It's all about jobs. It all comes down to jobs. It all comes back to jobs. Jobs is what progressives should be talking about and aren't - at this moment in history. Everything else is frills. Everything else is derivative. Everything else is secondary - or lower priority. How bad is the level of distraction? Bad: "Hard times, but your lips look great" (E1 NY Times 5/01/2008). Jobs determine how much humans value themselves. If there is a labor shortage, they value themselves. If they allow a labor surplus and a job shortage to develop, they don't value themselves and we get headlines like this from all over the world: "Burma's death toll may top 15,000 - Junta is criticized in cyclone recovery" (A1 Boston Globe 5/06/2008). Compare all the downsizing headlines - today's: "Student loan firm to shed 500 jobs - First Marblehead hopes action saves it $200m" (C1 BG 5/06/2008). And this is virtually every day, day after day. Then we get "Downscaled hopes for an upscale mall [Natick MA]" (G1 BG 5/04/2008) and "Condo sales in Boston drop off - Prices are also down in a market formerly seen as bulletproof" (C1 BG 5/02/2008), and then "Virtual crime, it seems, pays well" (C1 BG 4/20/2008) and even "Determining who rides the lifeboat" (C1 NYT 5/02/2008). And what are the rich and powerful doing during this period? "Ahern bestows $2m on Kennedy library" (B1 BG 5/03/2008), in other words, taking coals to Newcastle. And everyone else? "Squeezed by prices, pantries ask help" (B1 BG 5/03/2008), in other words, giving a man a fish so he can live for a day = no longterm thinking.

It is absolutely necessary for all human societies to have adequate sharing mechanisms. If their sharing technology falls behind, we get the phenomenon of unlimited concentration of value, whether skills, employment, the money dimensions (income, wealth, credit...per person), and decision-making power. And no matter how much the wealthy think they are getting feedback, in myriads of ways they cushion themselves and insulate themselves - it happens too gradually for them or anyone around them to notice - and this builds a (self-)destructive situation of impeded and damaged system feedback. Once system feedback is compromised - damaged or distorted or constricted - the system cannot adapt to changing situations, it cannot evolve in the most adaptible and adaptive ways, it cannot maximize its chances of surviving. And it thereby makes itself vulnerable to being outcompeted by other societies and/or extinguished by changing natural conditions. By falling behind in sharing technology, a society thereby signs its own death warrant,

Comments on Soros' Reflexivity Theory of Economics

The Face of a Prophet - Soros craves respect for his theories, not just his money
- George Soros wants to make a lasting contribution to economic understanding,
by Louise Story, 4/11/2008 NYT C1.
[Soros has apparently been dismissed by mainstream economists, except the extraordinary Stiglitz, a personal friend - not that mainstream economists are in any position to criticize. A deepening of Soros' ideas from timesizing and worktime economics might make an interesting third avenue for accelerating human progress, third besides (1) developing a book based on Bruce O'Hara's "Working Harder Isn't Working" and (2) seeking working models from corporations like Nucor and Lincoln Electric to economies like Japan's - or Hungary's. For Phil Hyde (617-623-8080), effectiveness is more important than fame - Hyde's the name and hide's the game.... And so far Soros is known only as a financial trader and a philanthropist - frustrating for someone who senses that our "skimming and charity" economy just doesn't cut it.]
...Last week [Soros] rushed out a book, his 10th, ["The New Paradigm for Financial Markets,"] warning that the financial pain has only just begun.
"I consider this the biggest financial crisis of my lifetime," Mr. Soros said during an interview Monday.... A "superbubble" that has been swelling for a quarter of a century is finally bursting, he said....
[Well, insofar as the postwar babyboomers grew up and entered the job market around 1970-75, restoring the labor surplus of the Great Depression, depressing wages and allowing the national income to begin funnelling into an unlimited concentration, a "black hole" of money, in the top 0.001%, there is something to what he is saying. But it's not hollow. It's a superdense near-solid. The correct metaphor is not a bubble but a black hole (which itself contains a misleading implication of emptiness but only because the black holes of astronomy present a gap in the carpet of light sources in the night sky, because black holes are so massive, not even tiny light waves or photons can escape their humungous gravity). Such phenomena do not "burst." In the economic sphere they can either lose value through inflation, preferably healthily and gradually, or gain wasted and dysfunctional value through deflation, because there are no investments in which to sustainably store their increased purchasing power and the top hundred-thousandth of the income brackets have no time to spend it anyway (again "flation" is a metaphor that misleads our imaginations toward hollowness). Why are there fewer and fewer sustainable investments? Because by fostering a labor surplus and depressing wages, the wealthy have vacuumed the spending power out of the markets for the productivity in which they need to invest - that's why prices are falling - it's the only way to sell anything to millions of people who have less and less money once consumers are denied further credit.
[The superbubble metaphor could definitely apply more aptly to credit. We currently have record consumer, corporate and government debt. It's rather like the "New Economy" of the late 90s when return on investment became "old hat" = out of fashion - for awhile. When investors realized this was stupid and tried to get returns, the dot-com bubble burst because the markets for it just weren't there because the spending power just wasn't centrifuged out to all the millions who might want to buy it - instead, it was concentrating without limit in the top tiny fraction and that means it had changed function from spending power to investing power because that's what happens when you redistribute money up the income brackets - the topmost wealthy fraction don't have the time to spend that kind of money and besides, they were already spending all they cared to before they got the last $10 million. So the dot-com bubble "burst" by lenders having to accept that "there was no there there," and writing off billions of dollars of investment and loans as worthless. Now it's the bubble of housing loans. And all kinds of other investments. It's like a Monopoly game where one person grabs all but a couple of dollars of Monopoly money yet still expects the game to go on, despite the fact that none of the other players have enough money to buy property or even pay fines.]
Mr. Soros...yearns to be remembered not only as a great trader but also as a great thinker. The market theory he has promoted for two decades and espoused most of his life [is] something he calls "reflexivity".... The idea is that people's biasses and actions can affect the direction of the underlying economy, undermining the conventional theory that markets tend toward some sort of equilibrium.
[We had this idea in the early 1970s. in the following form: The fact that there are thousands of professional economists, many making six digits, and get the economic problems go on and on (chiefly in the early 70s the market's failure to sense and avert the Oil Crisis) probably means that there is something very very basic that all of us are doing every day - and taking for granted - that is sabotaging our economy and vitiating any deep-structure (Soros' "underlying") economic solutions and progress. Soros is groping toward setting up the quest for this same invisibly taken-for-granted Bad Habit that is so widespread as to be universal. This mysterious Bad Habit is preventing any hope of a level playing field for all market participants. In fact, it is sloping the playing field more and more, for fewer and fewer of the players. The surface-structure villain is obviously the so-called "income gap" to give it its unactionable name, or more actionable, the unlimited concentration of income and wealth - which is going to be very hard for "one of the world's richest men" (Soros) to be detached enough to see as a problem. I.e.: the problem is him. But deep structure to the rescue. There's something else going on, something systemic, that permits such concentration of income and wealth and gets rich guys off the hook a bit, enabling them to pose as our fellow victims of...The System. On with Soros' gropings -]
Mr. Soros said all aspects of this life - finance, philanthropy, even politics - are driven by reflexivity, which has to do with the feedback loop between people's understanding of reality and their own actions....
[Our version of this is the following: The top brackets have SO MUCH MONEY that they have drawn to themselves all the important decision-making in the socio-economic system, but they have also used it to insulate and isolate themselves from any negative feedback for any of their bad decisions; ergo, no feedback. Oh, they THINK they have feedback but, no pain, no gain. The weathy are surrounded by pleasant people who, if not completely Yes Men, are at least skillful diplomats and cushioners of any unpleasant news. Bottom line: we all live in a huge system which has virtually NO FEEDBACK and no adaptibility. We cannot change course. George Bush epitomizes this. No matter how bad the news from Iraq, no matter how deep America plunges toward total bankruptcy with its national debt now over nine trillion dollars, Bush, "the decider," will "stay the course." And we're all the lemmings. His policies, and those of most other world "leaders" today, amount to "Suicide, Everyone Else First." Investors, seeing mainly the financial markets, tend to think that the financial markets are the foundation and base of the economy, never mind the humble consumer markets (unsettling called the consumer base - funny they haven't tried to rename that yet). So it's OK for the government to rescue the financial markets (ie: the rich investors) and not the consumer base (ie: the poor spenders/purchasers) - so we keep getting more and more investing money and less and less spending money. Fine, except that investing money needs marketable productivity to invest in, and with less and less spending money in the economy, the markets for all that productivity are shrinking. Back to Soros -]
"To make a contribution to our understanding of reality would be my greatest accomplishment," he said....
[But he's running against the odds. Because he's rich, and in a very real sense, he, his richness, and that of those like him, IS THE PROBLEM. Does he have the detachment to confront this and move on - and down deeper - to the systemic rigidity that permits this kind of wealth? Recall G.B. Shaw's words, "It's not the rich who reform society - they don't have the incentive." Shaw goes on to say, "And it's not the poor who reform society - they don't have the means. It's the dispossessed sons of the rich." In other words, it's those in the middle who can see both sides. Here's some of his blindness -]
In 1992, his fund famously bet against the British pound and helped force the British government to devalue the currency. Five years later, he bet [against] the baht \and helped force Thailand\ to devalue....
Asked if it bothers him that people accuse him of causing economic pain [and] if those people are right to blame him, he says...no single investor can move a currency.... "Markets move currencies...."
[The super-wealthy have a corner in which they long to be average, at least when it suits their conscience. The assumption of invulnerable infinity often helps them to do this. "Currencies are invulnerably infinite, so no single investor (like me) could possibly move it." Now every business school and CEO is assuming that the job market is infinite - "We can lay off and downsize without a thought because the job market can take any amount of abuse without a ripple." It's like cod fishermen, "We can increase the size of our catch every year with no end because the cod fishery is infinite." Or the groundwater drillers, "We can pump out any amount of groundwater for irrigation and there will be no appreciable effect." Or the polluters, or the ozone depleters, or the population subsidizers, etc. etc. The Ecological Age is adawning, and all these assumptions of infinity are being questioned or outright exploded.]
Mr. Soros...has for decades longed to write a masterpiece that might put him among thinkers like Hegel or Keynes....
[So what is Soros missing (and everyone else, neighboring article has title, "Global Forum Calls for New Financial Controls")? He's missing the specific Bad Habit (rigid 1940-level workweeks or more). He's missing the real foundation market (consumer base) and like other managers and investors, not connecting the dots between employees and consumers, that is, between downsizing&outsourcing and weakening markets. He's (understandably) missing the strategic priority of the time dimension over any of the money dimensions, because if you take money from rich A to give to poor B, you're making B a dependent parasite and not compensating A, but if you take working hours from workaholic A to give to unemployed B, you're making B an independent self-supporter and giving A the most fundamental freedom without which the other freedoms are inaccessible, free time. But doesn't capitalism always maintain overlong working hours while injecting worksaving technology to make labor redundant and powerless and cheaper wage-wise? Isn't this a problem with capitalism per se? No, because capitalism worked very well during and after World Wars I and II (and during and after any series of plague years, like 1348, 1662,...) when there were labor shortages - in fact, it worked better. Here's a forceful presentation of this perspective from 1932: " ...By 1923 I had evolved the hypothesis that the evils of Capitalism - its unemployment, its very unequal distribution of wealth, its "economic imperialism," its plant duplications and wastes of distribution, and its...materialistic standards - were basically rooted in the public's failure to appreciably shorten the hours of labor while laborsaving machinery was being injected;
[...although we did cut the workweek in half from 1840 to 1940, but though on the right track, this was obviously too little too late, and we have frozen the workweek rigid ever since 1940 despite wave after wave of worksaving technology...]
i.e., that these evils were due to the public's failure, from the very beginning of the industrial revolution, to make Capitalism operate under a genuine scarcity of labor-hours, rather than under a chronic scarcity of job and business opportunity....
[This is from page x of Arthur Dahlberg's "Jobs, Machines and Capitalism." Now from page xii:]
This book is not an apology for Capitalism.... I am familiar with and dislike its shortcomings as much as anyone. But, unlike most critics of Capitalism, I believe that as a system of economy it has not had a fair trial. The trial has been long enough, true indeed, but never,- with the exception of a few years during the World war[s],- has Capitalism been permitted to function under a chronic "scarcity of labor." It has always been forced to operate under a scarcity of job and business opportunity; and, under such conditions, I maintain that Capitalism is necessarily in unstable equilibrium. I contend, however, that under a chronic and genuine scarcity of labor Capitalism is potentially almost an ideal system of economy....
[because labor scarcity harnesses market forces to raise wages and guarantee that a big enough portion of the national income gets spread out to those who want and need and have time to spend it, and consume their own productivity, and provide markets to make that productivity a sustainable investment destination for the investing power of the topmost fraction of the wealthy.]

Quoting from [and commenting on] "Recent Economic Changes - and their effect on the production and distribution of wealth and the well-being of society" by David A. Wells (New York: D.Appleton & Co.,1889), limited edition of 1000 (copy 231). The title suggests the character of the book is to reassure at least the wealthy, and as many others as possible, that everything's all right, the system's still working OK, and they don't need to worry about, say, technological disemployment, its weakening of the consumer base, and its destabilizing effect of the economy and society at large. By 'distribution' of wealth we are apparently to understand the channelling and concentration of wealth, in the 1880s, in the topmost income brackets without limit (as today, 2008).
First, the relevant paragraph on pp.394-95 uninterrupted:
...Evidence [questionable in view of the phenomenon of recurrent recessions], therefore, seems to lead to the conclusion that there is little foundation for the belief largely entertained by the masses, and which has been inculcated by many sincere and humane persons, who have undertaken to counsel and direct them, that the amount of remunerative work to be done in the world is a fixed quantity, and that the fewer there are to do it, the more each one will get; when the real truth is, that work ,as it were, breeds work; that the amount to be done is not limited; that the more there is done the more there will be to do; and that the continued increasing material abundance which follows all new methods for effecting greater production and distribution is the true and permanent foundation for increasing general prosperity.

[Now with commentary -]
[Note overall patronizing tone -]
...Evidence [questionable in view of the phenomenon of recurrent recessions], therefore, seems to lead to the conclusion that there is little foundation for the belief largely entertained by the masses...that the amount of remunerative work to be done in the world is a fixed quantity,
["The world" in some indefinite timeframe is not the problem - the problem is the corporations and industries that are downsizing in the immediate present or future. This would-be debunker has set up phony parameters that no one is arguing and that are easy to knock down.]
and that the fewer there are to do it, the more each one will get;
[This is exactly the strategy of his own profession of political economy (and many others such as medicine) in setting up high hurdles for would-be entrants - to increase and maintain their own pay.]
when the real truth is,
[Here we go - roll up your pant legs!]
that work ,as it were, breeds work;
[and any work that is routine, in whatever amounts bred, can and does get taken over by mechanization, automation, and now, robotization - with technology, quantity is no longer the problem - it's all a question of routine vs. unpredictability]
that the amount to be done is not limited;
[the amount to be done by humans is not only limited but reduced by the increasing amount done by machines, automata and robots and the diminishing amount demanded by a workforce constantly downsized, paycut, and outsourced]
that the more there is done the more there will be to do;
[not if we constantly downsize our workforce, our payrolls, and our consumer base, and constantly funnel a vaster and vaster ratio of the national income and wealth to the top tiny fraction who were already spending all they cared to before they got the last $10 million - plus if this were true, think about it, no one would ever be able to complete any work project.]
and that the continued increasing material abundance which follows all new methods for effecting greater production and distribution is the true and permanent foundation for increasing general prosperity.
[But the distribution never happens if the "masses" whom he's insulted above are repeatedly getting laid off and impoverished. The real foundation of general prosperity is labor shortage, as during plague years and wartime, - hence the famed "wartime prosperity" that one hears whispered about but that is never mentioned or explained by mainstream economists. It's simply that in response to a perceived labor shortage, employers have to bid against one another for good help, so wages rise and the national income flows in and out to the 'masses' who really spend it, instead of to the superrich who are just looking for sustainable investments, and without a labor shortage there are none, because by fostering labor surplus they have vacuumed the spending power out of the markets for the investments in which they need to invest, - ergo repeated recessions, nee 'depressions'.]

It is time to draw aside a veil of deception that has clouded the eyes of ordinary Americans for 75 years. In 1933, the USA almost passed a 30-hour workweek bill. Traumatized by that close call, the power elite set out to frame worksharing as a failure, a sharing of unemployment, a ridiculous and stupid approach that was gullty of the "lump of labor fallacy," The reframing worked, and the labor movement, which for almost the entire previous history of the American republic had gauged progress in terms of shorter and shorter working hours, gradually lost its focus on its power issue and refocused on eye candy that left it fighting market forces instead of harnessing them on its side. The success of a brief spate of nationwide worksharing between 1938 and 1940 was eclipsed by the ramp-up for war, which accomplished what worksharing did faster and with much more waste and destruction - but still got itself labeled a success and coined the term wartime prosperity. But after the war, unions, now focused on higher pay instead of shorter hours, gradually lost power and membership and functionality and importance, and shrank from 35% of the workforce to today's 13% mostly in the pub;ic sector.
        But despite the huge and successful campaigns to the contrary, wages (labor prices) do not go with hours or productivity but, like all other commodities, with supply and demand. Investors never realized what was wrong in the Depression, because it was too close to themselves. But the problem was them. Their unlimited concentration of the national income and wealth was the problem. And by distracting attention from that and misdirecting attention onto a "problem" with labor, they succeeded in reframing labor's power issue (shorter worktime) as a failure and, ironically, guaranteeing that the economy would never rise much above depression in the future. Their strategy was right in line with Marx's old accusation, that the rich foster a labor surplus (a desperate "army of the unemployed") to keep maintain job insecurity, discourage wage demands and keep wages down.
        The problem with that strategy, however, is that then the workforce can gradually purchase less and less of its own technologically amplified output and the rich have gradually less and less marketable productivity to invest in. And the alternative destination of the growing share of the national income that the workforce is no longer getting cannot purchase the output either because it's now going to the wealthy who, as Robert Reich points out (op ed, 2/13/08), were already spending all they cared to before they got the last $10 million. What are they doing with all the extra money that they schemed and manipulated to flow up to them instead of out to the lower income brackets? They're just looking to sock it into sustainable mega-investments - of which there are fewer and fewer, because by fostering ever deeper labor surplus and lower wages, the wealthy are effectively vacuuming the spending power out of the markets for the productivity in which they need to invest. In short, they have reconstructed the depression conditions of 1929, point for point, where there was still lots of money, but it was not in the hands of the hundreds of millions who wanted and needed to spend it. Instead, it had been concentrated, without limit, in the hands of the hundreds of thousands in topmost income bracket, the group that Paul Krugman describes as the top 0.001% (op ed, April 2006).
        Reich recommends the usual nostrums to remedy the situation: by taxing the rich and increasing government spending on makework to redirect the national income to those who actually spend it instead of trying to invest it in unmarketable productivity. But this has only worked when spun as "defense" and crisis-coated with militarism, because otherwise it's been too little too late and very vulnerable to getting reversed by the top brackets, as we've seen recently, despite the suicidal nature of this policy for them though of course for them it's "suicide, everyone else first." The alternative is and has always been the disciplining of the power elite by fostering what they perceive as a labor shortage. War does this in the worst, most unecological way. Shorter worktime per person does it in the best, most ecological way. And also in a way that is gradual, market-oriented, grassrootsy, organic, and systemic.
        The fact is that it's the discipline of management that is the critical problem in the long term, not the discipline of labor. And by fostering labor surplus instead of a by-them-perceived labor shortage, the power elite have kept their management skills low and their customer base small. They have suppressed and tabooed the most important questions in economics, namely, is there a point of diminishing returns in the concentration of income and wealth beyond which such concentration starts to undermine itself? and, how do we determine that threshold and how do we achieve and maintain it?
        We have the additional difficulty that the money dimensions, income and wealth per person, cannot be balanced first because if you take money from A to give to B, you turn B into a dependent and you don't compensate A. By contrast, if we start with the time dimension and take worktime from workaholic A to give to unemployed B, we turn B into an independent self-supporter and give A a life - free time for his/her familty, spiritual life, civic responsibilities, and oh yes, time to get rested up.
        Plus we have the difficulty, shown in the letters to the editor that greeted Roberet Reich's op ed, that people are confused by the term "consumer base" and immediately on behalf of the environment react against increased consumption, not realizing that what is meant here is not unecological overconsumption but simple, economy-sustaining purchasing and selling, much of which has no environmental impact whatever and almost all of which could be of that sort. Hence we should be reframing "consumer base" as "customer base." The irony is that overconsumption is the least of our problems in an unlimited-concentration economy, because consumers, oh sorry, customers, don't have the money - the rich have it all. As Will Rogers said when people asked him who was going to pay for all his big recovery program, he said, "Wal, I guess the rich are going to come up with the money 'cause they's the only ones that's got any." It's not overconsumption that's the problem in a labor surplus, - it's increasingly desperate overproduction to try to provide destinations for all the extra investing power. As money gets redistributed up the income continuum, it changes function from spending power to investing power, and in an unlimited money-concentration, labor-surplus economy like ours, consumption is constantly weakening due to the funnelling of the national income to the topmost fraction of the population. The Ford-Reuther Paradox sums it up nicely. Ford, "Let's see you unionize these robots." Reuther, "Let's see you sell'em cars."
        Again, every sports league starts every season with zero games won for all teams. Every culture too had a reset, from the Hebrew jubiliees to the Tlingit potlatch to the Hopi katchina dances, where resources are redistributed from those who have too much to those who have too little. Only in unlimited-concentration, labor-surplus economies do we have a situation where the concentration of money just goes on and on, year after year, straining whatever integrating mechanisms that still survive in the society at risk until they snap.
        At the very least we need a two-gear approach, a first gear to boost consumption to save the economy and a second gear to cut consumption to save the environment.
        How do we redistribute work? Tax overtime, subsidize OT targeted training and hiring and hitch the workweek to the unemployment rate, redefined to include the whole problem (welfare, disability, homelessness, prison, forced retirement, forced self-'employment'). A confiscatory tax on overtime profits (corporate) and earnings (individual) and a generous subsidy on overtime to training and hiring conversion would do the trick.
        But doesn't the devil find work for idle hands to do? With the concentration of natural market-demanded employment among fewer and fewer employees, hands are idle anyway, and desperate - because they have no money. Better to have a larger leisure class with lots of money (*pickup how more pay with less work later) because then the leisure industries can find work for "idle" hands to do, as it did in France in 2000 when they jumped from 39 hours a week to 35. This has been spun as a failure by a careful selection of the start and end dates of the experiment but when it was voted in unemployment was 12.6 and after it was done but before the US recession hit France unemployment was 8.6, one percent less for every hour cut from the workweek.
        I'm hitting Kate's writing wall, can't stand anymore, drop everything point. ?

What we've got:
makework&disability capitalism thanks to downsizing and unlimited concentration of income and wealth
what we could have:
market-oriented full-employment capitalism thanks to timesizing and $concentration limited to levels that can find stable sustainable investments

Basically there's political economy, economic economy, and ecological economy. Economic economy (aka infinite economics) is based on the naive assumptions that resources are infinite - including the consumer base and the job markets which can be milked indefinitely with no serious let-alone-permanent damage - while the free market is omnipotent and can automatically balance and offset any withdrawal no matter how large.
Ecological economics relies on automatic design features to guarantee at much finer levels the equilibrium that infinite economics so naively and blindly assumes (despite mounting contrary evidence).
Economic design simply applies the design principles that are applied everywhere else from aeronautics to software, to the economy. Such as homeostasis. Deliberately designed homeostasis. Not homestasis that is disingenuously assumed to be automatic in the nature of things à la "invisible hand." Really, what a crock the power elite have put over on the rest of the income brackets!
You want a true picture of the "invisible Hand"? The so-called "invisible Hand" of economics is simply the very visible hand of politics, namely, the spreading vote leading its balancing effect into the economic sphere. And not only is spreading suffrage in politics very visible but it is also very deliberate and design-based = nothing automatic about it at all, but it is also the very opposite of the concentration of money because the whole evolutionary purpose and function of the vote is to offset the system-feedback-numbing effects of the unlimited concentration of money and allow the socioeconomic system to make some fundamental and vitally necessary changes of course, regardless on ongoing dysfunctional money concentration.
And why is unlimited money concentration dysfunctional? Because (1) the top brackets not only have enough money to draw to themselves all the important decision-making in the system - they also have enough to insulate and isolate themselves from any negative consequences of any bad decisions they make and, no pain, no gain in terms of real course-changing feedback. And large systems absolutely depend for their long-term survival on variability. (2) Unlimited concentration also gets dysfunctional because it begins to act like an economc black hole without functionally infinite space around it - it vacuums all the spending power out of its own foundational consumer base and markets and slows the currency circulation from the volumes and speeds required to sustain itself, and these are the markets for the productivity it needs to invest in. Ergo it stops investing and just starts storing money under the mattress and thence the stored entitlement becomes mere meaningless symbol, with no use value or function except as positional goods, and as such vulnerable to efficient, impatient and increasingly, ecological, puritan-like housecleaning and destruction. So, unlimited concentration of value (such as money) means no functional and sustainable value-storage (=2), and no system feedback-variability-adaptibility or long-term survivability-continuability (=1).

FAQS about our deteriorating economies -

The answer to the question, how do we control growth rather than growth controlling and extincting us is, control the source of growth. What is the source of growth? Models of more. What is the ultimate model of more? The unlimited concentration of value among an ever-smaller population limited only by the natural minimum, one (and then, zero, if that one goes mad and destroys it all, or at least all parts that aren't already destroyed by the lack of circulation, eg: currency circulation, in their base, eg: consumer markets).
The answer to the question, what is the ultimate cause of inflation, is the same, the unlimited concentration of value among an ever-smaller population. And the subsequent operation of derivative phenomenon, envy or the desire to share in the advantage(s).
Is there a form in which this is in the public debate? Yes, it is the "income gap," but that is a safe unactionable description of the problem which sounds like an act of God against which we are helpless.
What makes possible this hyper-concentration? The shortage of the entitled and the surplus of the unentitled.
What causes these relative proportions? Generally, the entitled do everything they can think of without destroying basic continuity to increase the shortage of themselves and the surplus of the non- or less-entitled.
Is there a way to limit and reduce the unlimited concentration of value, ie: to centrifuge and deconcentrate value, without revolution and violence? Yes. The concentration has always been limited and even reduced by reversing the increase in the surplus of the non-entitled, in other words, by decreasing the surplus of the non- or less-entitled.
How has this been done before? Usually by war (yielding "wartime prosperity") or plague (yielding the less-talked-about "plaguetime prosperity").
How does it work? By killing off part or all of the surplus of the unentitled and harnessing natural "market forces" to spread the value, eg: the money, eg: it gets employers bidding against one another for good help and not even government wage control boards can stop this healthy process, which basically gets a larger share of the national income flowing out into the hands of people who actually spend it instead of funnelling it without limit into the hands of the top 0.001%, who were already spending all they cared to before they got the last $10 million. (Money changes function as it gets redistributed up the income continuum from poor to rich - it changes from spending money to investing money - and if the rich have concentrated enough money in few enough hands, they weaken their own foundation, the consumer base, and vacuum the spending power out of the markets for the productivity in which they need to invest, ie: they recreate 1929. But there is a distinct threshold at which the concentration of national income and wealth shifts from self-strengthening to self-undermining, and it is seldom if ever spoken of in the English-language economies. Why? Because the top 0.001% generally own the news media and the public-debate-setters and they insist that anyone who brings up this topic either drops it immediately, gets fired, or gets promoted away from the "Big Microphone." Notice how quickly candidate John Edwards was excluded from the top runners in the Democratic primaries in January 2008. Isn't this to the longer-term disadvantage of the top 0.001% and isn't the longer term arriving faster every year? Yes and yes but the habit is set and they are running toward the cliff with the rest of the lemmings, all the others first.)
What is this in terms of economic variables? War or plague reduces the surplus working hours on offer in the job market and gets employers competing against one another for good employees.
Is there a non-usual way to do this? Yes, by reducing the share-per-person of natural market-demanded employment, ie: by cutting the worklife (by longer credentialling on the incoming and earlier retirement for the outgoing), workyear (longer vacations), workmonth, workweek and/or workday (shorter hours). Most effectively, by cutting the workweek. The Timesizing program is the most gradual and market-oriented way to do this.
Has workweek reduction as a way to centrifuge the national income and wealth ever been tried and tested? Yes, the USA cut its workweek in half (80 to 40) between 1840 and 1940 and avoided gross unemployment and poverty as it introduced more worksaving technology on one hand and more immigrants and babies on the other hand - and all the other "developed nations" did the same in roughly the same or a slightly later timeframe, though a few are just finishing the process now, eg: South Korea is currently in the midst of a seven-year nationwide reduction from 44 hours a week to 40. In 1938 this process became systematic in the USA and a nationwide workweek maximum was established for the first time (at 44 hours) which was then reduced two hours a year for the next two years. Unemployment went from 19% to 17.2% to 14.6%, roughly one percent reduction for each hour cut from the workweek.
In 1997 France voted to cut the workweek from 39 to 35. This process dribbled on till early 2001. Unemployment was 12.6% in 1997 and 8.6% in 2001 before the US-led recession hit France that summer, again one percent less unemployment for every hour cut from the workweek.
Unions have shot themselves in the foot by dropping their power issue. Their historic main goals are shorter hours and higher pay. If they can just get one and its higher pay, they wind up with neither because they're just pinning an artifically higher price on a surplus commodity, themselves, and fighting market forces. But if they can just get one and its shorter hours, they wind up with both because they're harnessing market forces by reducing the surplus of themselves and their labor time, and getting employers bidding against one another, raising wages flexibly and gradually, to get good help, or in the extreme case, any help.
But don't we already have a shortage of labor - we NEED illegal aliens to do the jobs that no Americans would do. Think about it, if these jobs weren't paid slave wages and worked slave hours, plenty of under and unemployed Americans would do them. The winking at the invasion of desperate illegal entrants just guarantees that those jobs will never be paid a decent wage or have civilized working conditions.
But won't this generate inflation in America? Wages will go up but so will our consumer base and economic solidity. If this is inflation, it is healthy, needed inflation. Only "runaway" inflation is a problem. Gradual inflation is nature's way of deconcentrating the black hole of income and wealth in any economy. And our only current inflation control is ridiculous anyway, it's raising interest rates - which discourages businesses from expanding and creating new jobs and thus cuts employees' job options and scares them out of asking for raises (which would deconcentrate income and wealth and increase consumer spending, markets and sustainable investment targets) or trying other jobs in which they might be happier, thus increasing the net resentment and pent-up need for compensation and raises (and inflation) in the economy. Timesizing has a much healthier, more organic and natural way to control inflation.
[I work like Will Rogers, unconnected flights of brilliance, sigh, maybe here some connections....]
Why isn't this strategy being discussed in the English-language economies? In America, it was uppermost on people's minds and lips from 1940 back to 1840 and back to the first unions in the1790s - almost right back to 1776 (though there were other problems in the early years, like the mitosis with Britain). It has been fought and smeared at least since the 1920s by short-sighted employers who wanted to reneg on their promise of easier lives through new technology (which requires shorter working hours and is sustainable), and substitute artificially stimulated demand (the "Gospel of Consumption") and the massive private-sector makework of advertising campaigns (now unnoticedly common and extended from annoying commercials to waves of junkmail to spam and adware), not noticing that with downsizing instead of timesizing they were removing the very possibility of their consumer base purchasing their own productivity, and thence the complete suicidal insanity of economists' incessant talk about productivity without regard to marketability and the ignoring of the inefficiency of unmarketable productivity in the context of obsessing about efficiency in technology and pressure from the environment
. Any discussion of worksharing is now totally taboo, like the unlimited concentration of income and wealth with which it is mutually reinforcing. Any mention of either and you are immediately labelled and dismissed from any further serious conversation. In fact, if you mention worksharing in any form besides mere lifestyle choice, you are treated as a deluded fool who believes in the Lump of Labor Fallacy (which should actually be called the Decline of Employment Truism).
In fact, many workers in this vinyard have fallen off the third rail. Dahlberg went to depreciating currency in his next book, unnecessary because inflation does that function more gently and gradually and automatically. Schor went to consumption, unnecessary because the impoverishment of the consumer base does this automatically, though in a worse way. Some go off trying to get a better index than GDP, unnecessary because the best top-priority general index is the unemployment rate, especially if we redefine it to include the whole problem of non-self-support.
In summary, the English-speaking economies cannot discuss their own worst problem or their own historical best solution. Since they have enough resources to ensure that they suffer last, it will take a huge deterioration of their host economy and repeated relexifications of the terms of the problem description before they begin to understand what they are doing to the economy and how fundamentally simple and destressing the most market-oriented solution is, essentially just redefining unemployment to include the whole problem of non-self-support, letting the unemployment rate automatically adjust the workweek, and letting overtime target, trigger, pace, gauge and finance its own resolution in terms of OT-to-training&hiring = the Timesizing process.
But won't we eventually have to confront the income and wealth divide? Yes, but we can't do that first. If you take money away from A to give to B, you just turn B into a dependent and don't compensate A. But if you take work away from workaholic A to give to unemployed B, you turn B into a self-supporting independent individual and reduce unemployment and welfare and disability and crime taxes on A and give A a life.
What if A wants to work long hours? Under the Timesizing program, s/he can - as long as s/he reinvests overtime/overwork earnings in OT-targeted training&hiring, thus proving that s/he's doing for love, not money; in other words, has deflationary, not inflationary, incentive for overworking relative to whatever the economywide workweek has currently been pushed down to by the unemployment rate.
But with discussion of its own worst problem and its own best solution tabooed and ridiculed, the English-language economies are in for serious decline, probably as far down as the levels of their big rivals, population-wise, China and India, because overpopulation can always sabotage the smartest economic design (India in the 1920s), as can central bank fiddling (Germany's Stinnes in early 1920s), and the US progressives have been seduced into irresponsible immigration policies by charges of racism or cruelty or ahistoricism ("nation of immigrants"), though they have zero discussion of the optimal population levels of the American ecosystems and ignore the question of how we help the third world when we've overpopulated ourselves to their levels and degraded wages and benefits and safety standards to their levels. So we can barely get this background problem into the public discussion.
Meanwhile, global warning goes on apace. And we can't even get agreement from the top 0.001% on the facts of its existence. As mentioned, they have the resources to be the last to suffer.
Anders Hayden thinks the ecological pressures will be the active constraints that will drive solution. I think the dysfunctional economy with its steering function insulated and isolated among the top 0.001% will guarantee that any ecological pressures will be translated into economic pressures long before the public at large feels any unanswerable direct effects from global warming, regardless of increased erratic weather, thunder and wind storms, and the already acute experience of Australia.

Progressives are giving rightwing nutcases massive undeserved opportunities by adopting bleeding-heart anti-ecological positions on population and employment.
First, their immigration policies are irresponsible in the extreme = immigrants: move everyone in the world onto the "advanced-economy ecosystems without limit, no birth policies, and as for imports, buy simplistic "free trade" regardless of how it guts your own middle class.
On employment, variations on Bucky Fuller's tragic error of "lifetime research scholarships," with no accountability or incentive design mentioned.
Employment is underrated and much neglected. But employment is nature's way of carrying species (and individual-specimen) viability into the increasingly artificial systems and worlds set up by "intelligent" species. Without it there is no fundamental accountability to the basic Universal Mandate: "Continue - And whatever continues better, there gets to be more of."
We cannot continue by clobbering employment - and the huge consumer markets that depend on it. The sacrosanct rigid-length workweek must be sacrificed again.

The Great Integration: Superceding Charity

As suicidal weapons technology advances b