If you have been a busy bee for a while and forgot how to
relax, you should know that on average, people work 8 hours a day and remain
stagnant during 16 others. People also work 5 days a week and remain stagnant
during the 2 days of the weekend. And if this is a long weekend, people will
have worked during 4 days and remained stagnant during 3.
To be sure, it was not always like that in the now
industrialized economies of the world for, at the start of the Industrial Revolution,
people (entire families, including children as young a 6 years of age) used to
work in mine shafts flooded with water that reached up to the knees. The
families worked for as long as 12 hours a day, 7 days a week never to see the
sun for months at a time. And in the countries now struggling to industrialize,
something close to that is happening in this day and age.
In the advanced economies of today, people also take a
number of statutory days off and sick leaves that vary in duration from year to
year. They work 50 weeks a year and take a vacation for two weeks during which
time they remain stagnant. All in all, of the 8,760 hours of the year, people
work for about 1,760 hours and remain stagnant for something like 7,000 hours.
This means they work only 20 percent of the time and stay stagnant for the
remaining 80 percent.
If we take the lifespan of an average person to be 85 years,
and we determine that such person will spend the first 20 years being schooled,
and the last 20 in retirement, the resulting numbers tell an even more
startling story. Allowing for the extra day of the leap years, that person will
live 745,110 hours and work during 79,254 of them. This comes to 10.63 percent
of the time lived.
All that takes into account only the population of the Earth
that is participating in the labor pool, and is gainfully employed. If we take
into account the unemployed, the underemployed and the unemployable, we find
that the wealth which is consumed by the entire human race is produced during no
more than 5 percent of the time that we live on this planet as a collective.
And this says that the theoretical maximum potential of the planet to produce
goods and services is 20 times what it is today.
I did these calculations because I was motivated by an
article that appeared under the scary title of: “Fear Secular Stagnation,”
written by Irwin M. Stelzer and published on September 6, 2014 in the Weekly
Standard. The importance of seeing how an economy functions in terms of what
happens in real life rather than see it through the eyes of bookkeepers,
accountants and economists, is that it puts into perspective a statement like
this: “The difference between a 2 percent growth and a 3 percent growth is
trillions of dollars and millions of jobs. Robert Gordon believes that we will
have to live with a meager 1.4-to-1.6 percent growth rate, and concludes, 'America is
riding on a slow-moving turtle.'”
The point of my argument is that in a globalized economy
where America forms 4.5 percent of its consumer base, and where the theoretical
potential is 20 times as large as it is today, it will take a very small tick
upward in world demand to give the American economy the chance to grow at a 3
percent rate or better. The trick for making this happen is to co-ordinate with
the rest of the world, and come up with a worldwide trade agreement that will
benefit everyone.
This should not be too difficult to achieve given that the
potential of the planet is so much greater than its current performance. Thus,
it should be possible to negotiate a set of agreements that will preserve the
idea of competition – which is necessary to encourage efficiency and greater
quality – but will also give all nations some practical tools with which to
protect their industries up to an agreed upon percentage of the local
consumption.
Until a deal of this kind can be negotiated, people should
look at the current apparent stagnation as being a hiatus, and enjoy it the
best they can. It may necessitate that an effort be made to redistribute the
wealth so that no one is left without food or a roof over their head.