Can Paradise Be Gained?
Is Trickle Down Really Necessary? Why should benefits not be equally shared? The rules of our society dictate that owners are privileged and workers get what is left over. Labor is simply a commodity whose price is determined by the rules of the market. This is so ingrained into our society that we rarely think about it, and when we do, it seems natural and inevitable. It is neither. It is the result of laws and institutions that have been promulgated and established by the powerful—who of course are the owners.
But thinking about this might shed some light on the failed prediction that Keynes made back in 1930. His prediction about steadily increasing worker productivity—more goods and services requiring less and less labor—was right on the money. Again, what went wrong?
The Two Assumptions. There appear to be two implied assumptions in his thinking that were not borne out by the facts. One has to do with values: He assumes that workers would prefer leisure and culture over simply acquiring more and more material possessions. The other is more important: the implied assumption that all would share equally in the benefits of increased productivity. Since workers do not share equally, they find themselves in a constant scramble just to stay even.
Now I want you to think about these two assumptions and about what we said earlier concerning the Luddite Fallacy. Let us do a little thought experiment. Let us suppose that productivity increased in just the way that it has, but that the first of those implied assumptions, and not the second, were true. What would happen? What if those who could afford it reached a modest level of material comfort and security and then chose to devote as much time as possible to leisure and culture? Instead of buying more and more stuff they listened to music, read literature, and studied history and science? What if they chose to conserve, to be economical, and improve their spiritual lives? (Remember, this is just a thought experiment.)
Would it not be likely that the Luddite “Fallacy” would cease to be a fallacy? That without the constant, unceasing—albeit wasteful and destructive—demand for more and more stuff jobs would become scarce? The supply of workers remaining constant and the demand for labor going down would mean that wages would shrink and unemployment would rise.
Why Not Percolate Up? Of course that would not need to happen if the second assumption, equal distribution of the benefits of increasing productivity, were true. Clearly, we need to get back to that idea.
But before we do, we may have accidentally solved another important mystery: the mystery of the compelling need for constant economic growth.