WHIPs, laugh all the way to the bank as you folks beat them with words. As long as we feed the workforce with financial cripples, if the WHIPs did not milk them like cows, somebody else would. As David C. Korten said in his 1997 "Money as a Social Disease:" >> "Many of the best minds of our time are engaged in finding ways for the already wealthy to use the money system to claim ever more of the world's real wealth for themselves. Remarkably few are concerned with how we might redesign money to serve a society that works for all people. It is time to change that." << Like everyone else, Korten is looking into the wrong end of the telescope. Our present condition has nothing to do with our money system, it would exist in a barter economy. Wishing you all the best, WesBurt
