I can agree with much of Jared Bernsteins analysis, but Bernstein fails to address the property rights issues with respect to the ownership of non-human productive capital assets––the computerization and robotic substitutions for labor workers that he identifies. While it is true that routine production jobs, which tend to pay solid, middle-class wages, get substituted by more efficient, less costly mechanized production processes and low-end non-routine manual jobs, at the present, are the jobs that remain as they are much harder to automate, job creation for high-end, high-paying jobs will be limited in the future by how necessary they are to complement, operate, and maintain new technological processes that enable more efficient and labor saving costs or enable production processes that are not humanely possible to perform. As a result, with anemic economic growth in real productive capacity and output, most job opportunities will remain stuck at the bottom with otherwise stagnant opportunities for middle and top tier jobs. There can be no denying that tectonic shifts in the technologies of production will continue in the future at an exponential growth rate. The reality is that our educated scientists, engineers, and executive managers who are not owners themselves, except for those in the highest employed positions, are encouraged to work to destroy employment by making the capital owner (those that own the non-human means of production) more productive. How much employment can be destroyed by substituting machines for people is a measure of their success––always focused on producing at the lowest cost. Their efforts result in technological change, whose function is to make tools, machines, structures, and processes ever more productive while leaving human productiveness largely unchanged (our human abilities are limited by physical strength and brain power––and relatively constant). The technology industry is always changing, evolving and innovating. The result is that primary distribution through the free market economy, whose distributive principle is “to each according to his production,” delivers progressively more market-sourced income to capital owners and progressively less to workers who make their contribution through labor––the primary reason for economic inequality. Only the people who already own productive capital are the beneficiaries of the work of our educated work force, as they systematically concentrate more and more capital ownership in their stationary 1 percent ranks. Yet the 1 percent are not the people who do the overwhelming consuming. The result is the consumer populous is not able to get the money to buy the products and services produced as a result of substituting machines for people, which in turn stifles real economic growth, which would create expanded job opportunities at all levels. This is critical to understand because you can’t have mass production without mass human consumption. It is the exponential disassociation of production and consumption that is the problem in the United States economy, and the reason that ordinary citizens must gain access to productive capital ownership to improve their economic well-being. Unfortunately, ever since the 1946 passage of the Full Employment Act, economists such as Bernstein and politicians formulating national economic policy have beguiled us into believing that economic power is democratically distributed if we have full employment––thus the political focus on job creation and redistribution of wealth rather than on full production and broader capital ownership accumulation. This is manifested in the belief that labor work is the ONLY way to participate in production and earn income. (Note that Berstein NEVER addresses the ownership of the technology substitutions he analyses.) Long ago the focus on labor was necessary because labor provided 95 percent of the input into the production of products and services. But today that is not true. Capital provides not less than 90 to 95 percent of the input. Full employment as the means to distribute income is not achievable. When productive capital owners replace labor workers (non-capital owners) as the principal suppliers of products and services, labor employment alone becomes inadequate. Thus, we are left with government policies, such as coercive minimum wage legislation and labor bargaining for greater wage incomes and benefits rather than ownership and dividend earnings, that redistribute income in one form or another and enslave most Americans in wage slavery or welfare slavery. I agree with Bernstein that there is an absence of a progressive economic policy agenda, but not with his focus on non-market-derived job creation, wages and taxpayer- and business-supported redistributive policies. Instead, to really solve economic inequality and stagnant economic growth, we need to focus on simultaneously creating new capital owners with the growth of the economy. Without a policy shift to broaden productive capital ownership simultaneously with economic growth, further development of technology and globalization will undermine the American middle class and make it impossible for more than a minority of citizens to achieve middle-class status. Now is the time for Bernstein and other economists, political leaders, the national media and academia to conduct a reality check. This reality check needs to be taken extremely seriously. All previous solutions focused on job creation and government dependency DO NOT WORK in an age where tectonic shifts in the technologies of production destroy jobs, devalue the worth of labor, and reduce people to desperate, government-dependent minimum wage jobs, or even worse subject them to broken taxpayer-supported government welfare programs, open and concealed, which is escalating the national debt. The question that requires an answer is now timely before us. It was first posed by binary economist Louis Kelso in the 1950s but has never been thoroughly discussed on the national stage. Nor has there been the proper education of our citizenry that addresses what economic justice is and what ownership is. Therefore, by ignoring such issues of economic justice and ownership, our leaders are ignoring the concentration of power through ownership of productive capital, with the result of denying the 99 percenters equal opportunity to become capital owners. The question, as posed by Kelso is: “how are all individuals to be adequately productive when a tiny minority (capital owners) produce a major share and the vast majority (labor workers), a minor share of total goods and services,” and thus, “how do we get from a world in which the most productive factor—physical capital—is owned by a handful of people, to a world where the same factor is owned by a majority—and ultimately 100 percent—of the consumers, while respecting all the constitutional rights of present capital owners?” The solution is to adopt and implement the Capital Homestead Act (cesj.org/learn/capital-homesteading/capital-homestead-act-a-plan-for-getting-ownership-income-and-power-to-every-citizen/ and cesj.org/learn/capital-homesteading/capital-homestead-act-summary/) that will empower EVERY American citizen to become an owner of wealth-creating, income-producing capital assets simultaneously with the technological economic growth of the economy. The Capital Homestead Act is a key plank in the Unite America Party platform (published by The Huffington Post at huffingtonpost/gary-reber/platform-of-the-unite-ame_b_5474077.html as well as Nation Of Change at nationofchange.org/platform-unite-america-party-1402409962 and OpEd News at opednews/articles/Platform-of-the-Unite-Amer-by-Gary-Reber-Party-Leadership_Party-Platforms-DNC_Party-Platforms-GOP-RNC_Party-Politics-Democratic-140630-60.html). prospect.org/article/it%E2%80%99s-not-skills-gap-that%E2%80%99s-holding-wages-down-its-weak-economy-among-other-things#.VDQ0NCBrWqw.facebook
Posted on: Tue, 07 Oct 2014 23:35:14 +0000
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