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2.5: Economics

next chapter: 3.2 Management

3 Orientation and Steering

3.1 The Orientation of Economics and the Orientation of Development. The Critical Factors for Steering Purposes

3.1.1 Summary of the Basic Economic Laws

There is a set of simple, basic laws that describe the economic processes. "Development" is strongly related to this economic process, as

> Production is the most important field of social action <

- but the problem is, that the economic process does not deal with its impact on the social, cultural and natural environment and not with the all-over aims of society. Its orientation is the fastest road to:

A)

- The strive for personal profit.

- Produce the maximum output with the minimum input.

- The bigger profit is preferred to the smaller one.

- The quick profit is preferred to the deferred one.

What is the first rule for the creation of a self-propelling economy - the accumulation and productive re-investment of capital - changes at the end into its major problem:

B)

The capitalist economy needs expansion, needs innovation - dominated by technical innovation, while on the social level it needs submission to a very restrictive thinking, concentrating on productive efficiency, rationality in decision making and administration, functionality and professional specialisation (s. Max Weber). Efficient production and trade do not allow to ask for the meaning of such production, its products and the lifestyle it induces.

The fact that "productivity growth is dependent on production growth" (Verdoorn Law) is enhancing the discrimination between productive economic cores and an exploited periphery, as well as special, isolated markets (developing countries, e.g. Yemen). This increasing discrimination does not only happen on the geographical level (North-South), but as well on an economical level, between capital and labour, trade and industrial production - between all those and the primary production.

The origin of the need for growth is:

The possibility to make money just with money. Calvin wrote most probably the satanic verses of Christianity, when disposing with the prohibition of interest. It is the strive for always more that does not allow economy, and with it society, to "stabilise", to really develop a balance of production and demand. The present system does not develop towards an equilibrium. It is the opposite - an equilibrium would be its end!

The "laws of growth" are for money roughly the same as for trees: the right environment and, as we say in forestry - wood grows on wood. Where a lot of capital is available, it is more easy to get more credits. Big capital can be invested for higher interest rates than small amounts, big companies produce cheaper (economy of scale) - and all that leads to the result, that "money is growing on money". This accelerating accumulation leads to the "peripherisation" and declassification of ever increasing parts of society. The political problem connected to that development is, that:

This fact undermines the political control of power, traditionally divided into legislative, executive and judicatory power.

These growth laws are not only valuable for private clusters of capital, but also for larger geographical units:

Those developed at natural resource centers as centers for production and trade.

Inside towns again there are nuclei of wealth, more often than not families that developed from aristocrats to plutocrats, that had the knowledge and relations (social networks), had access to decision makers, could use their political and monetary influence on decision makers to their favour.

3.1.2 The Limits of the system

The market-system restricts the world-view to a system that serves well individual, smaller or larger scale business. But - as any fixed system, it excludes more than it includes. It's functional, professional, individual ethics does not sum up to a holistic, social ethic!

Orientation in time is lacking. In the time-categories of thinking are:

Economy is fixed on the present, with only very limited interest in the the future. "Imaginatio" is used to create and sell products - with the help of psychology to detect individual aspirations (towards upper-class models and other idols e.g.) - and to enhance those. But economy does not have any respect for the past or for the future. The process of productivity increase is depleting natural resources, reduces diversity - not only bio-diversity, but as well cultural diversities (languages, costumes, cuisine) - and last not least the time available for socialisation.).

Time is money! Here lays the "original sin" of capitalism, born in the negation of religious rules against the interest. Time was belonging to God. Now it belongs to those that have money and time is only worth exactly as much as is produced during its span. The other uses of time, the "unproductive" ones, for social dealings, for meetings, for dreaming, for thinking, for planning, for politics - is more and more restricted or commercialised. Even the aim of "leisure" is reduced to the function of restoring the productive forces.

Additional to the lack of time due to the full integration into the work process, there are more and more people, that need all their time just to look for jobs. Short term contracts, work on demand, longer time needed to get new jobs, more time needed to get to the work, changing workplaces - this destroys the social integration, the roots, and leads to a "beduinisation" of society. Among the beduins in the desert, cooperation is a must. The new job-hopping beduins are trained to care for nothing than themselves and their work. No wonder that no social cohesion is left! But with the freedom for meaningful aim-oriented socio-cultural development, the individual freedom is disappearing as well.

Care for External Resources is lacking

Due to productivity increases, the inherent growth process, the "less productive" is eliminated, or changed into "more productive". This is positive as long as we talk about internal changes of the system (change from industry to service e.g.) - but is critical if it expands to landscapes (forests converted into agriculture), cultures (agriculture converted into industry) and society (human work replaced by machines and energy, by profit of and for the capital).

The market system has surely its advantages, but driven to its extremes, restricting everything to the view of the "winners" - it has to fail. Competition makes not only winners! The "elimination of the (economically!) unproductive" is driving lower social strata down to subsistence level or even below. The present system of market is interesting for those that "that got the chance", "that have already", "that are in a good position", that are "useful" for the market - for winners. No care, decreasing care even in Europe, is given to the losers. Justice and equality do not have a price, that means, they are of no interest for the market.