Our leaders are blind to these drivers of economic decline.
August 27, 2014
The world’s current economic and political structures are proving incapable of fixing the global crisis of poverty, unemployment, and dislocation from a viable way of life for the majority of the world’s population. Why? Let us begin with one present-day example: Larry Summers, former Secretary of the Treasury and also former chair of the Board of Economic Advisors, recently was the principal guest of the national radio broadcast “On Point.” The topic of the hour-long dialogue was growing “inequality.”
Summers posited that we are in an oddly slow recovery. He gave some reasons for the slowness but maintained that the measures instigated by the government (the Federal Reserve pumping funds into the economy, and the like) were fundamentally correct, and that with patience and persistence the recovery would solve the problems we have.
This basically is the position of Obama and importantly, by no means only his. Every government in every country subscribes essentially to this same apostolic faith. That faith is pathetic and even grotesquely mistaken. It ignores the four “Tsunami” causes for the globally increasing inequality:
1. Automation: The number of jobs that have been automated out of existence in the last 30 years is astronomical. Any effort to enumerate them would be silly. Useful, on the contrary, are perhaps a few hints of the kinds of automation that are still in the future, but nonetheless just around the corner. Observe what is happening in retail –
Amazon.com, and more generally in the service sector, in banks and offices; but beyond that consider the near future of robotics, and close to that the potential of self-driving cars, and of course the galloping field of fabricators. Automation so far has only been the first breeze of an approaching hurricane.
2. A second colossal cause is globalization. Despite the nonstop discussion of that topic its basic significance is still largely misunderstood. That factory work is outsourced to lower wage countries is a belittling phrase; more accurate is the contrast between the former monopoly of a very few colonial powers and the now prevailing condition where all countries everywhere — even the Central African Republic and Borneo and Mongolia — are indevelopment. In other words, in all countries people are looking for jobs. Thus the supply of labor has burst through all bounds! This in turn means that the value of unskilled work has plummeted beyond human sustainability much less economic growth.
3. Environmental degradation is growing. The depletion of natural resources is directly caused by fruitless efforts to stem unemployment. Unemployment threatens to grow continuously and the only response we have so far marshaled is economic growth, which self-evidently is coupled to the depletion of our resources.
4. The fourth mega-force that escalates inequality everywhere is the industrialization of farming. Throughout the millennia of the Agricultural epoch approximately 75% of the population lived and worked on farms. That percentage only started to gallop away from this ratio when farming became mechanized. However, in the brief period of less than 200 years a breathtaking transformation has taken place. Worldwide 70% of farmers have been driven from their work and their land. In country after country the percentage of people still working and living on farms has thundered downwards so that it is now in some countries only about 4%. On some continents that human migration is still in its headlong tilt: but as villages die, the former farmers do not find work; they are absorbed in slums and sink down in the morass of extreme poverty, violence, crime, prostitution and drugs.
The really foul and grotesque dimension of this lies in its cognitive segregation, for the worldwide migration away from the farms is hardly mentioned when the deficit of jobs and the rise of inequality are discussed. In sheer numbers, this is obviously the most gargantuan cause.
It is stunning that there are whole shelves of books about the job-problem, but the reality of the loss of working on farms has rarely been included in the workforce calculations. In essence it means that 75% of the total working population have been cut off from their work and that the need to find re-employment for that huge number is part of the monster-problem that we are failing to even identify let alone solve.
If one adds these four Tsunamis together —automation, globalization, destruction of natural resources and the industrialization of farming — then it becomes obvious that the remedies now applied — stimulation of the economy, raising the minimum wage, more education and the rest — are laughably inadequate. It also becomes evident that we are emphatically not in a recovery, somnambulant or otherwise.
None of these causes are “circular,” or as it is sometimes expressed cyclical, which recoveries by definition are. All four are linear: automation, globalization, destruction of the environment and the migration away from the land will grow, far beyond where they are now, and will multiply. The inequality will become even more monstrous and more dangerous than it is now. The contrast between slums and the palaces of the superrich is already surreal and fantastic, but it will grow further and beyond our worst imaginings. The faith that we are in a circular turning wheel situation, and that automatically, obedient to the laws of economics, we move towards equilibrium, is totally unfounded. It is just a misguided medieval superstition.
We are not turning in a circle; on the contrary we are undergoing a gigantic linear transformation that is as all changing as the shift from agriculture to industrialization.
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Why is this a gigantic linear transformation? Because there is no circling back to a former “better” time. The mega-factors listed have produced an enormous rift or a bifurcation. It is a split between the 20%, Oasis people (the rich) and the 80%, Desert people (the poor.) Other groups have of course a greater liking for describing the division as between 1% and 99% but that seems too exaggerated.
New Work New Culture is a new way of looking at and actualizing how people can live in peace and prosperity, working together to provide what is needed not just for survival but for joyous fulfillment. People of good will must stop looking back, yearning for the good old days.
New Work New Culture gives us a roadmap to take on the task to articulate a ladder that defines a practical, performable sequence of steps in detail that is realistic and manageable. By doing so we will not just alleviate the four Tsunami Calamities but give life to a rise, an ascent that has become possible with the technology that we now have.
(Frithjof Bergmann is a retired Professor of Philosophy from the University of Michigan. He has been writing, teaching and organizing for the ideas of New Work for more than 3 decades. He has authored many works, including On Being Free (1977). He is a principal organizer of the
New Work New Culture conference in Detroit, Michigan from October 18-20.
#NWNC2014)
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