Dateline February1, 2012 Los Angeles Times: “Legislation already on the books, if left alone, would do several things: Tax cuts passed under President George W. Bush’s administration would expire December 31, generating more revenue. And deep budget cuts passed as part of last summer’s debt ceiling deal would be automatically triggered, slashing spending in 2013.”
The result will be to curtail th…e nation’s modest economic growth, The unemployment rate will rise back above 9 percent due to the significant reduction in government spending and thus the extent of government jobs (whether real, boondoggle or make-work) and resulting sluggish consumer demand.
Given that you can’t have mass production without mass human consumption, this is an unsustainable fiscal course. Compound this with the fact that our scientists, engineers, and executive managers who are not productive capital owners themselves, except for those in the highest employed positions, are encouraged to work to destroy employment by making the capital worker more productive though his or her ownership of productive capital assets. 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. Only the people who already own productive capital are the beneficiaries of their work, 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. That is why the government has had to redistribute income through government jobs and contracts to stimulate consumer demand.
We cannot balance the budget without cutting out coerced taxpayer-dependent redistribution, which if we did at this juncture would kill the economy and ruin lives. But there are policies that can be adopted and executed to reverse the ultimate direction of collapse of the American market economy system. These policies are based on the recognition that as the production of products and services changes from labor intensive to capital intensive, the way in which every human being––not just a few, but every person––earns his or her income must change in the same way. At the core of this revolution is the understanding and commitment to broadening the ownership of productive capital.
The policy changes we really need embrace the goal of broadening ownership of productive capital simultaneously with economic growth so that consumer demand is bolstered among the 99 percent who now do not own productive capital assets.
