Would anyone help me understand?

After so many decades of nominal global growth and technological progress, production costs are bottom low, wages are being depressed and taxes for the have-nots are rising. What is the next phase of this type of capitalism? Since there will soon be no more disposable income for people to consume products and services are we going towards a system with consumer-robots?

Horror Vacui*

For the past twenty years, traditional European center-left and center-right governing parties have been competing in following the excessively neo-liberal policies dictated by the “markets”, thus alienating their traditional electoral clientele. They conceded extreme deregulation in a series of fields such as finance, trade and employment, on the manifestly false assumption that markets will self-regulate through competition, if they are left at their own devices. They enabled tax evasion (or avoidance, which is 99% the same thing, as it constitutes semi-legal fraud) multiplies the pressure on public finances.

The result was growing economic and social inequality both within nations and between countries. The traditional parties thus abolished the “social contract” which kept European societies at peace during the post-WWII era. They allowed the income and wealth gap to grow as much as to create growing masses of working-poor with minimal or no access to proper education and health care. They also force the middle class to carry an ever increasing burden since public expenses are no longer covered by taxing the “haves” but by borrowing from them, often with high interest rates and forcing the “have-nots” to foot the bill. This is obvious even in the German “success story” of the last ten years, a period in which the percentage of people living at or bellow the poverty level has officially doubled.

This problem is magnified in the euro-zone's poorer countries, such as Greece, Spain, Ireland, Italy etc. Although the original Maastricht Treaty for the Economic and Monetary Union stated as it's main aim “to promote economic and social progress which is balanced and sustainable (…) through the strengthening of economic and social cohesion and (…) ultimately including a single currency”, the so called periphery of Europe is diverging instead of converging with the wealthy members of the Union. The evidently faulty architecture of the euro-zone in combination with the failure of EU institutions on monitoring and auditing public finances makes it impossible to secure the social peace needed to pursue a common aim.

By taking active part in the dismantlement of the “social contract”, the European center-left parties, such as the German Social Democrats, the Labour in UK or the Spanish Socialist Workers' Party are now facing the danger of PASOK-ification. PASOK, the Greek socialist party which was in power for most of the previous twenty years and in 2009 regained governing power with more than 42% was thrashed by voters on January 25 this year, getting a meager 4,68%! 

Yes, Greece is indeed a rather different case, but the European center-left parties are facing qualitatively similar political problems. They will either have to regain their position as “protectors of the less privileged” or risk becoming politically irrelevant in the not so far future.

* “Abhorrence of vacuum”, postulate attributed to Aristotle (Physics, book 4), that surrounding material will instantly fill any void in Nature .