What Drags On The Economy And A Decent, Fair Society?

Around the Net you can find plenty of depictions of an underclass of scum dragging the rest of us down, from police blogs like Gadget to the witty raised eyebrow analysis of Ambush Predator and their commentators.  There is something undeniable and factual under our loathing of free-loaders.  What isn’t factual about the bottom of society at all is that they get any real share of the wealth.  They do keep our police and social agencies in work all would rather miss completely – and without this we could be doing more important policing and social development.  My guess here that it’s the time and effort of the workers concerned, rather than the money spent that’s really important.

In the analysis of behavioural economists (Steve Keen is the easiest to find and his Internet lectures are better than most I’ve witnessed in universities) the great drag is debt.  This is particularly topical and it’s clear on reading David Graeber’s Debt: the first 5000 years that we lack a historical grip on just what debt is.  I’m trying to codge together a paper that looks at accumulated wealth as the actual problem.

Accumulated wealth has a good side – like houses, hospitals, facilities and infrastructure already built – but there’s a long-standing concept of ‘surplus capital’ that can be used to account for a bad side to accumulation.  There are plenty of treatments of this (David Harvey would be a start).  Many commentators have linked this to the financial crisis.

Looking at unemployment in developed countries I generally come up with a figure of around 20% when official figures have it at about 8%.  You can get the gist of how I come up with this in the last post.  My solution to this unemployment is complex, but boils down to a liberal form of international service across the developed countries, somewhat akin to National Service.  There is clearly a cost involved in this – one could think of three times the welfare budget – but I’m guessing until I have time to create a model.  There would be a knock on cost in higher wages elsewhere given the removal of the reserve supply of labour.  The tax take would increase and no doubt many other variables would need to be plotted into the spreadsheet.

Currently our governments have been ploughing money into banks (I’m short on this having sorted the insolvency) and this is basically coming from us as tax payers and people seeing their working lives extended and pensions wither.  Much of the ‘bad’ accumulated wealth is controlled by the rich – the 1% probably needing expansion to the top 20%.  This is the very money that has ‘required’ the shadow banking system that now dwarfs the real economy – the surplus capital that once made loans to klepto-oligarchs in South America and  so on and is now wrapped up in Ponzi-derivatives and such.

It doesn’t take much brain to wonder if this surplus capital should and would be better invested in international service based in education, training and projects that need doing, rather than the bankster Monopoly games – and also whether it is this form of accumulated capital and its games that are the real drag on the economy and a decent, fair society, particularly because the world has too many workers given massive productivity rises in essential agriculture and manufacturing.

I’m hoping to have time to put some numbers to a heuristic model  I’m more interested in the historical context in which the rich have resisted social change at every turn, and modelling concepts like fractals that might help explain how the behaviour of the top in our society has the same ‘shape’ as we move down the pecking order – perhaps Gadgets ‘Swampees’ are not different in this than our political-bankster class?

There is a possibility that the surplus capital is no more than tax dodged over the last two hundred years and wages not paid (a common feature of non-western HRM).  What I am sure of is that we know how to mobilise our populations when it comes to war, yet seem impotent on the same for the purposes of peace, sustainability and much greater equality.  I suspect this is genetic and animal in nature, and that modern economics is merely a rationalisation of what is really worked out and on in the sub-conscious of the interpersonal setting (we think differently on our own to when in groups).

In short we are being stiffed by the rich – but I think we can give a rational exposition around which we could, in principle, vote.


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