Business Synthesis

Published on March 24th, 2014 | by Todd Smekens

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Income Inequality, Resource Exploitation: It’s Unjust and Unsustainable

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MUNCIE, Indiana – Over the past few years on income inequality, nearly all studies are reaching the same conclusion – due to increased technology, worker productivity increased dramatically. Unfortunately, all of those dramatic improvements in wealth extraction has gone to the upper 1%. All else being the same, the income and wealth of a typical worker has declined.

Home values and jobs have not rebounded so both the wealth and incomes of workers has suffered, yet both the wealth and income of the upper 1% have all returned to the same values as pre-2008, or have grown dramatically above those figures. The rich get richer and the poor get poorer.

Forget about the Middle Class. There are two classes in America: the Elite and the working class.

We can fight over religion, same-sex rights, immigration and other civil rights issues, but economic issues and the plight of our natural resources by the wealth extractors are the most glaring it’s ever been. Well, except for maybe the early 1900’s. If you’ve read Muncie Voice before, you know we’ve compared our current day to the Gilded Age. This comes from Wikipedia:

Reformers crusaded against child labor and for the 8-hour working day, civil service reform, prohibition, and women’s suffrage. State and local governments built schools, colleges and hospitals; private ones were founded, often with support from local philanthropists; numerous religious denominations built institutions as well, such as parochial school systems for Catholics and some Protestant groups.

Sound familiar?

Public education is being assaulted from the privatizers who use “school choice” to grab public education dollars to finance private and charter schools so they can get around laws separating church and state and cut teacher unions who they blame for our failing public education reports as compared to our international peers.

However, one only need spend 15 or 20 minutes with Diane Ravitch and she’ll tell you the correlation between poverty and test scores are indisputable. Teachers have used their already low salaries to subsidize classroom supply shortages which has gone on for decades. Exactly the opposite of our European peers who consistently rank high in test scores.

How long can the Elite in this country continue forcing austerity on the working class in this country? So far, it has worked as the working class remains evenly divided thanks to carefully placed political wedges between the populous.

The Tea Party demographic blame the liberals who want bigger government. The progressive blame the businesses for seizing control of the government. The establishment republicans and democrats live off the wealthy élite who control the economic and political structures.

How long can this continue?

Not only is this a matter of social justice, it’s also about sustainability.

According to a recent study coming from SESYNC, not much longer. It’s not sustainable. Here is what SESYNC’s website says about their organization:

The National Socio-Environmental Synthesis Center (SESYNC – sặ-sink) is dedicated to solving society’s most challenging and complex environmental problems by fostering collaboration amongst natural and social scientists, such as ecologists, sociologists, and political scientists. SESYNC brings together a national and international community of scholars from diverse disciplines, employing methods intended to accelerate synthesis, group productivity, and the production of actionable findings. SESYNC adapts and evolves these methods utilizing an experimental approach designed to benefit researchers and increase the likelihood that their research makes an impact beyond academic communities.

That might be a mouthful, but it’s worth a few minutes of your time. Safa Motesharrei, Jorge Rivas and Eugenia Kalnay used a mathematical model called HANDY to run some tests. They built a human population dynamics model by adding accumulated wealth and economic inequality to a predator-prey model of humans and nature.

We’re not sure if this is the same model which Albert Einstein referred to in his 1949 article titled, “Why Socialism?”, which we discussed in a recent article, but it certainly uses similar variables.

Four equations describe the evolution of Elites, Commoners, Nature, and Wealth. The model shows Economic Stratication or Ecological Strain can independently lead to collapse, in agreement with the historical record.

So they already applied it to existing data on earlier civilization collapses.

According to the research document, “In this paper we attempt to build a simple mathematical model to explore the essential dynamics of interaction between population and natural resources. It allows for the two features that seem to appear across societies that have collapsed: the stretching of resources due to strain placed on the ecological carrying capacity, and the division of society into Elites (rich) and Commoners (poor).”

Notice, they do not use the “political correct terms of ‘Middle Class’ or ‘Working Class'”. Could you imagine a corporate owned media company in this country using the two exact demographics of rich or poor?

You should spend some time reading the paper – it explains how workers productivity converts our natural resources into wealth for the Elite, or rich. Of course, technology helps workers be more efficient, but it also helps workers increase their productivity, thereby, making the rich, richer.

This is exactly what Albert Einstein predicted because the outcome of a capitalist system is predictable and unsustainable. What did these research professors conclude with this HANDY model?

Exactly what Einstein predicted – it’s unsustainable. Here is the conclusion from the research paper:

In sum, the results of our experiments…indicate that either one of the two features apparent in historical societal collapses |over-exploitation of natural resources and strong economic strati cation| can independently result in a complete collapse. Given economic strati cation, collapse is very difficult to avoid and requires major policy changes, including major reductions in inequality and population growth rates. Even in the absence of economic strati cation, collapse can still occur if depletion per capita is too high. However, collapse can be avoided and population can reach equilibrium if the per capita rate of depletion of nature is reduced to a sustainable level, and if resources are distributed in a reasonably equitable fashion.

What was Einstein’s 1949 theory? He called capitalism “evil”…why?

Because: The profit motive, in conjunction with competition among capitalists, is responsible for an instability in the accumulation and utilization of capital which leads to increasingly severe depressions. Unlimited competition leads to a huge waste of labor, and to that crippling of the social consciousness of individuals which I mentioned before. This crippling of individuals I consider the worst evil of capitalism. Our whole educational system suffers from this evil. An exaggerated competitive attitude is inculcated into the student, who is trained to worship acquisitive success as a preparation for his future career.

His solution is exactly the same as the professors who recommend, “If resources are distributed in a reasonably equitable fashion, then we can divert a collapse.

Einstein’s conclusion:

I am convinced there is only one way to eliminate these grave evils, namely through the establishment of a socialist economy, accompanied by an educational system which would be oriented toward social goals. In such an economy, the means of production are owned by society itself and are utilized in a planned fashion. A planned economy, which adjusts production to the needs of the community, would distribute the work to be done among all those able to work and would guarantee a livelihood to every man, woman, and child. The education of the individual, in addition to promoting his own innate abilities, would attempt to develop in him a sense of responsibility for his fellow men in place of the glorification of power and success in our present society.

Who would obstruct movement toward this kind of society, where all men and women are created equal, regardless of your birth right – privilege? Why don’t all Americans own the oil that lies under the soil? Who makes the rules that keep the poor, poor, while protecting the Elite?

Those who benefit from the existing system. The extractors of wealth. The Rich. The Elite. The Upper 1%.

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About the Author

Journalist, entrepreneur, publisher, DSA member, and ethical leader with a passion for truth-seeking. Enjoy cycling, yoga, meditation, and spending quality time with my daughter. Wellness advocate who practices servant style leadership.


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