As the capitalists and socialists continue their past savings-based “tastes-great-less-filling” argument that manages to avoid any of the real issues (such as why do both insist that only past savings can be used to finance new capital formation), the stock market is wavering.
Not that the stock market, up or down, is any real indication of what’s going on in the real world, but it is something of an economic indicator. Not of economic growth or decline, of course, but of the gamblers’ confidence in how various factors will affect their bets on the economy, so that they will know whether to place their bets to go long or short.
For example, employment figures are important not because human labor is responsible for the bulk of production in a modern economy, but because it means that consumption income for those now employed will come from the private sector cost-push inflation instead of public sector demand-pull inflation.
Translation: Paying higher wages drives up the cost of producing marketable goods and services, which costs are passed on to the consumer. Multiplying or creating jobs when technology can do the same thing cheaper also increases costs that are passed on to the consumer. This is “cost-push inflation” — the rising cost of an input to production “pushes” prices up.
This is not to say that higher wages and unnecessary “job creation” also contribute to “demand-pull inflation.” When the wages and job creation are subsidized, the money comes out of increased government debt — money creation. Whether paid to consumers as welfare or to workers whose employment is effectively boondoggling, effective demand in the economy increases, which “pulls” prices higher in response, hence, “demand-pull inflation.”
Of course, all this would be moot if 1) all people were capital owners and the price of labor could rise or sink to its “real” level, 2) all financing for new, non-speculative capital investment came out of future savings instead of past savings, and 3) government was prohibited from creating money (“emitting bills of credit”), living within its tax revenues, and borrowing out of existing savings to cover temporary shortfalls or meet emergencies.
That’s what Capital Homesteading would do. To bring this about, here’s what we’ve been doing this past week:
• All eyes this week were on the re-enactment of the “March on Washington,” even more than were on the sesquicentennial of the Battle of Gettysburg earlier this year. What is interesting about the comparison is that, where Gettysburg contributed greatly to bringing the Civil War to a successful conclusion, the March on Washington set the stage for great advances in securing and protecting civil rights equality. The difference is that where the Thirteenth and Fourteenth Amendments and the success of the Homestead Act followed Gettysburg, the Civil Rights movement failed to secure its gains by building capital ownership into ordinary people. All the rhetoric in the speeches during the reenactment was for “jobs” instead of ownership, and government action instead of the “people power” that Martin Luther King, Jr. was able to mobilize.
• The “Just Third Way Edition” of Fulton J. Sheen’s 1940 opus Freedom Under God will be officially published as of Labor Day, September 2, 2013. The book itself is in the public domain and can be republished by anyone, having lost its copyright protection on January 1, 1968 due to the failure of the copyright holder, the Bruce Publishing Company of Milwaukee, Wisconsin, to renew the copyright registration as required. The “value added” material in CESJ’s Just Third Way Edition — the Foreword, Bibliography, Index, and additional notes and annotation — however, are copyrighted by CESJ.
• If you like the cover to Freedom Under God, you can thank Photographer Louis Fabian Bachrach, who gave his gracious permission for the use of the photograph he took of Fulton Sheen in 1965.
• If you would like a free .pdf of the text of Freedom Under God for review or endorsement, please send a request to “publications [at] cesj [dot] org.” If you are a reviewer, tell us a little bit about the publication where the review will appear. If you are endorsing, give us a line or two about yourself.
• CESJ cannot take retail orders for books, only bulk/wholesale orders for drop shipment from our distributor. Please do not attempt to order individual copies or small quantities from CESJ. We will post a notice when the book is available in retail outlets. At this time we are accepting bulk/wholesale orders only, which we expect to be shipped within three to four weeks.
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• As a historical note tying in to the March on Washington, it’s significant that “The Conspiracy” only gained credibility in the United States after the “free land” available under the Homestead Act effectively ran out in the 1890s, and the lack of consumption power combined with too-rapid expansion of industrial and commercial capacity triggered the Panic of 1893 and the Great Depression of 1893-1895. Talk of “The Conspiracy” went into remission in the U.S. following the end of the Great Depression due to bumper crops of wheat in 1897 and 1898 and crop failures in Europe. At the same time, “The Conspiracy” gained a great deal of traction in Europe where capital ownership was becoming much more concentrated than in the U.S. and economic hardship was spreading. The Sixteenth Amendment and the Federal Reserve Act instituted critically needed monetary and fiscal reforms, but were diverted by the need to finance U.S. entry into World War I, and hijacked completely to finance and implement the New Deal and then finance World War II. The New Deal turned the proletarian (propertyless) condition in America from an unfortunate side-effect of advancing technology and lack of financing for widespread capital ownership into a presumably essential condition for society to advance. The “American Dream” was transformed from small capital ownership to high wages, benefits, and government welfare.
• As of this morning, we have had visitors from 73 different countries and 49 states and provinces in the United States and Canada to this blog over the past two months. Most visitors are from the United States, Australia, Canada, the United Kingdom, and India. The most popular postings this past week were “Shakespeare Speaks! (Again),” “If You Have a Free Moment,” “Thomas Hobbes on Private Property,” “News from the Network, Vol. 6, No. 34,” and “Was Pope John Paul II a Socialist?”
Those are the happenings for this week, at least that we know about. If you have an accomplishment that you think should be listed, send us a note about it at mgreaney [at] cesj [dot] org, and we’ll see that it gets into the next “issue.” If you have a short (250-400 word) comment on a specific posting, please enter your comments in the blog — do not send them to us to post for you. All comments are moderated anyway, so we’ll see it before it goes up.