Since studying economics in college eons ago I have from time to time written about what I call “capitalism’s flaw.”  In our free enterprise, market economy one’s position in society is largely determined by his job and wealth.  The result is that we have one of the most flexible and mobile societies, that is at the same time crass in that lucre is the test for moving up or down. 

Having lived in many other cultures I find it amusing to find in any gathering of people from many lands, e.g. a diplomatic cocktail party, how easy it is to spot the Americans.  While most on introduction to a new person ask “what is your name, where are you from, where do you live, who is your family,” the first thing an American asks is, “What do you do?”  The reply immediately classifies the person in the American’s mind.  My reply to the question, “What do you do?” is always, “Anyone I can,” or, “As little as possible.”

Our job based society is all well and good while we have a growing economy that steadily creates sufficient jobs for new comers to the social race.  However, the flaw lies in the steadily declining need for new workers.   At the beginning of the 20th Century over half the US work force was in agriculture.  By the end of the century less than 4% was in agriculture.  The slack was taken up by massive shifts of workers to the manufacturing sector.  However, manufacturing peaked with some 25% of the work force and has since that high point steadily declined to maybe 13% today. 

The point here is that less than 20% of the work force provides a surplus of food to eat and manufactured products.  That would leave 80% without a means to enter the society in which your job defines your status in the society.  As it now stands, agriculture and manufacturing cannot and will not provide enough jobs for everyone.  

Thank God the service sector has managed to keep creating new jobs to fill the gap and today over 80% of our work force is in the service sector.  However, now that unemployment has reached over 9%, which is rapidly becoming the “new normal,” the service sector may not be able to take up all the slack and we will have many that will be left out of our society based on “what you do” and not “who you are.”

And while your job determines your social status, it also determines your share of the output of our economy.  Socialism had an answer for this since it said you would receive according to what you needed.  Capitalism says your share of output is based on your input, thus no job, no input, no share of output.

I guess this all of this is reflected in a sign I saw held by one of the “Occupy Wall Street” crowd.  The sign said, “I have a degree that put me deeply in debt, where is my job?”  The easy answer is the old maxim, “The world does not owe you a living.”  But the question is not just about making a living, but, more importantly, about how one enters society.  Not having a job does not just mean having to rely on others to stay alive, but meaning you have no place in our society. We lessen this angst by extending school years and retiring earlier, but it is still a flaw in our economy and society. 

Time to reconsider our whole approach to our economy, society and way of life.