What are Economic Gluts?
"Economic glut ('overcapacity' is the euphemistic term) is when producers are able to turn out more products than consumers are willing to buy. It's not a shortage of demand; there could be plenty of destitute people around who desperately need more products; it's a shortage of EFFECTIVE demand--demand backed by money--a shortage of people willing and able to pay the cost of production plus a profit for the makers."
"There can be a glut in one or more products; for instance, 5% of American workers produce more agricultural products than can be sold here or abroad. But then, optimists note, the displaced farm-workers could move into new fields of work. However, there is also conceivable a universal glut: too much productive capacity in most lines of product."
"Paradoxically, the 'productivity-enhancers' in each nation will benefit that nation temporarily by helping it to undersell other nations--so they will be valued in each nation--but they will harm the whole world in the long run by aggravating the world glut"
Dan Lyons, Further reflections (after my Sept piece) on a society with a universal glut.
There are millions of people in the world who live and die in poverty. This would only be comprehendible, and justifiable, if there was a scarcity of essential goods and services in the world. However, not only is there not a shortage, there is a world glut of almost everything.
"A global surplus of everything from food to videos co-exists with hundreds of millions of people living in destitution. An astonishingly large and increasing number of people are not needed or wanted to make goods or to provide the services that the paying customers of the world can afford." -- Jamie Swift, Civil Society in Question, 1999
Vast amounts of food are tossed in the garbage on a daily basis to artificially inflate the price of food. Instead of having access to water, land and resources to grow our own food, the world's business leaders plan to continue privatizing land and resources for cash crops.
(web page search tip - if you are looking for a specifc quote on a long page of text, use your "edit" and "find" functions to find a specific word on the page.)
"Farmers dump potatoes to boost price" Canwest Global News, January 28, 2005
"The proposal does not deal with the nature of crop agriculture and the reasons why farm programs were established in the first place. As a result, it does not identify how a buyout will serve to address the chronic problem of supply growing faster than demand and the resulting low prices." (April 22, 2005, Daryll E. Ray, Agricultural Policy Analysis Center, University of Tennessee, Knoxville, TN)
Chicken Glut: "With the repopulation of laying flocks, expansion in the broiler production sector has brought an oversupply situation." -- Wells Fargo Economics, April 2005
"Part of the shell egg oversupply problem is an over abundance of layers. Therefore, this purchase will assist the egg industry by reducing flock size to a profitable level...", USDA, AMS, Poultry Market News, April 15, 2005
"With a fortnight of President Kalam's exhortation to agricultural scientists, farmers in Kurnool district in Andhra Pradesh, dumped cartloads of tomato on the streets. Excess production had resulted in a crash in tomato prices, with prices slumping to 50 paise a kilo (less than half a cent for a kg), farmers were left with no choice. In Maharashtra, Uttar Pradesh and Punjab, irate potato growers have demonstrated their anger by throwing potatoes onto the highways. There are no takers for the bountiful potato harvest. Not only crop failures, even bumper harvests have begun to push farmers into a vicious cycle of mounting debt and distress. Whether it is Andhra Pradesh, Karnataka, Tamil Nadu, Maharashtra or Punjab, farmers are increasingly becoming a victim of the new emerging phenomenon of "produce and perish".
"Already, the electronics gold rush is leading to overproduction in flat-panel TVs."
There is enough productive capacity in the world to meet the people's needs --food and housing and other necessities. The real reason billions of people live in poverty is that according to the moral logic of the world's dominant social leaders, only people with money have 'earned' the right to buy the things they need to stay alive. Somehow, millions who are simply born into a wealthy family have 'earned' the right to food, shelter, health & dental care etc.
Those of us who are poor live and die in poverty not because there's not enough food and shelter (and other necessities) in the world, but because we don't have enough money to buy the food, housing, energy, water, medical and dental care that already exists.
In spite of gluts of goods, economic leaders insist that industry must be even more productive to compete. "More productive" means producing more with fewer costs (i.e. wages).
In the 1960's, there was much discussion in the U.S. about the problems created by "cybernation." There was much support for guaranteed income at this time. However, instead of insisting that people be given a share of wealth through a guaranteed income, they embraced the misanthropic, illogical puritan work ethic and insisted that people must be productive or die. To push this agenda along, the idea that there are just "too many people" became the world's number one problem, and not the reality that there was too much stuff, too much waste, too much planned obselecence, too much pollution, too much inequality, too many luxury goods for the command economy of those with too much money while those without money cannot meet their basic needs for good nutrition and healthy and safe housing and other necessities.
And in the year 2006, the 500 year old ideas of John Calvin drive our social and economic agenda.
To insist that everyone must work hard to earn their keep (of course having and looking after children is not counted as work) even though businesses seek to replace people with machines whenever possible is completely demented.