"I draw the conclusion that, assuming no important wars and no important increase in population, the economic problem may be solved, or be at least within sight of solution, within a hundred years. This means that the economic problem is not --if we look into the future -- the permanent problem of the human race.” John Maynard Keynes, “Economic Possibilities for our Grandchildren” (1930).
O.K., what went wrong?
For starters, there was World War II with 60 million deaths. That´s roughly 3% of the world population in 1940.
As for that world population, it was 2 billion in 1930, when Keynes published his article. Today, it is almost 7 billion. Sounds alarming and it is. The only good news is the growth rate has been declining, from a high of 2.09% in 1968 to 1.12% in 2017.
Keynes left something out.
It is big enough to cause me to suspect that even if Keynes´ two conditions were met, economic underdevelopment would still be "a permanent problem."
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There is a reason why economic underdevelopment persists. It has nothing to do with anything you read or heard, or even imagined.
Certain people -- the top 5% who control 22.3% of America´s economic pie (see below) -- benefit enormously from underdevelopment. They make more money clipping coupons in five seconds than you do working hard all year.
Trump´s rabid complaints about illegal aliens -- they´re criminals, rapists -- are the first solid clue as to where the problem -- as well as the solution -- are found.
His pounding on the desk and foaming at the mouth are a classic case of ideological inversion. Which means, if you turn what he says upside down, the truth emerges:
To paraphrase Elvis, the American oligarchy wants, needs and loves illegal emigres.
What?! How can that possibly be?
Undocumented workers form an excess labor pool that keeps U.S. wages low. There -- that´s the deep dirty secret nobody is talking about. Don t look for it on CNN or ABC. Forget the Washington Post or New York Times. They fear that if they break the taboo, major league advertisers will pull their accounts. Media magnates know only too well about such facts of life; after all, they too are oligarchs.
The Trump wall with Mexico is a sideshow -- all 1,954 miles of it. Most illegal aliens come in through other points of entry, including airports, where they officially declare themselves to be "asylum seekers." While the government studies their case, they disappear. Now you know why American oligarchs look at the Trump $5 billion-wall and snicker in their Cloudberry liqueur. They know that it is being erected in order to be avoided.
Not to worry: they also know all about the waiter who served them the liqueur.
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How big is the excess labor pool?
The number of illegal aliens is estimated to be 10.7 million. That is 3.3% of the U.S. population. Doesn´t sound like much -- but watch out! -- that number is at best a guesstimate. I was an expert witness in Federal Court where this issue came up. Nobody really has a clue how many illegals are in the U.S. because when the census taker shows up at the front door, the illegals run out the back.
However, we will accept 10.7 million for the moment. Now, I think we can rightly assume that the vast portion of them are working or looking for work; after all, that is why they came.
The American labor force -- people working full time -- is 129 million. To repeat, only guesstimates are possible. However, it looks like for every 10 American workers, there is one illegal alien. That is enough to significantly pressure wages downward where it counts: the minimum wage.
The minimum wage is THE benchmark. All other salaries, public and private, are fixed in multiples of that wage; hence, anything lowering it pulls down all wages up the line.
I will belabor the obvious. The excess labor pool in the U.S. is
(i) overwhelmingly a result of underdevelopment in Latin America. 92% of undocumented immigrants in the U.S. are from Latin America/Caribbean. That means if you want to reduce the pool and raise U.S. wages, the necessary condition is
(ii) economically develop Latin America.
Here a major problem rears its ugly head... As mentioned, Trump´s cronies want, need and love illegal aliens. That 5%-megawealthy has the power, not you or I.
Like Trump´s wall, the traditional responses -- foreign aid and private charity -- are processes that ape numerous laws: they are written to be evaded. Both are pure eyewash to appease the old folks at home. I say that because giving aid and charity only perpetuates the relationship between the giver and the recipient. How?
The giveaway to the giveaway: no reciprocity is demanded of the recipient. Not even a dance or fiesta.
Gifts are extremely complex. The giver of a gift is in a superior position because the receiver owes him something. In many societies, notably in the Pacific, the receiver is obligated to give a superior gift in return. Thus, a chain of human interaction is established through imbalance. In a monetary exchange, nothing of the sort occurs. If I pay you money for a product, we are even. Period. Good-bye.
All that is nothing new. If foreign aid and charity could solve economic underdevelopment in Latin America, they would have done it by now. Which means, they exist for another purpose: power -- how to get it, how to maintain it. In both aspects, aid and charity are marvelously effective literally where it counts...
U.S. income figures tell the tale: the portion of the national economic pie going to the top 5% is 22.3%. That is up from 16.3% in 1968. That colossal increase can only come out of the hides of --you guessed it -- the middle and lower classes.
If foreign aid and charity have not solved underdevelopment in the past, are not solving it now, and will not solve it in the future, what will?
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As is common knowledge, a big dream throughout Latin America is to immigrate to the United States. To the point: is there an alternative dream and reality?
The people of Salinas de Guaranda in Ecuador showed in concrete terms what is possible.
Antonio Polo, an Italian Salesian priest, starting in 1970 organized a dirt-poor rural village -- 85% illiteracy, 45% infant mortality -- into a prosperous community, by making manifest something that was latent.
That something was Pre-Columbian collectivist norms and values.
Salinas created an organization-production-commercialization-savings model based on “esfuerzo comunitario” (community effort).
The impact on the United States could be enormous.
There is a catastrophic trend in the United States which is not being attended to. We indicated it above: rich richer, poor poorer and middle class smaller. A necessary (but not sufficient) precondition for redressing that trend is to reduce the surplus labor pool.
To significantly reduce it, however, is not possible without going to the source of the problem as Salinas did -- not by tinkering with legislation in Washington; not by foreign aid; not by Dr. Feelgood charity.
Only economic development in Latin America will suffice. In concrete terms, that means more Salinases. Hundreds, maybe thousands more.
That cannot happen, however, under prevailing circumstances.
More Salinases is exactly what the American oligarchy will oppose to its dying ember.
Of course illegal émigrés present problems beyond pure economics. We may be on the threshold of an era of historically-unparalleled humanitarian crises. .