The 'Affluent Society: A different approach

The 'Affluent Society'
A different approach

by Alfredo Ascanio (askain)
Published 2008-10-15 12:36 (KST)

Prominent members of the Republican Party accused John McCain of bringing the campaign in a wrong way; but it is unusual for Fidel Castro to write positively on Barack Obama. "Obama has more intelligence and serenity than Republican John McCain," Castro said. On May 26 Castro had said that Obama is "in terms of social and human, the most advanced candidate" in the US presidential.

This past Sunday, former Cuban president said in an article, "In the deep racism of the United States, 'pure miracle' Obama has not been assassinated, as the black leader Martin Luther King."

Castro, 82 and absent from public life due to illness since July 2006, sent five comments to McCain last February and then another in June. In the same line of disqualifications, on Sunday added that McCain:

"Cultivates his reputation as bellicose man, was one of the worst students in his course at West Point and did not know anything about math, and is presumably much less the complicated economics."

Castro was also very aggressive and bellicose and he was not human with Cuban political prisoners. The qualifications of Castro or his attitude apparently there are more maliciously and never candid, without giving credit to a free and democratic campaign that he never had. Someone might suggest: Care! not reflect on the behavior of politicians reflect on the current economy.

The question we are doing now is: why Castro writes positively related to Obama and write negatively to McCain? The comments of Castro benefit or harm the image's Democratic leader?

Let me outline the reasons for these contrasting comments. We must be careful when politicians say things and especially in the context of a political campaign.

The world has become more and more complex, its physical and moral health constantly being influenced by a thousand beneficial or maleficent forms of progress.

Then, perhaps, this disturbing and this dangerous crisis that we foresee, will be more easily controlled and will be better understood by politicians who have been able to make a proper assessment not only of short-term but long term.

We realise then that, for solving complex problems, the number of possible solutions is such that a simple statement of preference in inadequate.

"A curiosity of modern economic life is the role of change. The innovations and alterations in economic life in the last seventy years, and more especially since the beginning of World War II been great," said John Kenneth Galbraith.

"The corporation was the instrument of its owners and a projection of their personalities. The names of these principals - Carnegie, Rockefeller, Harriman, Mellon Guggenheim, Ford - they are still known," said Galbraith.

Today is different. The shareholders of the companies are unknown to the general public, although experts working on Wall Street very well know the characteristics and behavior of investors.

The relation of the state to the economy has changed. The services of Federal, state and local governments now account for between a fifth and a quarter of all economic activity. In 1929 it was about 8 percent.

Additionally, in the wake of what is now called the Keynesian Revolution, the state undertakes to regulate the total income available for the purchase of goods and services in the economy. It seeks to insure sufficient purchasing power to buy everything desirable.

The economic thinking of Professor Galbraith warned of the danger to society of a chronic inflation, because the ideas are one thing and another thing is reality. The competition is still not working as classical economists conceived it. The producer no longer sells at prices that the market is fixed.

Production depends on the economic stability and the triumph electoral. A production is the "alchemy" of the Liberals.

The modern economy is characterized, Galbraith said, for complex technology and efficient domain of large companies, increased state intervention to regulate the economy, weakening worker's unions and development of higher education.

An affluent society no longer responds to the actions of the market and it imposes the producer to the consumer. Shareholders no longer have power but are a "techno structure" with high operating level and autonomy, where big business concentrates all the power and decisions.

The only businesses that depend on the market are small and medium enterprises.

The neo-capitalism, according to Tom Kemp, is dominated by the 500 largest and most powerful companies, with 50 percent of the production of goods and services.

The income of senior officials of these 500 companies has a positive correlation with stock prices and them Harry Magdoff said: "... the casino on Wall Street may be useful for members of the techno structure and for shareholders."

However Galbraith alerts us to point out: "the magnitude of the obstacles to be overcome is now higher than in the era of Keynes when he advised stimulate demand for emerging from the great depression." It is now essential to ensure that production does not grow beyond certain limits.

For the Mexican economist Alonso Aguilar is difficult to convince the majority of the poor that capitalism has been humanized.


Alfredo Ascanio is a professor of economics at Simon Bolivar University in Caracas, Venezuela.
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