Capitalism seems to have dual personalities as it pertains to our country.

“Greedy capitalism” is when corporations do whatever it takes to build the cheapest product possible so they can make more profit for the few managers at the top. They buy components from the cheapest global suppliers and sell their product to any market available regardless of location.

“Patriotic capitalism” will use US based suppliers for all parts and product because it will keep jobs here. This will create product loyalty and allow local people to purchase the product and pay taxes, which will support the US economy.

If US citizens stop buying foreign goods and start buying US made goods again – it will almost immediately turn our economy around. The bad news is that is has to start with the US automakers because they have a positive impact on the largest number of potential jobs. If the bail out is not handled correctly it will allow Chrysler, Ford and GM to keep doing business as usual until they totally fail in the near future. The automotive industry is possibly the only one that can support itself and many other industries due to the high profit generated by the sale of vehicles.

Another sticking point is that the union wages and benefits must be reduced to allow the big three to compete more fairly on the global scale. There are many non-union companies that can compete globally but they are closing their doors due to the poor economy.

Regarding the first point, it is true that, until fairly recently in human history, productivity improvement has enabled development (not “driven,” a subtle distinction, I suppose) by freeing up labor to tackle new challenges and provide new products. But, when new products aren’t developed at a rate sufficient to utilize the excess labor that has been freed up, then productivity improvement only serves to drive unemployment higher, in which case there is no productivity improvement at all, when the total output of the society is divided by the total labor force available. That’s precisely where we are right now.

Regarding my second point, any strategy for “economic growth” relies upon population growth as a key driver. But we have arrived at the point where rampant population growth threatens our economy and quality of life. I’m not talking just about the obvious problems that we see in the news – growing dependence on foreign oil, carbon emissions, soaring commodity prices, environmental degradation, etc. I’m talking about the effect upon rising unemployment and poverty in America.

I should introduce myself. I am the author of a book titled “Five Short Blasts: A New Economic Theory Exposes The Fatal Flaw in Globalization and Its Consequences for America.” To make a long story short, my theory is that, as population density rises beyond some optimum level, per capita consumption of products begins to decline out of the need to conserve space. People who live in crowded conditions simply don’t have enough space to use and store many products. This declining per capita consumption, in the face of rising productivity (per capita output, which always rises), inevitably yields rising unemployment and poverty.

This theory has huge implications for U.S. policy toward population management. Our policies that encourage high rates of population growth are rooted in the belief of economists that population growth is a good thing, fueling economic growth. Through most of human history, the interests of the common good and business (corporations) were both well-served by continuing population growth. For the common good, we needed more workers to man our factories, producing the goods needed for a high standard of living. This population growth translated into sales volume growth for corporations. Both were happy.

But, once an optimum population density is breached, their interests diverge. It is in the best interest of the common good to stabilize the population, avoiding an erosion of our quality of life through high unemployment and poverty. However, it is still in the interest of corporations to fuel population growth because, even though per capita consumption goes into decline, total consumption still increases. We now find ourselves in the position of having corporations and economists influencing public policy in a direction that is not in the best interest of the common good.

The U.N. ranks the U.S. with eight other countries – India, Pakistan, Nigeria, Democratic Republic of Congo, Bangladesh, Uganda, Ethiopia and China – as accounting for fully half of the world’s population growth by 2050. The U.S. is the only developed country still experiencing third world-like population growth.

If you’re interested in learning more about this important new economic theory, I invite you to visit my web site at OpenWindowPublishingCo.com where you can read the preface, join in my blog discussion and, of course, purchase the book if you like. (It’s also available at Amazon.com.)

Please forgive the somewhat spammish nature of the previous paragraph. I just don’t know how else to inject this new perspective into the overpopulation debate without drawing attention to the book that explains the theory.

Pete Murphy
Author, “Five Short Blasts”

You can not take one aspect of technology or one aspect of society and say, well this bit has improved therefore it must be good, without considering the cascading impacts it has elsewhere.

There are always cascading impacts on other things we do.

The obvious one, is that the development of IT has resulted in the development of games consoles, which in turn has resulted in more TV sets being produced, gadgets being used etc.

Your first big mistake is to bother with what most economists say or write. The environment doesn’t factor in most economic thinking, it’s an infinite resource for most of them.

Unless you make people work physically or mentally harder then the only way of getting more productivity is to use more energy and material resources. That is basically the cause of most environmental problems.

Sure you/we need a new economic model. But pretending that a boost in ‘productivity’ is going to cure the climate is basically barking up the wrong tree.

Any economic plan must result in humanity living within its means and that will often mean ‘doing without’ or ‘making do’ with what you have got.

Some light reading:

http://www.newscientist.com/article/mg20026786.100-special-report-why-politicians-dare-not-limit-economic-growth.html

http://portal.surrey.ac.uk/portal/page?_pageid=822,494813&_dad=portal&_schema=PORTAL

Ted touches on a valid point- where did that all that economic growth from “increased productivity” go to? Who is now doing more with less? Well, between 1979 and 2000 the poorest 20% of Americans got 0.8% of the total income growth; the middle 20% got 5.1% of it, while the wealthiest 20% got 74% of total income growth and within that bracket 38.4% went to the richest 1% of the population alone(EPI: The State of Working America).

Of course, the supply-side and monetarist economics favored by Neo-liberal think tanks would see this as no problem at all. They’ve gone so far as to pretend the Great Depression had nothing to do with a lack of demand. But the exploited middle/working classes’ ability to finance their consumption through debt has been cripple by the successive collapse of the dot come and housing bubbles (along with any claims to validity of monetarist economics).

We need to be wary of Greenwashed Reaganomic policies coming from people like the CATO institute focused on robbing from the public to give to that same richest 20% (or more likely the top 1%) to create windfall profits for private sector construction of the new green infrastructure and agriculture we do desperately need. Public financing is critical but its equally critical where it goes, to whom is the “return on investment” returning? As Van Jones warns, trying to recreate the glory days of growth Teryn points to here using the same engines of inequality is a dead end.

More on these half-baked ideas later…

In modern times, this means that the only way to sustainably create more money tomorrow is to innovate today. This is the tiny little flaw of Wall Street that Innovation Economics will correct.

There are a few simple web applications discussed at http://www.ingenesist.com which will allow human knowledge to become tangible outside of the organizational construct of a corporation, and therefore out from under the thumb of Wall Street.

These applications are as follows:

1. The knowledge Inventory

2. The Percentile Search Engine

3. The Innovation Bank

Believe it or not, human knowledge would make a wonderfully tangible asset upon which to peg a currency – better than Gold, Silver, Oil, or Debt. This can be done today with today’s social networking technologies.

Many people have a deep sense that something very new, something very exciting, and something hugely lucrative is coming down the road as Web 2.0 converges to Web 3.0. Our hope is that we can capture it in our communities before it passes us by and becomes “Incorporated” in the old business model.

If we work together, Innovation Economics can be the best way to capture the engine of wealth creation and distribution for ourselves and our communities. Now is the time to build the Innovation Economy. Our research is open to you.