A frequent topic for discussion is the widening gap between super-rich and the poor, with people in the middle being squeezed down. This is occurring in most countries, the effect being particularly marked in the USA and Britain. Nobody seems to know what to do about it.
Yet there is no mystery about what is happening. It is precisely as predicted by the nineteenth century economist Henry George, who, in his book "Progress and Poverty" examined and accounted for the paradox whereby the enormous increase in productive power produced by the Industrial Revolution led to a small class of wealthy people and a huge class of people squeezed to the limit and living in poverty.
The past thirty years have seen a succession of revolutions which have had the same effect as the first Industrial Revolution, of increasing people's productive capacity. First we had the large centralised mainframe computer, which did away with a vast number of routine jobs. Then came personal computers, which did away with another raft of jobs. And then came the communications revolution which brought us the internet, mobile phones and other technologies which have transformed the way people work. Each has increased the individual's productive power at least five-fold, but who has enjoyed a five-fold increase in real wages? It is probably the most recent of these information technology revolutions which has resulted in the great widening of the gap in the last few years.
George explained why an increase in productive power does not result in a commensurate increase in real living standards. The experience of the past few years vindicates his analysis, and, incidentally, the relevance of his proposals to deal with the problem. But are any politicians or their advisors really interested?
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