Workers of the World Relax!

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I recommend perusing Conrad Schmidt's ideas. He's the founder of the Work Less Party of British Columbia and author of the book Workers of the World Relax: The Simple Economics of Less Industrial Work. His argument; that though increased mechanization increases the amount of goods per worker, the increases fail to increase the buying power of those workers. The gap between worker buying power and increased production eventually leads to a recession/depression.

The solution? Work less, specifically at industrial production. Spend time doing other things, and buying less. He makes a convincing argument in his interview at The Extraenvironmentalist Podcast.

I will take exception with one tenet of his argument. I don't believe the increase in production was the only change that lead to the Great and Current Depressions. His theory leaves out the exacerbating factor of finance and the machinations thereto that banks, et al. can exert. After reading half of The Pecora Report of 1934 (aka Stock Exchange Practices. Hearings before the Committee on Banking and Currency Pursuant to S.Res. 84 and S.Res. 56 and S.Res. 97), it's apparent that banking practices covered up and thereby postponed the economic declines started by industrialization with leverage, continuing and accelerating the economic velocity beyond the level the actual economy could sustain. The result? Unlike a slowing of economic growth after an industrial increase (what one would expect following Schmidt's theory), the increases continued, inflating the money supply for years beyond a sustainable level.

Hyman Minsky seems to have articulated this phenomenon, pithily described as a "Minsky Moment." Sadly, thanks to the reign of the neo-classical economists who debate even the existence of "bubbles," not many know of Minsky's theory. It is, thankfully, gaining some traction after the most recent crisis, so hopefully you'll be hearing more about it, rather than the drivel that passes for economic commentary on the commercial noisy box media.

And this slowing of the worker hours is nothing new. Mr. Kellogg of cereal fame tried an experiment near the turn of the last century. One of his factories ran normally, while the other went to a seven-hour work day. The latter had the same productivity per worker as the former, but the town surrounding the shortened workday factory was more vibrant, with greater community cohesion and more economic activity. (From Daniel H. Pink's Drive: The Surprising Truth About What Motivates Us)

In the meantime, give Schmidt a listen or read. You can view a short movie at the web site.