The Weiner Component V.2 #20 – The Origins of American Government & its two Major Political Parties

A cotton gin on display at the Eli Whitney Museum.

A cotton gin on display at the Eli Whitney Museum. (Photo credit: Wikipedia)

To understand the government and the two major political parties in the United States we need to examine assorted economic happenings.  These entities changed the course of history in the late 18th and early 19th Centuries.  The first was the invention of the Cotton Gin, from the 1780s on, another was the American Revolution, a third was a rebellion by small yeoman farmers in inland Massachusetts, and the fourth was the Constitution of the United States.  What occurs here is a cause and effect relationship that brings about major historical changes.

************************************

Eli Whitney was an American inventor who developed the Cotton Gin.  The word gin is short for engine.  The problem with cotton is that it is filled with seeds.  It takes a person working diligently for an hour to clean one pound of cotton.  A single cotton gin could clean 55 pounds daily.  Whitney received a pattern for his gin in 1807.  Like the grist and sawmills he expected to charge farmers for cleaning their cotton by getting 2/5 of the cotton cleaned.  The mechanical simplicity of the device and the primitive state of the pattern law made infringement inevitable.  Local carpenters could easily make duplicates of the gins.  Ultimately lawsuits consumed the profits and the cotton gin company went bankrupt in 1797.  Whitney, however, gained national, if not international fame for his invention.

 

Cotton had been very labor intensive and expensive.  The new inexpensive cotton changed the economics of the world by bringing about the Industrial Revolution in England in the early 19th Century and it also made slavery profitable in the new United States.

 

Prior to the 1790s slave labor was a slowly dying institution.  Slaves were employed in the growing of tobacco, rice, and indigo.  None of these crops were particularly profitable.  With the invention of the cotton gin cotton became the chief source of wealth in the American South; it became king cotton or the chief export of the new United States.  In the Southern settlements from South Carolina to Texas cotton became the dominant economic force and slavery became the key institution of Southern society.  This would persist until the end of the Civil War.

 

With the early Industrial Revolution from the late 18th Century, both England and New England became dependent upon this crop.  Their factories buzzed spinning thread and weaving cloth.  In the American South enormous fortunes were produced and the large cotton growers lived regally.  They tended to utilize the large English purchasers as suppliers of all the goods they wanted, ordering furniture, grand pianos or whatever they decided they wanted or needed.  This in time resulted in their spending more than their current crops allowed.  Eventually the large plantation owners owed their future crops to these people.  To the English manufacturers this was good business because it tied these planters and their crops to them.  The combined debt must have been in the millions.

 

With the formation of a new central government in 1788, caused by the Revolutionary War the Southern cotton barons refused to honor their debts to the English manufacturers.  In essence cotton as an export was still “king” and could always be sold in England or New England.  Some of the English manufacturers sued in the New United States.  Not one ever won his case.  The large cotton growers wiped out millions in debts virtually overnight without spending a penny.

**********************************

The American Revolution was fought from 1765 to 1783.  By the end of the Battle of Yorktown it became obvious to the British that it was far less expensive to trade with the American colonies than to gain trading advantages from them by ruling them.  Consequently the colonies gained their independence.

 

The government that the new independent state established was codified under the Articles of Confederation.  This document rested sovereignty with each of the 12 newly independent states with a central elected body have representatives from all 12 states.  The final decision on any measure passed by this Continental Congress had then to be approved by each of the 12 states.  Any state or states that so wished could disregard any measure passed by the Continental Congress.  In essence what existed were 12 independent nation states that had agreed to more or less cooperate with one another.

******************************

In the period during 1786 and 1787 the Revolutionary veteran, Daniel Shay, led 4,000 rebels, called Shayites, in an uprising against economic and civil rights injustices.  Basically the inland area of the state largely consisted of subsistence agriculture.  Mostly where roads existed they were unpaved, becoming muddy and impossible to use during rain, making it impossible for the farmers to bring their crops to the coastal areas where they could be shipped throughout the tidewater areas of the colonies or overseas.  Consequently most, if not all, of the farmers had stills.  A lot of grain made a small amount of whiskey, which was always in demand and could be easily transported.

 

Along the economically developed or older coastal areas of Massachusetts Bay there existed a market economy which was driven by the activities of wholesale merchants dealing with Europe, the West Indies, and elsewhere on the North American coast.  The state government was dominated by this merchant group.

 

After the end of the Revolutionary War the European businesses, for good reason, refused to continue to extend lines of credit to these merchants and insisted that they pay in hard currency, gold.  There was a shortage of such currency.  Also the state government, run by the business class, needed money.  Following a period of taxes not being paid where it could be avoided, the state of Massachusetts passed a whiskey tax on the small inland farmers to be paid in gold coins which were in short supply.

 

The rural farmers were unable to meet the demands made upon them by the merchants or the civil authorities and many began to lose their land and other possessions.  This led to strong resistance against the collectors and the courts where the collectors obtained judgements authorizing property seizures.

 

A great many of these depressed individuals felt that they should be able to cancel the debts the same way that the Southern planters had.  This led to open warfare between the two groups, temporarily shutting down the courts, sporadic fighting, and the governor refusing to enforce actions against the small farmers and being replaced by one who would enforce the law.  In 1787 Daniel Shay, leading 4,000 rebels, attempted to take the federal armory in Springfield, which was stoutly defended by state troops raised as a private army.

 

Eventually in 1787 4,000 people signed confessions admitting participation in the rebellion in return for amnesty.  Most of those indicted were eventually pardoned.  In subsequent years the state legislature cut taxes and placed a moratorium on debts.  In 1787 John Hancock replaced the militant governor.

 

As a note of irony it should be noted that at that time the only people allowed to vote were male property owners.  All the small farmers were property owners.  There were more of them than there were merchants.

*********************************

As a result of this and of other effects, many upper class individuals felt that there was a need for a stronger central government that could protect property rights throughout the states.  The most important effect was the call for a Constitutional Convention which would reform the Articles of Confederation, presumably strengthening the central government.  In addition Shay’s Rebellion brought George Washington out of retirement at Mount Vernon to chair the Constitutional Convention and to eventually become President for the first two four year terms.  It also brought two distinct political groups into existence: the Federalists who wanted a stronger central government and the Anti-Federalists who didn’t want this.  It was the merchant, businessmen class against the agrarians and laborers.

 

The people at the Constitutional Convention tended to represent the wealthy and educated classes.  They agreed to hold the meetings in secret and soon discovered that amending the Articles of Confederation could not produce a government with central control of all the states.  Consequently they produced from May 25 to September 17, 1787 a totally new document of government.

 

France has been through more than a dozen Constitutions since 1789; the U.S. has only had one, which still exists and functions.  The reason for this is that the U.S. had two sets of states: One free and one slave.  The elite of upper classes in both ends of the country agreed upon the necessity of a stronger central government.  They did not agree on numerous other issues.  They needed a document of unity but they did not agree upon a host of other issues.  In order to create their document of government they had to compromise upon innumerable issues.  Interpreting these issues, according to the needs of the times, has kept the Supreme Court busy since the inception of the nation.

 

The one issue that the Court could not deal with was the issue of where the basic power lay, with the Federal Government or the States.  That issue was resolved by the Civil War.

 

Although there were different political groups in the United States at that time the issue of political parties was never considered by the Founding Fathers.  Once the new government came into existence so did political parties.  The first one was the Federalist Party, representing coastal business and the educated classes.  They were able to dominate the first three elections, two for George Washington and one for John Adams.  The Federalists were opposed by the Anti-Federalists, who represented the small yeoman farmers like Daniel Shay.

 

The leader of the Federalist Party at that time was not the President but was Alexander Hamilton.  The first dramatic election was that of 1800 when John Adams ran against Thomas Jefferson.  Jefferson had organized the Anti-Federalists groups and anyone else who was dissatisfied with the Federalists into, what he called, the Republican Party.  As a put-down the Federalists called the new political group the Democratic-Republican Party.  Eventually the word “Republican” was dropped and this became the Democratic Party, which we still have today.  They represented the interests of the small, or as Jefferson preferred to call them, “Yeomen farmers.”  In fact the purchase of the Louisiana Territory by the Jefferson administration in 1803 would provide land for yeoman farmers for at least the next 100 years, according to Jefferson.

 

Initially only males voted who were property owners.  With the availability of cheap or free land the Federalists, after the Election of 1800, were never again able to mount a successful Presidential election.  They went out of existence after the War of 1812, when they backed the wrong side, England.  From 1814 on there was only one major political party in the U.S., the Democratic Party.

 

Other groups across the United States formed small political groups.  The other major party that would come into existence in 1835 was the Whig Party, which more or less carried on the values of the old Federalist Party, they represented largely the growing businesses across the ever growing nation which was blossoming with the new Industrial Revolution.  In addition they were also strongly anti-slavery.  In 1860 the Whig Party and a number of fringe groups coalesced into, what was to become, the Republican Party in the Election of 1860.

 

Lincoln was originally a Whig, He won the Presidential Election of 1860 with less than 40% of the popular vote because the Democratic Party had split into two parts, the South voted for one candidate and the North and West voted for another.  With the exception of Virginia where he received less than 2% of the popular vote Lincoln was not even on the ballot on any of the other Southern states.  In essence there were two elections in 1860: one in the South and a different election in the North and West.

 

Here we have the origins of the two major political parties in the United States.  Today, with a so-called Republican President and universal suffrage, the two political parties are at a point where they can barely communicate with one another.

 

Here we can see the origins of our government and our political system.

**********************************

It should also be noted that when United States history is taught as a survey in the schools everything is taught as a group of events which generally are simplified and not related to one another.  Cause and effect relationships are ignored or not understood.  This article generally deals with, on a general basis, cause and effect.  The invention of the cotton gin and the Industrial Revolution, switching from manmade to machine made products, brought about the changes which resulted in the growth of slavery, the Civil War and the country as it is now,

 

If the discovery of the cotton gin had been delayed for another twenty years or so, slavery might have died out on its own and there would have been no Civil War.  If Shay’s Rebellion had not occurred the government might have gone on under the Articles of Confederation and the United States could have eventually developed a Parliamentary System similar to the present day government of Great Britain.  There certainly would have been no immediate need for a Constitution.  There are certainly a lot of “Ifs” available.  Of course we’ll never know the answer to a lot of these questions because they never happened.

The Weiner Component V.2 #20 – The Origins of the American Government & Its Two Major Political Parties

 

To understand the government and the two major political parties in the United States we need to examine assorted economic happenings.  These entities changed the course of history in the late 18th and early 19th Centuries.  The first was the invention of the Cotton Gin, from the 1780s on, another was the American Revolution, a third was a rebellion by small yeoman farmers in inland Massachusetts, and the fourth was the Constitution of the United States.  What occurs here is a cause and effect relationship that brings about major historical changes.

************************************

Eli Whitney was an American inventor who developed the Cotton Gin.  The word gin is short for engine.  The problem with cotton is that it is filled with seeds.  It takes a person working diligently for an hour to clean one pound of cotton.  A single cotton gin could clean 55 pounds daily.  Whitney received a pattern for his gin in 1807.  Like the grist and sawmills he expected to charge farmers for cleaning their cotton by getting 2/5 of the cotton cleaned.  The mechanical simplicity of the device and the primitive state of the pattern law made infringement inevitable.  Local carpenters could easily make duplicates of the gins.  Ultimately lawsuits consumed the profits and the cotton gin company went bankrupt in 1797.  Whitney, however, gained national, if not international fame for his invention.

 

Cotton had been very labor intensive and expensive.  The new inexpensive cotton changed the economics of the world by bringing about the Industrial Revolution in England in the early 19th Century and it also made slavery profitable in the new United States.

 

Prior to the 1790s slave labor was a slowly dying institution.  Slaves were employed in the growing of tobacco, rice, and indigo.  None of these crops were particularly profitable.  With the invention of the cotton gin cotton became the chief source of wealth in the American South; it became king cotton or the chief export of the new United States.  In the Southern settlements from South Carolina to Texas cotton became the dominant economic force and slavery became the key institution of Southern society.  This would persist until the end of the Civil War.

 

With the early Industrial Revolution from the late 18th Century, both England and New England became dependent upon this crop.  Their factories buzzed spinning thread and weaving cloth.  In the American South enormous fortunes were produced and the large cotton growers lived regally.  They tended to utilize the large English purchasers as suppliers of all the goods they wanted, ordering furniture, grand pianos or whatever they decided they wanted or needed.  This in time resulted in their spending more than their current crops allowed.  Eventually the large plantation owners owed their future crops to these people.  To the English manufacturers this was good business because it tied these planters and their crops to them.  The combined debt must have been in the millions.

 

With the formation of a new central government in 1788, caused by the Revolutionary War the Southern cotton barons refused to honor their debts to the English manufacturers.  In essence cotton as an export was still “king” and could always be sold in England or New England.  Some of the English manufacturers sued in the New United States.  Not one ever won his case.  The large cotton growers wiped out millions in debts virtually overnight without spending a penny.

**********************************

The American Revolution was fought from 1765 to 1783.  By the end of the Battle of Yorktown it became obvious to the British that it was far less expensive to trade with the American colonies than to gain trading advantages from them by ruling them.  Consequently the colonies gained their independence.

 

The government that the new independent state established was codified under the Articles of Confederation.  This document rested sovereignty with each of the 12 newly independent states with a central elected body have representatives from all 12 states.  The final decision on any measure passed by this Continental Congress had then to be approved by each of the 12 states.  Any state or states that so wished could disregard any measure passed by the Continental Congress.  In essence what existed were 12 independent nation states that had agreed to more or less cooperate with one another.

******************************

In the period during 1786 and 1787 the Revolutionary veteran, Daniel Shay, led 4,000 rebels, called Shayites, in an uprising against economic and civil rights injustices.  Basically the inland area of the state largely consisted of subsistence agriculture.  Mostly where roads existed they were unpaved, becoming muddy and impossible to use during rain, making it impossible for the farmers to bring their crops to the coastal areas where they could be shipped throughout the tidewater areas of the colonies or overseas.  Consequently most, if not all, of the farmers had stills.  A lot of grain made a small amount of whiskey, which was always in demand and could be easily transported.

 

Along the economically developed or older coastal areas of Massachusetts Bay there existed a market economy which was driven by the activities of wholesale merchants dealing with Europe, the West Indies, and elsewhere on the North American coast.  The state government was dominated by this merchant group.

 

After the end of the Revolutionary War the European businesses, for good reason, refused to continue to extend lines of credit to these merchants and insisted that they pay in hard currency, gold.  There was a shortage of such currency.  Also the state government, run by the business class, needed money.  Following a period of taxes not being paid where it could be avoided, the state of Massachusetts passed a whiskey tax on the small inland farmers to be paid in gold coins which were in short supply.

 

The rural farmers were unable to meet the demands made upon them by the merchants or the civil authorities and many began to lose their land and other possessions.  This led to strong resistance against the collectors and the courts where the collectors obtained judgements authorizing property seizures.

 

A great many of these depressed individuals felt that they should be able to cancel the debts the same way that the Southern planters had.  This led to open warfare between the two groups, temporarily shutting down the courts, sporadic fighting, and the governor refusing to enforce actions against the small farmers and being replaced by one who would enforce the law.  In 1787 Daniel Shay, leading 4,000 rebels, attempted to take the federal armory in Springfield, which was stoutly defended by state troops raised as a private army.

 

Eventually in 1787 4,000 people signed confessions admitting participation in the rebellion in return for amnesty.  Most of those indicted were eventually pardoned.  In subsequent years the state legislature cut taxes and placed a moratorium on debts.  In 1787 John Hancock replaced the militant governor.

 

As a note of irony it should be noted that at that time the only people allowed to vote were male property owners.  All the small farmers were property owners.  There were more of them than there were merchants.

*********************************

As a result of this and of other effects, many upper class individuals felt that there was a need for a stronger central government that could protect property rights throughout the states.  The most important effect was the call for a Constitutional Convention which would reform the Articles of Confederation, presumably strengthening the central government.  In addition Shay’s Rebellion brought George Washington out of retirement at Mount Vernon to chair the Constitutional Convention and to eventually become President for the first two four year terms.  It also brought two distinct political groups into existence: the Federalists who wanted a stronger central government and the Anti-Federalists who didn’t want this.  It was the merchant, businessmen class against the agrarians and laborers.

 

The people at the Constitutional Convention tended to represent the wealthy and educated classes.  They agreed to hold the meetings in secret and soon discovered that amending the Articles of Confederation could not produce a government with central control of all the states.  Consequently they produced from May 25 to September 17, 1787 a totally new document of government.

 

France has been through more than a dozen Constitutions since 1789; the U.S. has only had one, which still exists and functions.  The reason for this is that the U.S. had two sets of states: One free and one slave.  The elite of upper classes in both ends of the country agreed upon the necessity of a stronger central government.  They did not agree on numerous other issues.  They needed a document of unity but they did not agree upon a host of other issues.  In order to create their document of government they had to compromise upon innumerable issues.  Interpreting these issues, according to the needs of the times, has kept the Supreme Court busy since the inception of the nation.

 

The one issue that the Court could not deal with was the issue of where the basic power lay, with the Federal Government or the States.  That issue was resolved by the Civil War.

 

Although there were different political groups in the United States at that time the issue of political parties was never considered by the Founding Fathers.  Once the new government came into existence so did political parties.  The first one was the Federalist Party, representing coastal business and the educated classes.  They were able to dominate the first three elections, two for George Washington and one for John Adams.  The Federalists were opposed by the Anti-Federalists, who represented the small yeoman farmers like Daniel Shay.

 

The leader of the Federalist Party at that time was not the President but was Alexander Hamilton.  The first dramatic election was that of 1800 when John Adams ran against Thomas Jefferson.  Jefferson had organized the Anti-Federalists groups and anyone else who was dissatisfied with the Federalists into, what he called, the Republican Party.  As a put-down the Federalists called the new political group the Democratic-Republican Party.  Eventually the word “Republican” was dropped and this became the Democratic Party, which we still have today.  They represented the interests of the small, or as Jefferson preferred to call them, “Yeomen farmers.”  In fact the purchase of the Louisiana Territory by the Jefferson administration in 1803 would provide land for yeoman farmers for at least the next 100 years, according to Jefferson.

 

Initially only males voted who were property owners.  With the availability of cheap or free land the Federalists, after the Election of 1800, were never again able to mount a successful Presidential election.  They went out of existence after the War of 1812, when they backed the wrong side, England.  From 1814 on there was only one major political party in the U.S., the Democratic Party.

 

Other groups across the United States formed small political groups.  The other major party that would come into existence in 1835 was the Whig Party, which more or less carried on the values of the old Federalist Party, they represented largely the growing businesses across the ever growing nation which was blossoming with the new Industrial Revolution.  In addition they were also strongly anti-slavery.  In 1860 the Whig Party and a number of fringe groups coalesced into, what was to become, the Republican Party in the Election of 1860.

 

Lincoln was originally a Whig, He won the Presidential Election of 1860 with less than 40% of the popular vote because the Democratic Party had split into two parts, the South voted for one candidate and the North and West voted for another.  With the exception of Virginia where he received less than 2% of the popular vote Lincoln was not even on the ballot on any of the other Southern states.  In essence there were two elections in 1860: one in the South and a different election in the North and West.

 

Here we have the origins of the two major political parties in the United States.  Today, with a so-called Republican President and universal suffrage, the two political parties are at a point where they can barely communicate with one another.

 

Here we can see the origins of our government and our political system.

**********************************

It should also be noted that when United States history is taught as a survey in the schools everything is taught as a group of events which generally are simplified and not related to one another.  Cause and effect relationships are ignored or not understood.  This article generally deals with, on a general basis, cause and effect.  The invention of the cotton gin and the Industrial Revolution, switching from manmade to machine made products, brought about the changes which resulted in the growth of slavery, the Civil War and the country as it is now,

 

If the discovery of the cotton gin had been delayed for another twenty years or so, slavery might have died out on its own and there would have been no Civil War.  If Shay’s Rebellion had not occurred the government might have gone on under the Articles of Confederation and the United States could have eventually developed a Parliamentary System similar to the present day government of Great Britain.  There certainly would have been no immediate need for a Constitution.  There are certainly a lot of “Ifs” available.  Of course we’ll never know the answer to a lot of these questions because they never happened.

Donald Trump enters the Oscar De LA Renta Fash...

The Weiner Component, Volume 2 – Economics in the 21st Century: #1: Change & the 21st Century: Part I Introduction

 

Prenote: I find myself getting bored with Donald J. Trump and his machinations.  He, as President-Elect is setting up a government which seems that it will wipe out any progress made in the 20th Century on.  Will it?  We’ll have to wait and see. 

Meanwhile the stock market is rising to new heights.  Is that because of President-Elect Donald J. Trump or in spite of him?  Again we’ll have to wait and see.  Basically the issue with Trump is that we, the public, will have to wait and see what he does after January 20, 2017, when he becomes President of the United States.

Meanwhile I will begin a new version of my book, “Economics in the 21st Century.

                  ************************************

Volume 2 #1 – The Purpose of Government in the 21st Century:                                                            Introduction: Part 1

 

The past is always safe, particularly if it is mostly imagined.  It is a known when balanced against the future which is always unknown and therefore unsafe.  In the presidential election of 2016, Donald J. Trump was elected by a minority of voters who were fearful of the changes that were occurring in society.  Trump promised to bring back the past.  He would bring back the values and conditions that supposedly were while Clinton would continue forward to a changing society.

                       *     *     *     *     *     *     *     *

 With the election of Donald J. Trump, as President of the United States by a majority of people from the smaller states the country choose the candidate that got the minority of popular votes but the majority of electoral votes.  Hillary Clinton actually won the election with nearly three million more votes than Trump received.  The voters who choose Trump actually choose to stay with what they believed would be a return of the past, to the supposed happy days when there were jobs for all the low skilled workers.  Trump would, he said, “stay the course” and continue the process of lowering taxes.  He would continue the war effort in the Middle East and the War against Terror.  He would bring back all the jobs that had moved overseas and take the country back to its happy days, whenever they were.  He would reform our society, making it as it had been in the past.

 

Of course “reform” historically was a euphuism for change or raising taxes among the ordinary citizens of the country.  Trump has promised to lower taxes for the wealthy.  Ordinary people would object to a tax raise but how can they be unhappy about reform, semantical games.  The problem is that the government is spending billions of dollars daily above what it collects in taxes pushing the National Debt (which President Clinton had begun to reduce) to new astronomical levels.  Trump will lower taxes for the wealthy and the corporations.  He will have to make up the difference somehow.

 

There is currently one vacancy on the Supreme Court and one Justice in her eighties.  From what I understand Trump should be able during his tenure as President to probably make two appointments to the Court.  This should make the Court 6 to 3 in favor of the conservatives.  The significance of a solid conservative balance on the Supreme Court is that it might, among other things like individual rights, finish striking down Roe vs. Wade; and thus take away the right of choice from slightly over fifty percent of the population.  The majority of women, according to the surveys taken, are overwhelmingly in favor of choice.  It would be a decision imposed by a minority upon the majority.

 

 This seems to be Trump’s version of the “good old days.”

                           *     *     *     *     *     *     *     *

But despite what is currently happening with Donald J. Trump as the new President-Elect no one really knows what he will do as President.  Still the Twenty-first Century holds the promise of all sorts of social and economic changes for the people of the United States, the other Industrial Nations, and even for the emerging non-industrial countries of this world.  The question, of course, is whether these changes will be positive or will they be otherwise.  Our traditional economic model will no longer function (if it ever did properly beyond the theoretical stage).  Technological change, particularly that of the Computer Revolution is moving forward at a rapid pace.  The changes are speeding up. 

 

     With these changes the concept of employment (What is work?) is/will also undergo evolution.  Low skilled jobs are and have been disappearing in the United States; some highly technological occupations are and have been coming into being.  A large number of factory and many white collar jobs are moving overseas where they can be performed at a much lower cost.  The economy today is a world-wide one with the individual nations still being essentially nationalistic.

                         *     *     *     *     *     *     *     *

     For the last three to four thousand years the concept of work has been fairly constant.  It has essentially been effort related to survival: production of food, shelter, clothing, and gradually entities needed for recreation.  Up until the Industrial Revolution it took ten or more people working full time (sunrise to sunset) to provide the fundamentals needed for one individual to have the leisure time to be a priest, government official, artist, or someone not having to work for survival.  With the change over from a hand-craft society to a machine- operated one the ratio has changed and continues to decrease.  From ten to one we gradually went to one person supplying everything for one hundred people.  With the coming and continuance of the Computer Revolution the ratio has gone from one supplying everything for one hundred people to one supplying what’s needed for a thousand individuals, with the possibilities of eventually going well beyond that number.

 

     What then happens to both the concept of work and the need to work when all the rudiments can easily and almost effortlessly be supplied?  Traditionally man (and woman) have earned their bread like Adam (after being expelled from the Garden of Eden) by the sweat of his (her) brow.  Now, ironically, we have returned to garden conditions.  Can we handle them?

 

     Today, at the Second decade of the Twenty-first Century, we seem to be well into the Computer Revolution; but, I suspect, we are only seeing its initial stage. 

 

The government constantly monitors and publishes the unemployment percentage of the working population.  They are thrilled when it decreases by one or several tenths of a percent.  Politicians like Donald Trump, are constantly promising to decrease unemployment.  The President will proudly proclaim and take credit for any tenth of a percent decrease.  The goal, as far as the government and public are concerned, seems to be a healthy economy with full employment in an era when computers are rapidly increasing the rates of productivity and many corporations are downsizing while increasing their output.  We seem to be squarely and hopefully looking historically backward.

                               *     *     *     *     *     *     *     *

Many thousands of years ago a man-like creature first picked up a rock or piece of wood and used it as a tool or weapon for the first time.  From that time on the concept was passed to others and they did the same, eventually discovering that they could chip the rock into a specific shape and sharpness and sharpen the wood, fire-hardening a point.  Over the multitude of years types of tools were developed.  Mankind developed more and better means of increasing his productivity, of making life easier for himself.  In fact his conscious or unconscious goal during all the years of his existence has been to produce more with less effort.

 

During the 19th Century the emerging handicraft society began to change in England and then Europe and the United States with the gradual development of machines; this became known as the Industrial Revolution, when manufacturing changed from hand-production to machine production.

 

The early machines were mostly made of wood and were operated by water-power, and shortly thereafter by steam power.  With the invention of the electric motor and development in metallurgy the machines became metal and also more highly efficient, multitudinously increasing their productive capacities.  Where in the Eighteenth Century it took ten people to produce enough to free one from labor, now gradually one person could produce enough to supply ten individuals with all their basic needs.  Life and the concept of work changed.  A percentage of the handicraft people were displaced becoming superfluous; these were the luggites.  Machines did their work a hundred times faster than they could by hand.  The level of productivity brought about by the Industrial Society achieved by the middle of the Twentieth Century a level of supply of goods and services in the Industrial Nations that had been inconceivable earlier.  It also brought about the Business Cycle — prosperity, recession, depression, and recovery — in a never ending pattern erratically coming about in shorter or longer periods of time.

 

Recession and depression, presumably caused by overproduction, brought about a situation in which there was fair to large scale unemployment, reduced consumption of goods and services in an economy where the overall workforce strongly desired to work and consume but could not.  The economy had broken down, ceased to smoothly function.  The willingness to work was there but the economy could not utilize it.  For one reason or another the basic rudiments that caused the economy to smoothly flow no longer worked. 

 

The question here is why?  There is a ready and willing workforce anxious to labor and consume the goods and services produced but there is no work for them and very little for them and their families to consume.  WHY?

 

The grease that allows the economy to function is money.  The distribution of that entity throughout an economy, the amounts that each family unit earns or has determines who will get how much of the goods and services produced.

 

How then is money distributed within a society?  The different occupations receive different levels of remuneration.  Unskilled labor, which is mostly grunt type work requiring generally brute strength only would be the lowest paid earnings.  In many cases, not enough is earned to provide for the basic needs of an individual or family.  Skilled labor, on the other hand, can go from a fair standard of living to a level where the amount of money earned cannot possibly be spent because of its vastness in the millions.

 

Money can also be stored, not used for consumption, but put into banks or other financial institutions where it earns interest.  In addition it can be used as a commodity where it can earn profit.  Used this way it tends to increase the productive capacity of a nation; but this has nothing to do with the distribution of goods and services.

 

Money, in the form of profit (Adam Smith’s “invisible hand”) becomes the motivating force behind production of both goods and services.  Profit, from the sale of goods or the charge for services and the accumulation of money is the motivation for production.  This accumulation allows a small percentage of the population to amass large amounts but again, has nothing to do with a reasonable distribution of the specie.

 

It can be argued that Adam Smith’s “invisible hand” works on every level of the economy.  Given a choice the laborer, white collar worker, executive, entrepreneur will take that position which pays the greatest amount or has the best advantages.  Therefore each entity within the society is functioning where he/she can in their own interest; doing the best for themselves and their family unit.  But, again, what has this to do with a fair distribution of the National Income?

 

Several interesting questions arise here: Is money really related to the production of goods and services?  And if it is not then in what way would distribution be accomplished?  Since volume of production is tied directly to volume of consumption how, if we are to avoid upturns and downturns (constant recovery and recession), can we maintain a steady course of production and distribution of goods and services? 

 

The economic model (capitalism) was stated in 1776 by Adam Smith in his book “An Inquiry into the Wealth of Nations,” which was published that year.  Smith designed his model for a pre-industrial nation, for a time when production could not meet the overall needs of everybody in the society.  We are now almost into a postindustrial society moving rapidly through and into the computer Revolution.  We are still prone to the vicissitudes of the Business Cycle.  Can we afford this kind of continual economic up and down turn?

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The Twenty-first Century promises to be a time of intense change.  If we continue to adhere to what we have now then the economic upheavals can be catastrophic.  The Great Depression of 1929 could be mild compared to what we may face. In 2008 we faced such a situation.  It was avoided by massive spending by Presidents Bush and Obama.  

 

Donald Trump seems to be pointing toward the pre-2008 period.  He could, during his four year presidency, bring us back to an economic situation as bad as or far worse than the potential 2008 Depression. 

 

To avoid the possibility of negative economic change within our economy the country needs a new economic model or it has to make massive changes within our present system.