Tuesday, December 20, 2011

It’s us against the Whirl

There is no “they” in charge.  That would be nice.  Then we could find “them” and do something to solve the “problem”.  But there is no “they” in charge.  There are people making decisions that have a greater impact than the decisions of other people, but they are not in charge, they are just doing what everyone else is doing but on a larger scale.

There is a process, properly described as a whirl: “To revolve rapidly around a center or axis.”  A tornado is a whirlwind.  The whirl that we are up against has a precise mathematical form, but before I tell you what it is, let me use an analogy. 

Suppose you start driving around in a circle increasing your speed ten percent with each circle.  You do the first circle at 10 miles an hour, the second circle at 11 miles an hour, the third circle at 12.1 miles an hour, etc.  How fast would you be going by the 100th circle? 

By the tenth circle you would be going 26 miles an hour, by the 20th circle you would be going 67 miles an hour, by the 30th, 174 miles an hour, by the 40th, 452 miles an hour… by the 100th circle, you would be going 138,000 miles an hour.  On the 105th circle you would be going 221,938 miles an hour, fast enough to reach the moon in one hour!  You would have created a whirl just by increasing your speed 10 percent per circle from 10 miles an hour.

Now apply the same math to money.  If a job paid $10 an hour to start and was increased 10 percent per year, in 10 years it would pay $26 an hour, in 20 years, $67 an hour, in 30 years, $174 an hour, … in 100 years, $138,000 an hour.  That’s the whirl we are up against.

Money numbers, what we call prices, income, wages, salaries, profits, and dividends, have risen by what seem like little, a few percentage points year after year after year to produce astronomical differences from person to person,   Not only does the top 1 percent have more money than the remaining 99 percent; there is enormous inequality among the 99 percent.

What can we do about it?

The first step is to convert all money numbers to Hours.  You can do it by dividing them by your wage per hour.  This will tell you how much things are costing you per hour of work.  We can do it together by dividing all money numbers by $20, which is about the median wage in the United States.  This step is like pilots being given altimeters for the first time so they can tell their altitude.  Before they could decide corrective action, they would need to know their correct altitude.  In the same way, we must first know how much money we are actually talking about before we can decide what policies to adopt.

The mathematical principle in the above description is: Any two numbers increased by the same percent become more unequal by the same percent.

Algebraically: AC – BC = C (A - B).

The whirl that we are up against is money numbers becoming increasingly unequal percent at a time.  That whirl has been growing for generations.  That’s why it is so visible today.  It’s a tornado tearing us up by more and more, faster and faster. 

I cannot overemphasize the critical importance of converting those numbers to hours, so we can begin to see what needs to be done.  We can stop the whirl right now by reducing interest rates to zero.  Lower interest rates are better; zero interest rates are best. 

Wednesday, December 14, 2011

What if cars did not have speedometers?

Imagine cars without speedometers.  How would you judge how safely you were driving?  There would be no speedometer on your instrument panel and no speed limit signs along the sides of the road.  One way you could estimate your speed would be how fast things are passing by.  That could work for a while at least.  But you know your sense of speed changes as you travel along.  At first, especially on a long trip, Your first few miles feel like you are driving fast but after a while, you find yourself driving a bit faster, even feeling like you are going slow when you are actually going a lot faster than when you started out.

Another way you could estimate how fast you were going is to watch other cars.  It would be reasonable to suppose that going as fast or as slow as they are is a safe speed.  That could work for a while, but remember how you sometimes feel that you are going too slow when you follow a car for a long distance.

With all drivers having no speedometers, instead feeling their speed by the seat of their pants, by watching the sidelines and other cars, that there would be a lot of accidents from going too slow or too fast.  We can imagine an industry evolving to build better cars, cars that would withstand the crashes better.  We have such devices even with speedometers and speed limit signs.  Without them, people would misjudge speeds more often across a wider range of speeds and have more and worse accidents.  The there would be calls for more crash resistant cars.

So it is with money.  It has no “speedometer,” only a word, in our case, “dollar.”  The word has us feeling like we have a measure of “speed” but we judge the value of our money by watching many prices and wages and salaries of as many people as we can.  It’s not easy because stores don’t mark prices like they used to because they now use barcodes and people rarely tell one another their wage or salary.  Variations in prices, wages, and salaries would grow wider and we would hear calls to limit them, but no one would know how or by how much.

Time money denominated in Hours would give us all the “priceometer” that we need.  Wages and salaries would still vary just like roads and speed limits vary, but the range of variation would be more reasonable because when people talked money they would talk time.  Hours on money would empower everyone to judge the fairness of prices and wages on their own, just like you can judge your speed simply by looking at your speedometer.  Think about this the next time you are driving your car.  Of course, keep your eyes on the road except for an occasional glance at your instrument panel.  Remember, Safety first.  Speed kills and so does money without a proper denominator.

Monday, December 12, 2011

Why is war what we say we need?

We get what we prepare for.  We are preparing for war all the time. President Eisenhower called it the “military industrial complex.”  With weapons being built every day, when a problem arises, there are powerful voices that call for war.  We are hearing it again about Iran. 

Mohammad Mosaddegh was the democratically elected Prime Minister of Iran from 1951 to 1953 when he was overthrown by the British MI5 and the United States CIA.  Why? Because he nationalized the Iranian oil industry.  He introduced many other progressive reforms including unemployment compensation, employer payment benefits to sick and injured workers, peasants freed from forced labor on landlords’ estates, and 20 percent of landlord rent money put in a fund for public baths, rural housing, and pest control.  Mosaddegh was imprisoned for three years, then put under house arrest until his death in 1967.  (Source: Wikipedia)

In his place our CIA supported the Shah of Iran, a dictator with a brutal police force.

Imagine all the goods things that would happen if we prepared for peace.  Today, Afghanistan, Iraq and many other countries would be living well and be our friends if we had helped them with tools instead of bombing them to hell on earth. 

In this season of Jesus’ birth, we should remind ourselves that he was the Prince of Peace.  He taught that we should love not only ourselves and our families and our countries but we should love our enemies.  Why? Because in loving our enemies we would soon make them our friends.  President Abraham Lincoln was confronted by a woman who complained that he wanted to treat the losers of the Civil War like friends – “With malice toward none and charity toward all …”  He responded, “If I make my enemies my friends, have I not defeated my enemies?”  So it should be with us. 

No one ever made friends by bombing them.  Make peace with Iran.  We are the country with thousands of nuclear weapons.  Why are we not dismantling those weapons instead of upgrading them?  Israel, Pakistan, India, Russia – all have nuclear weapons.  Iran has none – but lots of oil.  Sound familiar? 

Peace on earth will come only by preparing for peace.  You can read The Peace Agenda on my website: http://www.siue.edu/~rblain  Congressman Dennis Kucinich wants a Department of Peace.  I think that is an excellent idea.  How about you?

Sunday, December 4, 2011

Peace on Earth

Peace we wish to all on our little planet - too small for war, too bountiful for poverty.

In the spirit of the season from Kahlil Gibran, The Prophet, 1923:

“To you the earth yields her fruit and you shall not want if you but know how to fill your hands.

“It is in exchanging the gifts of the earth that you shall find abundance and be satisfied.

“Yet unless the exchange be in love and kindly justice, it will but lead some to greed and others to hunger.'”