Limiting the accumulation of wealth is vital to ensuring that everyone can be guaranteed the minimum requirements of life. But unless sufficient wealth is created to satisfy everyone’s needs, limiting accumulation will not be sufficient. The second principle addresses this issue. First, it establishes the necessity of maximum utilization of all resources, and then it states that these resources have to be rationally distributed.
Presently, economists claim that economic growth is the best way to solve poverty. But, if inequality rises as the economy grows, the rich are actually receiving the largest portion of the economic benefits. Economist Thomas Piketty demonstrates in his book Capital in the 21st Century with comprehensive historical data that for the past two hundred years the return on capital has been much higher than the growth of the economy, something he expresses in the formula r > g; which means return on capital has been higher than economic growth. The only exception to this rule, according to Piketty’s research, was seen during the first and second world war, a time which effectively reduced inequality due to the destruction of the assets of the rich. This means that even when the economy is growing, inequality is rising, and the poor ends up with only a small part of the total growth.
Due to this reason, the second principle does not only discuss maximum utilization, but also rational distribution of resources. As high concentration of wealth is associated with speculation and unproductive investments, as well as many other social ills discussed earlier, rational distribution implies a drive towards equality. We could thus consider the first principle to be encompassed and fulfilled by the second, but the importance of limitations to wealth accumulation is so central to a healthy economy that it has been made into a separate principle.
Maximum utilization, however, goes beyond the issue of economic growth. In the concept of modern economics, rebuilding houses destroyed by a natural disaster contribute to economic growth, ignoring the fact that we are only replacing something that was already there. Similarly, any activity designed to clean up environmental pollution is also considered economic growth. Somehow economists seem to fail to account for destruction and disaster as a minus to economic activity, but readily add it as plus when it is rebuilt.
The new economy is not concerned merely with GDP figures, but with the maximum utilization of resources in this world. Looking at the GDP of a country is not sufficient to establish how efficiently resources are being utilized, so to measure utilization of the type considered here, new indices will have to be developed.
Subtle or intellectual resources are ideas, knowledge and know-how. It also includes artistic expressions, such as music, poetry, literature and film. In fact, the human mind itself is a subtle resource. Software could also be considered a subtle or intellectual resource. Without intellectual resources, it is impossible to utilize material resources, as the very process of utilization is an intellectual concept. Intellectual resources are different than physical resources in that they do not diminish when they are used, and the more intellectual resources are distributed the more value they give. The more educated people a society has, the greater social, cultural and economic prosperity is possible. We will return to this issue in a moment.
Finally, this principle also recognizes spiritual resources. All cultures and religions recognize a spiritual reality as a source of strength, inspiration and solace to individuals. Spiritual resources would include uplifting scriptures, moral education, spiritual practices of various kinds; contact with saintly people and attendance at spiritual functions, as well as learning from the holy and saintly persons themselves.
Although this second principle may seem self-evident to many, in contemporary society, this principle is being systematically violated due to the profit motive, capitalism’s principle of self-interest, as being the main driver of economic growth.