August 12th, 2016 by
Category: Economics

One of the big reasons we’re moving back into a more socially polarised society – as seen recently in some countries of the EU, the UK and the US – is the continuous dilution of the middle class in many economies over the last 20-30 years, and tensions are rising around the globe.

Aristotle wrote it down more than 2,300 years ago in Politics: “Great then is the good fortune of a state in which the citizens have a moderate and sufficient property; for where some possess much, and the others nothing… tyranny may grow out of either extreme. Where the middle class is large, there are least likely to be fractions and dissensions.”

Politics are as true today as they were then.

Tim O’Reilly wrote an interesting post on the growing inequality between the very rich and the much poorer and the relevance of basic income as a solution in today’s society.

He writes: “Here is one of the failed rules of today’s economy: humans are expendable. Their labor should be eliminated as a cost whenever possible. This will increase the profits of a business, and richly reward investors. These profits will trickle down to the rest of society. The evidence is in. This rule doesn’t work. It’s time to rewrite the rules. We need to play the game of business as if people matter.”

Many discussions of our technological future assume that the fruits of productivity will be distributed to the benefit of all. Tim argues that this is clearly not the case.

Right now, we’re at an inflection point, where many rules are being profoundly rewritten. Much as happened during the industrial revolution, new technology is obsoleting whole classes of employment while making untold new wonders possible. It is making some people very rich, and others much poorer. It is giving companies new ways to organize; those new forms of organization are gradually being matched by labor.

In Technology Vs. Humanity Gerd Leonhard mentions that trend becoming a reality in his “2026: The automation of everything and the basic income guarantee” section.

The economic logic of working for a living is evaporating; instead, we are starting to work for a purpose. A basic income guarantee (BIG) is already in place in 12 countries including Switzerland and Finland, and it’s widely expected to become a global standard in the next two decades, ringing in a new post-capitalist era.

With machines doing all the hard work, increasing numbers of people are doing what they want to do rather than what pays the bills. The BIG has become a key factor in societal happiness, fueling a new boom in arts and crafts, entrepreneurship, and public intellectualism.

Source: To survive, the game of business needs to update its rules

Featured image source: Man at the center of the mural (detail), Diego Rivera, Man, Controller of the Universe, 1934 (Palacio de Bellas Artes, Mexico City) (photo: Joaquín Martínez, CC Attribution 2.0 Generic)

technology vs humanity book cover gerd leonhard

Author: Gerd Leonhard

In the words of American poet John Berryman, “the possibility that has been overlooked is the future”. Most of us are far too busy coping with present challenges to explore the future in any depth – and when we do our own cravings and fears often run away with us, resulting in utopias or dystopias that are not very helpful in terms of planning and decisions. Today’s professionals, leaders and their organisations need a dedicated, passionate long-term understanding of the future if they are to successfully navigate the exponential waves of change. For countless individuals and organizations that intelligence is called Gerd Leonhard.

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