Harmonious Economics or The New World Order. 2nd edition by supplemented

One more factor that leads to  suppression is usury. Without generating anything useful, it depresses the real economics, forces the producers to support the money owners, and sucks the resources out of production. The source of usury lies in the money deficit, which is inevitable in economics. In the past, when money was guaranteed by gold reserves, the valuable metals available were not sufficient for serving all the trade flows in the country. But even after this guarantee was withdrawn, the said deficit has been artificially maintained. The only reason for this is letting money generate more money, whatever the cost for production and society may be. SLP

Besides, the foreign economic activity influences social performance, SLT and the population’s quality of life, too. If the foreign trade balance is positive, it means that the country exports convertible goods paid for in uncovered paper money. For certain years Russian import exceeded its export by almost three times. Thus, our country was selling its goods at foreign markets for one third of their nominal value. This made certain private individuals richer, but on the other hand, limited the usefulness of such trade. All other people suffer from it, the state is ruined, and social labour productivity decreases. In the end, the country becomes a donor for other states, whose balance of foreign trade with Russia is negative. However, the government makes of the positive trade balance a feather in its cap and does its best to increase it ever more.

1.3.4. Productive economic factors

Social labour productivity depends from many factors; however, it is most significantly influenced by human beings and their interest in the results of the labour. To be precise, it is human intelligence, education, qualifications, knowledge, physical strength and agility, and health that really impact labour productivity, as well as human energy, decisiveness, honesty, discretion, decency, common sense, tact, and communication skills. The desire to work, and the individual and social labour culture also play an important role in the SLP.

That is why everything that helps people develop the above-mentioned qualities, contributes to the SLP increase. Among these: fair wage distribution, efficient education and upbringing methods, the health both of the parents and the child, psychological and moral family, workplace and social environment, physical education and sports, ecology, and the entire infrastructure for life and leisure.

The works of W. Petty, A. Smith, A. Marshall, T. Schultz, G. Becker, and many others reflect the idea that the reproduction of high-quality work force is productive. Thanks to the contributions of these authors, the work of progressive managers to improve people has ceased to be seen as unproductive expenses, but has become the main source of flourishing for companies and the society, not less important than capital investments in the main funds. That is why, in the twentieth century, advanced economies accrued human capital faster than material capital. For instance, the US economic recovery is at least 15—30% due to the increased level of education among the work force.

Thus, in advanced economies human investment exceeds generously the investment in the main production means. Table 2 presents the correlation between the US investment in the so-called “social expenses’ and production investment, taken for 100% . [36]

Table 2. Correlation between “social’ expenses and production investment in the US, %

The data provided above allows to see that the US allocates as much for healthcare and social security as for education. It is also evident that if these expenses did not pay back, they would not be so significant. The expenses for reproduction of work-force in the US in 1947—1989 alone increase 5.5 times, while those for reproduction of fixed capital – by 3.7 times only. As the UK Prime Minister Tony Blair said, “’. This idea was supported by Bill Clinton, who believed that “’. However, modern Russia would rather save on its people. Knowledge-based economy has people as its main resource Sustained growth requires investment in human capital, education, healthcare, technology, infrastructure 43

Social labour productivity is highly dependent on the labour and living conditions of workers. Therefore, all measures that improve the labour ergonomics increase its productivity, as well. But one of the biggest impacts on  is that of the extent of people’s satisfaction: the higher it is, the more significant their contribution in the production process. SLP

Let us consider a specific example. To keep a worker idle – like a machine – about 2 Mcal of energy is needed. If the worker consumes 3 Mcal, he can use one 1 Mcal for useful work only, that is 33% of the energy received from the food he eats. Then, if the same worker consumes 4 Mcal of food, he can use 2 Mcal for work. This shows how the increase in the amount of food eaten every day by 25% lets the worker do twice the amount of work he did before. This is why academician S. G. Strumilin concludes that “’. the more we want to save on economy, on income and food norms, the bigger damage we will suffer 44  [37]

Eminent entrepreneur Henry Ford believes the same: “. however promising it may seem. That is why  in the end, Wages is more of a question for business than it is for labour. It is more important to business than it is to labour. Low wages will break business far more quickly than it will labour’ Saving on people is, thus, a costly approach, 45  [38]  unpopular measures are, all regressive (sic).

 considerably depends on the technical equipment of labour, and this subject has often been brought up by authors. However, there is no definite answer here. In fact, machine production and maintenance require so much effort, that their use does not always help to save social labour. That is why the science that works out progressive principles, machines and technologies is believed to be one of the major production forces of the society. Plato wrote that “t’. “ ’ (Philip Handler, President of the US Academy of Sciences). And advanced economies do understand this. SLP here is nothing more powerful than knowledge, it always and everywhere overpowers pleasure and all other things Our economy is not based on natural resources, but on intelligence and application of scientific knowledge

As the result, American companies are the only to spend more than $15 billion on training and education of their personnel annually. For the implementation of the Equal Opportunity in Education Act adopted in the US in 2002 alone $26.5 billion was allocated. The total costs of education in advanced economies amounts to 5—6% of their GNP.

In Russia, however, they have never reached 1%, and in the years of crisis dropped further to 0.23% of the GDP. As the result, the salaries of professors employed at the Russia’s Higher education system were 1.5 times lower than the average for the country. The salaries of other academic workers are too shamefully low to quote here. Teachers in Russia do not earn enough to afford a minimal living standard. Doctors and nurses, however essential their work might be, are struggling to make both ends meet. It is evident that such stimulation neither stimulates the country’s development, nor creates proper conditions for the SLP increase or production acceleration.

Thus, the state as such, in order to assure its proper functioning, relies on quite specific expenses, just like a house or a complex piece of equipment require regular maintenance. Otherwise, they turn into a ruin. That is why a redistribution of the national income to private individuals beyond reasonable level turns out to be mortal for the country.

1.3.5. Labour differentiation and cooperation

The science of equilibrium is the key of occult science. Unbalanced forces perish in the void

Eliphas Levi 46

Still, one of the most efficient factors that increase SLP is It does not require as much time and money, however, it efficiency is superior to that of all other factors combined. Besides, notwithstanding all other conditions, only harmonious organisation is capable of shaping harmonious economics, and of creating conditions for the implementation of all highly-productive advances. This factor remains the backbone of any enterprise or economy restructuring. All the rest is nothing more than its result. improvement of labour organisation.

We are not considering here the factors related to the scientific labour organisation, such as specialization, and introduction of rational labour methods and techniques, because all of them have already been studied in great detail. This approach reduces organisation to building an optimal structure for production based on the combination of Without providing an ample description of these phenomena, we will just point out some of their properties that would be interesting for the current analysis. two dialectically different factors, i.e. labour differentiation and labour cooperation.

In the process of evolution, it has been remarked that professional  in space and time increases significantly labour productivity. This tactic helps split human activity into specific functions and operations, none of which are meaningful on their own, by all of which when combined creating a completed product. Such organisation makes better use of the individual workers’ capacities, improves their qualification and instruments of production, and assures rational consumption of work time. As the result, among workers there are more and more experts in a narrow field of specialization. labour differentiation

This factor influences the formation of all social organisation structures (see Figure 1). Besides, the more complex and specialized production, the deeper labour differentiation. “’ (K. Marx and F. Engels ). Thus, the division of labour types according to their functions is one of the most powerful factors of progress. How far the productive forces of a nation are developed is shown most manifestly by the degree to which the division of labour has been carried [39]

On the other hand, labour differentiation leads to the need for agreement and unification of separate workers and worker groups within the common working process, for interaction of all levels of production from individual employees and teams to entire enterprises, subindustries and sectors of economy. This association and interaction between the separate specialized workers in the labour process bear the name of  (from Latin ). This phenomenon is one of the key factors of labour organisation. labour cooperation cooperation

Labour cooperation converts labour quantity into higher quality thanks to “’ (K. Marx). Cooperation is followed by joining of the results of differentiated labour; as the result, labour productivity increases faster than aggregate labour consumption. It is this correlation that allows resolving global issues: developing science, education, culture, building defence from enemies, constructing canals, dams, roads, and other structures that serve a public purpose, and bring collective benefit. the creation of a new power, namely, the collective power of masses  [40]

Rational combination of labour differentiation and cooperation shapes all economic structures. For instance, workers unite to make a team, teams form workshops, which are parts of companies, enterprises, plants, and economic sectors.

On the other hand, the state is a cooperation of its regions, a region is a cooperation of districts, areas, etc. Thus, labour differentiation and cooperation can apply both within production framework, and depending on the territory; they function both in space and time.

In literature on economics this structure is called  Figure 2 shows such tree for a random plant. However, this structure is applicable to other types of organisations as well, including the state. In each case it is determined by a series if objective and subjective factors, by the production and organisation type, its level of development, management, production and human relations, type of property, etc. “organisation hierarchical tree’.

At the same time, as it is easy to see, each link, each cell of production has  For instance, if we analyse the organisation tree from Figure 2, from top to bottom, we will notice the division of all structures into a number of cells. But when you move from bottom to top, then all the cells combine in cooperation to create a bigger structure. Thus, labour differentiation and labour cooperation are interdependent instruments of organisation. Labour differentiation pattern determines the reasonable level of labour cooperation. And vice versa, cooperation allows to deepen labour differentiation processes. When a worker does not have to do everything in life himself, he can specialize in his profession even more. At the same time, he would be more interested in cooperating with other workers and units. both labour differentiation and labour cooperation.

Fig. 2. Modern enterprise “organisation tree’

This is why labour differentiation contributes to a more intense labour cooperation within professional or territorial unions. Moreover, without cooperation with other structures labour differentiation is not efficient and cannot be allowed. A metallurgist will only work well when a farmer provides him with food to eat. The same level of interdependence is observable with all other professions.

On the other hand, the impact of the above-mentioned factors on people is not uniform. Labour differentiation makes workers more egoistic, and limits their circle of interests to personal problems. Cooperation, on the contrary, makes people part of a bigger entity, more important than a single person. This elevates the man, enlarges his scope of interests including other people in it, helps understand his place in the hierarchy of the community, the society, and the entire Universe. Thus, the man becomes wiser and more far-seeing. The combination of the factors mentioned generates the variety of human characters, promotes a dialectic unity of the humanity, and integrates people within each other, within their communities and the World.

This means that  Every unit is created through labour differentiation of a bigger entity, and all divided labour is reunited in a bigger structure. And this does not depend on property form, on fashion, on organisation name, or nature of its activities. no labour differentiation is possible without cooperation, just as no cooperation is feasible unless the components of the whole are divided.

Every enterprise, every organisation possesses dual qualities. On the one hand, its mission is to satisfy the needs of its employees, on the other hand, to satisfy social needs. “’ (H. Ford). Capitalists and workers are equally wrong in thinking that enterprises exist for the sake of income. They disagree on who should have this income. In reality, enterprises exist for satisfying social needs 47  [38]

It is evident that without social functions any enterprise loses all sense to exist, as if the workers and the owners were not interested in the results of their own labour. Absence of social functions turns organisations into business mechanisms, that is, hospitals then work for the profit of doctors, schools – for teachers, banks – for their own gain, administrative services become ordinary tools for enrichment, and armies serve the well-being of generals.

On the other hand, labour differentiation and cooperation generate additional types of work, not required before, like coordination, supply, control, accounting, and management. It would be hard to classify them as anything better than social labour waste if they did not create conditions for labour differentiation and cooperation, and did not help save social labour to a greater extent than they consume it. However, this is not always the case. In certain conditions the amount of supplementary labour is inexcusably large and its efficiency (i.e. the capacity to save social labour) derisory.

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Примечания

1

[This English-language translation of the monograph is based on the Russian-language manuscript provided by the author; it may, therefore, contain a number of slight differences from the published Russian version of the book.] Translator’s note:

2

[Unless stated otherwise, all quotations from English-language original sources and English translations of foreign-language sources referenced in the bibliography are cited from the respective originals/ translations. All other quotations, unless stated otherwise, have been translated into English for the present edition. All biblical quotations are cited from the Authorized King James Version of the Bible.] Translator’s Note:

3

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4

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9

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24

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25

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26

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27

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28

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29

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30

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31

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32

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33

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34

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35

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36

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39

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41

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42

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43

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44

[Translated by me.] Translator’s note:

45

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46

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47

[Translated by me.] Translator’s note: