Ray,
You said: You can build the products without labor but without workers there are no consumers. Then why are you building the products? Harry From: [email protected] [mailto:[email protected]] On Behalf Of Ray Harrell Sent: Monday, October 04, 2010 9:33 AM To: 'Keith Hudson'; 'RE-DESIGNING WORK, INCOME DISTRIBUTION, EDUCATION' Subject: Re: [Futurework] *****SPAM***** Living within our means Unfortunately, if the issue is a simple economie of scale we are all in deep dokey since the real issue today is labor not product. You can build the products without labor but without workers there are no consumers. You have to Make work and the private sector dependent upon profit cannot make work therefore they cannot employ those who would destroy their profit. Even the energy industries are heavily subsidized. Food is heavily subsidized. Didnt Marx say something like this Arthur? Keith, simple productivity destroyed 98% of the Arts in America and is in the process of destroying the education and health care systems. The energy system is as stagnant as the Japanese economy and soon to be English. Productivity lag, is a reality. Economie of scale only works for wealthy goods as you state but the base of the economy is a consumer sector with money in their pockets. Workers. How come an artist has to tell you economists these things. Do you all know anything about chromatic harmony or dodecaphony? REH From: [email protected] [mailto:[email protected]] On Behalf Of Keith Hudson Sent: Monday, October 04, 2010 2:49 AM To: RE-DESIGNING WORK, INCOME DISTRIBUTION, , EDUCATION Subject: [Futurework] *****SPAM***** Living within our means The headlines in today's New York Times says it all: "Cheap Debt for Corporation Fails to Spur Economy". The writer, Graham Bowley, goes on to talk about firms like Microsoft "borrowing vast sums of money for next to nothing" -- simply because they can -- but not building any factories, stockpiling their money "until the economy improves". This shows that large firms know no more than advanced governments do as to how the industrial economy works -- and how the industrial revolution took off 18th century and grew so successfully for 200 plus years. It worked because, one after the other, some hitherto highly expensive hand-made consumer good, bought only by the richest segment of the population was able to be made in a factory, and then increasingly mass-produced and becoming cheaper step by step. In turn, each class of society underneath the very rich was able, by saving, to own a new item and thus aspire upwards. What we now need is a consumer good priced at, say about £10,000,000, that would appeal to the very rich but capable of being factory-made in due course priced at, say, $1,000,000 and affordable by the "merely" rich, and then mass-producible a bit further to be priced at, say £100,000, etc, etc. And when we have invented this consumer item, we need to find another one. And then another one, and then another one. Hundreds of them. Because that is what happened all through the industrial revolution from about 1780-1980. By that time, even the computer was being affordable by individuals and now, today, even the poorest in the land can afford a personal computer of equivalent power that a rich individual or a corporation would have paid £1,000,000 for in 1980 and £10,000,000 in 1970 (and did). Forty years ago, the brilliant economist, Prof Fred Hirsch of Warwick University, who tragically died young, pointed out that the choicest consumer goods, affordable by the very rich, are now in limited supply. Furthermore, beautiful countryside homes, ocean-going yachts, personal airplanes, visiting the moon, etc, for one reason or another -- natural, spatial, logistical (but not financial) -- can't be mass-produced. There are no more chains of consumer goods except houses (which, because they're so important, governments and banks have fouled up for the present by means of arbitrarily playing around with interest rates). We only have embellishments of the consumer goods that were already invented, or in mind, a century ago. And they tend to be mass-produced from the start at cheap prices so there's no aspirational effect. The Great Depression of the 1930s might well have been solvable by Keynesian methods because many consumer goods had still only reached halfway down the social scale but governments stuck to a perverted, upside down, notion of the gold standard and kept the value of money too high. Today, no matter how much extra money governments throw into the melting pot, it is either being trapped by the banks (which still have massive debts to pay off) or is already seeping out as inflation which is affecting the poorest already as regards heating and food costs. It is not being saved (from which real investment can flow) because there is no longer a long chain of consumer goods at different points on the social scale which can be successively afforded by all classes from the top to the bottom. The beginning of wisdom is to say that the Industrial Revolution has now ended for Western Europe and America. We are already being forced into a no-growth society. Politicians and their controllers, the vast civil services, won't admit this until we reach there either by a permanent state of deflation or via hyperinflation. Very possibly one or two (probably smaller) countries can reach a civilized version of no-growth by means of self-discipline and austerity. But when we get there in a few years' time it is to be hoped that governments understand what has happened a great deal better than they do now, so that we can give some guidance to countries like China and India when they, start meeting the same problems that we now have. Perhaps then, with a new tranche of innovations in mind, we might be able to contemplate a new economic era before us, this time living within our means. Keith Hudson, Saltford, England
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