You Create Money

1.5 Production Efficiency

Efficiency is the ability to create production without the waste of time and energy.  Production efficiency is a much sought after goal.  This means the Producer’s, the Laborer’s or the Worker’s goal is to produce the same goods and services in less time and with less energy than was done before.  Producers have an innate drive to increase production efficiency.  Non-producers do not have an innate drive to increase production efficiency.  Non-producers waste time and energy.

Production efficiency plays a large part in money velocity and in prosperity.  Anytime Producers can increase their production output, their income will rise provided the producers of the increased goods and services receive all of the increase in money and wealth they have created with this increase in production.

When non-producers are allowed to take this increased money and wealth, which was created by the Producers, Workers or Laborers, an increase in prosperity for the Producing individuals and the society will not be realized.  We are currently witnessing the result of this rewarding the non-producer phenomena in the United States and all around the world today in 2012.  I am talking about the phenomena of allowing the non-producers to take the wealth and money which was created by the Producers.

Allowing non-producers to steal the wealth created by Producers, Workers or Laborers has a very suppressive effect on the Producers and the society.  It tends to squash the morale and incentive thrust of the Producers.  It is not good for the survival of the individuals, the families, the society, the Nation or all of Mankind.  Allowing the non-producers to take the wealth created by the hard work of the Producers drives the Producers into apathy.  When this, rewarding the non-producers, continues too long, or in a more and more extreme pattern, desperation sets in among the Producers.  This results in demonstrations, riots and the overthrow of governments.  History is riddled with examples of these results of rewarding non-producers.

During the past 30 years the production efficiency for the Producers in the United States has greatly increased.  However, income has risen very little, if at all, over that same time period.  This country is in a great recession.  This recession is a manifestation of allowing non-producers to take the money and wealth created by the Producer’s increased production efficiency.

It is important to remember that Labor and Production create capital.  Labor and Production are senior to capital.  All Producers are Workers and Laborers.  If a person is taking money and is not a Producer, Worker or a Laborer he/she is a non-producer.  Non-producers have this concept of “Labor creates capital” reversed.  They believe capital is senior to Producers, Workers and Laborers.  It is self-evident that capital does not create Production, Work or Labor.  Capital by itself has no productive action and no life.  Labor is alive and Labor puts the action into production, labor is life.  Capital is used by Producers, Workers or Laborers to produce and survive with.  Labor puts the action and life, if we can call it that, into capital.  Producers, Laborers or Workers survive by using capital to create new production.

“Labor is prior to, and independent of, capital.  Capital is only the fruit of labor, and could never have existed if labor had not first existed.  Labor is the superior of capital, and deserves much the higher consideration.”  Abraham Lincoln

In Producer Rewarded Open Market Economics, production efficiency increases money velocity, where the Producers receive the newly created money.  If non-producers receive the newly created money, money velocity tends to decrease.  Anytime non-production is rewarded money velocity decreases along with morale and production.  Producer Rewarded Open Market Economics Technology, when applied, brings about a pro-survival thrust (incentive) within the producing individuals.  This pro-survival thrust (incentive) tends to create technological advances in production, production efficiency and in new more advanced types of pro-survival goods and services.   This thrust (incentive), when it creates new more efficient methods of production also increases money velocity which increases the prosperity levels in the societies applying Producer Rewarded Open Market Economics Technology.

As production efficiency increases it leads to increased money velocity.  Rewarding the Producers of the goods and services increases money velocity and production efficiency.  Rewarding non-producers decreases money velocity, production efficiency and prosperity.

Increases in production efficiency bring about increases in per capita production.  Increases in per capita production places more goods and services on the Open Market.  This action speeds up the money velocity, leading to increases in prosperity.  The faster or swifter this flow becomes the more prosperity we see in a society.

The money velocity cycle, if increased, will bring about greater affluence and prosperity.  If the money velocity cycle is decreased, recessions and depressions will be the result.  Slight decreases in money velocity bring about recessions.  Greater and greater decreases in money velocity bring about deeper and deeper recessions and eventually will lead to depressions.

Producer Rewarded Open Market Economics
The Science of Economics
By: R P Obrigewitsch
January 29, 2012

Tags: affluence, Capital, depressions, efficiency, laborers, money, money velocity, non-producers, producers, production, production efficiency, properity, recessions, wealth, workers

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