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The Theory of Economy

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by Viktor Person

supply-and-demand-01-resized-600This summer I had the mixed pleasure of reading a course in Microeconomics and International trade. In microeconomics the primary focus of the researchers is to establish ‘What is the market really doing and why?’ – and this is attempted to be done utilizing mathematical formulas; primarily utilizing the famous graph where two lines cross each-other, the one line sloping downwards (demand) and the other sloping upwards (supply) – and where they meet each other = that’s apparently the optimal price for the product and the optimal quantity of that product in that given market.

What first struck me as being fascinating about these theories was that they seldom predicted how the market would behave in reality, and neither could they be verified with empirical evidence – and most of the time the authors of the my books where busy trying to find reasons and various viewpoints as to why these theories wasn’t working “as they should” – and how they probably did work but it was just that the inventors missed to take into consideration some important factors and variables.

Though, what was the most fascinating about this entire area of research, was how there was this complete worship to the idea that lower prices = higher consumer satisfaction; and that apparently for a market to be functional, what is required is that we produce as many products as possible, to the lowest prices possible, because then the consumers are able to buy as much as possible, and then we’re apparently okay, happy, and have a fruitful existence here on earth.

Obviously, when I looked at these ideas, I silently chuckled – because the logical flaw of this assumption is glaringly simple = the producers are the consumers! YES – that’s the secret of economy and the reason why we’ve got so many unemployed in this day and age is because we’ve failed to understand that when a product is cheaper, someone at the other end gets less money, which in turns means that a (employee) consumer gets less money, which in turns means that the producer gets less customers = and it all ends up in such a way that most lose but a few that manage to reap the monopoly profits of those very low-priced products – because they’ve priced out everyone else.

It’s clear that we have to develop a new way of looking at economics, and that mathematics and statistics isn’t the way to go – no – we actually require to look at the actuality of what is going on. For example, poverty, what is the actuality of poverty? Why does poverty exist to begin with? It’s not a matter of mathematics, rather it’s a matter of seeing what is behind everything in this world – and that is MONEY – money that in itself is a completely innocent creation meant to be but a way of distributing goods and services to where they are required and wanted the most; but in our current system – money has become a point of control – where those that are already rich and on top of things with all possible means make sure the keep those stricken by poverty in place – else we wouldn’t anymore have a functional slave labor force that can produce all of our various gadgets and other mechanics of entertainment.

Thus, what we must ask ourselves, and economists more importantly, is why have we never used our knowledge to produce a sustainable system where all of us are able to create a life that is dignified, cool and enjoyable? What is required for us to do that? MONEY – and what do we need to bring through such money into this world? Resources – so what is then the solution – the real economic master plan as to how to create a world that would be sustainable and practical for all its inhabitants? To agree that we share the resources – at least the basic and most essential resources – those that we MUST HAVE in order to live.

Thus, I stand behind the Living Income Guaranteed – which is a functional, effective and sustainable way of creating a new world for all people where money will be shared – and for those economists that want to make a difference – I suggest that you investigate this concept and bring your knowledge to the table and help to create something from which we can all benefit!

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The Self-Perpetuating Cycle of Homelessness and Living Income Guaranteed

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The following article lays out the account of one mother’s ‘bad luck’ after the other: Homeless Mother Gets Job Interview But Doesn’t Have Childcare, Ends Up In Jail

She is a mother of two, homeless, unemployed and finds herself having a chance for a job. Not having a home, she cannot leave her children at home while she attends the job interview. Not having money, she is unable to afford childcare while she attends the job interview. So she does the only thing she can do in her situation: leave the children in the car with the window cracked open while she attends the job interview.

Taylor was charged with two felony counts of child abuse for leaving her six-month-old and two-year-old in a car with the windows cracked last Thursday for at least 45 minutes as she sat in an interview for a potential job. She told officers that she was homeless, so she couldn’t leave her children in the house, and she had no one else to watch them.”

Yes, what she did was dangerous, creating conditions which could have led to a fatal outcome. But like the article states: “Taylor’s story raises an important issue: People in her situation are left with only bad options. “Just as she set up the conditions for possible harm for her children by leaving them in the car, so is the system and society guilty as a whole for creating the conditions in which people’s hands are forced to make ‘bad decision’ and forced to choose between lesser evils.

Once landed in a bad position, it can be hard to move out if it, as one’s dysfunctional reality is set up to maintain itself as just that: dysfunctional.

Homeless people also struggle with more than child care when looking for work — they can have difficulty finding an internet connection to apply to job or transportation to get to interviews, clean clothes, or a place to put their belongings. And once they land a job offer, they can run into even more problems, especially if they don’t have things like an ID or birth certificate. It’s a vicious cycle; not having a job perpetuates homelessness, which can in turn make it even harder to find a job.”

break the cycle

What this story tells us, is that in how we are currently running our society and economic lives – you need money in order to make money. If you do not have money to clothe yourself, feed yourself, take care of basic hygiene, have a roof over your head; then it is very unlikely that you will be able to move into a position that will enable you to attain a dignified living standard. It’s kind of a Catch-22 in the land of the economically underprivileged.

How do we break this self-perpetuating cycle? With a Living Income Guaranteed of course.

If this woman would have had a Living Income disposable to herself, she would a) have had the option to stay at home and take care of her kids or b) pay for child care to give her the time and space to get employment.Not only is a Living Income Guaranteed instrumental to ending homelessness, a manifestation which puts to question our solidarity and should really have been eradicated already ages ago; it is also a cost-saver.

“It is cheaper to give homeless people a home than it is to leave them on the streets.That’s not just the opinion of advocates working to end homelessness, nor is it the opinion of homeless people themselves. It is a fact that has been borne out by studies across the country, from Florida to Colorado and beyond.The latest analysis to back up this fact comes out of Charlotte, where researchers from the University of North Carolina Charlotte examined a recently constructed apartment complex that was oriented towards homeless people.Moore Place opened in 2012 with 85 units. Each resident is required to contribute 30 percent of his or her income, which includes any benefits like disability, veterans, or Social Security, toward rent. The rest of the housing costs, which total approximately $14,000 per person annually, are covered by a mix of local and federal government grants, as well as private donors.In the first year alone, researchers found that Moore Place saved taxpayers $1.8 million. These savings comes from improvements in two primary areas: health care and incarceration.”
From: It Saves Millions To Simply Give Homeless People A Place To Live

Both humanitarian and economic motives for a better world, come together within a Living Income Guaranteed. We can reduce social misery, improve human dignity and security and boost the economy – all in the same package. We’d be crazy not to.

Investigate the Living Income Guaranteed Proposal and Join us for discussion.

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