Commodities, derided for decades as unimportant, have become scarce resources, to be guarded and managed with the utmost care. Conversely human labor and skill, on the basis of which the glories of human civilization were built, is entering into a state of gigantic glut. Martin Hutchinson - Prudent Bear
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The quote at the top of this is the world's political bottom line.
Today this glut of human beings includes highly skilled, trained and educated human beings, not just the hewers of wood and drawers of water that have always made up Marx's "reserve army of labor".
I should quickly add that the author of the quote is anything but a Marxist.
Martin Hutchinson is a former international merchant banker, with a first class Honors degree from Trinity College in Cambridge and a Master of Business Administration from Harvard Business School. He writes a weekly column called "The Bear's Lair" in a web called Prudent Bear. I read him regularly because, in my opinion, he writes well and he has interesting and provocative ideas. He is a very classical economist: very conservative in the old, pre-Reagan use of the word.
Let me quote him at more length:
Certainly this is a different message than the one given by globalization's cheerleaders like Thomas Friedman, or intellectually more respectable folk such as Keynesians Paul Krugman, and Robert Reich.
I cannot imagine any of the aforementioned having such a sweepingly pessimistic view of where the world is heading as Hutchinson does. They might see grave dangers in global warming, but probably they would see new, "green" industries as solving climate change and unemployment too. I have to admit that I find myself more in tune with Hutchinson on this.
Keynes, who is probably the one chiefly responsible for an American boomer like me having had a prosperous childhood in the 50s and 60s, was a self-confessed bourgeois, someone who wanted to save capitalism and his upper-middle class place in it by tinkering with the system, not scrapping it. His tinkering worked very well for my generation, certainly much better than the Friedman to Thatcher to Reagan to Greenspan to ruin, that we have just been living through.
Since I am not an economist, since I am someone who, without a pocket calculator, is helpless when confronted with even the simplest arithmetic... you might ask... I should ask myself... On what exactly to I base this preference?
The way I get there without crunching any numbers is through an effort of imagination, seeing the world as a shrinking whole, without economic frontiers with everyone jammed together, where prices can be instantly compared, where anything that can be digitized, ideas, numbers, words, images, films, blueprints, intellectual property of almost any sort which can be copied endlessly for next to no money and increasingly melts into something like air. Air which is something that I'm sure they would have always liked to charge for, make into a commodity, but have never found a way to.
A world of staggering complexity and speed, without past or future, only an overpoweringly universal, pressing, simultaneous present.
In this world there wanders a creature who for most of his hundred million years of existence was a drop in the ocean of nature, a being who throughout most of his saga wandered naked in the company of small groups of relatives and friends, merely reaching out his hands to reap nature's generosity. A gregarious, sensitive, labile creature of intense empathy and interest in his fellow's doings, whose ability to speak empowered cooperation in hunting and accumulating knowledge and memories, who for most of his species' existence has owned nothing that he couldn't carry in his two hands.
This is the creature that confronts today's world of artifice and oppression.
We have to look at humanity as a continuum starting from Lucy the Australopithecus afarensis right up to today to see the blinding truth of Rousseau's dictum, "Man was born free, and he is everywhere in chains."
I agree with Hutchinson's bleak view essentially because I think that humanity is going to have a its nature as an animal. Like those performing dogs you see in the circus: wearing a hat and glasses and tottering along on its back legs, dreaming of a fire plug. DS
Today this glut of human beings includes highly skilled, trained and educated human beings, not just the hewers of wood and drawers of water that have always made up Marx's "reserve army of labor".
I should quickly add that the author of the quote is anything but a Marxist.
Martin Hutchinson is a former international merchant banker, with a first class Honors degree from Trinity College in Cambridge and a Master of Business Administration from Harvard Business School. He writes a weekly column called "The Bear's Lair" in a web called Prudent Bear. I read him regularly because, in my opinion, he writes well and he has interesting and provocative ideas. He is a very classical economist: very conservative in the old, pre-Reagan use of the word.
Let me quote him at more length:
Overall, rapid economic development has thrust commodities from a position of glut into a position of relative scarcity. Conversely, the emergence of modern telecoms, the globalization of markets and the increasing wealth and education levels of billions in China, India and elsewhere, has transferred human labor, even skilled human labor, from a position of relative scarcity into a position of glut. That’s not surprising – when the number of full participants in the global economy quadruples from 700 million to 3 billion over a period of less than 20 years, those participants are likely to face an over-supply problem. It’s also not unusual – as Thomas Malthus would have told you in 1798, the periods when human labor is worth more than bare subsistence have historically been few and far between.
( ...) In summary, in today’s world, commodities have become scarce and labor has become commoditized, unless fenced in by artificial restraints. With the global supply of commodities finite, this problem can only worsen if population is allowed to continue growing. A world with 10 billion people, all able to compete on an equal basis in a globalized labor market and desiring commodity-intensive modern mechanical marvels, would be a world of ever-increasing scarcity and impoverishment, besides its adverse environmental effects. Hence population reduction programs, aiming to reduce global population to a level at which labor once more becomes more valuable than commodities, should be given the highest priority at a global level. Otherwise, with the labor supply unlimited and the skills supply nearly so, and commodities supply relatively restricted, the only wealthy people will be those who own mines or oil wells.I find it interesting that there seems to be a clear convergence between the view of the future of a very classic conservative economist and a classic Marxist reading of of it. Both see the "increasing immiseration of the proletariat" and the only real difference that I can see between them is that the Marxist would believe and hope that this will lead to a revolution and the classic conservative, at some point, probably fears that it will.
Certainly this is a different message than the one given by globalization's cheerleaders like Thomas Friedman, or intellectually more respectable folk such as Keynesians Paul Krugman, and Robert Reich.
I cannot imagine any of the aforementioned having such a sweepingly pessimistic view of where the world is heading as Hutchinson does. They might see grave dangers in global warming, but probably they would see new, "green" industries as solving climate change and unemployment too. I have to admit that I find myself more in tune with Hutchinson on this.
Keynes, who is probably the one chiefly responsible for an American boomer like me having had a prosperous childhood in the 50s and 60s, was a self-confessed bourgeois, someone who wanted to save capitalism and his upper-middle class place in it by tinkering with the system, not scrapping it. His tinkering worked very well for my generation, certainly much better than the Friedman to Thatcher to Reagan to Greenspan to ruin, that we have just been living through.
Since I am not an economist, since I am someone who, without a pocket calculator, is helpless when confronted with even the simplest arithmetic... you might ask... I should ask myself... On what exactly to I base this preference?
The way I get there without crunching any numbers is through an effort of imagination, seeing the world as a shrinking whole, without economic frontiers with everyone jammed together, where prices can be instantly compared, where anything that can be digitized, ideas, numbers, words, images, films, blueprints, intellectual property of almost any sort which can be copied endlessly for next to no money and increasingly melts into something like air. Air which is something that I'm sure they would have always liked to charge for, make into a commodity, but have never found a way to.
A world of staggering complexity and speed, without past or future, only an overpoweringly universal, pressing, simultaneous present.
In this world there wanders a creature who for most of his hundred million years of existence was a drop in the ocean of nature, a being who throughout most of his saga wandered naked in the company of small groups of relatives and friends, merely reaching out his hands to reap nature's generosity. A gregarious, sensitive, labile creature of intense empathy and interest in his fellow's doings, whose ability to speak empowered cooperation in hunting and accumulating knowledge and memories, who for most of his species' existence has owned nothing that he couldn't carry in his two hands.
This is the creature that confronts today's world of artifice and oppression.
We have to look at humanity as a continuum starting from Lucy the Australopithecus afarensis right up to today to see the blinding truth of Rousseau's dictum, "Man was born free, and he is everywhere in chains."
I agree with Hutchinson's bleak view essentially because I think that humanity is going to have a its nature as an animal. Like those performing dogs you see in the circus: wearing a hat and glasses and tottering along on its back legs, dreaming of a fire plug. DS
