The Growth Imperative Part II: Social Problems

Capitalism necessitates that tomorrow’s economy is better than today’s; however, the viability of the continued economic expansion is threatened by both environmental and societal degradation. Previously, I discussed how the growth imperative promotes overconsumption that results in unsustainable resource extraction and cumulatively disastrous wastes (See Part I here).

The other front that increasingly threatens tomorrow’s prosperity, and that this post will aim to cover, is the growing inequality between social classes.

Ask any economist and the two most important variables in the world are supply and demand. We can produce all the environmentally- and socially-harmful products in the world but without a proper consumer base, the economy will not prosper.

Globalization, from its inception in the religious/market/scientific-driven front and its underlying colonial pursuits, has made markets open for consumers all over the world to share in the multitude of products. The global middle class is growing, but in late-capitalist societies, growth is grasping at straws to push the envelope of frivolous consumption and polarized wealth accumulation and drive the separation of Have’s and Have nots even further. The inequality is shrinking the consumer base and fewer and fewer people can afford such Apple pods or Gucci goloshes.

In the US, the top 1% owns 40% of the wealth. The three richest Americans own more wealth than the bottom 50%. I’m all for winners and losers, but running a race when the opponent is driving a golf cart and you’re jumping over structural hurdles, seems a bit rigged. The Gini coefficient is an internationally-agreed upon metric of income inequality, and in the US in 1979 was at 34.6; in 2016, it was 41.5. As you guessed it, the higher the value, the higher the wealth inequality. Ironically, empirical studies show that excessive inequality hampers economic performance. A rising tide does not lift all boats, nor does having a cruise ship among fishing vessels rise the tide (unless you consider the cruise ship’s contribution to sea-level rise).

While inequality is hampering growth in the US today, this trend will only continue to grow until the world is divided into two groups: the producers and the consumers. Producers are already victims from the monopolization of the means of production and the large corporations/employers who sell humans as labor units for the lowest price on the docking board (a subsistence job with exploitative working conditions is better than no job, right?). Our disposable iPhones could not be upgraded every other year without the mined cobalt at the crux of ethnic conflict in the Democratic Republic of Congo, which is then exported to China where nets placed outside of factories catch the underpaid and overworked factory workers who decide that living to work is not worth working to live. Then our iPhones can be attached to the consumers’ hip while we work in our white-collar jobs to shift money from investor to client, or profit from a celebrity faux pas, or entice other consumers to overconsume using unregulated and often unknowingly given data points. Exploited to produce, exploited to consume.

While we work to satiate the ever-increasing appetite of capitalism, we also work to make production even cheaper, so the profit margins of the corporate executives continue to expand as does their plenteous lifestyle. We can innovate further. We don’t need to accept the folly of humans and their unreasonable demands for good wages and working conditions, we can automate every form of production. The number of farmers in the US is already falling with a 3% decline in the number of farms between 2012 and 2017 owing to the monopolization of agribusiness who outcompete small family farmers–American dairy farmers have declined 3% just from 2017 to 2018. The number of manufacturing jobs in the US is also falling with 7.5 million manufacturing jobs lost since 1980 due to both automation, and more significantly, offshoring to Asian countries where labor is cheap and regulations are lax. Will the roomba and drone-delivery meals replace domestic workers as well? Will we be satisfied when the robots produce all of our consumables disposables and produce clean energy and sustainably-grown produce as well?

While innovation and efficiency gains aren’t necessarily negative, we need to ask who is left behind from these production shifts? Who is left to suffer? Not the person who works in the middle moving product to market; not the person in the cubicle working to increase sales via social media targeting; not the person in the courtroom defending their employer for cutting corners to cut costs of production. Blue-collar workers are disappearing, and the remaining jobs are exclusively based on imaginary transactions to make constructed money that has no use-value. Who is left to afford the consumer goods? The economically-participating shadows left by blue-collar workers or the ones working to erase their existence in pursuit of profit margins?

Reducing costs of production is an effective way businesses have appeased their shareholders and grown the economy but at the cost of an increasingly marginalized working class who are increasingly excluded from the consuming market. When will we sit back as humanity and say, ok, we’ve done enough? We don’t need to extract more from the earth, we don’t need humans (or robots) working in poor conditions with low pay so we can benefit from the revolutionary iPhone 78. We can live off of what we produced, pay workers a living wage, and all have a comfortable lifestyle.

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