Making Locke’s, Smith’s, and Marx’s Dreams Come True

any or all of them, incrementally or all at once, with a single change to the existing economic system

Photo by Jon Tyson on Unsplash

John Locke dreamed of a minimal government, one that would exist only to protect persons and property. Adam Smith dreamed of an economic system that was fully self-regulating. Karl Marx dreamed of ending economic exploitation, i.e. ‘wage slavery’. There is a way to make any or all those dreams come true. All it would take would be one change to the existing economic system.

As a response to the Great Depression, largely due to the influence of John Maynard Keynes, government was assigned the task of attempting to deal with problems that were not of its making: unemployment and poverty. As time has gone on, given the failure to eliminate poverty the responsibilities of government have been extended to include food, housing and medical care.

Before the Great Depression there was little or no ‘management’ of the economy that had emerged over the course of the previous century or so. With its booms followed by busts, the ‘business cycle’ was the nature of the beast. Beyond tasking government with dealing with unemployment and poverty, the Great Depression ushered in the era of economic ‘management’ — regulation of the of the economy as a system by government (in conjunction with the quasi-governmental central bank) in order ameliorate, if it could not be eliminated, that cycle of instability.

Unemployment, poverty, and instability are results of the existing economic system. Exploitation, in the form of wage slavery, occurs within it.

Anyone who is employed by any other person or entity and is paid money for it is a wage slave. That is to say, that person is being used as a machine — or a draft animal.

Some slaves get well-compensated — some are even among those who decide what the distribution of remuneration among the wage slaves will be — but all are wage slaves; all are being used as machines of some kind (even decision-making machines). The distribution of remuneration for the wage slaves within any entity is always decided by self-interested people who know that the less others get, the more there will be for themselves: wage slaves most certainly do exploit other wage slaves.

People can make money due to the efforts of wage slaves without being a wage slave. We call such people ‘speculators’. There are productive speculators and there are unproductive speculators. The former contribute money that is used to pay for non-human machinery for the wage slaves to use and a place for them to slave away. The latter buy and sell pieces of paper for no purpose but to try to make a profit. For both kinds of speculators, for them to make a profit can depend at least in large part on how the wage slaves are performing. (Speculators can also of course buy and sell other things, such as rare objects like works of art, but here the topic is speculation as it is related to wage slavery.)

This economic system, with its inherent unemployment, poverty, instability, and exploitation, runs on money. It is important to have the right amount of money in the system. If there is too much money, the result can be inflation or even hyper-inflation; if there is too little money the result can be recession or even depression.

There is a way to ensure that there will always be enough money in the economy without there ever being too much money. This way of doing that can eliminate unemployment, poverty, instability, and even exploitation — all at no cost to anyone, without having to redistribute anything, and without imposing any limit on incomes/wealth. The same process can be used to fund government — all government, from central to local — without taxes or public debt (though to keep them eliminated permanently total government spending could not exceed its current per capita level). All of that could be accomplished in any nation on this planet, with a single legislative Act.

This approach to supplying the existing economy with money can be thought of as a kind of permanent ‘quantitative easing’. It is not an all-or-nothing proposition: within this paradigm there are options and stopping points. With it in place, though, the people of any nation could be living by the end of next year in a state of which Locke, Smith, and even Marx could only dream.