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Lectures to the Chinese by Alfred De Grazia

PART TWO:  The Eight Goods

4. Producing Goods

Throughout the world, America has the reputation of being a highly productive nation. Naturally the Americans agree. Yet if the output of calories is an indication, the U.S. economy may be one of the world's least efficient. It has been said that a Chinese working with his hands and using natural manure puts in 1 calorie of energy for every 20 calories of rice that he harvests. An Iowa farmer, the nation's most efficient, puts in 20 calories of energy for every 1 calorie of hog produced for the market. Thus it would seem that Chinese agriculture may be four hundred times more efficient in supplying calories than the American, at least so long as one grows rice and the other hogs.

Half of the Americans suffer from Old Poverty and New Poverty. But probably three fourths of the Chinese suffer from the Old Poverty. So the U.S.A. is definitely better off, no matter how poverty is defined. In fact, if the paleo-poor of Americas would tolerate the change in diet, they could eat all the rice they might want. And America would be a great deal richer, because hogs cost much to raise and, by using up much mechanical energy and machines, they contribute to the development of the New Poverty in America. Americans have looked only one way in production, towards using up the product: "We use every part of the pig except the squeal," the slaughterhouses say. But now we see that we must measure the energy and side effects of everything that goes into the pig, including whether its squeal is adding to noise pollution.

If the Americans converted to the Muslim religion, and could not eat pork, they would be that much richer. But it is much more likely that they will change their diet somewhat as the cost of their food goes higher. Chinese restaurants have become ever more popular in America in recent years.

These are some of the silly yet serious paradoxes that multiply as people insist upon worldwide comparisons and as the question of universal equality is raised. Suppose that we put aside China's problems for a time' I am not familiar with them. And let us focus on the problem of paragogia, or producing things, in America. What should be and may have to be the shape of production in future America?


First we think of the terrible "three exponentials" -- population, resources use-up and pollution. So we realize that the American production schedule cannot endure. Everything will become more costly, even breathing. Meanwhile, the world will be trying and succeeding in part, to withhold things from America; less of value will be coming into the country in return for what is going out. So Americans will have less to work with in the country and less to get from the outside, whether they try to buy it or fight for it. (And fighting now has become so costly that it consumes as much as it gains. Even if American had gone to war in Vietnam for imperialist exploitation, the war was quite lost in that sense, as in every other sense.)

The next thought to occur is that the production of the country will change not only in amount but in type. Therefore, at this moment in history, any discussion in terms of Gross National product of goods and services sold is ridiculous. The Grotesque National Product has become nearly useless as a concept for coping with world economic problems. We have to go back to the beginning.

What will Americans require to live in 1980? They will need, at one room apiece, 225 million rooms. They will need $150 in 1973 dollars to keep the room furnished and clean per year. They will need 2,500 calories of food per person per day. They will need $200 worth of clothing and shoes per year each. They will need 1/300 of a medical doctor and 1/300 of a dentist. Also 1/10 of an automobile apiece, 10 train and bus tickets for 100-mile trips or more, and 400 short rides. They will need the cost of two weeks of vacation, 1/5 the cost of keeping a person in school, 1/5 to keep another at home, and 1/10 of the cost of keeping someone in bed or in a hospital. They will need sundries -- soap, razors, etc. They will need reading and writing materials at about $50 a year. They will need 1/6 of a television set. They will need large consumer projects such as cinemas, libraries, and sports arenas.

Strangely, if you add all of this up, it comes to the budget of an American at the officially certified poverty level per man, woman, or child. If that is, say $2,000, then the whole population can exist decently and carefully on $450 billion with all the micro-property it needs and without counting its other micro-assets, such as small landholdings, workshops, machines, leftover material and goods, and cash. The sum of $2,000 happens to be $2,000 or so less than the national average of about $4,000 that is, one half of the national per capita personal income. It is ten times the Thailand and five times the Philippine average, but these dollar statistics mean little.

What I should like to point out is that the Americans would not suffer unduly with a universal per capita income. Indeed, were it properly distributed and the production mix changed, and with some changes in taste, they might be noticeably better off. Paleo-Poverty would disappear. Neo-Poverty would diminish sharply.

Perhaps I am in a position, then, without offending anyone, to say that a one-third to one-half cut in the apparent average American income might not be unmanageable or distressing. It all depends on what is cut out of production and what production substitutions are made.

Just to give you an idea of one way to do it, I would mention the following suggestions that have been offered in some quarters:

* Cut back the individual-serving part of the automobile industry and all that is affected by the industry by one half.

* Cut back all packaging, fashion changes, and advertising by three quarters.

* Cut back military expenditures by one half.

* Cut back all consumer energy consumption by one fifth, in addition to whatever is saved above.

* Encourage multiple-unit dwellings under condominium plans and discourage scattered houses and large tenements.

* Block the expansion of all cities except along mass transit lines connecting cities. (Suburban social costs are grossly excessive.)

* Extend recycling and reuse of all materials by one fourth, especially in the construction industry.

* Introduce education without walls (correspondence schools, project teams, and free schools supported by personal vouchers given by the state) to cover one half the total educational system, and convert many recovered facilities into recreation centers, hospitals and clinics, and neighborhood law courts.

* Expand the medical force by 500 per cent and place it upon the competitive market for medical services.

* Expand rental system to eliminate two thirds of the personally owned autos, boats, airplanes, machines, tools, and other reusable movable property.

* Set energy and materials limits upon all new industrial design in housing, furnishings, factories, and offices.

* Build one hundred new cities to supplement the old ones or even to replace parts of them wherever the costs justify the change-over.

* Double mass transit capacity.

* Abolish useless jobs, with all the costs connected to them; support "do it yourself?" production, and promote forms of recreation that use only human energy.

* Guide population to an ultimate maximum of 200 million people for the country.

* Bring new types of windmills and solar-energy devices into full production for use throughout the world.

In sum and substance, eliminate the "three exponentials" and "four disproduction." Create a reasonable standard of living for all. Stress decentralized and truly efficient energy sources.

The result will be a cutback of one half of the present outpouring of goods and services, half of which in turn can be devoted to differential profits on work and individual incentive rewards for productivity in America. The other half may be used to lift standards among the poorer peoples of the world.

it is well to remember history if you believe this is physically impossible. While you were locked in the fastnesses of interior China fighting in civil wars and against the Japanese, the United States gave over, within the space of several months and for the duration of four years, one third of its total goods and services to fighting the war; when some of its armies appeared at the gates of Berlin, others were at the entrance to Tokyo, Indeed the tasks of the Chinese communist government were greatly facilitated by the Americans supplies and equipment that they had captured from the forces of the so-called nationalist government. Note also that nowhere the Americans forces entered and liberated did any starvation appear.

Such is the power of the American productive system when it is directed at clear objectives. The problem is not: can America change its mode of life, live well notwithstanding, and contribute to a sizable uplifting of the standards of the poor around the world? The answer to this is known and is yes. The real question is whether the Americans can come to feel willing to undertake such a task of the same order of magnitude as World War II but of utterly peaceful ends. Furthermore, the task, as described above, when coupled with the techniques of a free culture, will disengage the force culture even as it provides a happier, more comfortable people.


I should be the last to recommend that Americans involve themselves in the campaign just described unless it could all be done under a system of free culture and would strengthen free culture in American and the rest of the world. Unless such conditions are met, I feel that the effort is not only hopeless, but misplaced.

Here are some of the production problems that the U.S.A. would face were it to enter into creating this new kind of world.

A large part of the population would have to accept transformations of space, time, energy, and skills. Therefore, the prompt institution of a universal income system is needed, which I plan to describe in the next chapter. The basal income system is needed even now and forever, but it is absolutely required if the U.S.A. is to enter a period of great production changes.

Bureaucratic regulation of production would have to diminish. Great draughts of power would have to be delegated to functional sectors of the society to achieve their goals. This would unleash the initiative of industrial leaders. Only general directives are necessary; more than that would impede progress.

The investment of workers in the new industrial order should be stressed-representative participation and subsequent co-ownership principally-so that their morale would be elevated during the transition of their business.

The military would want reorientation. America has now ventured upon a volunteer army; men and women are paid to make a career of military service, and the draft of persons from the general population has ceased. The proportion of the military to the total population is small, although the military reserves are large. The Army, Navy, and Air Force remain splendidly equipped, and I see no reason why this condition should be relaxed. However, nuclear armaments may be reduced, and naval aircraft carriers no longer justify their heavy costs.

The capability of the military as such should be to block and bring to a standstill any aggression by a large power in any part of the world in conjunction with the allies of the U.S.A., which, in Europe and Korea, posses great weight in their own right. Further than this, the American military has a civil mission to perform that can make the transition to a new world easier. All three branches of the armed forces can be charged with peaceful mission of great consequence. The Americans Navy is in a position to develop the science of oceanography. It can help police the drive against pollution and overexploitation of the life and minerals of the seas. It can replenish the seas. It can help to develop the world's marine service and the marine equipment of the poorer nations.

The Air Force can take on the mission of bringing health services to deprived, remote areas of the world. It can launch rescue and relief operations; such emergencies will occur more frequently as the impending food and energy crises strike now here and now there around the world. It can join in and lead world meteorological and exploratory efforts.

The Army has within its jurisdiction the world struggle against pollution of coastal waters and land masses. It can lend organizing services to emergency build-ups of services and facilities wherever invited to lend aid. More than anything else, it can provide instruction in the performance of civil missions to all those armed forces who have hitherto looked to the U.S. Army largely as a source of instruments of destruction and training in the handling of them.

The center of change can be found in American industry. There reorganization would be pursued in the direction of decentralization, autonomy of units, and step-down of scale. Stress would be laid too on the invention and supply of the greatest possible number of devices for making individuals and small groups self-reliant as makers. As Vico said, two hundred years before his pragmatic American successors, "Man knows only what he makes," and we look to industry to search out the full meaning of this expression. If man makes nothing, or too little, or merely copies, or makes only a piece of something much larger, then he is destined to ignorance and is less of a person.

Industry can supply the need for man to make in two ways --by heightening the worthwhile and autonomous employment of workers and providing more and more of the means whereby a person's free time can go into self-help projects. With a basal income guarantee, and a short work week to allow full and free opportunity for all who want to work, the individual's command of time and resources to develop his or her micro-property and recreation facilities should greatly increase. This I would regard as highly productive time even though it might not reflect itself in an increased Gross National Product.

The final goal should not be to set up an aristocracy of workers, but to establish a society of work-sharers. You use two slogans in China. One is "No work, no bread." That will set up a totalitarian society. Your other slogan is better: "From each according to his ability, to each according to his needs." This can be more appropriately the slogan of a free culture than a culture of force. But I proceed on the assumption that the Chinese have nothing against freedom as such; you simply cannot agree that, when a people is free, all can eat.


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