Not peak oil, but a general state of the way the economy has been trending over the last 30 or so years (and since we've all done this "Are Buy To Let landlords parasites?" thing to death then why not? ...) It's American, but since we run our economy in such a similar way, I expect it to pretty much be as applicable here.
This will confirm the suspicions of some of my generation (30 and belows, but older too maybe) but also inform a little more (so whilst buy to let, for instance, seems to be an easy target, there are larger, mostly unseen forces at work also.)
YouTube lecture here.
The coming collapse of the middle class
Moderator: Peak Moderation
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chubbygristle
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fifthcolumn
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A bit of history and a bit of thought will show that without cheap energy the middle class will indeed disappear.
Prior to the industrial revolution there were a small sliver of rich (say 1% of the population), a "service" class to the rich consisting of tradesmen etc and a small merchant class, together consisting of about 10% of the population. The rest were some form of peasants, indentured servants or slaves.
The industrial revolution changed all that.
The middle class expanded massively and the peasant class even went upwards to become the working class, leaving a small sliver of poor.
In America it was even more exaggerated than here as they were able to exact a tax on the world through having the reserve currency and the only functioning economy left standing after world war 2.
This time around, though I expect the middle class and the working class to shrink, I don't think we're going to see a complete return to pre-industrial revolution society.
Possibly more like Mexico is what we could be looking at.
Prior to the industrial revolution there were a small sliver of rich (say 1% of the population), a "service" class to the rich consisting of tradesmen etc and a small merchant class, together consisting of about 10% of the population. The rest were some form of peasants, indentured servants or slaves.
The industrial revolution changed all that.
The middle class expanded massively and the peasant class even went upwards to become the working class, leaving a small sliver of poor.
In America it was even more exaggerated than here as they were able to exact a tax on the world through having the reserve currency and the only functioning economy left standing after world war 2.
This time around, though I expect the middle class and the working class to shrink, I don't think we're going to see a complete return to pre-industrial revolution society.
Possibly more like Mexico is what we could be looking at.
It's more about the inherent weaknesses in our current system, and how we have made married families with two kids far more vunerable than they were in the 70's.
As a family we have a bit higher income that our parents did when we were young, but we have two adults working (mostly) now and then it was just one (mostly). A current Fathers income is slighly less (all this in real inflation adjusted figures) than his own fathers was in 1970.
However the costs on this family unit have gone up dramatically. Mostly the elastic items have become cheaper, while the essentials (in America we're talking mortgage, healthcare, and interest paid on debt, and kids school fees etc) have risen hugely, making this family very vunerable. If one adult gets ill or looses their job, the family collapses into debt, reposession and bankrupcy. There is no slack in their system. No room for error. In the 70's if things got hard there was a spare adult who could tide things over. Not now. Currently, more families in the US experience bankrupcy than divorce! No one is talking about the bankrupcy issue though. It has a huge social stigma attached.
Guess this is just where we are. Peoples greed and competition has lead to families overstretching themselves to compete for the 'best', which means the biggest or most expensive. It's socially unacceptable to 'drive a bus' for a living now, unless you aspire to be a brain surgeon and are doing biology night classes to improve yourself.....
Not much prediction (unless I fell asleep) of the future, although I think we can all see where it's headed. More hours at work, higher taxes, more of the 'big squeeze', more fighting to get into the right school etc. We're going to have middle classes fighing over diminishing wealth aren't we? What lenghts are you willing to go to? How long before people send their kids out to work for the family good?
As a family we have a bit higher income that our parents did when we were young, but we have two adults working (mostly) now and then it was just one (mostly). A current Fathers income is slighly less (all this in real inflation adjusted figures) than his own fathers was in 1970.
However the costs on this family unit have gone up dramatically. Mostly the elastic items have become cheaper, while the essentials (in America we're talking mortgage, healthcare, and interest paid on debt, and kids school fees etc) have risen hugely, making this family very vunerable. If one adult gets ill or looses their job, the family collapses into debt, reposession and bankrupcy. There is no slack in their system. No room for error. In the 70's if things got hard there was a spare adult who could tide things over. Not now. Currently, more families in the US experience bankrupcy than divorce! No one is talking about the bankrupcy issue though. It has a huge social stigma attached.
Guess this is just where we are. Peoples greed and competition has lead to families overstretching themselves to compete for the 'best', which means the biggest or most expensive. It's socially unacceptable to 'drive a bus' for a living now, unless you aspire to be a brain surgeon and are doing biology night classes to improve yourself.....
Not much prediction (unless I fell asleep) of the future, although I think we can all see where it's headed. More hours at work, higher taxes, more of the 'big squeeze', more fighting to get into the right school etc. We're going to have middle classes fighing over diminishing wealth aren't we? What lenghts are you willing to go to? How long before people send their kids out to work for the family good?
Jim
For every complex problem, there is a simple answer, and it's wrong.
"Heaven and earth are ruthless, and treat the myriad creatures as straw dogs" (Lao Tzu V.i).
For every complex problem, there is a simple answer, and it's wrong.
"Heaven and earth are ruthless, and treat the myriad creatures as straw dogs" (Lao Tzu V.i).
The perverse effect for singles is that it also prices them out - it's not as if their costs are exactly half.
It's a sad truth, but has been noted throughout the ages that wherever a market economy functions, all excess wealth produced eventually gets absorbed into the price of land. So for all the extra work being done, you end back at square one. It's called the "law of rent". There's some discussion of it here: http://www.henrygeorge.org/pchp11.htm
It's a sad truth, but has been noted throughout the ages that wherever a market economy functions, all excess wealth produced eventually gets absorbed into the price of land. So for all the extra work being done, you end back at square one. It's called the "law of rent". There's some discussion of it here: http://www.henrygeorge.org/pchp11.htm
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RenewableCandy
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I'd kind of suspected that all along, but never seen it put into words before...thanksThus, wages and interest do not depend on what labour and capital produce -- they depend on what is left after rent is taken out. No matter how much they might actually produce, they receive only what they could get on land available without rent -- on the least productive land in use. Landowners take everything else.
Until the government overhauls the way it taxes the whole economy, no. The best you could do (short of becoming the next Richard Branson or Duke of Westminster) is probably to own your own place mortgage free, so the expenses and insecurity are factored out of your personal equation (so to speak, this might make more sense after you watch the lecture). Then you only have to worry about your kids...snow hope wrote:I haven't seen the video, but will watch it tonight.
Is there a mitigation route? I don't particularly want to become a peasant! Tradesman or Merchant sounds good though.
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biffvernon
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