"Production and technological advances that enrich capitalists also raise
mass living standards. Marxism's failure to recognize this was its
undoing." This statement is not accurate, at least as it pertains to Karl
Marx the economist. Karl Marx appreciated the market, particularly the
innovation it creates. But Marx's theoretical system is still valid,
surplus value is real, that is, labor produces a surplus (labor is not
compensated fully for the value it adds). For this reason, labor's
interests though related to capital are not the same. Moreover, as it has amply
demonstrated in our own time, capitalism is notoriously unstable, trashing lives
left and right. So, the question is, how do we evolve this system?
If I understand the graphic in this editorial correctly and Samuelson's
explanation of it, the labor portion also includes "wages and fringe
benefits" of corporate CEOs, other high-level executives, and high-paid
employees (such as those in Wall Street financial institutions, who make
hundreds of millions per year—or billions in some cases). If this is so,
then things are worse than we think. The divide widens, and inequality will
eventually sink the ship as it gets too top-heavy.
@Nonconlib: You're forgetting that most workers also own capital stock in
the form of IRA, 401k and pension funds.The divide between capital and labor is
not as clear cut as the class warriors want us to believe. Almost all of us
represent both labor and capital to varying degrees.
Invisible Hand,Truer in the past. Many companies which would have
offered 401K and other retirement benefits in the past no longer do.Irrespective of the disagreements we may all have on the solutions, the facts
on the ground are stark and well documented. Over the past several decades
(several administrations of both parties) there has been a shrinking middle
class and a growing divide between rich and poor.
Invisible Hand, you also have to remember that while workers still have some
IRA's and 401K's workers participation in such programs is shrinking.
It was once was a healthy participation because companies participated.
Companies substituted defined contribution plans 401K's for defined benefit
plans. Now most large companies and I would assume most small companies have
drasticly reduced or stopped all together their contributions so all the savings
are personal savings. If you're making 30K a year..good luck with that.The trend of more to the owners and less to the workers is just getting
worse..incluing any and all previous plans where workers shared in profits.
Invisible Hand,10 percent of the population owns 80 percent of the
stock. And that too is getting more lopsided. Any way you slice it,
the divide between the rich and the rest is widening, and rather rapidly, and
that does not make for a healthy economy. The shallow Republican argument is
that we need to lower taxes on the rich so that they will invest and create new
jobs. But the rich have been raking in record profits and salaries. Where are
the new jobs? Companies claim they cannot afford to hire more people because the
economy is weak and there is insufficient demand. So much for supply-side
economics. It never did work, and it never will. You want growth? You need
consumers to spend. How will that ever happen if the consumer classes don't
have enough disposable income?I sometimes hope that we do elect
Romney and that the Republicans gain control both houses of Congress. Then we
may finally see how bankrupt conservative economic theory really is.
Unfortunately, that scenario may spill us into an abyss we can never climb out