Poverty is a fundamental aspect of the market economy

Poverty is a fundamental aspect of the market economy. This assertion is frightening if true, and seems to be at the core of all radical critiques of capitalism. Are the problems of poverty systemic, a feature of the economic system in which we live, or, are they the result of bad decisions, easily corrected without real systemic change.

In order for markets to operate, prices must be set. The common understanding of how prices are set is via the law of supply and demand. The assumptions outlined in this system appear simple to us, in that we experience them every day. We even utilize them ourselves in a rudimentary way when we sell things at a garage sale, or post concert tickets on Craigslist. The need for an item as well as its relative scarcity work together to generate a price that seems fair to all parties involved.

Scarcity plays a large part in this. The relative levels of scarcity on a given day and in a given market are one of the factors that allow items to be sold above their cost of production. This is one of the ways profit is generated, as the relative advantage of a given capitalist can be used to sell objects at a price higher than its value. In short nobody buys sand at a beach.

In this way, a segment of the population must go without in order for the market mechanism to operate. Scarcity, and its human consequence poverty, are a requirement of functioning capitalist markets. How can wages be set if there is not a group of people looking for work. Who would pay for food if everyone had enough to eat.

In this sense, scarcity is manufactured to allow markets to operate. It does not exist in an absolute sense. If we can look beyond the economic system in which we live, poverty is not a question of scarcity, but rather a problem of the distribution of abundant resources.

The answers to these questions seem simple enough, yet solutions prove remarkably difficult. The slogan of the World Social Forum "Another World is Possible" comes to mind, however the world around us works to make imagining this world as difficult as possible.

The Best things in Life are Free - By Andrew Harvey

There may be no truer statement.

Take our relationships with others, which outside of a few notable exceptions such as prostitution, have no monetary cost. The most rewarding things in this world come when we escape the nearly omnipresent grip of money. Take, for example, volunteering. When you freely give your own time, and have complete control of where you devote your efforts, the rewards far exceed anything money could offer you. The benefits of free giving between people is where the salvation of our world lies.

Every time you stop to hold the door for a stranger (or your best friend), pick up a piece of garbage, donate used clothing, time, or yes, even money, you are disproving all of the nay-sayers that say socialism cannot work. The biggest step in people acceptance that we can live in a world without money is convincing them that there is a possible alternative. Instead what we should do is to look at the many ways in which this world has existed without money since the least hairy of the apes stared walking together.

Of course there has been money, barter, or trade since we have started gathering in groups, but was this for the better? What about all the ways in which we never needed money? Family, community, and friends have always existed, usually managing to stay away from the divisive nature of money, and always for their detriment when they have failed to do so.

Sure we have had money for a long time, but who were the ones who decided we needed that? It was those who were in power. The ones who needed to create a monetary system in which they could measure and place an arbitrary value on everything. By measuring and assigning values to the things which we use, it removes the inherently communal nature of the world around us, by classifying items as “property”.

What I am getting at is that we are all in this together. This is another truism, which I have yet to hear a rational argument against. When it comes down to it, everyone, and everything in this world, are linked. Most places in this world have created a intricate series of classifications to divide us as people: governments, monetary systems, gender, class, religion and race (to name a few). When it comes down to it, these are all meaningless. They are imaginary social constructs that only have power because we continue to legitimize them by using them, and rigidly enforcing them in our social order. Our society (globally, and especially western-ly) continues to give these systems of exploitation and division power by ensuring that they persist.

Why? Money.

Money equals power in capitalism, and so long as 10% of the world controls 85% of it’s wealth, this will not change. The richest in our society have it in their (perceived) interests to maintain the status quo. Capitalism requires a perceived scarcity of resources to fuel the competition and inequality which it produces. When we are divided as people, in all the ways we are, we can perceive this inequality, and then seek to out-compete the “other”. This competition leads to an animal ferocity towards each other, and this world. We have been tricked by each other, and the media, into believing that our “needs” are not met. In western society we have more wealth than the other 70% of the world could ever imagine, but still feel the need to consume at ever-increasing rates. We work ourselves to the point of stress-induced illnesses, while keeping our neghibour, and fellow people across the world conditions we would never allow our $800 dog to live in. The perception of “need” in our society can include new game consoles every other year and new iPods every single year, while next door, across-town, or on the other side of the world “need” includes clean drinking water, and food that would cost what we tip our barista each morning.

This local, and global inequality is what leads to crime, national tensions, and the ravaging of the world, and the vast majority of it’s population for the benefit of the tiny minority.

Now that I have convinced you we should immediately abandon money, and embrace the glorious boosum of socialism, here is what we can do:

• Stop letting money come into our lives in whatever ways possible, stop paying prostitutes for company for one.
• Give yourself. In whatever ways you can think of. Volunteer your time, make sure you are there for friends and strangers when they need you.
• When you must use money, ensure that it goes somewhere where it will be more equitably distributed, i.e. fair trade. This also means DON’T GIVE MONEY TO BIG CORPORATIONS. Corporations are massive organizations of exploitation which use their size, and leverage to “outcompete”, and undercut smaller, more local, fairer companies which spread the money around more.
• Join a co-op. Any co-op you can. If one does not exist where you live, start one. Start on a small scale. I am not talking about the business designation the government has created necessarily, I mean starting with two families buying bulk rice together to save money. Any step we take together is a step in the right direction.
• BE NICE TO EACH OTHER. Stop acting like it is us versus “them”, whoever “them” might be. Smile at people, hold a door for someone, unplug your earbuds, and start a conversation on the bus with a stranger. You will find we all have a lot more in common than you think.

There are many other ways to do what I am talking about, but this is a good start.

I love you all people. Lets start fixing this world together.

More thoughts about Money

While the statement "Money is the root of all evil" has some truth. The current form that money takes under capitalism is very different from that which existed in pre-capitalist times. When people say we have always had money and always will, they are misinformed. Feudal society may of had money, but it was a minor factor in the overall economic system. Most economic relationships in feudal society where mediated by kinship bonds, religion, and other factors, rather than by the almighty dollar. Money was used by very few wealthy people and the vast majority of people would have little contact with it, day in and day out.

However, under our current economic system (capitalism) money, has become a means in and off itself. It is currently impossible to function successfully without money. The role that money plays as the "universal commodity" is a major factor in the daily exploration, human misery, and inequality we witness all around us.

What is the purpose of money under capitalism? One would imagine it is to purchase the goods/services you need to survive. You work a job, get paid, and then use the money to rent a house, buy groceries and live your life

While this may be true for the majority of us. If you are a business owner or investment banker (re: capitalist) this is not the case. People in these positions no longer need money to purchase things, but instead use things (commodities) to get money. As the universal store of value, money is better than things. Even with Hummers, Rocket Cars and Solid Gold Houses there is a natural limit on the amount of stuff that can be owned/used. However there is no limit to the amount of money one can have.

Additionally, money can be put to use to generate more wealth. Through the purchasing products for sale, investment in production, lending at interest, and the multitude of other methods which exist under capitalism to generate wealth, money is the ultimate factor in generating more money. In fact money must be used in this way, as, left to its own devices, it will loose value over time.

This never ending cycle is what drives the capitalist system. It creates the need for ever expanding compound growth. Additionally, it sets people against each other by creating an endless competition to generate the most money from the least amount of starting money.

This relationship leads directly to the explotation of working people. If the goal is to have more money at the end of the day then you did at the begining there are only a few ways to do this. The most classic method is to employe people to turn raw materials into more finished goods that you can sell at a profit. Even with all the technological wonders around us human labour remains the only way to add value to a given process. At some point people must work to turn raw materials, concepts, and technological processes into an object that can be sold for a price. By exploiting the ability of people to create things, selling them at a price higher than the cost to create them, capitalists extract value from working people. The cheaper this can be done, and the less you can pay people to do it, the more profit is to be gained, and the more efficient your process of transferring money, into commodities, and back into more money will be.

Money in its current form is both a biproduct of the current economic system and an essential element of its success, while doing all we can to minimize our reliance may be a useful symbolic gesture. They key remains to dismantle the system that relies on it and replace it with something that does not have the exploitation of working people at its base.