But three! Three! Three mints in one!
Krugman says, "It’s time to raise Keynes: we need big fiscal stimulus, now now now."
What part of the word three(3) don't these stimulus addicts understand?
One: investment.
Two: expanded consumption.
Three: working less.
What John Maynard Keynes wrote. In May 1943. "The Long-Term Problem of Full Employment."
In the final phase of post-war economic performance,
"It becomes necessary to encourage wise consumption and discourage saving,--and to absorb some part of the unwanted surplus by increased leisure, more holidays (which are a wonderfully good way of getting rid of money) and shorter hours."
But talking about shorter hours is anathema to post-Samuelson Anglo-American economists. Why? You need to talk about ingredient three, Paul. NOW NOW NOW.
Sandwichman, man. It sure would be great to work less. I was thinking about the stuff you write and I think I see a flaw: specialization.
ReplyDeleteSuppose we have 10 workers: 1 doctor, 1 plumber, 1 economist, 1 shoemaker, 1 comedian, etc. Suppose 3 out of 10 are unemployed. You think that all 10 should share all the work that exists, but the unemployed painter can't do a surgery, can he? Bummer.
So, first you need to create a society that "regulates the general production and thus makes it possible for me to do one thing today and another tomorrow, to hunt in the morning, fish in the afternoon, herd cattle in the evening, criticize after dinner without ever becoming hunter, fisherman, cowherd, or critic." And then we can discuss the details.
Am wrong here?
abb1,
ReplyDeleteYes, you are wrong.
Well, you might have a point if there were only 10 highly specialized workers in the economy. But in the real world... Well, it's completely different.
It's simply amazing to find an economist with a bona fide degree who can bridge the conceptual and programmatic gap to Marx.
ReplyDeleteI imagine a decomissioning ceremony where all the economists are lined up. We rip the buttons off their tunics and rend their epaulets. That...for intellectual myopia....that....for lack of imagination....that...for intellectual dishonesty and ideological bias.
You remember the arguments cited in Das Kapital regarding shortening the working day from 12-16 hours, "we make our profit in the last hour of the work day and if hours are shortened we will go bankrupt." Just transition them to our town and magnify the scope: "the country will go bankrupt."
News flash: everyone has been working longer hours and the country is bankrupt anyway.
A crisis of capital is simply that, a crisis of Capital. It is not my crisis and no reflection on my personal productivity or work habits. Yet I suffer because of the predatory nature of the system and the greed or simple incompetence of its owners and managers.
Keep skewering those sacred cows, you've got plenty of fans in the expat community here in China.
SM, I understand, in the real world specialization is not down to the individual level yet.
ReplyDeleteAlthough if you read, say, IT help wanted ads, you'll think that they are indeed looking for one unique individual with so many years of experience in this, and so many years in that and so on.
But still, even though in the real world the level of specialization is not as bad as in my illustration, it still must be a bit of a problem, no?
And it's getting worse, not better. 30 years ago I knew pretty much everything about computers. Today I know even more, but the complexity increased so much that now you can only be an expert in some narrow sub-sub-sub area.
And I'm sure that's a trend everywhere. And it doesn't help your case, it adds the burden of permanent training and re-training. And who wants that? It's even worse than work.
Many years ago I read a book called " The Share Economy". I liked it because the proposal worked under classical assumptions. It could also work by workers splitting up work, i.e., working less.
ReplyDeleteMy recollection of that proposal was that unions hated it, because it lowered the wages of longer term employees. In other words, I had a problem constructing a wage structure that seemed fair to everyone.
Anyway, just a thought.
Don the libertarian Democrat
I need some help here, since I have not read Keynes and only know the textbook version. What exactly is he referring to by "unwanted surplus"? I am guessing (going back to the textbook version) that it is the excess of aggregate supply over aggregate demand at the current price levels. If so (and is it so?), is the suggestion of cutting hours a means of reducing aggregate supply? That would seem odd, so what is Keynes saying?
ReplyDeleteI'm assuming he meant surplus labor supply.
ReplyDeleteDOn said: "Many years ago I read a book called " The Share Economy". I liked it because the proposal worked under classical assumptions. It could also work by workers splitting up work, i.e., working less. My recollection of that proposal was that unions hated it, because it lowered the wages of longer term employees. In other words, I had a problem constructing a wage structure that seemed fair to everyone."
ReplyDeleteIt is quite easy to maintain real income if working time is reduced. One need only reduce income and payroll taxes until, for instance, 32 hours of work generates the same after tax wages as previously.
The degree to which the wealth of the nation has been appropriated by government over the past sixty years is awful. Most of this, according to progressives, is allegedly to cover public goods. But, in fact, it is more often than not diverted to such public "bads" as militarism and an almost unbroken string of wars and interventions, public debt, and corporate welfare.
The US could easily reduce more than half of its federal, state and local budgets if these expenditures were stopped.
Most arguments in favor of shorter working time - as in France's experiment - ignore the social costs of government and it impact on the income of working families - and this is a tragedy.
In the real world of the USA today the major impediment to reducing the work week and sharing the jobs is the fixed cost of employees. As the number of employees increases then the price of health insurance increases and so too the company contribution to the 401k. Then there is the office space and the parking garage and it all adds up.
ReplyDeleteThe number one problem which should be dealt with immediately is the health insurance. The employer based health insurance scam needs to stop. It is a "hook in the butt" of the employees and so too the company contribution to the 401k. These expenses need to be made tax deductible to the employees and all funds that would have been paid by the employers should be paid out as wages to the employees. It should be straight hourly because it is "at will" employment anyway.
The other big gainer is the home office with the full blown teleconferencing that makes the office at home appear to be the office downtown. -- there is no downtown.
Get it fixed.