Re: Income distribution [and growth]

["John Gelles" <johng@xxxxxxxxxx>]

The common sense of income distribution demands that
it will tend to maximize income growth, (consistent with
environmental and peace imperatives.)

Such economic growth has both its supply-side and
demand-side problems.

We know there is ordinarily a chronic deficit in demand
relative to both supply and need; (need generally asks
that supply grow--often many times its current level).

Income distribution, as a logical notion, suggests that
we RE-distribute monetized demand from the rich to
the poor.
            The reasons NOT to do this proclaim that such
added demand from the poor requires supplies of water,
food, medicine, education, housing and care, etc., be
radically raised to meet demand-- and then.
            They proclaim that the motivation and
systems to raise supply by meaningful amouints will
be undercut by "giving" the poor money they never
"earned" competing to be professional suppliers who
can maximize quality and quantity of supply.
            So, the nay-sayers offer a catch 22: the
supply we have at any moment cannot be raised to
help to the poor without tending to lower supply
for everyone else including the poor.

Now who is right?  Those who would redistribute
income from the rich to the poor or those who
won't?

Under socialism the idea was to empower the poor
to produce more supply for themselves without
relying on the rich to take charge of the system.

It is said that socialism failed on account of over-
regulation of everything and an absence of human
rights enforcement. Why this happened is not
clear:  the Washington consensus claims that
commerce and commercial systems tend to
support freedom from over-regulation and
freedom in general relative to protection of
human political rights (if weak on economic
rights needed by the poor).

At Johannesburg the two sides of the argument,
social versus commercial, are at loggerheads.
They agree on what is needed but not on how
to produce and distribute it. It seems to me that
a balanced meshing together of both camps is
necessary--and one way to mesh them is by
reforming money and financing systems on
which commerce relies.

Money is no longer in the hands of bankers.
Governments control it. But government is
no longer in the hands of Lincolnesque types;
bankers appear to control it.

If Lincoln were alive today he would use his
greenbacks (with the power that Nixon gave
us to forget gold) and the theories of Adler
which imply that prices--not tax revenues--are
key to stimulating growth;   and that if work is
rewarded by affordable "things" (and savings
workers trust), government can spend into cir-
culation money enough to grow an economy
big enough to distribute income enough to
end poverty, pollution and some of the
threats to peace.
            The sought after balanced meshing of
command and commerical economies would
rely on commands for priority programs that
spent all the money they needed.  Commerce
would be untaxed and unhindered--but in no
position to monopolize production, restrain
competition or interfere with priority programs.
            At its heart would be money managed
so well you wanted to have an inflation-indexed
dollar in the bank for every dollar you were
worth in non-monetary property.

    John Gelles