A role reversal has occurred in this world as China is quickly surpassing the US in the innovative and economic world. With its increasing wealth, China is expanding its existence throughout the world.
This is a MUST READ op-ed that talks about the general affluence that is resulting in the economy that China is building. The author, Michael Payne, points to the reason for the real turning point that has enabled China to surpass the United States in technological development. That is, of course, the result of the decisions of American manufacturing corporations to abandon the United States to produce products and services far more cheaply in China (and other countries such as India and Mexico, for example), thus “making the devastating mistake of handing over this country’s world renowned manufacturing sector to China.” The movement to manufacturing in China has created a domino effect in which virtually every American manufacturer is outsourcing its manufacturing to China or other low wage, non-regulated countries in order to remain competitive on a global scale.
What has followed is that the Chinese took that gift from America and used it to power its economy by producing far less costly products and services, which were then sold to American consumers (who as consumers shop for the best price bargains they can find either at brick-and-motar stores or on the Internet). As a result, China is experiencing tremendous growth potential as a result of technological industrialization, though the vast majority of Chinese are still living a relatively impoverished life. Why? Because, as with the United States’s form of greed capitalism, the Chinese have also adopted a “communist” version of greed capitalism that ONLY benefits those who are well connected politically and favored to benefit from the OWNERSHIP of the massive investment on the part of American business corporations.
What really is driving this shift is the demand by American consumers (for that matter the world’s consumers) for far less pricey products and services. But no one should blame people when behaving as consumers who benefit from lower prices as a result of lower costs of production––whether achieved through lower labor costs (far fewer people) or technological shifts that make labor unnecessary or a combination of both actions.
While a role reversal has occurred as China is quickly surpassing the United States in the world of technological invention and innovation and economic development, with seemingly almost unlimited growth potential, China will eventually experience a steep slide in their economic fortunes as the vast Chinese population becomes no longer connected to the growth through jobs, and find themselves unemployed. This will be true as well for the peoples of other countries who also will continue to see their prosperity deteriorate due to the continual shifts in the technologies of production that destroy jobs and devalue the worth of labor.
It is the exponential disassociation of production and consumption that is the problem in the United States economy that is shifting its manufacturing abroad and concentrating wealth ownership, and the reason that ordinary citizens must gain access to wealth-creating, income-generating productive capital ownership to improve their economic well-being.
Once upon a time the American economy was labor intensive Americans had numerous opportunities for jobs as labor was a critical input factor, with those in manufacturing paid decent wages upon which to support a family. Also, the spread between the richest and the middle-class was less obvious, or acceptably tolerated because people felt that the rich earned their wealthy status because they “worked harder.” Few then, as today, realize that to become truly rich and stay rich requires that one OWNS the non-human means of production (such as land, structures, tools, machines [including human-intelligent and robotic], super-automated processes, computerized operations, etc.––all the result of technological invention and innovation and the core assets necessary for manufacturing products and services. Thus, those who are the OWNERS of productive capital assets are the people who are able to be free and lead an affluent lifestyle. Those who do not OWN are regulated to wage slavery and welfare slavery leading to increasing dependence on the State for their subsistence.
Every country whose system is non-inclusive and barrier-ridden, as is the United States and China (really the entire world of nations), will continue to experience affluential decline for the majority of their citizens because people will continue to invent “tools” to reduce toil, enable otherwise impossible production, create new highly automated industries, and significantly change the way in which products and services are produced from labor intensive to capital intensive––the core function of technological invention and innovation. Without OWNING a share of this technological progression, people will struggle to earn income to support themselves and their families.
As a result of this slow, but steady shift, the trend has been to diminish the importance of employment with productive capital ownership concentrating faster than ever, while technological change makes physical capital ever more productive. Technology is an easier and faster way to get a job done. Corporate decision makers know this, whether in the United States or China, or anywhere organized assemblies of people engage in production. Technology is an easier and faster way to get a job done. Because technology increases the profitability of companies throughout the world, technology always has the advantage over human labor when the costs of them are the same. But because this is not well understood, what we as a society have been doing is to continually shift the work burden from people labor to real physical capital while distributing the earning capacity of physical capital’s work (via capital ownership of stock in corporations) to non-owners through make-work job creation, minimum wage requirements, and welfare programs. Such policies do not function effectively.
The solution is to reform the system and create a a democratic growth economy, based on an understanding of binary economics (human and non-human productive inputs). In such a future economy, the ownership of productive capital assets would be spread more broadly as the economy grows, without taking anything away from the 1 to 10 percent who now own 50 to 90 percent of the corporate wealth. Instead, the ownership pie would desirably get much bigger and their percentage of the total ownership would decrease, as ownership gets broader and broader, benefiting EVERY citizen, including the traditionally disenfranchised poor and working and middle class. Thus, productive capital income would be distributed more broadly and the demand for products and services would be distributed more broadly from the earnings of capital and result in the sustentation of consumer demand, which will promote economic growth and more profitable enterprise. That also means that society can profitably employ unused productive capacity and invest in more productive capacity to service the demands of a growth economy.
To accomplish this objective we need new justice-committed leaders, especially those who want to end the corruption built into our exclusionary system of monopoly capitalism––the main source of corruption of any political system, democratic or otherwise. These leaders need to advocate the need to radically overhaul the Federal tax system and monetary policies and institute proposals to get money power to the 99 percent of American citizens who now only rely on their labor worker earnings. Under the Just Third Way’s more just and simple tax system, access would by provided to ownership of the means of production in the future to every child, woman and man by requiring the government to lift all existing legal and institutional barriers to private property stakes as a fundamental human right. The system was made by people and can be changed by people. Guided by the right principles of economic justice, “we the people” can organize and demand that the system be reorganized to make true economic democracy the new foundation for true political democracy. The result of this movement of new justice-committed leaders and activists will be inclusive prosperity, inclusive opportunity, and inclusive economic justice.
The following actionable measures will be necessary to reform the system to work for EVERY citizen, not just those well-connected for government welfare contracts, heirs of wealthy estates, those able to earn more than enough wages to invest their savings, or owners of inventions that are financially rewarded, etc.:
Support the Agenda of The Just Third Way Movement at http://foreconomicjustice.org/?p=5797, http://www.cesj.org/resources/articles-index/the-just-third-way-basic-principles-of-economic-and-social-justice-by-norman-g-kurland/, http://www.cesj.org/wp-content/uploads/2014/02/jtw-graphicoverview-2013.pdf and http://www.cesj.org/resources/articles-index/the-just-third-way-a-new-vision-for-providing-hope-justice-and-economic-empowerment/.
Support Monetary Justice at http://capitalhomestead.org/page/monetary-justice
Support the Capital Homestead Act at http://www.cesj.org/learn/capital-homesteading/capital-homestead-act-a-plan-for-getting-ownership-income-and-power-to-every-citizen/ and http://www.cesj.org/learn/capital-homesteading/capital-homestead-act-summary/. See http://cesj.org/learn/capital-homesteading/ and http://cesj.org/…/uploads/Free/capitalhomesteading-s.pdf.
Support the Unite America Party Platform, published by The Huffington Post at http://www.huffingtonpost.com/gary-reber/platform-of-the-unite-ame_b_5474077.html as well as Nation Of Change at http://www.nationofchange.org/platform-unite-america-party-1402409962 and OpEd News at http://www.opednews.com/articles/Platform-of-the-Unite-Amer-by-Gary-Reber-Party-Leadership_Party-Platforms-DNC_Party-Platforms-GOP-RNC_Party-Politics-Democratic-140630-60.html.
Good writing, Gary.
Norm