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The Myth of Scarcity

The Myth of Scarcity

by Susan Rosenthal

(Chapter 4 of SICK and SICKER: Essays on Class, Health and Health Care)

Easy access to health care has created a society of consumers with an insatiable demand for medical services.(1)

All individuals, all mental health care systems, and all nations face the ubiquitous problem of scarcity. The demands of society are infinite, but its capacity to meet those demands is finite.”(2)

These statements are repeated so often that they are assumed to be true. “Everyone knows” that unreasonable demand has created a social crisis.“Everyone knows” that government debt is caused by spending too much on social programs. The few brave voices that protest, “What about corporate tax cuts, bailouts and giveaways?” are drowned by a chorus of high-paid experts who insist that there simply isn’t enough to go around.

The myth of scarcity has one purpose: to justify not sharing the social wealth. There is no evidence that society does not have, and never could have, sufficient resources to meet human needs. On the contrary, the resources spent on war alone could provide everyone in the world with a very good life. Let’s look at the facts.

Artificial Scarcity

In most nations, the production of wealth has consistently outpaced the growth of the populations that produce that wealth.

Gross Domestic Product (GDP) measures the annual value of all goods and services produced. Between 1950 and 2000, the population of the United States increased 86 percent, from 151 million to 281 million. Over the same 50 years, US GDP soared 3,239 percent, from $294 billion to $9,817 billion. In other words, the production of wealth grew 38 times faster than the population.

Such a massive increase in wealth compared to the size of the population should eliminate poverty and result in a very generous rise in the standard of living, including universal access to medical care.

If the total wealth produced by American workers in 2003 had been shared, every US resident would have received the equivalent of $38,000, and every family of four would have received $152,000 in that year alone. This payment would have been much larger if it included a share of the wealth produced in the past. And much more could be produced if everyone who wanted to work were employed.

However, capitalism is not about sharing. Because the means of producing wealth and the wealth produced are both privately owned, only a small elite benefit from rising productivity.

The top five percent of individuals in the world receive about one-third of total world income. The top 10 per cent get one-half of world income, and the bottom 10 per cent get only 0.7 per cent of it. Within 48 hours, the richest people acquire more than the poorest people earn in a year.(3) Such extreme inequality is not easy to sustain.

The myth of scarcity was invented to justify the growing gap between what is possible – a world of plenty for all – and what exists – fabulous wealth for a few and declining living standards for the rest.

In the world’s richest nation, an artificial scarcity has been created for American workers whose average real wages are back to what they were in 1958. More families are living paycheck to paycheck and relying on credit cards to purchase food and other essentials. As consumer debt rises, those with money to lend are further enriched at the expense of the impoverished.

Back in the 1970s, the mass media promised that the new computer technology would raise productivity so high that people wouldn’t know what to do with all their leisure time. However, like the rise in wealth, the rise in leisure went only to the leisured class.

Since the 1970s, the amount of time Americans spend on the job has risen steadily, and leisure time has declined by one-third. Workers have less time to sleep, eat and relate to their children. Overwork exists alongside chronic under-employment. Twenty percent of workers are unable to secure as many hours as they need to make ends meet.(4)

A Crisis of Plenty

The competition between capitalists to raise productivity creates periodic economic convulsions. For example, the more cars that are produced and the faster they roll off the assembly line, the larger the profit. However, this formula works only so long as people are buying. When the number of cars produced exceeds the number of paying customers, it is no longer profitable to invest more capital in auto production. The result is a crisis of profitability.

The capitalist class has surplus capital to invest, but production is not sufficiently profitable. The alternative is to invest in the stock market, in finance, in real estate, in whatever might bring a profit (regardless of whether anything is actually produced). The demand for profit generates risky investments and speculative bubbles. When these bubbles burst, financial institutions are left holding billions of dollars in bad debt. They tighten credit, and the economy dives into recession.

Capitalists respond to recessions by closing factories, laying off workers, and cutting wages and benefits. Now workers have even less money to purchase goods and services in any sector of the economy. The recession deepens.

To prevent the entire system from collapsing, governments bailout failing corporations which increases government debt. Using a nasty bait and switch manoeuver, this debt is blamed on too much social spending, and social programs are cut. Before you know it, the money “saved” has been handed back to the business class, creating more government debt and another round of cuts. The public is warned that the economy can recover only if the majority accept lower living standards. However, this reduces the pool of customers for manufactured goods.

The system is in permanent and irreversible crisis. It can survive only by driving down the living standards of the global working class.

In fact, there are not too many goods being produced, there are too few paying customers. Billions of people desperately need manufactured goods – agricultural machinery, construction equipment and supplies, plumbing, computers, medical supplies and technology, etc.

If production was directed to meeting human needs, instead of making profit, there would be no economic crisis. When one need was filled, we would fill the next; and when all needs were filled, we would have leisure time for other pursuits. However, the capitalist system of privately-owned production, backed by the myth of scarcity, stands in the way.

Malthus

The French Revolution raised the first serious threat to class divisions, as working people fought for liberty, equality and brotherhood. To counter the spread of this revolution to Britain, the Reverend Thomas Robert Malthus published his Essay on the Principle of Population (1798), in which he denied

the possible existence of a society, all the members of which should live in ease, happiness, and comparative leisure; and feel no anxiety about providing the means of subsistence for themselves and their families.(5)

Malthus argued that population always grows faster than the ability of the land to produce food, so that hunger and poverty can never be eliminated. Moreover, the poor should not be helped because that only causes them to multiply and more quickly deplete the resources available to the middle and upper classes.

Frederick Engels condemned Malthus “Law of Population” as “the most open declaration of war of the capitalist class upon the working class.” He described Malthus’ theory in this way:

that the earth is perennially overpopulated, whence poverty, misery, distress, and immorality must prevail; that it is the lot, the eternal destiny of mankind, to exist in too great numbers, and therefore in diverse classes, of which some are rich, educated, and moral, and others more or less poor, distressed ignorant, and immoral. Hence it follows in practice, and Malthus himself drew this conclusion, that charities and poor-rates are, properly speaking, nonsense, since they serve only to maintain, and stimulate the increase of, the surplus population…that, in other words, the whole problem is not how to support the surplus population, but how to restrain it as far as possible. Malthus declares in plain English that the right to live, a right previously asserted in favour of every man in the world, is nonsense…This is now the pet theory of all genuine English capitalists, and very naturally, since it is the most specious excuse for them.(6)

Malthus was dead wrong. Widespread poverty in 18th century England had nothing to do with the size of the population. Poverty results from the way society is organized.

Most of the world’s starving people live in nations that export food. In India, where more than half the children are malnourished, the State spends more to stockpile food than it does to feed the hungry. In the world’s richest nation, 40 million Americans have difficulty putting food on the table, while up to 30 percent of all food produced, worth $48.3 billion, is discarded.(7)

Over the past 30 years, food production has consistently outpaced population growth. In 2008, record food production was accompanied by widespread food riots.

Even at the height of the [2008] food crisis, when the number of seriously malnourished people rose to 963 million…almost one in every seven people on the planet – there was more than enough food available to give every single person 2800 calories per day, enough to make every person on the planet overweight.(8)

The problem is not too many hungry bellies, but that food is sold for profit, and too many people can’t afford it. The same is true for medical care. There are not more people than can be cared for, but more people than can be cared for profitably. Because these truths cannot be admitted, social problems are blamed on too many people wanting too much.

Modern Malthusians

Malthus’ theories found a home in 19th century America.

As capitalists pushed for more profit, workers pushed back. To defend their rule, America’s elite embraced Malthus’ theory that the rich are superior beings and natural-born leaders. In 1910, the Rockefeller, Carnegie and Harriman families funded Charles Davenport, a professor of biology at Harvard University, to promote the hereditary basis of poverty and inequality in the United States.

At that time, many poor people in the American South were suffering from pellagra, a disease that causes skin rashes, muscular weakness, dizziness, and mental deterioration. A devout Malthusian, Davenport argued that pellagra and other diseases of the working population were hereditary. Appointed head of the Pellagra Commission, Davenport promoted a do-nothing policy on the basis that treating “pellagrins” would only allow them to survive to breed more “pellagrins.”

In 1916, Dr. Joseph Goldberger (head of the Public Health Service) showed that pellagra was a form of malnutrition that could be cured by eating foods rich in Vitamin B6. Davenport rallied influential doctors and politicians to reject Goldberger’s findings, with the result that pellagra was ignored for another 17 years.

Letting the impoverished die of disease was one way to get rid of them. Sterilizing them was another.

In 1907, the state of Indiana passed the world’s first compulsory sterilization law in the belief that “heredity plays a most important part in the transmission of crime, idiocy and imbecility.”(9) In 1913, President Theodore Roosevelt declared,

it is obvious that if in the future racial qualities are to be improved, the improving must be wrought mainly by favoring the fecundity of the worthy types…At present we do just the reverse. There is no check to the fecundity of those who are subnormal…(10)

In 1927 the U.S. Supreme Court upheld the constitutionality of forced sterilization, declaring,

It is better for all the world if instead of waiting to execute degenerate offspring for crime, or let them starve for their imbecility, society can prevent those who are manifestly unfit from breeding their kind.(11)

By 1931, thirty US states had passed laws to sterilize members of the “socially inadequate classes.”

Compulsory sterilization was promoted for: the “feeble-minded;” anyone thought to be insane, criminal or delinquent; epileptics, alcoholics and drug addicts; the deaf, blind and crippled; anyone with tuberculosis, syphilis, leprosy or any other chronic infection; and any dependents upon the State including inmates of government institutions, paupers, orphans and the unemployed. People could be designated as feebleminded and sterilized simply for doing poorly on I.Q. tests. Recent immigrants, those who knew little English, and the poorly-educated fell into this category. By 1935 an estimated 20,000 people in the US had been forcibly sterilized.

The United States had become the world’s foremost advocate of racial purity, and Germany’s 1933 Nazi Act for Averting Descendants Afflicted with Hereditary Diseases was openly modeled on Davenport’s 1922 model sterilization law. Between 1933 and 1945, Nazi Germany forcibly sterilized an estimated 2 million people and exterminated millions more in “Race Hygiene” death camps.

When the full horror of the Nazi genocide was exposed after the war, talk of racial purity was discredited. Undeterred, the American eugenics movement re-invented itself as a campaign against “overpopulation.” The poor would still be blamed for social problems, not for being genetically defective but for being morally deficient – lazy, criminal – and far too numerous.

Too Many People?

In 1948, William Vogt’s book, The Road to Survival, warned that the greatest threat facing humanity is too many poor people. According to Vogt, the United Nations “should not ship food to keep alive ten million Indians and Chinese this year, so that fifty million may die five years hence.” Special venom was reserved for advocates of the poor who, “Through medical care and improved sanitation…are responsible for more millions living more years in increasing misery.”

In The Legacy of Malthus: The Social Costs of the New Scientific Racism, Alan Chase observes,

Every argument, every concept, every recommendation made in The Road to Survival would become integral to the conventional wisdom of the post-Hiroshima generation of educated Americans…would for decades to come be repeated, and restated, and incorporated again and again into streams of books, articles, television commentaries, speeches, propaganda tracts, posters and even lapel buttons.(12)

In Puerto Rico in the 1950s, fewer than two percent of the people owned 80 percent of the land. To uphold this inequality, US officials blamed Puerto Rico’s poverty on overpopulation and began testing “population control” methods on the island. By the end of the 1960’s, more than one-third of Puerto Rican women of child-bearing age had been sterilized.

Puerto Rico’s lower birth rate did not reduce poverty, but it did protect the profits flowing to US corporations. In 1997, Richard T. Ravenholt, a population officer for the US Agency for International Development, stated that if US goals were met, one-fourth of the world’s women would be sterilized to prevent revolutions that would interfere with multinational corporations’ financial success.(13)

The social movements of the 1960’s opposed forced sterilization on the basis that poverty is caused by inequality and exploitation, not overpopulation.

In 1968, Paul Erlich wrote The Population Bomb to counter these arguments. Like Vogt, Erlich insisted that overpopulation (not poverty) is the greatest threat facing humanity, and he opposed giving food aid to famine-stricken nations unless they agreed to sterilize their poor. The Population Bomb became a best-seller.

By the late 1960’s, the US was pouring millions of dollars into foreign and domestic sterilization programs. Within the US, poor people, First Nations’ peoples, and Black people were targeted. Poor Black women were sterilized so frequently that the procedure was nicknamed, “the Mississippi appendectomy.”

In 1974, federal judge Gerhard Gesell ruled that

…poor people have been improperly coerced into accepting a sterilization operation under the threat that various federally supported welfare benefits would be withdrawn unless they submitted to irreversible sterilization…Over the last few years, an estimated 100,000 to 150,000 low-income persons have been sterilized annually under federally funded programs.(14)

Despite such condemnation, forced sterilization continued. In the 1990’s Medicaid paid for poor women to have hormone-releasing contraceptive devices implanted under their skin. Removing the device was not funded. In 2000, a Louisiana woman convicted of child abuse was given the “choice” of medical sterilization or lengthy jail time.

When the AIDS epidemic began, Malthusians crowed. As one fanatic put it,

AIDS and other incurable diseases are simply nature’s way of saying, ‘Hey, there are too damn many of you. If you don’t stop multiplying like rabbits, I’m going to have to take matters into my own hands.’(15)

The environmental movement has largely embraced the myth of overpopulation, contrasting a love of Nature with a fear of human beings. According to Support a Comprehensive Sierra Club Population Policy (SUSPS),

Unending population growth and increasing levels of consumption together are the root causes of the vast majority of our environmental problems.(16)

In fact, environmental destruction is accelerating despite falling global birth rates. The US does more damage to the environment every year, even though its fertility rate has been below replacement level for decades.

In her 1962 book, Silent Spring, Rachel Carson blamed the destruction of the natural world on the “gods of profit and production” and a world “in which the right to make a dollar at any cost is seldom challenged.” John Bellamy Foster notes,

Where threats to the integrity of the biosphere as we know it are concerned, it is well to remember that it is not the areas of the world that have the highest rate of population growth but the areas of the world that have the highest accumulation of capital, and where economic and ecological waste has become a way of life, that constitute the greatest danger.(17)

The belief that social and environmental problems are caused by too many people persists, not because it is true, but because it serves the ruling class. The unpalatable truth – that capitalism builds wealth for the few by impoverishing the many and destroying their environment – cannot be acknowledged. To do so would be to admit that what is good for the capitalist class is bad for the world.

The Grapes of Wrath

The myth of scarcity is necessary to reconcile the obscenity of growing wealth alongside growing poverty.

According to the World Health Organization, 10.4 million children died in 2004 from largely preventable causes like malnutrition and infections.(18) At least two million child deaths a year could be prevented by existing vaccines and most of the rest could be prevented by access to clean water, sanitation and other basic necessities. Nearly 1.3 billion people live in absolute poverty, and more than 15 million adults aged 20 to 64 die every year from preventable causes.(19)

Malthusians insist that such suffering cannot be prevented, because there is not enough to go around. They strive to make the unacceptable acceptable: beggars in the streets of the world’s most prosperous cities; an abundance of food, while millions starve; treatments for disease that the poor cannot afford; one part of the population being overworked, while the other part is desperate for work; surplus wealth growing alongside, and at the expense of, destitute “surplus” populations.

These arguments break down when, as Engels put it,

The workers have taken it into their heads that they, with their busy hands, are the necessary, and the rich capitalists, who do nothing, the surplus population.(20)

As American author John Steinbeck wrote in 1939,

There is a crime here that goes beyond denunciation. There is a sorrow here that weeping cannot symbolize. There is a failure here that topples all our success…and… in the eyes of the people there is a failure; and in the eyes of the hungry there is a growing wrath. In the souls of the people the grapes of wrath are filling and growing heavy, growing heavy for the vintage.(21)

The goal of all Malthusians is to ensure that the grapes of wrath are never harvested, to continue the rule of the few and the misery of the many, to obscure what would otherwise be obvious: that ordinary people create all of society’s wealth and deserve their share of it.

The elite who rule society can never accept this account of the matter. If they did, they would have to abandon their system of private ownership and competition for profit. Because they cannot do this, they promote the myth of scarcity instead.

Notes

1. Epstein, S. (1998). Consult note requirement leaves referring physician in “no-win” situation. Ontario Medical Review. June, p.8.

2. Maynard, A. (1993). Are mental health services efficient? International Journal of Mental Health. Vol. 22, No. 3, p.3.

3. Milanovic, B. (2006). Global income inequality: What it is and why it matters? UN Department of Economic and Social Affairs, Working Paper No. 26. August.

4. Schorr, J.B. (1991). The overworked American: The unexpected decline of leisure. USA: BasicBooks.

5. Malthus, T.R. (1798). Essay on the principle of population as it affects the future improvement of society. London: McMillan & Co.

6. Engels, F. (1845). The condition of the working class in England: From personal observation and authentic sources. London.

7. Williams, C. (2009). Are there too many people? International Socialist Review 68, pp.28-38.

8. Ibid, pp.28-38.

9. Quoted in Chase, A. (1977). The legacy of Malthus: The social costs of the new scientific racism. Chicago: R.R. Donnelley & Sons, p.125.

10. Ibid, p.15.

11. Ibid, p.315.

12. Ibid, p.381.

13. Hoerlein, S. (2001). Female Sterilization in Puerto Rico. Cited in Peña, D.G. Scientific racism: Origins of the concepts,nativism, sterilization, racial profiling, discrediting the theories, general system of Nature

14. US District Judge Gerhard A. Gesell. (1974). Opinion in Relf v. Weinburger et al. Civil Actions Nos. 73-1557, 74-243, U.S. District Court for the District of Columbia, March 15.

15. Tim Avery’s web site:  accessed January 31, 2004.

16. Support a Comprehensive Sierra Club Population Policy web site accessed March 6, 2006.

17. Foster, J.B. (1998). Malthus’ Essay on Population at age 200. Monthly Review. Volume 50, Number 7.

18. Global Health Risks: Mortality and burden of disease attributable to selected major risks. World Health Organization, 2009.

19. World Health Organization. Fifty facts from the World Health Report 1998 – Life in the 21st century: A vision for all.

20. Engels, F. (1845). The condition of the working class in England: From personal observation and authentic sources. London.

21. Steinbeck, J. (1980). The grapes of wrath. New York: Penguin, p. 385.

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1 Comments For This Post

  1. Lisa Geiger Says:

    This is a very good article.

    Food chain politics in a nut shell :).

    And the big one that is conveniently missed when the linear thinkers talk about scarcity is the multiplier factor, which can go both ways, but it has great power for good.

    For example. A ten dollar bill, passed around by 10 people, has power of a 100, and a lack of a ten dollar bill, cannot be passed around by ten people so the loss of a power of a 100.

    The problem is not the lack of things, but the price of things, and that is how capitalism’s destructive “tendency” takes over. The “wealthier” people become, the higher the demand, higher the price, that is the inflation we are always being warned about. And then over production then sudden collapse, price collapses and then deflation, people out of work. And that is what Marx warned about it in volume 3. Capitalism destroys itself.

    It is just a matter of time, that food will be rotting in stores when at the same time people won’t be able to afford to buy food and then we will see the power of the people, and sadly probably the power of the military too.

    I guess the power of the beast will rule for a while, and then hopefully something better will rise from the ashes.

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