© 2006 , 2007 Greg Kaiser

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Exposť: Profit Motive and Meritocracy

ďThe trade of the petty usurer is hated with most reason: it makes a profit from currency itself, instead of making it from the process which currency was meant to serve. Their common characteristic is obviously their sordid avarice.Ē - Aristotle

Itís the rich who are the weak. They give in to envy and desire for the produce of others. When theyíve misled the community and have hoarded our common wealth, they claim it was produced by their authority and hard work. We all know how many poor fools believe that sorry propaganda. We shall vanquish this evil. Remember, the profit of investors is the most unnecessary part of the cost of any product.

April 15, 2007
      The shortcomings of profit motive first started to intrude on my consciousness when I noticed the size of candy bars had shrunk while the price increased. I didnít know then that wages had increased by a smaller percentage or that the conservatives lied, when they blamed their greedy overcompensating price increases on labor costs. A few years later, the moral decline, implied by the planned obsolescence in automobiles, became noticeable to me. That was when the reduction towards the lowest common denominator of scruples and greedy behavior started to sink in. The rationalizers, which weíve euphemistically called spin doctors, and sane people call propagandists and liars, were working overtime. But they had the resource, support and encouragement of conservative and libertarian economists. In many cases they were one and the same.
      The construction and auto-workers were also working overtime. Their consumption boosted the economy. The extra money they earned was never more envied, and condemned as moral decline, by the rich conservatives, who want everything for themselves and begrudge US even what we need to live. Despite their disapproval, the retailers and the food chain behind them squirreled away every cent of it that they could get their hands on. That, of course, was most of it! The 1960s are unmatched for prosperity, production and output of real goods. Todayís service economy has bigger numbers but we donít have the goods. The greedy rich only know how to take; they donít know how to make a real thing. In fact, most of what they have is paper and the marks they make on it. But theyíre industrious. Theyíve made so much paper profits that the inflation shifts more of the goods, which the money represents, into their hoards. And the bobble heads all say in unison, ďAwesome! Ainít they smart!Ē

      The increased cost of prescription drugs and medical care are a great part of the 80% service, $13 trillion economy. Usury on debt and the profit of investors is the greatest unnecessary part of the service, but anything that produces no goods is a burden on real production. Today itís all incorrectly called increase in productivity and growth, even if the only thing they make is money and the only thing that grows, as an inevitable consequence of service activity, is inflation. I define inflation as an increase in the money supply thatís not reflected by an increase in goods to be represented by the inflated currency. The GDP reflects increases in non productive activity [inflation of the money supply without the goods to back it up is a fraud tantamount to counterfeiting] in its false economic readings. In effect, liabilities are listed as assets and the economists teach this inherent cooking of the nations economic books to the CEOs and the politicians. All that fraudulent activity is in the service of the elite, rich investors. The 20% remainder of economic activity, the $2.6 trillion thatís made up of farming and manufacturing of real goods that can be sold to recover our money from China, is the real economy. Much of the rest is flimflam. All of service is an inflationary burden on real production. This dysfunctional economic insanity is where weíve been driven by profit motive.
      The argument at the basis of profit motive is Adam Smithís invisible hand. All of US working for our individual self interest will come together by magic in the free marketplace and produce the best of all possible economies. I wonder if Smith was Voltaireís model for his fool, Dr. Pangloss. In any case, all is not well in the land of profit motive. And Iím not convinced that anyone really gets what they deserve. For instance, those who take the most from our community, burdening US with their extravagant and useless existence, deserve to be punished. Instead they take more and we suffer more want and need thereby, as the standard of living declines for most of US. Their individual greed is so great that it threatens the survival of the Human Race, yet we donít defend ourselves against the blight of the rich. Few of them provide even a necessary or useful service.
      Though it is a necessary and useful service, I question whether for profit medicine serves US very well. Does it attract the most dedicated healers to the med schools or the greediest children of doctors who have the clout to get them through admissions whether they merit the slot or not. Profit motive certainly fails to provide the drugs to combat the recent antibiotic resistant strain of gonorrhea thatís affecting the sexually active population. Thereís more to be made in drugs that people will use for years, like those which keep someone, who would have died ten years earlier, alive and addicted until ninety. A less profitable antibiotic remedy, which might be used for a few weeks and then that patient will never need it again, is not developed because our dysfunctional economic system provides no incentive for private industry to do so. To add insult to injury, the Med Corps lie about the cost to them of government subsidized research, which we pay for, to increase prices and profits even further. Everybody wants the most lucrative business, regardless of the value of their mostly useless and unnecessary products or the harm they do to our community.
      Ten years ago the government started to allow pharmaceutical manufacturers to market drugs to consumers with ads like, ďAsk your doctor about . . .Ē This is another example of decline in quality as profit drives drug use. The doctors are pressured to push the most lucrative product, regardless of usefulness or even safety. The FDA is pressured to help with the coverups of damage done by untested drugs. The congress wants to limit lawsuit settlements, when incompetent doctors or unscrupulous corporate drug pushers kill or maim someone. Nobody notices the slide to the lowest common denominator of honesty and morality as the lowest quality of the product becomes the most lucrative because its sold at what the market will bear and supply and demand are manipulated by advertisers. Our leaders and owners lie to US at every opportunity. The neo liberal service economy theory pushes medicine and the entire culture towards destruction by ignoring the needs of worker producers of the real goods that we need to manufacture in order to give our money value. Instead they seek the greatest profit regardless of the damage it does to the home community. That itís unsustainable is obvious. So is the stupidity of the mis-leaders who take US there for individual profit . . . all unaware of their self destructiveness.
      The most unnecessary and lowest quality products are sold at the highest possible price and the good of the people who are the community thatís defrauded is not an issue at all with the CEOs who do this or the economists who taught them to do it. Soon weíll have nothing but high interest credit card lending, because itís the most lucrative way to steal from the community. The service economy is moving that way and profit motive is pushing them there.

      Today theyíre saying family farms are from 1500 to 10000 acres. When I grew up they were 160 acres in Ohio and 320 to 640 in the grain belt. But profit motive causes chemical companies, banks, [crop] insurance and commodities traders to take more and more of the cash flow for themselves, as the land is consolidated with owners [often the financiers, including those who moved fertilizer or machinery profits into banking] who have more and more economic clout. Iíll bet there are few genuine family farms of any size left but the politicians can still get votes by pretending ma and pa havenít been squeezed out and bought up by the technical support and financial industries who made them dependent then priced them out of business. And theyíll also pretend that the few who held on and grew didnít benefit from nepotism but itís all meritocracy. And the farm bill will continue the subsidies to the corporate farms and the few real farmers left, mostly staunch Republicans, will bash the government with their right hand for doing it and take the money with their left because they canít survive the squeeze by the chemists and the bankers if they donít. This is the dysfunctional and obviously unsustainable way the service economy is doing US, with farming and everything else we need to live. The fastest growing segment of the population is non productive [non manufacturing] parasitic service providers. Capitalism and itís service are concentrating our wealth, making US dependent on China and threatening our survival for the enrichment of a few. Our situation deteriorates and our chances of survival shrink every day.
      When they discussed the conservative farmerís chagrin at the necessity of taking the government money on NPR , it was all out the context of the chemical companyís and financial industryís profits, from the products and interest, on which the federal handout is spent. Itís the profit squeezed from the farmer by the industries that ďserveĒ farming that make the subsidy mandatory. Of course the service and support industries who take all the profits, which create the impossible situation for the farmer, will push the neo liberal Friedman-esque propaganda so the farmer blames himself and we blame him and the government. The parasites wonít pay taxes. They say thatíll raise food prices. So we pay for it out of our taxes then pay the middle men exorbitant prices for our food anyway and all along the insane way we travel, the remaining family farmers, who grow the food we need to live, instead of grain for alcohol or lucrative non food items, near starve.
      Everyone blames the government for the farm subsidies and taxes and no one sees whatís really going on. Profit motive and capitalism have formed the system whereby the people who do the work get the least reward. Thereís nothing left after the technical support, bankers, financiers and middle men, all parasites on the fundamental industry whatever it is, have taken theirs. Chemical companies including pharmaceuticals push unnecessary products that harm the environment and cost more than the increased productivity they provide. Thatís why theyíre included with the rest of the parasites. Machinery and oil companies are also of exaggerated value in most cases. No one will see it because we donít want to see it. We want the facile answer. Oh, just cut off the subsidy. The banker and chemist will also say thatís what they want but theyíll never let it happen. The system as it is provides them with the greatest profit while taxpayers fund it. The subsidies are really going to them because thatís where the farmers spend the money. Thatís the fraud that capitalism is.

      Many people say why canít we all get along. Live and let live. They usually include the rich in that nice place they imagine. But the existence of the rich threatens ours. They are the real enemy of the Human Race. The sad fact is: we canít live and let the rich live.

      Even if unruly profit motive didnít result in unregulated greed by the corporations and investors, theyíd still push US against the rail till it broke and we went overboard, before they sunk the ship from incompetence. In the best case, in which the service economy morons are capable of moderation, the system is still dissipative. Eventually it must take US down. Free market capitalism is still abomination because it detracts from the well being of the community that supports our survival, by the concentrating our wealth with the elite few. In such a world as weíve allowed the rich to create, dissipation is a built in mathematical certainty. Free market capitalism, like mercantilism and trade before it, has been constrained from birth to increase the wealth of the elite few who are the rich investors and the neo-aristocracy. Whether they are heirs of royal aristocrats, or feudal lords, or have displaced them, or have merely risen to their elite class, is inconsequential to US. Their greed is a threat to our lives, because they exploit the community for the profit of a few individuals. That is a fundamental flaw of civilization that must be rectified if we are to survive. No matter how good hearted and sincere they are (which they arenít and only believe themselves to be when theyíre fools) as long as a few hoard the produce of many, the uncorrected indulgence in greed by the elites will bring on failure. Even Friedman acknowledges we must cooperate to have anything but thinks the magic market will organize the cooperation most efficiently, and all will be well. And it will for him and his class - for a while. The system can never work for US.

      More isnít better. Imagine the renaissance trader who buys and sells things. Such merchants provide a useful service but at some point the burden on the community that must actually produce the goods that are traded becomes so great that the service is dissipative of the goods needed for the common well being of those whose physical work produces them. Trade eventually takes so much of the goods produced, in order to support itself, that itís detrimental to the community. Itís no longer a useful service because itís destructive to the base itís built upon.
      All service is parasitic on the economy. It has grown to such a large percentage of activity today that itís no longer tolerable, much less useful. The eighty percent service economy in America no longer has a manufacturing base which will support it. Weíve been led here by profit. Each individual investor and corporation sought greater profits through cheaper production and failed to see that the consumer base, who used to work in domestic manufacturing which was the source of the goods they traded, was being destroyed. They still donít see it. Theyíre among the twenty six percent of college educated and many of them have got theirs. Thatís all they want to see. Theyíre the ones who talk about the great productivity and high pay in the service jobs they hold.
      They see the $trillion trade deficit with China but think thatís OK because the Chinese will keep on loaning it back to US because people have always trusted dollars. They donít notice that theyíve contradicted themselves by having claimed high productivity as the reason for their continued success. They donít know that the value of money is the product you can buy with it, or that we make none. Theyíre counting on faith [in their military might?] to sustain their empty [headed] service economy. They donít understand that only so much service can be useful. They donít understand the debt kite economy or the unsustainable, baseless pyramid scheme of profit that theyíre counting on to sustain them. Most obviously, they donít understand that, unless we produce goods, for trade and consumption, right here in America, our dollar can have no real value.
      Conservatives crossed the line into economic fantasy land so long ago that they have no idea where they went wrong. They donít even know that they went wrong. They donít have a clue. But the Chinese National Bank does. Theyíre using our money to fund buying high quality products made by highly paid German manufacturing workers. Theyíre building a pipeline to Iran and also buying oil in Africa and Venezuela. An interesting side note: the Venezuelans are offering cheaper loans with no privatization and ďfree tradeĒ strings attached. Theyíre taking business away from the World Bank. Global corporate hegemony is weakening. The neoliberal loving neo cons see none of this. They think that trade and banking were good things 500 years ago. So the more the better. If a little service helped, a lot must be better and today the likes of credit card usuries are the most lucrative service businesses. They run on their own little stretch of road with little idea where it came from and less of where its going. Though some conservatives are cynical and stupid enough not to care, most are really libertarians who naively believe that all is well.

      Arizona privatizes road work to contractors who maximize profit by hiring the lowest cost labor and using the cheapest, lowest quality materials they can get the inspector to sign off. The roads usually cost more than the state doing it in the first place and must be redone more often because poor materials and low skilled workers are used. This is the deadly fault of privatization, or any activity driven by profit motive, and is the reason ďfree market capitalismĒ [an oxymoron] must fail in the long run. Itís all about getting the most of the communities produce. If it can be had by corrupting our common organ, the state, to the provision of profit, the mis-allocation of our tax money, thatís fine with the capitalist entrepreneur. They donít care about providing a quality product or service. They only care about making money. Thatís why we must do the things we need in common on a non profit basis, by ourselves. The privatized functions are more costly and/or lower quality. The so called efficiency (it efficiently fills the pockets of parasites) is like the rest of the ďfree marketĒ capitalist fraud. It harms our community. If this was a meritocracy, the rich parasites, who threaten the existence of the Human Race, would have gotten what they really deserve.

ďThe People, United, Will Never Be Defeated!Ē

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Greg Kaiser
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