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Is Economic Recovery Possible?

Sam Rachele 1992 Published in: The Northwest Technocrat, 2nd quarter 1992, No. 327  

This article was submitted by Technocracy member Sam Rachele as a letter to the editor, but was printed instead in the guest editorial column “As I see it” of the January 16th issue of the Gazette Times, Corvallis, OR, under the title U.S. economy needs radical alteration.

For the United States and Canada the long term prospects for economic recovery are not very good. The Federal Reserve has taken steps to pull the U.S. economy out of recession. Although the move may provide a temporary stimulus, in the long run, it will solve nothing. We face insurmountable obstacles that old economic palliatives cannot correct.

One major obstacle is the need for continuous and increasing infusions of government money into the economy. Left to business by itself, there is no way that enough purchasing power can be created to buy the goods produced by modern technology. In the United States and Canada, machines are responsible for over 98 percent of all goods manufactured. Mines and farms are also highly mechanized.

The economy in 1929 faltered for lack of money and a glut of merchandise; now the problem is much worse. Economic survival since that time can be attributed to deficit financing and the management of goods and labor to avoid surpluses. Now, however, the debt creation mechanism is in danger of faltering. More and more of our national income must go toward payment of the interest on the national debt.

One mechanism for dealing with potential surpluses was fulfilled by the military. For years the military has helped to generate jobs in the civilian sectors while at the same time siphoning off potential surpluses of both goods and labor from the civilian arena. Now, with the need for a large military commitment receding, and because of budget constraints, this assistance to the economy is on the wane.

A major obstacle to recovery is the limit to exponential growth. Within a system using advanced technologies, an expanding economy can provide necessary employment. However, as new and better technologies develop, the faster factories and equipment must expand. This phenomenon is a self-defeating proposition. Since the number of man-hours in basic industries has been declining for many years, most new employment has been shifting to the service sectors. However, the recent revolution in electronic equipment is now taking its toll on the white-collar work force. The prospects for continuous economic growth, for the near future, are dim, and for the long run, apparently, impossible — we live on a finite planet with finite resources, and with limits to environmental abuse.

Another development is the steady flow of products into American markets from other countries, especially Japan. Recent plans by General Motors to close some of its plants is a reflection of the inferiority of American-made cars, the streamlining and automation of manufacturing and assembling, and the lack of purchasing power in a declining economy. An important point is the fact that high quality has a negative impact on our economy by inhibiting the demand for new products. Some innovations, model changes, style changes, making throw-away products (that is expedient obsolescence) in general are in large part surplus-control mechanisms.

The need for economic growth as a means for creating jobs has long been recognized. The impact on the environment has long been minimized or ignored. How ironic, that instead of encouraging people to consume less, the hue and cry in business and politics is to buy more and more. President Bush’s frenzy over public confidence and his urging people to get out and buy is sheer lunacy. Usually the people with the greatest need are least able to buy. Life-threatening environmental damage, due to unwise consumption and over-consumption, is becoming increasingly apparent.

In summary, our economy, for the past 60 years has flourished because of accelerating government and private debt, extravagant militarism, expedient obsolescence, and creation of demand by costly sales promotion schemes.

Even though the floodgates of debt will be opened, as a last resort by panicking politicians, the cost of debt will eventually choke the debt flow off. At the same time new technologies will make faster economic growth more imperative, but increasingly difficult, due to a disparity between income and production.

We are very close to economic and social chaos in North America. Russia’s problems will pale in comparison, since Eastern Europe is more agrarian. It may be that the only viable solution is the one advocated by Technocracy Inc. Its proposed “Scientific Social Design” eliminates the use of money — and debt in general, as a means of distribution; instead they advise the use of non- negotiable energy units. The design emphasizes function and sound ecological considerations.

The proposal is, indeed, radical, but theoretically workable. Since we have few options, we need to look at radical ideas. The future looks grim. For many this grim future has already begun.

 

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