On July 27. 2014, Michael Snyder writes on The Economic Collapse:
The global economy is structured to systematically funnel wealth to the very top of the pyramid, and this centralization of global wealth is accelerating with each passing year. According tothe United Nations, 85 super wealthy people have more money than the poorest 3.5 billion people on the planet combined. And 1.2 billion of those poor people live on less than $1.25 a day. There is something deeply, deeply broken about a system that produces these kinds of results. Seven out of every ten people on the planet live in countries where the gap between the wealthy and the poor has increased in the last 30 years. Despite our technological advances, somewhere around a billion people go to bed hungry every single night. And when our fundamentally flawed financial system finally does collapse, it will be the poor that will suffer the worst.
Now, let me make one thing clear at the outset.
Big government and more socialism are not the answer to anything. Big government and more socialism almost always result in increased oppression and increased poverty. If you want to see where that road ultimately leads to, just look at North Korea.
What we need is a system that empowers individuals and families to work hard, be creative, build businesses and to take care of themselves.
But instead, we have a system where all power and all wealth are increasingly controlled by giant banks and giant corporations that are in turn controlled by the global elite. The “financialization” of the global economy has turned almost everyone on the planet into “deft serfs”, and the compound interest on all of that debt enables the global elite to constantly increase their giant piles of money.
As I have written about previously, the total amount of government debt in the world has increased by about 40 percent since the last recession.
And when you consider all forms of debt, the grand total for the planet is now up to a whopping 223 trillion dollars.
This enables the super wealthy to constantly become even wealthier. It is like a giant vacuum cleaner that sucks wealth out of all of our pockets and transfers it to them.
It has been reported that the global elite have approximately 32 trillion dollars stashed in offshore banks around the globe.
But that is only what we know about.
What we don’t know about is probably far greater.
Just like most people don’t realize that men like Bill Gates and Carlos Slim are not the wealthiest men on the planet.
The people that are really at the top of the food chain are masters at hiding wealth and they absolutely do not want their names being thrown around in the media.
Meanwhile, those at the bottom of the pyramid continue to suffer.
For example, it was been widely reported that there are more people in slavery today than ever before in human history.
That is an absolutely amazing statistic. It is hard to comprehend how that could be possible, and yet it is. A new UN report says that there are 21 million slaves around the globe right now…
Nearly 21 million people are working as modern day slaves, falling victim to trafficking, forced labor and sexual exploitation, a new UN report finds. The illicit market in exploited people generates billions of dollars in profit worldwide.
The report by the International Labour Organization (ILO), which draws on information gathered in a 2012 survey, also found that annual profits stemming from forced labor are three times higher than previous estimates.
“Put into perspective, the 21 million victims in forced labor and the more than US$150 billion in illegal profits generated by their work exceeds the population and GDP of many countries or territories around the world,” the ILO says.
This is an utter abomination, but this is actually happening all over the planet. The following is one story that I recently came across out of India…
Dialu Nial’s life changed forever when he was held down by his neck in a forest and one of his kidnappers raised an axe to strike.
He was asked if he wanted to lose his life, a leg or a hand.
Six days earlier, Nial had been among 12 young men being taken against their will to make bricks on the outskirts of one of India’s biggest cities, Hyderabad.
During the journey, they got a chance to escape and ran for it – but Nial and a friend were caught and this was their punishment.
And yes, he did end up losing his hand.
Fortunately, most of us are not facing that kind of oppression.
But that doesn’t mean that we aren’t slaves. The borrower is the servant of the lender, and over the past four decades the total amount of debt in America has gone from about 2.2 trillion dollars to nearly 60 trillion dollars. Many of us work as “debt serfs” our entire lives, and we never even know the names or the faces of those that we are making rich as we slowly pay off our debts.
And all of this debt is one of the primary factors destroying the middle class in America. Just this past week, the New York Times reported that the wealth of “the typical household” in the United States has declined by 36 percent over the past decade…
The inflation-adjusted net worth for the typical household was $87,992 in 2003. Ten years later, it was only $56,335, or a 36 percent decline, according to a study financed by the Russell Sage Foundation. Those are the figures for a household at the median point in the wealth distribution — the level at which there are an equal number of households whose worth is higher and lower. But during the same period, the net worth of wealthy households increased substantially.
The Russell Sage study also examined net worth at the 95th percentile. (For households at that level, 94 percent of the population had less wealth and 4 percent had more.) It found that for this well-do-do slice of the population, household net worth increased14 percent over the same 10 years. Other research, by economists like Edward Wolff at New York University, has shown even greater gains in wealth for the richest 1 percent of households.
Does that upset you when you read that?
And the outlook for the next generation is even worse. Most of our young adults are absolutely drowning in student loan debt and other forms of debt, and wages for new college graduates are terrible.
Sadly, most people don’t even realize how the global financial system works or why the gap between the super wealthy and the rest of us continues to grow so rapidly.
It has been estimated that the wealthiest one percent currently have 110 trillion dollars.
That is 65 times more wealth than the bottom half of the global population combined.
They are hoarding wealth as we approach some of the most unstable days in all of human history.
Both the cause and the solution is our technological advances.
Why are technological advances the cause? Because tectonic shifts in the technologies of production are displacing the need for human labor and at the same time devaluing the worth of labor. Yet labor is the ONLY means to an earned income that the vast majority of people have.
The role of physical productive capital is to do ever more of the work, which produces income. Full employment is not an objective of businesses. Companies strive to keep labor input and other costs at a minimum in order to maximize profits for the owners. They strive to minimize marginal cost, the cost of producing an additional unit of a good, product or service once a business has its fixed costs in place. Reducing marginal costs enables businesses to increase profits, offer goods, products and services at a lower price, or both. Increasingly, new technologies are enabling companies to achieve near-zero cost growth without having to hire people. Thus, private sector job creation in numbers that match the pool of people willing and able to work is constantly being eroded by physical productive capital’s ever increasing role.
Over the past century there has been an ever-accelerating shift to productive capital––which reflects tectonic shifts in the technologies of production. The mixture of labor worker input and capital worker input has been rapidly changing at an exponential rate of increase for over 235 years in step with the Industrial Revolution (starting in 1776) and had even been changing long before that with man’s discovery of the first tools, but at a much slower rate. Up until the close of the nineteenth century, the United States remained a working democracy, with the production of products and services dependent on labor worker input. When the American Industrial Revolution began and subsequent technological advance amplified the productive power of non-human capital, plutocratic finance channeled its ownership into fewer and fewer hands, as we continue to witness today with government by the wealthy evidenced at all levels. People invented tools to reduce toil, enable otherwise impossible production, create new highly automated industries, and significantly change the way in which products and services are produced from labor intensive to capital intensive––the core function of technological invention.
Most changes in the productive capacity of the world since the beginning of the Industrial Revolution can be attributed to technological improvements in our capital assets, and a relatively diminishing proportion to human labor. Capital does not “enhance” labor productivity (labor’s ability to produce economic goods). In fact, the opposite is true. It makes many forms of labor unnecessary.
Why are technological advances the solution? Because productive capital is increasingly the source of the world’s economic growth. Therefore, productive capital should become the source of added property ownership incomes for all. Simply put, if both labor and capital are independent factors of production, and if capital’s proportionate contributions are increasing relative to that of labor, then equality of opportunity and economic justice demands that the right to property (and access to the means of acquiring and possessing property) must in justice be extended to all.
The system of big government and socialistic programs funded by tax extraction and non-asset-based national debt are not the answer to anything. The socialistic system almost always results in increased oppression, increased poverty or sameness as EVERY citizen becomes dependent on the State.
As Michael Snyder states, “What we need is a system that empowers individuals and families to work hard, be creative, build businesses and to take care of themselves.” Yes, but he leaves out the MOST IMPORTANT need, which is to extend equal opportunity to EVERY child, woman, and man to share individually in the FUTURE wealth-creating, income-producing capital assets of corprations whereby financing new capital formation and transfers of existing assets is accomplished from the bottom-up and without redistributing property rights of the rich and super-rich with regard to their existing assets
Snyder states, “But instead, we have a system where all power and all wealth are increasingly controlled by giant banks and giant corporations that are in turn controlled by the global elite. The ‘financialization’ of the global economy has turned almost everyone on the planet into ‘deft serfs,’ and the compound interest on all of that debt enables the global elite to constantly increase their giant piles of money.”
Not only has EVERY person become a debt slave, but also a wage slave, and increasingly a welfare and charity slave. Over the past four decades the total amount of consumer debt in America has gone from about 2.2 trillion dollars to nearly 60 trillion dollars. As Snyder notes, “many of us work as ‘debt serfs’ our entire lives, and we never even know the names or the faces of those that we are making rich as we slowly pay off our debts.”
Most thinking people should realize that never-ending consumer is not a wise situation to put one into. Such consumer debt requires a source of income that is promised to be paid to the owners of the note, credit card, or mortgage.
But there is a good form of debt, which is constantly used by the rich and the super-rich to make themselves richer. It is capital credit, a loan specifically tailored to finance FUTURE investment, repayable out of FUTURE earnings, without the need for “past savings” or the reduction in one’s personal consumption needs and wants. In the business world, physical capital is expected to go on producing income indefinitely with proper maintenance and with restoration in the technical sense through research and development. This is how technological advances occur and develop over time.
While other forms of non-asset-based debt is inflationary, commercial capital credit relies on non-inflationary capital asset creation, unlike government expenditures which rely on tax extraction or non-asset-backed debt to redistribute or inject inflationary money into the system.
The socialism practiced today relies on tax extraction and non-asset-based national debt to firstly redistribute monies collected into social welfare programs and second to finance public infrastructure and the military, etc. To the extent that modern “capitalistic” economies redistribute they are practicing socialism.
For those who are interested in the specifics of the solution see the Just Third Way and the Capital Homestead Act––the purpose of which is to eliminate privilege and provide EQUAL OPPORTUNITY for EVERY child, woman and man to build independent, sustainable financial security and incomes through acquiring ownership in FUTURE wealth-creating, income-producing capital assets financed without the necessity of pledging “past savings” or a reduction in consumption.
The solution eliminates the barriers to ordinary people forming capital themselves in association with others without the necessity for “past savings” or the pledging of equities which only the wealthy ownership class has.
The JUST Third Way is a radical overhaul of the economic system (i.e., the Federal tax system, Federal Reserve policy, inheritance law, welfare and entitlement system, etc.) that will achieve genuine economic democracy, based on the Platform of the Unite America Party and its links and the proposed Capital Homestead Act. Our Platform is a call for a vision of political economy that can unite the left and the right, based on binary economist Louis Kelso’s ownership-based paradigm. Now is the time to cure America’s political cancer (Crony Capitalism) and restore America to again becoming a model for global citizens in all countries.
For a new vision see http://www.foreconomicjustice.org/?p=12331 andwww.facebook.com/uniteamericaparty. Support the Unite America Party Platform, published by The Huffington Post at http://www.huffingtonpost.com/gary-reber/platform-of-the-unite-ame_b_5474077.html as well as Nation Of Change at http://www.nationofchange.org/platform-unite-america-party-1402409962 and OpEd News at http://www.opednews.com/articles/Platform-of-the-Unite-Amer-by-Gary-Reber-Party-Leadership_Party-Platforms-DNC_Party-Platforms-GOP-RNC_Party-Politics-Democratic-140630-60.html.
Support the Capital Homestead Act at http://www.cesj.org/learn/capital-homesteading/capital-homestead-act-a-plan-for-getting-ownership-income-and-power-to-every-citizen/ and http://www.cesj.org/learn/capital-homesteading/capital-homestead-act-summary/.