Let's face it, the real engine of growth in this country over the last 25 years -- or more -- has been the financial industry, which has accounted for a whopping percentage of the GNP. And if it gets cut down to size, as MUST happen, then what will become the basis for the American economy during the "recovery"? Where will the jobs be?My own personal preference is for a managed economy, where jobs and resources are allocated on the basis of ability and need. You know the drill: "from each according to his ability, to each according to his need." Karl Marx -- via Jesus Christ. (If you can't find it in the New Testament, it's because you don't know how to read between the lines.)
Since hardly anyone in this country really cares much for the gospel according to either Marx or Christ, there's no point in going on forever along such lines. In my opinion, we'll eventually get a managed economy whether we want one or not, but meanwhile, for the benefit of those bound and determined to fight socialism, in any way shape manner and form, to the bitter end, it might be fun to contemplate what sort of future capitalism might have as the current financial crisis inevitably morphs into an economic crisis of unprecedented depth and breadth. So here goes:
The really really deep -- deep deep deep -- fundamental beyond all other fundamentals -- reason for the situation in which we now find ourselves (SIWWNFO), is not really the greed, mismanagement and outright corruption of the knaves and fools who've been driving the financial markets, though that's certainly been a hugely contributory factor. No, the most fundamental reason is a very gradual, but probably inevitable, rise in awareness and aspiration, also education and ability, on the part of the hundreds of millions of third world citizens who have for much too long been willing to labor continually, day and night, week after week, month after month, without complaint, in order to simply subsist on the margins, regardless of the debilitating work, the grinding poverty and the endless cruelty and exploitation they've been forced to endure. Over a considerable length of time, this group has gradually made itself aware, or been made aware (probably a little of both) of its economic power. Which is not to say that it isn't still being exploited, because the exploitation has probably, in most cases, gotten even worse. No, what is different is that this group has now made its appearance on the radar of the world economy and is now becoming a force to be reckoned with on the global labor markets.
But you already knew that, didn't you? Only you were content to think of it merely as "outsourcing." And you've been conditioned to believe that many of our problems will be over once we force our manufacturers, service providers, information processors, etc., to end this practice so we can have all our wonderful jobs back. Dream on. Capitalism is based not only on greed and manipulation of financial markets, but also, and fundamentally, on competition. So if you are really truly devoted to the principles of "free market" capitilalism, you are going, at some point, to be forced to admit that we, in the good old US of A, are no longer in a position to compete on the world market.
Our labor force can no longer compete. Because we both expect and need far more income than our competitors, who can now do the same jobs just as well, but for a fraction of the cost. And our products can no longer compete, because the costs of producing such products in the USA are far greater than they are when produced abroad.
Don't give up hope, however, because, as I promised, there is an answer. You might not want to hear it, but I swear that for now at least I will have nothing whatever to say about the joys of socialism. My answer lies totally and completely within the realm of capitalism. Within this realm, we have one hope and one hope only: deflation.
(to be continued)