Introduction To 8 Days A Week

Eight Days a week. What connects the dots?

Schematic synopsis A very interesting article: http://www.globalresearch.ca/index.php?context=va&aid=10977 : “The Great Depression of the 21st Century: Collapse of the Real Economy” by Michel Chossudovsky Real economy is based on the production and marketing of • Consumer goods, which are bought by the people in order to fulfil their needs (basic and created). • Investment goods, which are bought by companies in order to produce and market consumer goods and other investment goods. But what if • The needs (basic and created) of the people with money to buy are amply fulfilled • and the people who still have basic needs do not have the money to buy? Then the demand for consumer goods and investment goods drops, the real economy collapses, the profit ratio of companies goes down (profit per year divided by the invested capital). No problem, there is also a third kind of goods that can be produced and marketed: des-investment goods • These goods are not bought by the people, but by governments. The price is not determined by any economic law of supply and demand, there is very little competition. • These goods are used to o Artificially induce economic growth. o Increase the profit ration (profit per year divided by the invested capital) by
Destruction of the capital infrastructure (lower denominator) so there is again demand for investment goods
Bring the people back to the level of basic needs so there is again demand for consumer goods and investment goods (higher numerator) http://english.pravda.ru/topic/defense-196/ : Military expenditure increases dramatically all over the world. However, another alternative is possible: increase the purchasing power of the people who still have basic needs. Unfortunately, this option has never been considered because of some great misconceptions: • http://en.wikipedia.org/wiki/Thomas_Malthus : Malthusianism and Social Darwinism. • http://www.questia.com/PM.qst?a=o&d=4995059 Chapter 1, The Profit Puzzle: economists themselves do not know what the origin of profit is. Both premises are wrong! The proof of this, and much more can be read on this link:

http://www.pdfcoke.com/share/upload/5633082/1ubbf6illsnokkr3by0z “Eight Days a Week”

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Most important chapters/sections: 2 3.4 3.6.5 4.4 5 6

The hidden mechanisms behind the world history Basic Theory On the origin of wars The dual active-recreational society: “the fourth wave” Epilogue Schematic synopsis

I hope that this schematic synopsis helps you to realize what connects the dots. Summary of Eight Days a Week

The purpose of studying economics is not to acquire a set of ready-made answers to economic questions, but to learn how to avoid being deceived by economists. -- Joan Robinson Start by doing what's necessary, then do what's possible, and suddenly you are doing the impossible. -- Francis of Assisi

In my manuscript “Eight Days a Week” I describe the economic evolution, more specific the recurrence of economic and financial crises, concentration of wealth and the occurrence of war, and the deeper geopolitical causes of this correlation. I also unravel the historical background of this evolution, but also other very actual and urgent questions and problems, as they are all interrelated with one another. All dots are connected with one another! I hope that you will pay some attention to this information. In business process reengineering, it is a paramount importance to understand the “as-is situation” as it really is before one can perform some change management in order to evolve to the “to-be situation” one has set as objective. Some people in the world do not like global democracy at all, as you can read in the book “Failed States” of Noam Chomsky (p 215-216): “Ferguson and Rogers were describing early effects of the powerful coordinated backlash against the “crisis of democracy” of the 1960s that deeply concerned the Trilateral Commission, which coined the phrase. The commission consisted of prominent liberal internationalists from the three major industrial regions: North America, Europe, and Japan. The general perspective is illustrated by the fact that the Carter administration was mostly drawn from their ranks. The worrisome crisis under discussion was that the 1960s had given rise to what they called “an excess of democracy”: normally passive and marginalized sectors – women, youth, elderly, labor, minorities, and other parts of the underlying population – began to enter the political area to press their demands. The “crisis of democracy” was regarded as even more dangerous by the components of the elite spectrum to the right of the commission and by the business world in general. The “excess of democracy” threatened to interfere with the well functioning system of earlier years, when “Truman had been able to govern the country with the cooperation of a relatively small number of Wall Street lawyers and bankers.” In the new and expanded edition of his international best-seller “The Globalization of Poverty and the New World Order” Professor Michel Chossudovsky outlines the contours of a New World Order which feeds on human poverty and the destruction of the environment, generates social apartheid, encourages racism and ethnic strife and undermines the rights of women. The result as his detailed examples from all parts of the world show so convincingly, is a globalization of poverty.

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The value of my study, compared to other books dealing with similar topics, lays in the fact that it does not only describes or analyses the problems in an original way, it also formulates real solutions. So I hope this manuscript can catch your attention, as it is very important to understand what is really going on in the world and why things as are they are. What follows is a short summary of the highlights of this manuscript. A society functions according to a certain paradigm, which is based on a set of premises more or less in accordance with reality. Several social groups in society set objectives and act toward those objectives according to these premises. If some of these premises are not in line with reality, but, on the contrary, are based on a wrong understanding or interpretation of reality or even on ignorance, then the performed actions will not lead to the desired objective. Instead, one will be faced with unexpected obstacles and undesirable consequences. This could lead to problems, frustration, even aggression and crisis. Because one has started from the wrong premises, one will most likely look for the causes of the failure in the wrong directions too. Otherwise one would have started in the right direction from the beginning! One will make the wrong diagnosis. One will even point to a scapegoat as a reason for failure. When a society functions according to a paradigm that is not in accordance with reality, and when, in spite of the crisis, it still follows the same line through, when it does not learn the necessary lessons and when it does not adapt its paradigm, then that society will again and again be faced with the same kind of crises - even with increasing intensity -, it will again and again go through the same scenario (scripts in transactional analysis, karma in eastern philosophies), just as the principal character in an ancient Greek drama: “The tragic error in tragic drama is walking in blindness so that the tragic hero who intends to accomplish a certain result with his actions accomplishes the exact opposite” (Claude Steiner, Scripts People Live). So the same economic fallacies keep on recurring generation after generation. The cause for recurrence and periodicity in economy can be found in the fact that the current economic paradigm is not in accordance with reality. The ever-repeating cycle of economic crises and wars can only be interrupted if we succeed to transcend the limitations of the present paradigm, add new dimensions to it, so it is more in tune with reality. Economic theory holds some strange paradoxes. On macroeconomic level, economists have some difficulty with the notion of profit. According to the concept of “evenly rotating economy” formulated by Murray Rothbard, when everything is perfectly known by everybody, technology is stabilized, and management is perfect, then the economy evolves to a stationary state and profit tends to decline to zero. Paul Samuelson has expressed the same as follows: “Suppose we lived in a dreamworld of perfect competition, where we could read the future perfectly from the palm of our hands and where no innovations were permitted to disturb the settled routine of things. Then the economist says, there would be no profit at all!” I do not agree with these statements. Economists try to let us believe that profit is not possible in the first place. I have never found a positive proof of this statement in all the books and articles on economy that I have read. So in a way it is an academic dogma, an axiom. But then every company wants to make profit. On microeconomic level, from a businessman’s point of view, we can describe profit as follows: • A company realises a turnover by marketing certain products or services. • In order to do this, it has fixed and variable costs. • Turnover minus the variable costs gives us the contribution. • Contribution minus the fixed costs gives us profit before taxes. • Profit before taxes minus the taxes results in profit after taxes.

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So in order to keep on making profit, you have to set one of the following mechanisms, or a combination of them, into action: • Mechanisms in order to realize the same turnover with less variable costs: increase productivity, more automation in order to reduce the direct labor costs and to increase output per man-hour (downsizing); mechanisms to guarantee cheaper input of raw materials and energy. • Mechanisms in order to distribute the fixed costs over more turnover by increasing the scale of production and acquiring new markets: mergers, acquisitions. • Mechanisms so that customers buy from you and not from your competitor: innovation, product advantage compared to the competition, advertising..... • Mechanism in order to create ever new products or variations on existing products and to be the first one to skim the market. • Mechanisms in order to eliminate the competition: mergers and acquisitions, regulations • Mechanisms in order to make the customer to buy your product over and over again: too expensive printing cartridges, built in wear-and-tear, genetic manipulation of planting seeds. • Mechanism in order to force the customer to buy the product from you and you alone: monopoly, autarky. • Mechanisms to pay less tax, or even better no tax at all. • Mechanisms in order to divert costs from your account to someone else, or even better to many others. • Mechanisms in order to divert money from the pockets from the others into your own pockets. … and when all of the above mechanisms are no longer effective, in order to save the system from total collapse: •

Mechanisms to start the game all over again from the beginning: same players shoot again, according to the concept of “creative destruction”, formulated by Harvard professor Joseph Schumpeter in 1942.

Unnecessary to say that the mechanism that you can set into motion depends on your “span of control”. So the economic system has derailed into the production of goods and services for the already affluent people, that do not meet the real basic needs of the majority of the people in the developing countries, and into the production of “dis-investment goods” in order to make the “creative destruction” possible. In my book I have proved that profit is possible, even when everything is perfectly known by everybody, technology is stabilized, and management is perfect. Profit is a consequence of economic growth, and the way profit is distributed among society determines future spending (qualitative and quantitative), future economic growth, and thus future profit. Economic growth and profit can be stimulated by diverting purchasing and investment power to the people whose basic needs are not yet fulfilled, as the Nobel Prize winner for peace Mohammed Yunus has demonstrated with his principle of micro credits and his Grameen Bank. So, economic growth on global level can be stimulated by involving the developing countries in the economic process by granting them more purchasing power and investment power. Unfortunately, as professor J.K. Galbraith has clearly described in his book The Culture of Contentment, the more people are affluent, the more they are afraid to loose their wealth, the more possessive they become. A lot of developed countries are currently faced with a kaleidoscope of urgent socio-economic problems: • • •

Unemployment with younger people and people over 50. The post WWII generations grows older and lives longer. The level of activity is too low in order to finance the system of pensions and social security. The economic growth is too low, certain parts of industry show low profitability.

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• • • • •

• •

Production is moved to countries with lower wages in the former East European block and to Asia, Latin America, but not to Africa. A lot of people have difficulties in order to pay back their mortgage loans, which results in an financial crisis. There is an increasing competition from lower wage countries, not only in the classical industries like textile and steel, but also in service industries and even high-tech sectors. But people in the new emerging economies do not get their fair share, their working conditions are often inhumane. Mobility problems, daily structural traffic jams to and from the agglomerations where the industry and offices are concentrated. Air pollution, CO2 emission, concentration of ozone, the heating of the atmosphere, a Kyoto norm that seems unattainable. If the ice on the North- and South-poles melts, a lot of fertile agricultural land and industrial infrastructure like chemical plants, nuclear power plants – mostly located near to ports and estuaries of rivers – will be below sea level. What will be the impact on national and international security when there is less land and pure drinking water available and productive resources and infrastructure are lost? Combined with the demographic evolution this holds a serious danger for conflicts on global scale. Companies like Haliburton and The Carlyle Group would make a huge profit out of this, but for mankind as a whole it would be a disaster. The demand of a great deal of the people to have a better balance between on the one hand working and commuting time, and on the other hand more quality-time for family and recreation. Etc.

Governments do not have enough room in their budgets to tackle all these problems in a fundamental way, so financial aid to the Third World countries and the necessary environmental measures are not their main concern. Governments are composed of several departments, which all try to take measures in the area they are responsible for, and this within the limits of their budget. The solutions proposed in one field often lead to sub-optimal situations or more problems in another field: more employment could lead to more mobility problems, more energy consumption, and more CO2 emission. As Mr. Kofi A. Annan, United Nations Secretary-General, has formulated it "We will have time to reach the Millennium Development Goals – worldwide and in most, or even all, individual countries – but only if we break with business as usual”. In Watching the Wheels John Lennon sings “There are no problems, only solutions”. Easy to sing, but hard to accept. Utopia of not? Maybe we should not look for isolated solutions for problems that are interrelated anyhow, but rather look for one holistic measure that could lead to the solution for all problems at once. In my manuscript I have elaborated such a holistic measure, which indeed breaks with business as usual and therefore could very well solve all of these socioeconomic and environmental problems in a very elegant and human-friendly way. One of the things that I have really proved in this study is that the rich countries can help themselves by helping the poor countries. Economic activity should be aimed at fulfilling the needs of the people. Economic growth allows fulfilling more needs of more people. Unfortunately the economy has gone astray: profit – a consequence – has become a goal on itself. A human being is only economically important in two ways: as a production factor, generating added value for the employer, and as consumer, with money to spend; the rest of the world population being labeled as “dispensable eaters”. In the period after the Second World War, the focus has been on creating ever more new needs of the same already affluent people. This has resulted in the ever increasing gap between the “haves” and the “have-nots” and an over-cropping of natural resources, especially of nonrenewable fossil energy. The core of my manuscript is that it focuses on man as man, and not as man as only a production factor or a consumer. My proposal holds a new division of work that could narrow the gap between “haves” and “have-nots”, as more people would be able to get a job and they could keep on working even at older age. Work – and thus income – and leisure time would be distributed more evenly and more fairly among all people. This would strengthen the viability of the social system in the rich counties and leave enough space for helping the Third World countries and solving the environmental

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problems. Freedom from want, freedom from fear and freedom to live in dignity are all guaranteed for all of mankind by the proposal. Consider this study as an “unpublished academic paper in process” that I am willing to share with you, and that very well could evolve into a book. I am looking forward to your reply and your feedback. Sincerely yours, and thank you for your time,

Geert Callens

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