Ride the Wind
Government is not the problem and alone is not the answer.
It’s not simply Donald Trump’s policies that have created the present set of problems that we face.
Both Parties and their candidates need to consider the fundamental nature of the economy and the role of government in societies like the United States as we enter a new era of scientific and technological development.
The long history at the West suggests that government is neither the enemy nor the savior of the people. It has been a threat to some and an aid to others, and, because of the complexity of human societies, it has always been both at the same time.
Government is the mechanism by which the economic activities of a society are constituted and managed by a legal framework, a framework that many of us in the United States refer to as “capitalism.” As presently constructed it benefits some groups and interests more than others. And harms some groups and interests more than others. Enforced by the police power of the State and maintained through millions of incentive-based choices by groups and individuals, an economy runs on like a “machine.” It does matter who holds power in the government. But only to a limited extent. Incompetence or ignorance, like our present tariff policy or war in Iran, will harm the interests of all to an extent, but by themselves they will not alter the basic framework.
We may elect a partially new government leadership in this Fall’s election. We may replace a less competent by a more competent government, but there is no reason to expect that this will result in any fundamental changes in the economic status of the rich and the poor in present day America. Elections can change the partisan balance of power in government, back and forth, as we have for the past several decades. Only fundamental reforms to the system itself will make any significant difference in the performance of the present economic system.
The problems we face are as old as human history. We live together in groups and allocate resources, organize labor and exchange the fruits of production in the “old” way, while our technological capacity and the resource base provided by our natural environment is constantly changing.
At present two fundamental “markets” are not in sync. People can be forced to work for others or rewarded for their services. This is the labor market. It determines what production and service organizations (“businesses”) have to provide their workers in order for them to accept a “job.” How little, that is, are people willing to take in pay for the work they do.
These transactions determine the extent to which people can afford the goods and services produced by these organizations. This is the other market, the consumer market. It doesn’t take much “genius” to see how these two markets can get out of “sync.” When workers are not being paid enough, or only just enough, to afford the goods and services they need to survive, and/or when technology increases worker output, so that fewer workers are needed by the organizations to meet the same consumer demand, many will end up seriously dissatisfied with their lot in life and fearful for an even worse future. In an electoral two-party democracy, this leads to opposition to whatever government is in power and a continuing shift in vote from one party to the other, until popular anger and dissatisfaction force those with power, who are benefiting from present arrangements, to cancel elections and rule by force of arms.
How did these two markets get out of balance? Is someone, some group, at fault? Was the whole American Dream a sham? Has some other group taken what was rightly mine? Or in a world of losers and winners, am I just basically a loser through my own bad choices or inherited “genes.”
We got this way it seems because people in other countries were making a lot of these products as well as robotic processes in this country . Our businesses adjusted to these conditions and were able to keep prices affordable while still raking in wealth for stockholders and upper-level management. It helped that government subsidized low wages by food stamp type payouts to workers. The so-called safety net no longer only caught those who fell out of the work force, it held up those that had one or two jobs and still were falling financially.
Prices are high because profits and salaries are high, and are likely to stay that way no matter who sits in the White House and admires the new Ballroom.
There is a lot more detail needed to make the complete argument. Regional differences, weather patterns, life-style expectations, transportation grids. But at the center of the problem is not simply that prices are high. It is that wages are low and, God help us, human jobs are likely to get scarcer thanks to A.I.
Yes, the voters will have their say in the Fall, and the group in power will be out. Those that replace them, however, don’t seem able (?), interested (?) or aware (?) that they will need to do something more than wave their wands in the air. And they are likely to get replaced two year later.
That is the present holding pattern of our electoral system. Lucy holds the ball and then pulls it away when we try to kick it. We replace Lucy with Jimmy. Jimmy holds the ball and then pulls it away when we try to kick it. We replace Jimmy …. And we may finally discover it doesn’t do much good voting people out and voting people in. The problem is that the ball doesn’t exist. We’re kicking air.
Is there an answer? Of course there is. But we won’t like it. It goes against our cultural grain. Governments must enforce policies (laws) that require private business to pay living wages to their workers, and forego the kind of profits they are presently making.
A house divided against itself cannot stand. I remember reading that somewhere. We cannot go on being half rich and half poor. And the corollary of this is that we have to reduce the work week to ensure that all who are able to work have jobs.
In the process we need to reevaluate the nature and extent of public goods. Communities must increase the goods and services that they provide outside the private for profit market sector. Some of the goods we purchase in expensive private markets are better viewed as public goods. Obviously, significant parts of health care. Certainly education. Parks, libraries, museums, theaters, communications and transportation networks. The infra-structure that would support more efficient and more profitable private businesses. Scientific research. Global welfare. Natural habitats. Rain forests. Climate adjustment. Space exploration. I could go on. Peace, order and security are all public goods that should cost more than we now pay if we are to get the benefits we need and deserve.
This isn’t a call for the replacement of free-market capitalism. Do the above and we will energize capital markets and innovations. New products and new services.
We are like stuffed horses that stand still at the starting gates. Or trick ponies that prance around and dance up and down.
You want political advice? Ride the future like the wind.
