2. COMPRESSION OF A TIME CONVERSION
Compressing the average workweek would proceed at the rate that people understand and believe in it. Unlike the unfounded political promises raining down from the Hill, compression is not something-for-nothing. It actually eliminates many instances of something-for-nothing. Instituting compression will reduce the gulf between the total hours that the average person works and those hours he actually works for himself. Presently, as figures in a later section demonstrate, the average person works more than a third of his time for various forms of taxes. The time worked in order to pay taxes are the public hours of one's total workweek.
Many people are unemployed because there are no job opportunities. These people draw on tax dollars which have been collected from the employed workers. The average worker spends many hours working for other people. Compression can reduce, possibly eliminate, people having to work for others.
Compression can improve the standard of living based on increased production per capita. This can be shown within a framework that is more encompassing than the one used by politicians and necronomists. This framework is based on time.
Time is the commodity of which all things are composed; without time, something ceases to exist. Each thing, including human beings, produces or consumes time. Since time is synonymous with energy, the previous statement can be translated as "everything is either producing and storing surplus energy (time) or consuming some of its stored surplus of energy." This statement applies to atoms as well as human beings, communities, nations, and civilizations. At any moment, these things are either producing or consuming their existence, energy, or time. Ideally, humans should be producing a steadily increasing excess of time. Today, the declining state of civilization indicates that the level of production per human capita is declining. Why?
Human production per capita is declining, in part, because top policy-makers (public and private) have placed the emphasis on production per worker. However, people err in concentrating on productivity per worker. Productivity per worker figures are synonymous with productivity per capita only if the unemployed are counted as workers also, that is, as inactive would-be workers with a production level of zero. Figures on productivity per capita that include unemployed are the true measure of whether a people will rise or fall. Hopefully, the following example will bring this home.
Suppose a ship wrecks between two small islands and 100 people swim to each island. On both islands, meetings are immediately held on gathering food. On one island, it is agreed that everyone will work a certain number of hours each day. On the other island, an MBA graduate proclaims that the greatest production will come if the most efficient worker is allowed to do all the work, for then the island will have a higher production per worker than if everyone works. Which island would you rather be on?
Politicians corruptly and/or incompetently pass laws to raise production per worker which reduce production per capita. (These policies encourage mergers and acquisitions among other counterproductive activities.) Private policy-makers essentially lobby for a reduction in production per capita. Unstopped, these policy-makers will create a world in which only a few, highly productive people work while the rest of the world is unemployed and starving.
Should one increase the comparative efficiency of the employed worker by firing the least efficient workers? Any worker that is efficient, to any degree, is producing more than he is consuming; he is producing a surplus of time, energy, and matter which can benefit others. Only deficient workers produce nothing at all. Is it wise to increase the production of one worker by 10% if it involves firing another worker and reducing his productivity from 100% to 0%?
In America, there are few deficient enterprises. There are many enterprises that have a low efficiency rate compared to others. Should we consistently lop off the least efficient companies until there is only one company left?
The various companies in America could be ranked according to efficiency rates. Some would rate as low as one percent; others would be as high as fifty percent or more. Should the pursuit of higher efficiency per worker come only from eliminating the least efficient companies and workers? If that is the case, we should immediately order the closing of all firms that don't have an efficiency rate of at least 25%. Overnight, the productivity of the U.S. worker would jump. Is this the kind of increased efficiency per worker that we want? Not if it plays havoc with the more important measurement of efficiency, that is, efficiency per capita.
Consider the following quotation.
Implicit in this quotation is that anything that does not return at least 17% is considered ailing by the chairman of a certain midwestern steel company. What does it mean for a country when production is arbitrarily closed down because it does not meet a certain boardroom standard of efficiency? It means more unemployment and shortage inflation with a drop in production per capita.
Interestingly, the cited cut-off rates are parallel with the prime interest rates that banks charge industry. The argument that a mandatory reduction in interest rates would halt the elimination of production caused by high interest on inventory costs will be explored later.
This talk about improving productivity and efficiency per worker is potentially destructive if one does not distinguish between efficient and deficient, and between per worker and per capita. The present pursuit of more efficient workers by the top public and private policy-makers is built on cutting the work force, not improving its efficiency. For human beings, the most important measurement of efficiency is productivity per capita. This is also the same as productivity per lifehour* since there are twenty-four hours in every day for everyone.
Almost without exception, anyone who works is probably an efficient human being; that is, he produces more than he consumes. Unemployed people are by definition deficient human beings since they are consuming more than they are producing. Deficient human beings must draw upon some store of resources (time) in order to survive: savings, welfare, or theft.
While most workers are efficient, all could be more efficient. One factor that retards efficiency per worker is working too many hours in a day, a week, a year, or a life. Most people would be more efficient at work if they did not have to work so many hours.
Compression will work because it will promote increased efficiency per capita or lifehour. Newly created employment vacuums will draw in the unemployed and presently deficient persons will become efficient. Overall, productivity per capita per lifehour will increase. With compression, people will more efficiently convert their lifehours into the energy or time needed to survive and have a better life. America, like all parts of civilization, is a time conversion process. Each day, people have 24 hours to convert into goods or services that represent time "savings" for their long-term survival. Each person has 24 hours in each day in which to create products (goods or services) that promote life.
Top policy-makers should be promoting a continual increase in the efficiency of every lifehour created by everyone. To dwell on the increased productivity of fewer and fewer workers is a prescription for social turmoil and upheaval. Under present conditions, more and more people will fall toward the starvation line. Compression is the means to reverse this self-destructive trend of increased efficiency for a fewer few.
Timism: The Basic Cost of Goods and Services*
Time must become the gauge by which people index their wealth and the quality of their lives. People are self-defeating when they want more symbols. For example, consider the union worker who strikes for more pay but has less actual buying power at the end of each contract. Unions traditionally strike to increase the number of symbols that the workers get for their work time, not to improve the private, productive worth of their work time. In the end, the workers have more symbols that are worth less.
Has the American standard of living been the highest in the world merely because of the number of symbols it has to manipulate? Did the employed workers' wealth increase by changing the numbers written on their paychecks? The crucial factor for improving lifestyle has always been what the worktime would buy, regardless of the intermediate scribbled-on paper products that symbolize wealth (e.g., money or checks). As the following quotations show, the cost of goods and services should not be measured in dollars and cents but rather in the time required to buy them.
Living Standards--U.S. Still Tops --- Hours of Work Needed to Buy Package of Basic Goods, Services.
Each year, one wants an increased worth of each hour that one works. Many people have equated increased wages and increased worth for their work time. The futility of this belief has been showing up again and again over the years.
Has the personal value of your work time increased if you get a ten percent pay hike that is immediately followed by a ten percent price hike? No. The personal value of your work time has not increased. With the losses that come from a strike or increased administration to determine Cost Of Living Allowances, you'll have to work just as many hours to buy the same things. The only difference is the little numbers on your paycheck and on price tags. Who wants to be a millionaire when a loaf of bread costs a billion dollars?
The course of the unions has brought them to the following situation: "More employees accept cuts in pay to help their companies survive." If employees had pursued ownership of substance instead of symbols they would not be negotiating "paybacks." Paybacks mean giving in to employers who retained and increased their ownership of substance while giving symbols to employees. Paybacks, as discussed at the end of "Influx Pressure for Compression" (Chapter 5), do not solve the plight of the hourly worker. Giving symbols back will not correct the initial mistake of accepting symbols in place of substance. The rank and file must now give up past gains because they repeatedly failed to pursue substance.
This reversal of past gains need not be. Unions should never strike for wage increases. Rather, they should strike for a stock option in which workers receive stock in lieu of pay raises. Slowly but surely the workers' standard of living would increase as they own more and more of the wealth that they produce each hour without inflationary price rises. Striking for wage increases merely changes the figures on pay checks and price tags. Striking for stocks increases annual income without increasing the prices of goods and services.
The workers at Ford, Chrysler, and International Harvester (as well as other companies) should agree to taking wage cuts only if the corporations do two things: 1) give stock in the amount of the wage reduction, and 2) remove the company stock from the stock exchanges and fix it at the final price. It is futile to trade one symbol for another if the value of both in substance is easily manipulated. In other words, one should not accept stocks as pay if the buying power of the stocks can be manipulated and cheapened as dollars have been inflated.
One reason that employee stock option plans (ESOP) fail is that the stability of the stock's worth is beyond the control of the employees. The worker, the company, and the nation will benefit when the stocks of companies are treated as long-term investments rather than as stale stocks for professional gamblers' speculation.
This is but a brief sketch of what people suffering from inflation should be striking for: a gradual increase in control over their lives by owning their companies. Pieces of paper are useless when they are readily cheapened by the "magic of the marketplace." Presently, the rank and file think that a big strike (instead of a gradual approach) will balance their wage deficiencies. This is the old tortoise and hare contest.
As emphasized repeatedly throughout the NUSA/AESOP writings, the key to people getting ahead is increasing productivity per lifehour per capita. The use of mandatory employee stock plans will improve worker efficiency, because the workers will have a personal stake in the company.
Government's Timely Costs
The previous section argued that a person must seek to increase his personal worth in tangible goods for each hour that he works, not in symbols such as money. One way is to increase the ownership of one's production by either working for oneself or by acquiring stock in the corporation for which one works (ESOP). Another way to increase the product worth of each hour that one works or lives is by reducing taxes.
Taxes represent the government taking some of your time (as money) to buy the time of other people to solve problems that you cannot or will not solve. This is the public time component of your total workweek (the time you work to pay taxes for public problems). On a national level, the amount of time taken from the average citizen through the various forms of taxation is quite high daily and annually:
The average worker [spent] two hours and 49 minutes of his eight-hour day earning money for 1981 taxes.
The average person works about 35% of his time to pay the government to solve public problems. Among these problems (which clearly are not being solved) are welfare, unemployment, social security, education, national security, and public works. The average person works almost two days every week for a politicized government that solves fewer and fewer problems each year.
There are two ways that people can cut their tax losses. One way is short-term and self-defeating. The other way is long-term and productive. Presently, "special" people decrease their tax losses by monopolizing the ears of politicians for special tax privileges. This mode of tax avoidance causes overtaxation of those unwilling or unable to participate in political graft or greed.
The productive way of cutting taxes is to cut the time-wasting problems behind taxation. If the reasons for taxes are reduced or eliminated, taxes will also be reduced or eliminated. However, the cart must not be placed before the horse; cutting taxes without first cutting problems is an exercise that wastes human energy and hope. This sequence was evident in Reganomic tax cuts. Without cutting problems first, cutting taxes causes rebounds in taxation and/or problems.
If public problems can be solved, the average person can work less as his tax burden is decreased. The average citizen could work a total of three days, the same three personal days he presently works for himself. He would also have as much buying power as he has presently.
Compression will work, in part, because it will organize people either to solve problems or to take care of the problems at a lower cost. Half of one's time-savings must be devoted to self-education and community service. The cost savings from decreasing public problems will be passed on in the form of real tax cuts.
By organizing people to solve local problems on a local basis, the workweek can be compressed without a loss of buying power. Once compression is commonly agreed upon and instituted, people will choose to commit a few hours each week to solving problems rather than continue to lose time in the form of taxes.
NUSA Proposition #2: For each hour that I save from work reduction, I will spend part in a NUSA community problem-solving service.
If your various tax bites (income, sales, home) amount to 16 hours of your pay, in order to avoid all taxes would you be willing to work 8 hours in some problem-solving community action? Would you be willing to reduce your workweek by 16 hours to 3 days? An affirmative response would result in your working only 32 hours a week with no loss in buying power. (24 hours at your regular vocation and eight hours in community service.) An affirmative response would also indicate an appreciation of the more problem-free world that would result from relocating the problem-solving processes to the local level.
Certain politicians may talk about taking the federal government out of your life, but they never proposed organizing you to take problems out of your life. In conjunction with colfilperhone* and NUSA, this is what compression amounts to. Problem-solving community projects (colfilperhoned from, by, and of the people) will reduce public problems and taxes. Those who participate in solving the problems will receive tax credits to use against their remaining taxes.
Government as Borrower/Relender of Your Time
What are taxes? In the simplest sense, taxes are monies collected by a government from the people. Less simply, taxes are monies collected to deal with problems that the citizens cannot or will not solve themselves. More completely understood, taxes are a government collecting and controlling the time of the citizenry. The amount of one's taxes symbolize the amount of work time that a person gives to his government.
When taxes are understood as the government collecting time from the citizens in the way of dollars, one can argue that a government is a borrower and relender of its people's time. In a timistic sense, taxes are a government borrowing time from the citizens to buy other peoples' time to deal with unsolved problems. The bottom line analysis of a government collecting its people's time is whether the collected time (dollars) is actually spent to solving problems. In other words, a government borrows and relends the citizens' time. Is the relending a profitable transaction for the citizenry? Does the forced collection of time and its relending save the people from time-wasting problems? (These questions on lending time to government agencies also apply to financial, insurance, and other national institutions in which the average citizen is forced to put some of his time: Do these other borrowers of people's time use the monies productively or counterproductively?)
Taxes: Direct or Indirect
There are two ways in which people can deal with unsolved problems: directly or indirectly. The direct method involves using their time to personally solve the problem. The indirect method is to spend time acquiring money to hire someone. In many cases, the indirect form is the most expensive. This is especially true if the people suffering the problems are the most knowledgeable about them.
When people elect government officials, the degree to which public problems are solved reflects how well the officials utilize the people's time. Do politicians organize the people to directly solve the problems? Or, do politicians attempt to indirectly solve the problems by forcing taxation in order to hire regulators? Either way, the people's time is being taxed. Obviously, one method is better than the other. A government errs when it tries to solve people's problems indirectly. The indirect manner involves unilateral, unrepresented taxation of the divided, disorganized people so full-time regulators can be hired. Ironically, many public problems are a direct result of the fragmentation and regionalization brought on by politicians. No amount of taxation or full-time regulation can cure these problems. The solution lies in enlightening the people and requiring that they give a certain amount of time to public problem-solving on a regular basis.
For a nation suffering from public problems and dwindling personal income, it is futile to increase taxes on the people's time. More specifically, if a nation is faced by rising unemployment and a deepening recession, increases in the indirect taxation of the people's time are impossible. The only remaining course is direct taxation of their time. This direct taxation of people's time can only be effective if they and their time are democratically organized. The colfilperhone process offers the ideal means.
The recent years have been accompanied by a rise in the cost of government and in the federal deficit. Both increases reflect the inflationary cheapening of life as a result of increased problems. Ronald Reagan called for tax cuts and budget cuts. These cuts, however, did not solve the problems that dictate the inflation rate. A few short months of Reaganomics led to demands for more taxes.
The rising deficits and unemployment generated by Reaganomics also reduced the tax base (in dollars). Monetary taxes cannot be raised if the GNP is dwindling. On the other hand, the lifehour basis of the country did not dwindle. Many lifehours are available for solving public problems if the government can present a plan whereby people will feel that their hours will benefit their standard of living. (One such organizational plan is the NUSA--National Universal Service Act--described in a later chapter.)
If you thought that Reagan would provide a plan, you forgot that he does not write his scripts. Reagan called for "volunteerism" but only on the terms set by the people who ran his administration. Reagan would never call for the people to organize themselves anew in a democratic and capitalistic fashion. To so do would threatens the moneyed interests who were and are privileged with inflationary returns.
America's problems will be solved by directly taxing the people a certain amount of their time. The taxation cannot be done in dollars, even though a dollar amount can be set on the amount of time required of the citizens. For instance, if the government requires that every person give 104 hours per year to some approved problem-solving activity, the corresponding dollar amount would be about $170 billion. This figure is arrived at by using $7 as the average hourly wage and using a figure of 230 million people ($7 x 104 x 230 million).
There is no way that the politicians can get $170 billion in taxes from the contracting U.S. economy. Under their tax dollar mentality, this means that they cannot solve the problems. Ironically, the unsolved problems are contracting the basis from which the politicians try to buy solutions. The solution is to provide the organization whereby people can be taxed some time to solve their problems. NUSA does this and offers an expanding tax base founded in real time, not symbols of time.
Direct and indirect taxation as ways of solving problems can be distinguished in an exponential way. This exponential contrast is especially clear when an economy is contracting under the weight of unsolved problems. With direct taxation of people's time, the people will have more and more time as the problems are solved. The tax base available for problem-solving will grow as time-wasting problems are reduced.
On the other hand, if top policy-makers continue to tax people indirectly through currency, the contraction of the economy will speed up. Instead of an increased tax base for dealing with fewer and fewer problems, indirect taxation causes an exponentially contracting economy burdened with an increasing number of problems. The remaining taxpayers are taxed more and more.
The best government is the one that educates the citizens to govern, serve, lead and police themselves. Is this not what NUSA promotes through the principle of democracy per diem? Is this not what the call for a per capita tax in time amounts to? Is not the call for a new social contract, in which each person will give a few hours to solving public problems, nothing more than a call for people to govern themselves? Does it not institute the following mentality:
And so, my fellow Americans,
This social contract, by which everyone agrees to give some time to and for America, can only work if there is a national referendum. The referendum must take a consensus of the people so that everyone knows that there is a will and commitment to sacrifices per capita.
The public enterprises to which people will give their time must be prioritized by the people themselves so that the most pressing problems can be dealt with first. If politicians had their way, we would all work for their reelection while the fields go unplanted.
Tax Polarization: Payers vs. Collectors
Compressing the workweek and establishing community-based, problem-solving enterprises are simultaneous steps toward ending the counterproductive trend in government. Over the years, America has become polarized into numerous opposing camps. One such polarity is that of the full-time tax payer versus the full-time tax collectors and handlers.
The consequences of this polarization show up in the insensitivity of the full-time tax collectors in their isolation from the problems of the taxpayers. Remember, taxes are supposed to be collected to solve the problems of the taxpayers. What happens when a class of habitual, full-time tax handlers evolves? They respond to their own problems rather than the problems of the taxpayers.
In terms of solving a nation's problems, which would be a better arrangement?
A country in which half the people work full-time to pay the other half who work as full-time, habitual tax collectors, or a country in which all the population works half the time to pay the needed taxes and the other half of their time to decide on the best use of the taxes?
Compression of the workweek is an attempt to bring about the latter.
Some will say that the problems will not be solved without full-time problem-solvers. This is true, and it is also why problems are not being solved presently. Despite the astronomical pay packages, the politically elected and appointed do not give America full-time problem-solving.
Politicians are paid full-time salaries, but their time is not spent on solving national problems. They spend all too much time on special interests. If America is to have full-time professional problem-solving, it will not come from habitual politicians. Compression, colfilperhone, and NUSA will provide the problem-solvers that America needs. Recall the distinction between habitual politicians and professional policy-makers. One wheels and deals using inflationary favors while the other is the "forward speaker" of truths that solve inflationary problems.
America: Producers Exchanging Time
Dependent upon time for existence, America is simply a system of human production in which people convert or trade their time in order to survive. The distinctions made by necronomists in describing the American economy (production, distribution, and consumption of wealth) are misleading, insufficient, short-term truths. Through these misleading distinctions they have developed a complex garbage dump of counterproductive rules for public and private policy-making. Among the misleading concepts is that management and labor are different, thus underlying the greater pay, perquisites, stock options, and benefits for salaried professionals. Yet, all people in a company are merely converting their time into producing the products of the firm.
Also among these misconceptions are the various scribbled-on paper products that confuse the ownership of production (e.g., stocks, bonds, certificates and currency).
Earnings: Just or Unjust
Most people would agree that one should be paid according to how well or how much one produces. If I produce twice as much as you, then I deserve twice the pay. This simple logical rule is not only moral, but practical. If you get paid as much as me for producing only half what I produce, I am going to stop working so hard. On the other hand, the person who is underproducing will not speed up his productivity because there is no incentive. The person who is overproducing, relative to other people receiving the same wage, will most likely pursue a less productive, but higher paying job. The results of everyone trying to get paid more for producing less should be evident.
A nation cannot go forward if it divorces productive effort from the rewards for producing. If allowed, a privileged, overpaid class of employment (to which everyone aspires) arises. The result is decreasing production per capita followed closely by a fall in the standard of living. This scenario describes America today. The present "uber-class" includes those who gain privileges in tax or business transactions by monopolizing the ears of politicians.
On a smaller scale, a hermit is a human system of production. In a system of one, the just rewards of one's production are very clear. Everything that the hermit produces is his for consumption. He has as much as he produces; the quality of his life directly reflects his productivity. As we consider increasingly larger human systems of production, however, the relationship between production and rewards, in the form of consumption and ownership of the produced goods and services, becomes clouded.
As the number of middlemen increases, just rewards for one's productive efforts become increasingly unlikely. Middlemen come in more varieties than people realize. Usually, one thinks of wholesaler. These traditional middlemen between the initial producer and the final consumers include truckers, food processors, and oil companies. These middlemen are frequently accused of being price-gougers who cause inflationary price rises. However, another class of middlemen is surely more responsible for inflationary suffering. These middlemen are employed in government, finance, insurance, unions, pensions, and management. They are the primary source of the misdistribution of wealth (goods and services). They are the overpaid who cause the inflationary suffering of the underpaid. These middlemen remain overpaid because underpaid producers do not organize in a productive fashion.
Traditionally, the underpaid become increasingly underpaid. At a certain point they are moved to action. Throughout history, violence toward the privileged, overpaid middlemen has been the course of action. Unfortunately and unnecessarily, this violence further erodes the lifestyle of the underpaid.
The producers' action should not be suicidal violence against the corrupt and/or incompetent middlemen. The best action is to organize the production of goods and services at a better price. Among the services that the basic producer must organize are national policy-making, finance, insurance, pensions, and management. Corresponding services within NUSA are:
Without these productive enterprises, the anger of the underpaid suffering from inflation will become violence toward both the victimizers and themselves.
In terms of management and unions, democratic capitalism is the only way for the workers' lot to improve. Striking for higher wages is useless when wage hikes are matched (or exceeded) by higher product prices. And union officials represent just another hierarchy of habitual politicians. Habitual policy-makers always become isolated from and insensitive to the plight of the rank and file. Unions and their strikes are two of the most unproductive paths that the basic producer can take.
A genuine solution is for the basic producer to acquire a greater degree of ownership in his place of employment slowly, through a worker-controlled stock option plan. In addition, the worker must spend a few hours each week educating himself to advance from simple repetition to higher levels of production: foreman, supervisor, management. This needed enlightenment will not occur without leadership. Top policy-makers must provide a social contract or covenant in which people agree to shift toward democratic capitalism. This shift means more self-control and continual education.
Despite their labels, the Democrats and Republicans will not bring about "just rewards for just production" by democratic capitalism. They themselves are excessively overpaid relative to their productive worth. If the politicians' wealth was determined by their actual productivity, they would be paupers.
Compression, as outlined herein, will create vacuums in management so that the presently underpaid, underemployed producers can rise in position and hourly income. Within a social contract that divides weekly time-savings between community, education, and leisure, the elevated workers will have time to educate themselves to fulfill their more rewarding responsibilities.
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