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View Diary: The era of shared sacrifice is over (330 comments)

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  •  now you've hit on something important (0+ / 0-)

    This is one of the paradoxes of capitalism, and a really important point.  The ideal thing for any business is to reduce its costs as much as possible.  So if you could eliminate all of your employees and produce just as much by using a workforce of robots, you would do it.  And if you don't do it, somebody else will do it and if their overall cost structure is lower than yours, they will eventually drive you out of business.  The paradox is that if every business could figure out how to produce just as well without employees, they would all find out that they don't have enough customers who can afford to buy their products.  

    The same thing happens when production moves to countries with lower labor costs.  That is great for them in the short run, but then if they have succeeded in putting all their customers in America out of work, all of a sudden they have to start closing factories.  

    How does the government, or private business, fix this problem?  It's not so easy.  I see a lot of people moaning about the fact that the government is not doing more to create jobs, but a lot less detail about exactly how the government is supposed to do that.  Ultimately, we have to figure out how to transition into whatever is going to be the next kind of economy, just as we transitioned from an agricultural economy to a manufacturing economy, and then to a service economy.  

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