to quit their current jobs and come and work for the new employer. When this happens, then employers pay more for labor and they have to raise prices causing inflation. Current non-Christian economic theories hold that an unemployment rate of between four to six percent is best. From a numbers perspective, this means that 6.4 to 9.6 million people should be unemployed. According to these economic theories, it is better to have 150.4 million workers supporting 315 million people rather than 160 million workers supporting 315 million people. Of course, this does not make sense. 315 million people need food, clothing, shelter, healthcare, disability care, old age care, transportation, furniture, education, etc. It obviously makes more sense to have 160 million workers providing these things for the 315 million rather than 150 million workers.
The arguments of current economic theory regarding full employment and unemployment rates are both false and deceiving. These arguments are based on the perspective of what is best for profit-based organizations and not what is best for the economy and not what is best for workers. For-profit organizations (not all organizations are for-profit) have as their primary objective the maximization of profit. Because of this they want to be able to minimize what they pay to workers both for new hires and existing employees. With a large number of people who are unemployed, there is more competition for jobs and people are often willing to accept less money than they feel that they are worth (good for the for-profit organization and bad for the worker and also the economy). Within a full employment economy (zero unemployment), there are always people looking for new jobs. There are young people entering the job market for the first time. There are people who want to relocate. And there are people looking for new opportunities. Christian economics holds that full employment is best for the economy and it is best for all workers. Full employment leads to full production and full consumption. Full employment provides more tax revenue for the various levels of government. It avoids the economic inefficiency of having to support those who are unemployed. And, it allows people to maintain their dignity as contributing to their own support as well as the support of the entire economy.
The very wealthy actually want high unemployment rates and they love the current real unemployment rate of 10 percent because it gives their businesses a cheap labor pool. Businesses can pay new employees considerably less than what they are worth and they can refrain from providing pay increases by telling employees that ‘they are lucky to have a job’. While the very wealthy favor unemployment, they look with contempt on those who are unemployed. They hold that the unemployed are out of work through their own fault when, in fact, the vast majority of people who are unemployed (as well as those who are underemployed), are in their predicament because of policies and economic theories developed and promoted by the very wealthy as radical capitalist economics. People who have dedicated decades of their work lives to one company have been laid off because their jobs have been outsourced outside the United States. Were they bad employees? No! The company wanted to increase profits by using lower-wage workers in other countries where there are virtually no laws concerning labor protection. The company does not care about employees; it only cares about its profits. The company does not care about employee ’s children; it only cares about its profits. The company does not care whether the laid-off worker eventually has to file for bankruptcy or lose his or her home; it only cares about its profits. “It is neither right nor wrong, it is just business” replies the radical capitalist.
People have been laid off for the simple reason that the CEO and the executive team will not make their bonus objectives unless they reduce costs by laying-off workers. If a company is generating a ten percent net profit and the CEO’s bonus is based on generating a net profit of twelve percent, how can the CEO make his or her bonus objective of twelve percent net profit? The solution is simple and is applied very often: lay off enough employees to hit the goal. The CEO and his or her management team do not care about the employees; they only care about their bonuses. The CEO and his or her management team do not care about the employee ’s children; they only care about their bonuses. The CEO and his or her management team do not care whether the laid-off worker has to file for bankruptcy or lose his or her home; they only care about their bonuses. “It is neither right nor wrong, it is just business” replies the radical capitalist.
Unemployment is bad, even terrible for the worker, but it is good for the radical capitalist. Most often unemployed workers take on increased debt by using credit cards or resorting to usurious personal loans. That is good for the radical capitalist. Unemployed workers are often forced to sell their homes or possessions at far less than market value. That is good for the radical capitalist.
Zero unemployment (and zero under-employment) is a wonderful thing for workers. Consider the lifetime career of a worker who never experiences any long period of unemployment or multiple periods of unemployment. Consider the benefits to college graduates who are able to find employment shortly after graduation. With zero unemployment, the net worth of workers over their careers would be higher. The stress, worry and anxiety of being laid off for tens of millions of workers have a heavy price on healthcare costs. With zero unemployment (and zero under-employment), these healthcare costs would be significantly reduced. Businesses actually benefit from a policy of not laying off workers in the long run. Workers who do not fear a lay-off are more dedicated and less likely to look for another job. The workers are happier and happier workers are more productive workers.
Would zero unemployment lead to price increases and inflation? No! Assuming that the radical capitalist theory on zero unemployment is correct with respect to the claim that wages will increase, does that imply that prices will rise? Within the context of maximum profitability, the corporation would want to increase prices. However, within the context of moderate and stable profitability, the corporation does not have to raise prices. And within the context of a democratic government that oversees and manages the economy and oversees and manages price increases, the corporation has no basis for raising prices as long as it is making a reasonable and fair profit. Balance and equity are the bases for a stable economy that benefits virtually everyone. Unfortunately, radical capitalist economics has as one of its main principles the maximization of profits for the capitalist and at the same time it denies the principle of economic balance and equity between capital and labor, between capitalists and workers.
Radical capitalism is a concept promoted by most current economic theories, though these theories do not use the adjective ‘radical’. At the heart of these theories is the position that economics and economic activities are amoral, that is, neither moral nor immoral expressed in the expression ‘it is neither right nor wrong, it is just business’. This principle frees people engaged in business from moral constraints and allows these people to pursue business objectives without any concern regarding basic morality and certainly not Christian moral principles. It is this principle of current capitalistic economic theories which allows businesses to put profits before people without any guilt and which is the main cause of the current economic and political crises within the United States and throughout the world. Is it possible for capitalism to be moral? Yes, it certainly is—but currently it is not. This is where it is the responsibility of Christians to make capitalism compatible with Christianity.
Another pseudo-theory of radical capitalist economics which illustrates the bias in favor of the capitalist and the bias against the worker involves ‘the minimum wage’. Radical capitalist economics hold that there should not be a minimum wage. The government should not regulate wages whatsoever and should allow businesses to determine wages. These theories hold that since the main objective of a corporation is to maximize profits, and profit maximization is accomplished by minimizing costs and maximizing prices; it follows that companies have to minimize wages. The company does not care if the wages it pays its employees are insufficient to live on and to support a family; it only wants to maximize profits. The company does not care that the employee will never be able to afford a home, buy a car, or someday to retire, it only wants to maximize profits. The company does not care that the employee receiving such low wages has to work sixty, seventy, or eighty hours a week preventing him or her from getting an education or training to better themselves, it only wants to maximize profits.
The purpose and objective of the US economy is to satisfy in the most efficient and effective
