Two Views: One Dated, One New.
28 December 2016 | Pago Pago, American Samoa
Mr. X: "Trickle-down economics" is precisely what took the masses in Europe and America from 40-year life expectancies in dirt-floor huts and cabins to modern living with indoor plumbing, personal computers, multiple cars per family and all the luxuries and conveniences of the modern world.
Kimball Corson: That was then, but now, matters are different. In the past when many working people were necessary for the wealthy, that need caused the spread of progress and some of the wealth across the masses who acted in service to the wealthy. Trickle down in the large worked and aided all in varying degrees. Technical change aided worker productivity. Now things are different. This is a new era.
Now, people are being displaced by machines owned by the wealthy and the pool of workers to serve the wealthy is being hugely thinned down to primarily the very smart and highly educated. Production processes have been refined and redesigned to reduce or eliminate the need for most labor.
In large numbers, people employable in the past are now largely discarded and displaced which is why we have 93 million Americans of working age not in the labor force.This is also why the problem now is not one of insufficient production capability, as in the past, but now instead is excessive production capability and deficient aggregate demand for what is producible. A historically new phenomena.
We are just through the door of this great transition. Indeed, life expectancies of middle class Americans are significantly falling as has been their wealth positions and general welfare. Middle class income has trended to stagnation, as all productivity gains have "trickled up" to the top 5%. This is the new paradigm that raises it ugly head, not the Dick and Jane, Horatio Alger scenes of the not so distant past.
The future I describe is now at hand.