Economic Abundance

An Introduction

William M. Dugger, James T. Peach

• Publisher: Routledge
• Year: 2015
• ISBN:
  9781317472667
• Edition: 1
• Topic: Business
• Subtopic: Business General
• Index: Business

Most principles of economics texts are predicated narrowly on the concept of scarcity as a fundamental force, but that is only one aspect of economics. This supplemental text for basic and intermediate level undergraduates provides a serious discussion of the concept of abundance - what it means, how we can move toward it, and what keeps us from doing so. The authors first outline the development of the concept of abundance and its meaning with discussions of the roles of population, resources, and the environment. Then they consider why abundance escapes us, focusing on the detrimental roles of four predatory behaviors - classism, nationalism, sexism, and racism. As a remedy, they propose a policy of universal employment as a replacement for full employment, and explore the effects of pushing the unemployment rate down to absolute zero.

II

Inequality

Why Abundance Escapes Us

5

Inequality

Since we cannot blame the environment, natural resources, or excess population, this chapter will finally get down to explaining why communities fail to live up to their potential—why they suffer scarcity when they could enjoy abundance. Inequality prevents abundance. It does so by denying access to members of certain groups. Four major social inequalities are involved—classism, nationalism, sexism and racism.

Everybody knows about the vicious cycle of poverty. Poor, unhealthy, and uneducated parents are unable to provide the best health care and educational opportunities for their children. The children, like their parents, are then ill prepared to take full advantage of the community’s joint stock of knowledge. The children of poor parents start their lives at a severe disadvantage. They start out behind and fall further and further behind. Their plight gets worse because they are caught up in a vicious cycle of cumulative causation spiraling them downward. Unless they are able to sustain heroic efforts to break out of the cycle, it continues pulling them further down.

But who starts their lives in poverty? How does society select the unfortunate one? Four systems of inequality are at work in modern society, pulling people in selected groups down. Sexism, racism, classism, and nationalism select those to be denied full access to the community’s joint stock of knowledge and it is the operation of those social inequalities that snatch away the promise of abundance. Here, very briefly, is a preview of some of the ways social inequality prevents abundance: Labor force participation rates of women are lower than men. Unemployment rates for persons of color are higher than for other groups. Men are paid more than women. Children work long hours in sweat shops of poor countries producing athletic shoes for consumers in rich countries instead of spending their time learning. Even the economies of rich countries require a running margin of unemployed workers to maintain workplace discipline. Extreme nationalism results in international instability and war.

Inequality, in all its various forms, reduces the total output of the economy. Reducing inequality means everybody could have more goods and services available. In the following chapters, we will explain how reducing or eliminating the more serious systems of inequality will put abundance within reach. Even the mainstream of economics, though still fixated on scarcity, is showing an improved understanding of the relationships between inequalities and growth retardation (Alesina and Rodrik 1994; Benabou 2000).

Are we suggesting some sort of utopian society in which everyone has exactly the same income? No, we are not. Complete equality is a silly and unattainable idea. We do argue that the path to abundance is through greater equality and that genuine abundance and greater equality can only be achieved together.

Class, nation, sex, and race sort people into different groups. These are the “differentia specifica” for each system of grouping—the specific differences (real and imaginary) between people who benefit from the community’s joint stock of knowledge and those who cannot fully participate. Sexual orientation and religion are also used, as well as other differentia specifica. Systems of inequality always involve some such system of grouping. The class system (classism) uses ownership of the means of production as the differentia specifica to sort people into the unequal groups. The race system uses race; the gender or sex system uses sex and the nation system uses nation. The sorting into unequal groups is the meaning of inequality.

Inequality is systematic. It affects the whole social system in which people participate. These systems of inequality are woven into the market system itself. The power exercised in each system of inequality is institutionalized in market rules and property rights (Dugger 2005). The rules and property rights produce a particular distribution of income and wealth. The more effective the top dogs are at institutionalizing property rights and rules that benefit them at the expense of the underdogs, the larger the share received by those on top and the smaller the share received by those on the bottom. But there are many mongrels—neither top dogs nor underdogs—in the inequality mix as well.

Inequality: The Illness

Inequality is a social illness, a collective disorder that divides people who are actually equals into superiors and inferiors. It is a social illness because it keeps people from achieving the abundant society. It benefits some groups at the expense of others. The complex and intertwined systems of inequality empower some people and disempowers others. To disempower means to strip away a person’s ability to pursue an objective. To empower, of course, means to enable a person to pursue an objective. Empowerment, of course, also means access to the community’s joint stock of knowledge.

The result of inequality is that those who are empowered use those who are disempowered. In sex or sexism, men use women. In race or racism, one race uses another. In nation or nationalism, strong nations use weak ones. (For further discussion of inequality, see Dugger 1996, 1998; for recent discussions of race, gender, and class, see Mills 2003, Wright 2005, and Zweig 2004).

Assume for just a moment that we are playing games, instead of really exploiting each other. The game assumption is not intended to trivialize exploitation, but to help us think more clearly about what is going on in classism, racism, sexism, and nationalism. These four inequalities are deadly, not trivial and the game assumption helps us understand them in order to combat them Let us consider three games—Russian roulette, poker, and room project. To play Russian roulette, the players take turns putting one bullet in a revolver, spinning the pistol’s chamber, aiming at their head, and pulling the trigger. The game continues until everyone has had a turn or until someone blows his or her brains out. Bad game! To play poker, the players get together with lots of drinks and junk food and deal out the cards, betting their hard-earned cash on each hand. Some of them win; some lose. Good game for the winners; bad for the losers. To play room project, the players get the needed materials, hammers, saws, and screwdrivers and build a new table for their room. When the game is over, all the players have the use of a nice table—a bit rustic, perhaps, but they can all enjoy it and use it for playing poker or for catching their blown-out brains if they are so stupid.

The first game, Russian roulette, is known by economists as a negativesum game. In Russian roulette, there is a terrible loss among the players. One dies. Adding up the positive value of the winnings (zero) and the negative value of the losings (immense) results in an immense negative sum. Avoid this game!

The second game, poker, is known by economists as a zero-sum game. In poker, the amount that the winners gain is the same amount that the losers lose. Subtracting what the losers lose from what the winners gain gives zero. The wins and the losses cancel each other out, resulting in a zero sum—not a bad game but not a good one, either. The third game, room project, is known as a positive-sum game. In room project, the players build something new for a room—a table, for example. Everyone can help and everyone can enjoy the table. There are no losers in this game. Summing up the winnings and subtracting the losings gives a positive sum. Wonderful game—build something today!

Inequality is such a pervasive feature of society that most people find it hard to see that it is a negative-sum game. As Theodore Roszak, a well-known historian and social critic, notes:

This is the sort of insight our angriest dissenters tend to miss when, in the course of heroic confrontation, they open themselves to the most obvious kinds of police and military violence. They quickly draw the conclusion that the status quo is supported by nothing more than bayonets, overlooking the fact that these bayonets enjoy the support of a vast consensus that has been won by the status quo by means far more subtle and enduring than armed force. (1969, 267)

Many other social critics have seen through normality and explained how people fool themselves. We will confine our discussion to three of them: C. Wright Mills, Simone de Beauvoir, and William Ryan.

In an analysis of sociology textbooks and textbook writers in the United States, C. Wright Mills probes how intellectuals fool themselves and teach others how to do likewise. Published over sixty years ago, his essay, “The Professional Ideology of Social Pathologists,” is still fresh and provocative (1943). Mills explains how textbook writers teach their readers to see people who are poor or marginalized by systematic inequality as being pathologica...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Table of Contents
• List of Tables, Figures, and Box
• Preface
• Dedication and Acknowledgments
• I. Abundance: A Practical Guide
• II. Inequality: Why Abundance Escapes Us
• III. Policies Promoting Abundance
• References
• Index
• About the Authors