While there is much talk about the Republican Party finding itself these days, there is a parallel conversation about post-Obama Democrats. In a Politico report this morning, they frame the discussion as being about income inequality. That is incorrect.
““The real struggle within the Democratic Party is where you stand on income inequality and whether the government needs to be a part of fixing that problem,” said Rep. Keith Ellison (D-Minn.), co-chairman of the Congressional Progressive Caucus. “The demographics that the Democratic Party must attract are the people who need responsive government.”
What Americans need is a sustainable economy that provides a good life for all citizens for their life cycle in the absence of poverty. It is based on people being self determined and self reliant, although within an economic environment created by government policy, laws and regulations acting in concert with free enterprise. Capitalism has been the economic model underlying this, and that model is in question as it may be improved.
Indications that capitalism isn’t working properly is that wealth has been skewed and concentrated into the hands of too few, depleting the middle class and increasing the number of impoverished persons. What are the causes of this circumstance?
In researching the topic while preparing to write another book, I discovered Dr. John Ikerd, a professor farmer from Missouri. He wrote the following.
If our capitalistic economy is not sustainable, neither are our farms or ultimately our society or humanity. Some questions are so important that no one can afford to remain uninformed, uncommitted, and uninvolved.
Is capitalism sustainable? Not the type of capitalism that dominates American and most global economies today. This is not a matter of personal opinion, but a direct consequence of the most fundamental laws of science. Sustainability ultimately depends upon energy because anything that is useful in sustaining life on earth ultimately relies on energy. All material things that are of any use to humans – food, clothes, houses, automobiles, – require energy to make and energy to use. All useful human activities – working, thinking – require human energy. Physical scientists lump all such useful activities together and call them “work.” All work requires energy.
In performing work, energy is always changed in form. In fact, the natural tendency of energy to change from more concentrated to less concentrated forms gives energy its ability to perform work. All material things, such as food, gasoline, plastic, and steel, are just highly concentrated forms of energy. Matter can be converted into energy, as in eating food or burning gasoline, and the form of energy can be changed, as in using heat to make electricity and electricity to produce light. However, even though work invariably changes matter to energy or changes the form of energy, no energy is lost. This is the first law of thermodynamics, the law of energy conservation, as in Einstein’s famous E=MC2.
At first, it might seem that energy could simply be recycled and reused forever, as if sustainability would be inevitable. However, once energy is used to perform work, before it can be used again, it must be reconcentrated, reorganized, and restored. Unfortunately, it takes energy to reconcentrate, reorganize, and restore energy. And, the energy used to reconcentrate and restore energy is simply no longer available to do anything else. It has lost its usefulness. This is the law of entropy, the second law of thermodynamics; the tendency of all closed systems to tend toward the ultimate degradation of matter and energy; toward inert uniformity; an absence of structure, pattern, organization, or differentiation. The barren surfaces of the Moon or Mars are examples of systems near entropy.
Since loss of useful energy to entropy is inevitable, it might seem that sustainability is impossible. Even if waste and pollution could be completely avoided in the processes of using and reusing energy, the tendency toward entropy would continue. In fact, life on earth would not be sustainable without the daily inflow of new solar energy. Sustainability ultimately depends upon the use of solar energy to offset the unavoidable effects of entropy.
Capitalism is a very efficient system of energy extraction, but it provides no incentive to reconcentrate and restore energy to offset entropy. Capitalists have no economic incentive to invest in energy renewal for the benefit of those of future generations. Capitalists reduce waste and pollution or reuse resources only when it is profitable to do so, meaning only when it is in their individual self-interest to do so. Capitalists have incentives to use renewable energy to support current consumption, but not to re-storing energy for future generations. Capitalism inevitably tends toward physical entropy.”