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Ending mass unemployment and poverty

grayscale photography of man sitting on chair

The causa causans Keynes identified in a passage cited in the previous note was investment.   Investment by profit-seeking investors is regarded as the source of employment.  If it stops, employment, stops.  At least that is true when one sees the world through the lenses of one mental model.  It dominates one way of life.

Nothing could be more typical of western modernity.  Julius Nyerere frequently observed that before Europeans conquered Africa there was no unemployment there.   Swahili and other African languages had no word for it.  There was no institution in African cultures for such a word to name [1].

In today¬īs dominant culture the bottom line is that you only get a good job if somebody else makes a profit by hiring you on terms that afford you a decent living.¬†¬† There is no reason why that auspicious outcome should befall every job seeker.¬†¬† It doesn¬īt.¬†¬†

It should be intuitively clear that under that under these rules of the game decent employment for all is not likely to happen.  Western modernity is one of the cultures that lives by buying and selling.  It always has been a game with losers; the classical economists including Adam Smith and David Ricardo held that the supply of labour was regulated by the law of supply and demand. When the demand for labour is low, the supply is low because working class mothers will not have enough food to keep their children alive [2].

After all, the objective of the investor is to maximize profits. Maximizing profits implies minimizing costs.   Minimizing costs means hiring fewer people and paying them less.

This explains the movement of production offshore to countries like India that offer a highly skilled work force willing to work for low wages.   Further, in this day and age productivity increases that create more value with less investment are normally achieved using more technology and fewer workers [3].  The days when it could be assumed that most children who are born will as adults make their living by selling their labour to an employer who will profit by hiring them are over. OVER. 

¬†WE SHOULD SEIZE TODAY S CHALLENGES TO GET READY FOR A FUTURE WHEN MOST HUMAN LABOUR IS REDUNDANT. Science will make it possible for technology to do most of the work, while humans relax and do the things we really want to do‚Äď if we are smart enough to reorganize our institutions to take advantage of the opportunity [4].

Fairly recent (2017) UN figures calculate that worldwide far less than half of the work force now enjoys decent work in our world dominated by the ¬īinvestment creates jobs¬ī mental model [5].¬†¬† The great majority ¬†either have work that is irregular, precarious or humiliating; or else have no work at all.¬† (Following Evelin Lindner, I count as ¬īhumiliating¬ī work that because of low pay or for some other reason makes it impossible for a person to fulfil their social role, perhaps most importantly the role of parent who takes good care of her children.)

The empirical fact [6] that under investment-for-profit-driven orthodoxy sustainable decent employment for all has never happened, strengthens my argument that that it is not possible.

I attach as an appendix a longer more theoretical argument to refute the common false claim that ¬īit must be possible because Sweden did it.¬ī To state the same common false claim more generally, ¬īwhenever there is market failure, the government can always step in and correct it¬ī [7].

 I move on to suggest that shared frugal prosperity can become possible: It also stands to reason that if we are all on the same page working for the same goal, i.e. a dignified life for all, and if we are open to pursuing this goal not just in one way but in a variety of complementary ways, and if science is generous in creating the productivity that will make it physically achievable, then it can happen.

To see that investing in hiring people to make a profit from their labour is only one of many ways to mobilize resources to meet needs, consider the following examples:

ABCD.¬† John McKnight and Jodi Kretzmann founded the now-worldwide Asset-Based Community Development Movement [8].¬†McKnight sometimes told the story of how ABCD began in an old black church in inner city Chicago.¬†¬† An ¬īinner city¬ī in the USA is a place where nobody wants to invest.¬† Years ago businesses would locate in inner city Chicago and hire people there, expecting to make a profit by doing so.¬†¬† Not anymore.¬† The parishioners faced a choice: they could close their church and move elsewhere; or else they could think outside the box. They could invent a way of thinking that would help them to organize the resources they had available, to generate sustainable dignified livelihoods.

They asked themselves:  What skills are present in our community?  What work experience?  What things (a truck, a motorcycle, a church basement unused every day but Sunday?)  What land (a vacant space next to a hospital destined to be a clinic someday that for now could be a community garden?) What passions (a passion for looking after children, for gardening, for caring for the elderly?)  What contacts?  Whom do you know?  What government programmes might work with us?  What CSR (Corporate Social Responsibility) programmes might work with us?

I once participated in an ABCD resource inventory meeting in Los Angeles.¬† We wrote our ¬īgifts¬ī on cards.¬† Next we taped the cards to the walls of the room.¬† Then we walked around the room rearranging the cards in different combinations, brainstorming what ¬īgifts¬ī might be combined to create a viable useful activity, one that would mobilize resources to meet needs.

Over the years the community resource inventory process that began in a black church in inner city Chicago has evolved into manuals that have sold hundreds of thousands of copies and courses taken by thousands of students.  Two of the students were Michelle Obama and Barack Obama.

THE PEOPLE’S ECONOMY.¬†¬†¬†These are businesses and professional practices whose purpose is to support a household, not to invest large sums to turn them into larger sums.¬†¬†

PERMACULTURE.  (Google it if you do not know what it is.) According to its Australian founder, Bill Mollisson, its three principles are: 1. Love the land.  2.  Love the people.  3. Share the surplus.  Permaculture is often combined with a L.E.T.S. (Local Economy Trading System) or a community currency [9].


SOUTH AFRICAN PUBLIC EMPLOYMENT PROGRAMMES There are several.  One has a mandate to use public employment to catalyse community development.   In Alexandra, a part of Johannesburg, young people are hired to dance and sing.  They have to audition.  They have regular rehearsals.   They put on performances in elementary schools for the children.  This self-improvement and happiness is paid for by public-private cooperation.   It provides a glimpse of a future when high technology does most of the work and most labour is redundant, while humans spend their time honing their skills and using them to do things that are intrinsically good!! 

There is no reason for private big business for profit and individuals with astronomical quantities of personal wealth to dominate just to strut and swagger.  They could just as easily be morally responsible co-partners who generate surplus that can then be transferred to where it is most needed.  For more evidence that the number of ways to create sustainable dignified livelihoods for all is unbounded, take a look at the web site of Catholic Charities of Spain.  There you will find innumerable examples to add to the few listed above [10].  Then the more you surf the web the more creative progressive ideas that are already being put into practice you will find.

Finding a way to be part of the solution and not part of the problem ‚ÄĒ doing your part to free humanity from being ruled by big capital with little conscience‚Äď is a simple problem to solve.¬† Find other people who are also fed up with a world where the only way to get a mainstream business job is to make somebody who is already rich even richer.¬†¬† Find people who are already building a world driven by ethics, not by what Amartya Sen calls ¬īpointless growth¬ī[11].¬† Find a growth point near you and join it.¬†¬†¬†

In later notes, as long as I remain alive and well, I will take up saving the planet, the coronavirus and other viruses, land tenure and other wicked property issues, and corruption.

[1]¬†Julius Nyerere (1973)¬†Ujamaa ‚Äď Essays on Socialism.¬†¬†Oxford: Oxford University Press.

[2]¬†David Ricardo (1817)¬†Principles of Political Economy and Taxation.¬†¬†London: John Murray.¬† See the beginning of chapter four, the chapter on wages.¬† Smith writes, ¬īThe demand for labour according as it happens to be increasing stationary or declining, or to require an increasing stationary or declining population, regulates the subsistence of the labourer‚Ķ¬ī¬†¬†Wealth of Nations¬†¬†(1776)¬† Kindle Edition, Position 13796.¬† Publishing.

[3] Thomas Piketty (2015).  The Economics of Inequality Cambridge MA:  Harvard University Press

[4] Peter Diamandis and Steven Kotler (2012).  Abundance: the future is better than you think.  New York: Free Press.

[5] International Labour Office. (2017). World Employment Social Outlook. Geneva: International Labour Office.

[6]¬†For exhaustive theoretical discussions see.¬† Steve Keen (2001),¬†Debunking Economics.¬†¬†London: Zed Books. The book is kept up to date on the author¬īs web site.

[7] Joanna Swanger, Catherine Hoppers and I are among those who believe, contrary to the views of authors like Yanis Varoufakis, Thomas Piketty, MMTers, Joseph Stiglitz and Robert Reich and in agreement with many feminists, post-Marxists, ecologists, Gandhians, and theologians that the cultural constitutive rules of western modernity need revision. Government intervention alone cannot correct market failure.

[8] John Kretzmann and John McKnight (1993) Building Communities from the Inside Out. Chicago: Institute for Policy Research

[9] Edgar S. Cahn. No More Throw Away People: the Co-Production Imperative  Washington DC, Essential Books.

[10] caritas+con+la+economia+solidaria     Google translate will help you if you are flummoxed by the Spanish.

[11] Amartya Sen (1999) Development as Freedom.  New York:  Alfred Knopf.

Howard Richards
Howard Richards