[p2p-research] America Out of Work: Is Double-Digit Unemployment Here to Stay? - TIME

[Paul D. Fernhout]

From:
"Jobless in America: Is Double-Digit Unemployment Here to Stay?"By Joshua 
Cooper Ramo
http://www.time.com/time/printout/0,8816,1921439,00.html
"""
The American economy has been shedding jobs much, much faster than Okun's 
law predicts. According to that rough rule, we should be at about 8.5% 
unemployment today, not slipping toward 10%. Something new and possibly 
strange seems to be happening in this recession. Something unpredicted by 
the experts. "I don't think," Summers told the Peterson Institute crowd — 
deviating again from his text — "that anyone fully understands this 
phenomenon." And that raises some worrying questions. Will creating jobs be 
that much slower too? Will double-digit unemployment persist even after we 
emerge from this recession? Has the idea of full employment rather suddenly 
become antiquated? Is there something fundamentally broken in the heart of 
our economy? And if so, how can we fix it?
...
America now faces the direst employment landscape since the Depression. It's 
troubling not simply for its sheer scale but also because the labor market, 
shaped by globalization and technology and financial meltdown, may be 
fundamentally different from anything we've seen before. And if the result 
is that we're stuck with persistent 9%-to-11% unemployment for a while — a 
range whose mathematical congruence with that other 9/11 is impossible to 
miss — we may be looking at a problem that will define the first term of 
Barack Obama's presidency the way the original 9/11 defined George W. 
Bush's. Like that 9/11, this one demands a careful refiguring of some of the 
most basic tenets of national policy. And just as the shock of Sept. 11 
prompted long-overdue (and still not cemented) reforms in intelligence and 
defense, the jobs crisis will force us to examine a climate that has been 
deteriorating for years. The total number of nonfarm jobs in the U.S. 
economy is about the same now — roughly 131 million — as it was in 1999. And 
the Federal Reserve is predicting moderate growth at best. That means more 
than a decade without real employment expansion.
"""

So, there it is, at least ten years of "jobless recovery".

See also:
"How to think about a jobless recovery"
http://www.economist.com/blogs/freeexchange/2009/07/how_to_think_about_a_jobless_r.cfm
"Not a pretty picture. But with output variables moderating while employment 
variables continue to sink, there is every indication that recovery from 
this recession, when it arrives, will do little for many of the unemployed 
for years to come. Time to start thinking about why this is the case, and 
what can be done about it."

And in other places I see this too.

Economists going on about "no one understands what is going on".

When all this was predicted in 1964 and even earlier:
   http://educationanddemocracy.org/FSCfiles/C_CC2a_TripleRevolution.htm
"""
The fundamental problem posed by the cybernation revolution in the U.S. is 
that it invalidates the general mechanism so far employed to undergird 
people’s rights as consumers. Up to this time economic resources have been 
distributed on the basis of contributions to production, with machines and 
men competing for employment on somewhat equal terms. In the developing 
cybernated system, potentially unlimited output can be achieved by systems 
of machines which will require little cooperation from human beings. As 
machines take over production from men, they absorb an increasing proportion 
of resources while the men who are displaced become dependent on minimal and 
unrelated government measures—unemployment insurance, social security, 
welfare payments. These measures are less and less able to disguise a 
historic paradox: That a substantial proportion of the population is 
subsisting on minimal incomes, often below the poverty line, at a time when 
sufficient productive potential is available to supply the needs of everyone 
in the U.S.
   The existence of this paradox is denied or ignored by conventional 
economic analysis.The general economic approach argues that potential 
demand, which if filled would raise the number of jobs and provide incomes 
to those holding them, is underestimated. Most contemporary economic 
analysis states that all of the available labor force and industrial 
capacity is required to meet the needs of consumers and industry and to 
provide adequate public services: Schools, parks, roads, homes, decent 
cities, and clean water and air. It is further argued that demand could be 
increased, by a variety of standard techniques, to any desired extent by 
providing money and machines to improve the conditions of the billions of 
impoverished people elsewhere in the world, who need food and shelter, 
clothes and machinery and everything else the industrial nations take for 
granted.
   There is no question that cybernation does increase the potential for the 
provision of funds to neglected public sectors. Nor is there any question 
that cybernation would make possible the abolition of poverty at home and 
abroad. But the industrial system does not possess any adequate mechanisms 
to permit these potentials to become realities. The industrial system was 
designed to produce an ever-increasing quantity of goods as efficiently as 
possible, and it was assumed that the distribution of the power to purchase 
these goods would occur almost automatically. The continuance of the 
income-through jobs link as the only major mechanism for distributing 
effective demand—for granting the right to consume—now acts as the main 
brake on the almost unlimited capacity of a cybernated productive system.
   Recent administrations have proposed measures aimed at achieving a better 
distribution of resources, and at reducing unemployment and underemployment. 
A few of these proposals have been enacted. More often they have failed to 
secure congressional support. In every case, many members of Congress have 
criticized the proposed measures as departing from traditional principles 
for the allocation of resources and the encouragement of production. Abetted 
by budget-balancing economists and interest groups they have argued for the 
maintenance of an economic machine based on ideas of scarcity to deal with 
the facts of abundance produced by cybernation. This time-consuming 
criticism has slowed the workings of Congress and has thrown out of focus 
for that body the inter-related effects of the triple revolution.
   An adequate distribution of the potential abundance of goods and services 
will be achieved only when it is understood that the major economic problem 
is not how to increase production but how to distribute the abundance that 
is the great potential of cybernation. There is an urgent need for a 
fundamental change in the mechanisms employed to insure consumer rights.
"""

A recap of what mainstream economists are ignoring or misunderstanding:

Increasing automation and better design, in the face of limited demand, 
leads to increasing unemployment. Very straightforward to understand it 
would seem.

And, if it had not been for:

* wars to destroy abundance,
   http://en.wikipedia.org/wiki/US_Wars
   http://www.lexrex.com/enlightened/articles/warisaracket.htm

* compulsory schooling of ever increasing length (people used to get just a 
few years of schooling around age ten, and now may be in school until their 
late 20s and early 30s),
   http://www.johntaylorgatto.com/underground/toc1.htm
http://web.archive.org/web/20071014123355/http://www.social-ecology.org/article.php?story=20031028151034651

and

* imprisoning or otherwise tracking about 2% of the US population (so, 
people don't work and their are jobs guarding them)
   http://en.wikipedia.org/wiki/Incarceration_in_the_United_States
"The United States has the highest documented incarceration rate,[3][4] and 
total documented prison population in the world.[3][5][6] As of year-end 
2007, a record 7.2 million people were behind bars, on probation or on parole."

then this issue of increasing unemployment would have happened a lot sooner.

And, the entire work world, based heavily on creating other guarding work 
like cashiers and one-third of every health care dollar spent on financial 
paperwork means the economy is poised to "implode" in the face of other 
improvements:
   http://www.whywork.org/rethinking/whywork/abolition.html
"I don't suggest that most work is salvageable in this way. But then most 
work isn't worth trying to save. Only a small and diminishing fraction of 
work serves any useful purpose independent of the defense and reproduction 
of the work-system and its political and legal appendages. Twenty years ago, 
Paul and Percival Goodman estimated that just five percent of the work then 
being done -- presumably the figure, if accurate, is lower now -- would 
satisfy our minimal needs for food, clothing and shelter. Theirs was only an 
educated guess but the main point is quite clear: directly or indirectly, 
most work serves the unproductive purposes of commerce or social control. 
Right off the bat we can liberate tens of millions of salesmen, soldiers, 
managers, cops, stockbrokers, clergymen, bankers, lawyers, teachers, 
landlords, security guards, ad-men and everyone who works for them. There is 
a snowball effect since every time you idle some bigshot you liberate his 
flunkies and underlings also. Thus the economy implodes."

Granted, in the USA there have been counter-trends like women moving into 
the work force, which have been matched rising expectations.
   http://users.ipfw.edu/ruflethe/american.html
But expectations have leveled off. So those counter-trends have played out 
IMHO. And, within the USA, offshoring has now become a counter-counter-trend.

Short of more war, more schooling, and more prisons, and more other guarding 
in society, the other solutions to mass unemployment are:
* a basic income (and universal health care) within the market;
* local subsistence production with gardening and 3D printing etc.; and
* a transition to a post-scarcity gift economy as has already been happening 
with peer production through an open commons like with GNU/Linux and Wikipedia.

Marshal Brain's Manna fiction revolves around only the first of these three, 
though he otherwise defines the problem well.
   http://www.marshallbrain.com/manna1.htm

How does one best get this message out, assuming economists and others want 
to hear it?

--Paul Fernhout
http://www.pdfernhout.net/