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TechnoratiIt’s the Economists Stupid
Economists like to think they are scientists but for the most part, aware of it or not, they are shilling for the powers that be. We won’t get out of this mess, until we call them on their shell game, broaden our thinking about how and for whom the economy works and take matters into our own hands.
What makes economists think they are doing science? Well, economists collect data and test their theories against objective real-world facts. They ask how well their models predict outcomes. They portray themselves as disinterested, as simply providing policy makers with facts; it is the policy makers who make normative judgments concerning policy – who gets the tax break; who gets fired; who gets fed. If you or I criticize their methods we are written off as unscientific, having an agenda, somehow weak minded.
Scratch the surface of this façade and it quickly crumbles. Economists rely on theories riddled with normative judgments – more is better, work is a disutility, it is rational to be self-interested – and with ways of viewing the world that skew their vision – we act independently, we are rational, labor is a resource.
Because economists’ theories, with all their implicit judgments and viewpoints, inform their way of seeing the world, the data they take to be an objective measure against which to test their theory is not objective at all. It is, itself, defined by the theory it is used to test. There is no objective measure, somehow defined outside of theory for theorists, economic or otherwise, to test their theories. Nor can economists, any more than soothsayers, predict the future. What is most surprising is not that economists think they are doing science, but that they have so little curiosity about what it means to do science. These observations on the problems associated with scientific method are more than 50 years old.
Don’t think I’m saying that one cannot do economics at all, only that any number of approaches to economics, be it institutional, feminist, Marxist or ecological, is possible. Each theory defines the economy differently, describes human behavior differently, and comes to different conclusions about what to do. One cannot claim as mainstream economists do, that only their approach is correct; only their approach produces a rational view of the world. That’s pure hubris. Hubris got us into this mess and it’s unlikely to get us out.
So it’s curious when a well-known economist decides to change camps. I am thinking of Richard Posner, the well-regarded Chicago school economists who recently declared he is now a Keynesian. Mostly when economic theory goes awry, economists blame everything except the theory – the data was faulty, an exogenous shock. Rarely does someone have the courage and honesty to consider he might have been wrong, all along, to think that markets are self-correcting. So let’s applaud Posner and for the time being put aside all the harm he and his cohorts have wreaked, at home and abroad, by insisting that markets self-regulate – a position that Posner has now, after thirty years of war on the working class, concluded is false. Let’s not ask, either, why the breakdown of the world economic system has yielded only one such convert.
The question I have for Posner is this: Which Keynes are you lining up behind - Keynes the conservative or Keynes the radical? Keynes the conservative sees the irrationality inherent in financial markets and protects the wealthy classes by insulating the real economy from this irrationality. Keynes the conservative protects capitalism from the actions of the real radicals – those who would throw open the door to even greater market excess in order to prove, once and for all, that economic collapse is not due to too little intervention but too much. Keynes the conservative would cringe at the Supreme Court’s decision, to treat corporations as persons, to flood the political system with even more corporate dollars to undo regulation. Keynes the conservative knows that without such intervention, and at least a veneer of legitimacy, the capitalist system is doomed.
I doubt very much that Posner is lining up behind Keynes the radical. Keynes the radical sees the irrationality inherent in financial markets and seeks to socializes wealth to prevent workers from being thrown out hungry into the streets. Keynes the radical believes that rationality results not from ‘independent’ profit-making decisions of corporations but from analysis and debate that produces policies that promote the common good. Keynes the radical considers the economic prospects of our grandchildren.
But Keynes the radical was no radical. Keynes the radical had no faith in the ability of working people to take charge of their economic fate. Keynes, even Keynes the radical, was all top down. All white bread. All patriarchy. All stuffed shirt. We’ve been there and done that haven’t we? Good for Posner for renouncing the blind faith that got us all in this mess. But even Keynes the radical can’t save us now.
The scientific community, I mean the real one, has its own problems with objectivity, but most scientists agree that we have to act very quickly to avoid catastrophic climate change. Throwing the door wide open to corporate dominance of politics is irrational – the legal equivalent of the final scene from Thelma and Louise only, this time, the straight white men are driving and you and I are on board. Someone has to get their foot on the brake and grab the wheel.
Howard Zinn’s gone. Gone, now, just when we need him the most. But his whole life he has been pointing us in the right direction. Don’t be impressed by the men in suits. Don’t listen to the pseudo-scientific babble of the high priests of the economy. Take things in your own hands, work for what’s right, make a bold move in the direction of the common good. It’s you and me who have to get up front and grab the wheel. We have to do it now – we have no time to waste.
123 Comments so far
Show All"Howard Zinn’s gone"
Good points about economic theory but you might want to learn how to use an apostrophe properly. At least you didn't use the word "surge". Sigh.
>>There can be no “market economy” (a vulgar expression for capitalism) without a “market society.” Capital stubbornly pursues this distinct objective — money; accumulation for its own sake. Marx, and after him other critical thinkers like Keynes, understood this perfectly. But not our conventional economists, including many of those ostensibly on the left.
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No less serious is the fact that economists on the “left” have long since embraced the essential tenets of vulgar economics and accepted the erroneous idea that markets are rational.
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President Obama deploys his talents to save Clinton’s and Bush’s program of imposing global military control, which is the only way of prolonging the days of U.S. hegemony, now under threat.<<
"Seize the Crisis!" by Samir Amin, Monthly Review, Dec. 2009
http://monthlyreview.org/091201amin.php
Hmmm...
Gary
“God forbid that India should ever take to industrialism after the manner of the west... keeping the world in chains. If [our nation] took to similar economic exploitation, it would strip the world bare like locusts.”
-- Mahatma Gandhi
The latest issue of The New Yorker pays a visit to the University of Chicago, where the Friedman school are busily proving mathematically, over and over again, that the economic implosion never happened. They remain secure in their belief that they are geniuses, except for one guy, who has become a Keynsean. :)
As a parent of a former government economist, I would have to say that economics is every bit as much of a science as psychology, medicine or maybe even physics.
It seems that there are as many theories as there are "scientists" in those fields... the good ones are the ones that have been right more than 50% of the time and even the good ones can create chaos with one simple math mistake... I've seen it happen!
The fact is, someone with a Masters or a PhD in Economics is more likely to be right than some jackass politician in Congress... and ten of them are more likely to be right than one with a different opinion.
I wonder if those posting on this thread are familiar with participatory economics (parecon), championed by Michael Albert et al on Znet? Among other things it aims for worker control, classlessness and a more equitable distribution of wealth. Considering the fact that the 2008 world per capita Gross World Product was approximately $10,500 US dollars, yet more than a billion people earn less than two dollars a day, a turnabout can't be more than a doubling in the price of bread away. So when the mass uprisings begin, won't it be helpful to have viable economic options to cut throat laissez faire capitalism available for popular consideration? Or not?
Excellent article about the FED having economists and economic journals in their back pocket:
...http://www.huffingtonpost.com/2009/09/07/priceless-how-the-federal_n_278805.html...
I enjoy reading articles that deliver the drubbing economists deserve.
In this regard, John Kozy does a great job:
http://www.jkozy.com/Economics.htm
In particular, he does a great job of dismembering The Law of Suppy & Demand.
Looks like a great site, the one article I took the time to read on trickle down was terrific and said much of what I more clumsily have tried to say myself. Lots of good reading ahead I expect.
Gary
“True individual freedom cannot exist without economic security and independence. People who are hungry and out of a job are the stuff of which dictatorships are made.”
-- Franklin D. Roosevelt
Everyone should read this page. It's a bit obtuse but it opens the doors to some real understanding of just how and why we are being screwed.
http://www.themoneymasters.com/faqs/
Great article, and actually pretty straight-forward about a both complex and amazingly simple process at the same time -- the Fed is owned not by the government but by private banks that create money and profits out of thin air.
>>Wouldn’t you love to have that exclusive ability – simply to type numbers on your keyboard creating bank accounts, and then write checks or charge purchases to those accounts (actually, no – it is gravely unjust to everyone else and is impoverishing the world for that power to be in private hands).<<
Sheesh, what a snow-job the Fed has put over on the public and the media.
Gary
“Did you ever think that making a speech on economics is a lot like pissing down your leg? It seems hot to you, but it never does to anyone else.”
-- Lyndon B. Johnson
Thank you. It's time we knock these witch doctors off their ivory towers before they cause more harm.
"Economists have a worse record of correct predictions than bookies do".
Science News Study
Two quickies:
1) "most scientists agree that we have to act very quickly to avoid catastrophic climate change."
Wrong - most scientists, not to mention our DoD, agree that it's too late and that it's time to begin adapting. Efforts to mitigate CCC should continue, natch, but preparing to survive should be our top priority.
2) It's not the economists. It's what happens to an economy that relies on consumption when consumers are full. The Corporate State has but one choice: make 'em hungry again. AKA, boom and bust - for us. Binge and purge.
And when we stop binging? Cause an economic earthquake which forces us to purge whatever we have left, then sell it all back to us until we're full again... rinse, repeat...
The economists' job is to make binge and purge sound like acts of the free market God so as to not rouse the rabble from their ownership society conditioning...
Great metaphor! Unfortunately, we don't have much left and await the fate of Karen Carpenter.
Its a matter of the degrees of parasitism, of which the various economic subsystems depend.
The whole mass of humans in developed worlds depend on burning up the stockpiles of fossil fuels and the fossilized brains of leadership intend to do so to the bitter end.
Since this has raised atmosphere greenhouse gas to already dangerous levels, their is no mutual benefit to nature, or long lasting benefit to humans.
We also parasitise the ecosystems to extract everything that can feed us or provide materials.
Since this is destroying soil, species and ecosystems, their is no mutual benefit to nature. We are raping the ecosystems faster than they can recover. Since the end goal is surely mutual reproduction and continuance, which depends on long term recycling in our closed world, there is something wrong.
The financial sectors and the political elite are one and the same, and are parasites on the rest of the population and the economy. They have the wealth and decision making powers. Ownership of overseas corporations, resources and factories, and military lordship over entire countries, means the wealthiest are no longer concerned for the health and well being in the narrow economic sense of national sources of profit. For the de facto emperors of the world, the citizens of any one country, including their own, are expendable, and are just means to the end of will to power.
The financial crisis is the oppertunity to suck out all sustenence, beyond hope recovery or revolt, to give aneamic and compliant condition of masses. All the money in the banks and the rich, and all the debt distributed amoungst the ignorant peasants. Capitalism with growing inequality seeks the perfect serfdom economy. Power of parasitism is more important than science, and maintenence of the present is more important than the future. Economists, in so far as they ignore the rest of reality, are both the children of and the trained accolytes of the culture of the rich.
Nothing can be done about climate change, or economic inequality, or military parasitism, without overthrow of the culturally parasitic mindset. And parasites generally require thousands of generations to evolve into symbiotics that benefit their hosts for mutual longevity.
It's this type of article that confirms to me that the right left dichotomy in politics is false, or at least not that useful. More useful is the dichotomy between those that scream and shout that they're right, and those that try to have a reasoned conversation.
If you told me that Glenn Beck had said the following, I would not be at all surprised:
"Don’t listen to the pseudo-scientific babble of the high priests of the economy. Take things in your own hands, work for what’s right, make a bold move in the direction of the common good. It’s you and me who have to get up front and grab the wheel. We have to do it now – we have no time to waste."
So nice job commondreams.org, you're now one step closer to being Glenn Beck.
Question: how do I know what's right? Do I think with my gut? What kind of bold move should I make after I have deliberately not listened to someone I've demonized? Should I get a gun? Do we surround them?
That there is no objective truth in economics makes it exaclty the same as all other sciences, that's why there is something called "scientific debate."
CD isn't moving to Glenn Beck. The Republicans and the economists both hate science. The economists want to misuse and distort science to their own liking.
Digging the hole deeper.
What do you mean by saying "hate science?" What is your idea of the economists' "liking," and how well do you know all of the ecnoomists? What sciences in particular to they hate?
What evidence do you have to support any of the conspiracy theory that you just posted?
No different than what you hear on Fox News. Substitute democrats and I would believe it came verbatim.
Strangely enough progressives now agree with each other more than with Obama. The difference is that when progressives exercise their brains, words come out; the same activity for teabaggers produces something not unlike a septic tank service truck discharging its product. Please point that thing the other way!
The totalization of the master-slave dialectic thematizes the fantasy of exchange value.
http://writing-program.uchicago.edu/toys/randomsentence/index.htm
ha ha!
The representational validity of the Other interrogates the fragmentation of the real.
This sentence is so wonderful! It would only be better if it really meant something...on the other hand, who would know?
must generate more...
This is a cool link. Thanks. It reminds me of the virtual psychiatrist program called Eliza.
Cool! Now Idon't even have to think to give nuclear advocates a response of reciprocal validity! It even works for ""free"-market" economice!
what is the economic value of a viable environment? of reliable reproduction?
physics has had many turns at bat in this thread, and good enough, as it should...
when does molecular destruction trump economic benefit? how many cases of cancer is a big screen tv worth? how many dead, two-headed babies for a barrel of oil?
economics...bah!
"what is the economic value of a viable environment?"
Within a nation it is part of the National Asset. Everyone talks about the National Debt but they forget about the National Asset. There are other things that make up the National Asset and many are hard to quantify.
jakenewton, unfortunately Jake the National Asset was put up for sale some thirty years ago. These people think that everything is a commodity to be bought and sold. Nothing is precious to these people unless it has a monetary worth.
Who bought it? And who do you see as "These people"? What is a good example as an illustration of your point? Thank you.
dubet, it should be possible to arrive at some values - if not exact, then surely relative values - if a sufficiently large number of people ask these questions. I have no doubt about that. When "quality of life" (which includes conditions for a healthy body, peaceful and sustainable society) becomes more important than some "standard of living" (where you get to drive to the gym and run on a treadmill that's powered by electricity) for a sufficiently large number of people, I think the relative values will become clearer and out in the open.
yes, thank you, alcyon...
the real question is:
what if the world, our only world, is of greater *value* undisturbed by man than disturbed? would economics ever show such a thing?
Well, some amount of 'disturbance' is inevitable. Even animal herds create a sort of a track - while moving en masse. Beavers build dams...and so on. And since man is part of nature, and it is nature that gave man the brains to build tools, it would seem that nature can withstand some amount of 'disturbance' by man. It's when man forgot that he was part of nature and started imagining he was the lord and had dominion over nature, and completely lost sight of the concept of sustainability, we started sliding towards serious problems. There is no more frontier for humans to move to, like in the past (never mind some of the 'frontiers' already had people living there), but I think many people still seem to believe deep down that there is something more to extract somewhere.And some at the top may clearly know this limit, and they are probably waiting for the "excess" population to start dying off. The question is, can the majority come together to bring about an orderly contraction?
People have been sounding the alarm about these limits for decades. The sheer arrogance of a supposedly more advanced society that failed to heed these warnings is mind-boggling. If the West had heeded these warnings, they could be in a position to lead the rest of the world towards a sustainable future. Kyoto (1997) was probably the last chance to start taking tentative, modest steps, and Copenhagen (2009) was when things were supposed to be given a push. I cannot believe the amount of criminality and willful stupidity that have gone on in the last few decades, and especially in the last 12 years. The mindset in the developing world seems to range from desperation to some blind hope that things will work out.
'And since man is part of nature, and it is nature that gave man the brains to build tools, it would seem that nature can withstand some amount of 'disturbance' by man.'
what if nature gave man brains not to build tools, but to decide NOT to build tools, NOT to disturb?
to choose?
to paraphrase your question:
can humanity choose not to destroy the earth?
Well, it's a possibility - that not building any tools would be preferable, but I don't want to argue as such. Because then we would be left at the hunter/gatherer stage. Nothing wrong with that either, but it's also part of nature that makes animals to seek safety - safety from the elements, safety from predators, and so on. Even birds build nests. So a limited amount of 'development' and storing of food for the winter doesn't seem unnatural to me. And also, I don't want to discount the possibility that nature intended us to have a bit of leisure time - apart from having to hunt or scavenge for food all the time. Perhaps a leisure time to contemplate, or to be just happy. I don't know...it's just a thought.
chemical alteration is my primary concern...the scene you describe doesn't seem to violate...I picture small groups living within reach of resources...
your comment about leisure is vital...too bad so many view a different life as one less enjoyable...I see lots of opportunity for joy without modern tech and industry...
viable local water, food and shelter is the key...and viable reproduction...of humans and other living things...which brings me back to chemical alteration...
compromise, seductive as it is, is a human thing...
peace, alcyon
"An economist is a person who knows 101 ways to make love and doesn't have a partner."
"Keynes the radical had no faith in the ability of working people to take charge of their economic fate".
Certainly true but you leave unanswered the question of why the working class has not taken charge of their economic fate. What is your explanation David Kristjanson-Gural? Where did Marx, Engels, and Lenin go wrong, at least until today?
My reading of history is that the working class has nearly always recoiled from having to take responsibility for the economy before even taking charge of it. Better to leave the responsibility in the hands of the entrepreneurs or of dictators. That is not a condemnation of the working class. It is my observation.
There have been short-lived exceptions to my rule. Perhaps the most clear-cut one was the running of the local production/distribution/consumption system of Catalonia by the anarchists of Barcelona during the Spanish Civil War to the horror of the Spanish and Soviet Bolsheviks who wanted their apparatchiks to be in charge.
Well, there's the (wait for it) original American "populists," who formed farmer's alliances in response to (wait for it) the bankster usury of their day:
http://www.amazon.com/Populist-Moment-History-Agrarian-America/dp/0195024176
There's a limited pre-view of Goodwyn's book on google books--even that much is a whole education in itself.
It becomes crystal clear why is was necessary to demonize these people--and still is, apparently.
quidditas: Thanks for your addition! I hope that you have concluded that my view of the Catalan anarchists is very positive and that I do not demonize them.
ClassAct, thanks for the post. The Economy is constrained by the Second Law of Thermodynamics.
As a biologist we explain the seeming breakdown of the second law, in the increasing order or complexity of biological systems (entropy), by recognizing that the Earth is not a closed system and that the major source of energy is the sun. [Some organisms do tap geothermal energy].
The sun and life forms have generated a great deal of fossil energy which has been overly exploited while we are barely aware that the sun is essentially the source of all our energy and wealth, should we choose to harness it appropriately.
Meanwhile our economy is in global terminal collapse due to our stupidity in the use debt money with interest as the conventional means for exchanging goods and labour. The economists who study monetary theory surely know better.
A waste of space from an evidently confused author. He declares that mainstream economics is an ideological apologetic, as if that were news (Marx declared such some 150 years ago). But he provides not even a hint as to what, if anything, distinguishes good from bad economic theory.
The author then wonders how to appraise one failed mainstream economist's conversion to Keynesianism: "The question I have for Posner is this: Which Keynes are you lining up behind - Keynes the conservative or Keynes the radical?" Alas, two paragraphs later the author informs us that his criterion is otiose: "But Keynes the radical was no radical."
He concludes with an utterly vacuous puerility, "Take things in your own hands, work for what’s right, make a bold move in the direction of the common good." He might as well have urged us all to be nice.
That a Professor of Economics would write such drivel is pathetic, and tells the reader more about the state of modern economics than the article itself. That such drivel is printed on a progressive website speaks volumes for what passes for Left political discourse today.
Soloduff:
It seems to me that you are just shitting on the commons of this idea exchange.
I think that the author’s conclusion to make sensible individual decisions can lead us to a more healthy commons. This could be based on community organizations with fair and as much as possible local distribution.
ePie: In my post I laid down premises and drew conclusions. An adult who disagrees with my argumentation would criticize one, the other, or both. But you tell us what "seems" to you; and the trash talk that you deliver confirms my original post's contention regarding the degeneracy of what passes for Left discourse in these times. As does your last paragraph--a pious banality. Why don't you just urge us to be nice . . . on the "commons"?
David Kristjanson-Gural
this author does not understand keynes
keynes melted down believes that you need a proper distribution of wealth to achieve a prosperous society
and he understood that the distribution was way in the favor of the wealthy
any specific recommendations were specific to the times and situations keynes lived in
so generally speaking a redistribution from the wealthy to regular people was needed
as for "deficit" spending
well if you can't get the rich to share, the government has to redistribute the wealth
print more money and give to the poor = stimulate the economy,
so keynes can save us if we followed his understanding of economics
keynes was the true scientist regarding economics
if only the economists, like t his one, actually studied his work and actually UNDERSTOOD it
"For Bernanke, the current financial system (or more to the point, the debt overhead) is to be saved so that the redistribution of wealth upward will continue. The Congressional Research Service has calculated that from 1979 to 2003 the income from wealth (rent, dividends, interest and capital gains) for the top 1 percent of the population soared from 37.8 per cent to 57.5 per cent. This revenue has been expropriated from American employees pushed onto debt treadmills in the face of stagnating wages." -- Michael Hudson, www.counterpunch.org Feb. 2, 2010
This is a little off subject, but still relevant. The entire aritcle is worth reading if you have time.
"Economists like to think they are scientists "
David or anyone else, do we know of any economists who claim to be other than *social* scientists like psychologists and anthropologists? These are a little different than chemists and biologists in that there are limitations as to how you can effectively study various phenomena with proper controls.
Heh, the Economist magazine occasionally writes articles similar to this article, pointing out that economists like to see economics as a "hard" science, even if it isn't, though the Economist obviously does not adopt the point of view that this article does.
Pretty much EVERY economist wants to see economics as NOT social science. The argument is that all the advanced calculus and mathematics used in economics is an indication, if not proof, at least evidence, that economics is not a "soft" science, that rather, it belongs with the "hard(er)" sciences.
Take any grad level economics class, or upper level undergrad ones, if undergrad especially the seminar type ones. Or read an economics academic journal,
Exactly! They can come up with a theory but can never do a real experiment with a control to see if their theory is true. For example take the recent stimulus. Money was injected into the economy and the economy is supposedly better for it. But is it really? A real scientific experiment would be to inject the money into the economy, and also have a control where nothing was done to the economy. Of course this can't be done, so we really can't know for sure what real impact the stimulus had. So you end up with some sudo-science economists saying it worked and another group of sudo-science economists saying it didn't.
Then throw in the fact that these same sudo-scientists think that indefinite growth is possible on a finite planet, and finite resources are really infinite, and you realize we are being lead by a bunch of highly educated idiots. It is sad that some areas of higher study can actually suck the commonsense out of some of it's students...
There are far too many significant variables to control in order to conduct a scientific experiment in economics and thus every outcome of every policy initiative can be spun in an infinite number of different ways. And of course the way it is spun is dependent on the interests of the spinner.
As to “There are far too many significant variables to control in order to conduct a scientific experiment in economics,” I offer comment from quantum theorist David Bohm:
"at the quantum level of accuracy the entire universe (including, of course, all observers of it), must be regarded as forming a single indivisible unit with every object linked to its surroundings by indivisible and incompletely controllable quanta. If it were necessary to give all parts of the world a completely quantum-mechanical description, a person trying to apply quantum theory to the process of observation would be faced with an insoluble paradox. This would be so because he would then have to regard himself as something connected inseparably with the rest of the world. On the other hand, the very idea of making an observation implies that what is observed is totally distinct from the person observing it.
The paradox is avoided by taking note of the fact that all real observations are, in their last stages, classically describable. The observer can therefore ignore the indivisible quantum links between himself and the classically describable part of the observing apparatus from which he obtains his information, because these links produce effects that are too small to alter in any essential way the significance of what he sees. In other words, the interaction between the observer and his apparatus is such that statistical fluctuations arising from the quantum nature of the interaction are negligible in comparison with experimental error." [David Bohm, Quantum Theory (New York: Dover Publications, Inc., 1989) 584-585.]
Physics has not “too many significant variables to control in order to conduct a scientific experiment” because physicists choose not to have “too many significant variables.” Quantity of “significant variables” in physical and social sciences is a manifestation of the assumption of free will when dealing with humans, and denying free will when not dealing with humans. This is a cultural rather than “observational” characteristic. Science, natural and social, is as much shaped by religious cultural history as any other Western institution.
I would add that I believe there is another important factor (less important than the uncontrollable variables) limiting progress in the social sciences and it is somewhat related to the point you made. The belief in human rights limits experimentation with human beings and that does limit progress, but I think most of us accept this tradeoff. The belief in and respect for human rights is related to the belief in "free will" but is far from equivalent as some who do believe in "free will" do not respect human rights and others who do not believe in "free will" do support human rights for utilitarian and other reasons.
Status of "free will" in consideration of rights is unclear. Relevant to this is Federal standards governing treatment of animals used in experimentation. Effectively, the animals are assumed to have rights. Whether this consideration is based on an assumption of "free will," I know not.
I do not recall reading any animal rights activist basing arguments on "free will," and I believe the federal guidelines were developed in response to pressure from such activists. What I understand is that some activists argue that all living things have rights just by virtue of being alive, others argue that it is only the fauna and not the flora that have rights, and others argue that only animals with nervous systems have rights because they can feel. I find this all troubling because that makes so many living things part of our community, where we respect their rights, and so many living things are making a living out of eating other living things and so the question arises as to whether we have a duty to do something to stop that or minimize the harm or pain in some way.
Also, are we committing a crime by taking antibiotics or killing parasites? What about stepping on ants or driving over them? In response to such questions, the activists argue that we can't intentionally harm the other living things, but accidentally harming them is okay (still, what about the antibiotics and parasites?). What about knowingly, rather than negligently, harming them? I don't think many have an opinion on that. And if intent is required for harming animals to be a crime then why not the same for harming people? Otherwise, those sound like unequal rights and that's unfair. That sure lets the US military off the hook for knowingly, but not intentionally, killing all those innocents in Iraq and Afghanistan. Sounds good to all the warmongers and other greedy, rapacious bastards.
It gets very muddy very quickly. I have never read the justifications of an advocate of animal rights who has thought it through very far. Someone could still protect animals on the basis of human affection for such animals, rather than on the basis of animal rights.
kivals, a legal approach to "rights" will by its nature be limited - but maybe required in some cases. The US military is off the hook due to a fundamental failure of democracy, and not so much due to any legal interpretation, I think.
As for taking antibiotics, I'm sure your question is rhetorical, but the answer is easy. All living beings try to protect themselves from harm. To the extent that we minimize the killing to the most inevitable (this approach is part of the 'Jainism' religion - which is very similar to Buddhism), I guess it should be ok. If there are dietary practices that clearly minimize this killing, and also boost the overall health and natural immunity of humans, we should adopt them. This would also avoid the need for most antibiotics - which is a losing battle anyway, since too much use of them only makes the germs to become resistant, requiring newer and more potent antibiotics. The anatomy and physiology of humans are much closer to herbivores than to carnivores or omnivores.
Regardless of whether US military members face legal consequences for killing, perception and world opinion do matter, and so if only intentional killing is considered criminal, that would change the perception and opinion of the actions. As it stands now, in all the US and most jurisdictions in the world it is a felony to knowingly kill, not just to intentionally kill, though usually a slightly lower order felony. It is usually a misdemeanor to negligently kill, unless it is considered reckless or gross negligence.
Also, if one believes that a human being is a parasite, one cannot just murder that individual unless the individual puts one's life in imminent danger, as we are expected to make certain sacrifices, endure certain nuisances, for members of our community. We obviously do not want to give the same consideration to animal parasites.
So, as you wrote, the legal rights must be limited. However, I just do not see how or by what reasoning they are limited or how one determines where the limits should be. I am not against laws preventing cruelty to certain animals, but I just do not believe that creating or referring to animal rights is the proper way to approach it.
We'll just have to disagree there. I believe that physicists are generally able to control in their experiments all the "significant" variables, i.e. those that are not negligible because of minimal contributions to the outcome. There is a reason why the hard sciences have grown by leaps and bounds and the social sciences have virtually stood still for the past century. That is because the physical sciences study the fundamental properties of nature, which involve a limited number of significant variables, and that allows for the design of rigorous scientific experiments with often clear results that provide new understanding and progress. The applied physical sciences such as climate science and environmental biology might not allow for rigorous experimentation, but they are just one small step removed from the fields in which rigorous experimentation has taken place, and so they can lean heavily on established scientific understanding and achieve some degree of progress.
The social sciences are further removed from the physical sciences. Psychology is a step, a big step, away from neurochemistry and neurobiology. And sociology, as the study of a whole society of individuals, appears to be one big step away from psychology. Economics has been classified by some, and I would certainly consider it, as a subfield of sociology, which could be relabeled as "Production and Consumption in Human Society."
By the way, there are plenty of social scientists who do not believe in "free will" and who never did. Personally, my belief is that "free will" is a misconception following from the illusion of pure identity over time, i.e. lack of recognition that we are not exactly the same people we were yesterday. We are all evolving all the time, our neuronal connections are changing, and what we think in any moment is a function of that evolution as prompted both by ongoing chemical changes and by changes induced by input from the external environment. By the time we finish the choice we are a slightly different person from the one who was prompted with the input that leads to the choice. The determinist focuses on the external input to the choice and how it affects the choice and a true believer in "free will" starts with the assumption that the person who finished making the choice is identical to the person before making the choice, before being prompted by the external input that leads to the choice. But it would be a mistake to model it as simple determinism where the input solely determined the choice, as the person at the time of being prompted was a fundamental part of the equation, a very significant participant.
I was wondering when you consider Physics and Thermodynamics and extraction of labor as it applies to exchange how do you account for the labor of machines?
When you consider that an Encyclopedia or a program or a computer chip requiring millions of hours of input can in turn be distributed for a very small percentage of all the inputs at a profit, where does this leave the conflict paradigm?
I wasn't really in on the thermodynamics discussion but I would add that an interesting twist is when you get into robotics where you have robots building, repairing, and programming robots to do productive labor of some nature (including replicating themselves), particularly when the energy source is external to the earth, such as the energy from the sun. The initial human labor in writing the original program and building the original robot could be replicated a very large number of times theoretically with no energy extracted from the earth.
Machines depreciate, break down, and require fuel to run ... which must be obtained by other machines. Efficiencies are a matter of throughput. A 40% efficient electrical generator runs a machine that might be 40% efficient for a net throughput of 16% efficiency.
See the discussion in Wikapedia on Embodied energy (or emergy):
http://en.wikipedia.org/wiki/Embodied_energy
>> defined as the available energy that was used in the work of making a product. Embodied energy is an accounting methodology which aims to find the sum total of the energy necessary for an entire product lifecycle. This lifecycle includes raw material extraction, transport, manufacture, assembly, installation, disassembly, deconstruction and/or decomposition.<<
Gary
"Enterprises for private profit are consuming the environmental systems that are the basis for public welfare. "
-- Howard T. Odum, Environmental Accounting: Emergy and Environmental Decision Making
I agree with the whole idea, but the question I have is whether any economists disagree. I think they all know it too and I can't think of one who denies it.
An economist and a non economist are walking down the sidewalk. The non economist says "Whoa! Isn't that a hundred dollar bill just lying on the sidewalk?" The economist responds, "Obviously not. If it were, someone would have picked it up already."
He is talking about economists versus scientists in general. Economists love to invent pie in the sky numbers to project their vision of economic growth. Even when they collect data, they make baseless projections and try to bias their predictions as well. Unlike scientists, economists try to sound like they are making guarantees but they aren't.
"He is talking about economists versus scientists in general."
They are different from hard scientists. That was my point, we are all supposed to know that already.
"Economists love to invent pie in the sky numbers to project their vision of economic growth. "
Who would be your best example?
The economists on Fox Noose and CNBC are the best examples. They had predicted that Bush's tax cuts and free trade would help the economy grow but the economy crashed like a house of cards. GDP means nothing when all the labor goes out of the country and we have a jobless recovery.
Could you name one please? And the question was around them making up pie in the sky numbers.
Thomas Friedman's Green Pie in the Sky
http://www.huffingtonpost.com/jeff-biggers/thomas-friedmans-green-pi_b_101099.html
Specifically, what numbers did *New York Times* economist friedman "invent"? Jeff Biggers isn't making that accusation, he is just disagreeing with him.
You had said that economists "invent" numbers.
Ok, I had meant this on a broad scale. I'll revise this. Sometimes, they don't have to invent numbers such as predicting when the Dow Jones will hit 20,000 or projected surpluses and deficits. They can simply make a general prediction that the economy will be better or worse but give no specifics. Sorry about my wording.
"Sorry about my wording."
I salute you for your admission, and I agree with your clarification.
Here is another Economist Joke: The famous Economist was so good, he correctly predicted seven out of the last three recessions.
I agree with the Bottom line (paragraph of this article) is, each of us have to fit into the real economy no matter what the economist are theorizing.
"We won’t get out of this mess, until we call them on their shell game, broaden our thinking about how and for whom the economy works and take matters into our own hands."
Notice that, after stating this, the author simply continues the shell game he's just criticized. What's the relevance of a well-known economist changing camps? It's simply a case of one opinionated elitist moving his intellectual baggage from one shell to another.
Where's the broader thinking? Where's the criticism of elitism, per se? Where's the explanation of how the economy really works? Where's the primer for taking matters into our own hands?
This author's article is the apex of hypocrisy.
The essence of how the economy works is known by analyzing the nature of money, banks and credit. When one understands that with our privatized monetary system, owned and operated by the bankers within and behind the Federal Reserve system, money is created by debt and debt is inherently multiplied by interest. It's not intended to be the foundation of an economy that serves the population; it's intended to be a reliable method of wealth extraction and concentration.
The essence of the global financial "market" is that it is an unproductive circus in which financial "players" insist their money must "work" and make money for them without them personally producing anything of value. This "global financial economy" (about which there is nothing the least bit economical) is just a system by which all resources, goods and services get monetized so they can be owned by the players. This isn't economics, it's exploitation. And it is all based on universally accepted usurious debt-based banking practices.
Money has historically been several things: A measure of value; a media of exchange; a means of storing wealth... But today money is simply financial information. Units of credit. But this is exactly where our chance to create an honest economy lies: in redefining for ourselves the terms of our credit exchange. For a detailed explanation read Thomas Greco, Jr.'s book, The End of Money and the Future of Civilization.
Economics was NEVER a science, except in the delusions of its alchemists, it's a HISTORICAL discipline at best -- using past happenings to try to understand economic processes, then trying, usually unsuccessfully, to spot future trends.
Gary
“Economics is extremely useful as a form of employment for economists.”
-- John Kenneth Galbraith
Economics has not yet developed a scientific theory because its theorists only offer apologias for existing social arrangements -- or had too little science to rely upon in the first place. Adam Smith posited that labor is the source of all value, a notion endorsed also by Karl Marx -- but if labor is the fundamental characteristic, it must be governed by the laws of thermodynamics, the second of which would prohibit the concept of profits. These laws were promulgated by Lord Kelvin in 1850-51 and not indisputably proved until 1900 with the work of Max Planck. Wealth of Nations was published in 1776 and Karl Marx died in 1883. In this regard I always offer these links:
http://www.eco.uni-heidelberg.de/ng-oeoe/research/papers/Faber%20et%20al%20AEE%201998.pdf
http://www.eco.uni-heidelberg.de/ng-oeoe/research/papers/JPEE_Introduction.pdf
http://www.ecoeco.org/pdf/jointprod.pdf
http://events.it-sudparis.eu/degrowthconference/themes/3Second%20sessions%20panel/1Indicators/Friend%2...
But what binds all these views of economy is the concept of "property," a legal construct that considers a sandwich, a deli shop, a bakery, a bank, a brokerage as all being identical items with identical "rights" for their "owners." It is to protect this delusion that Justice is blind; she sees all property as identical in law. But it is property that creates unequality in society that sustains the prospect of inequality before the law. A scientific economics must address the legal issues of property, drawing distinctions among the various kinds -- necessarily rejecting outright the centerpeice of conservative ideology: that property should be inviolate.
ClassAct, I know it's tempting for many people (including me) to invoke thermodynamics to explain many things :) But I just wanted to throw in a word of caution before this particular thread grows too long, with possible misconceptions. The second law itself can be stated in several different ways, but it's important to declare or acknowledge something as a closed system or as an open system, to avoid confusion and error. So, when you treat the Earth as an open system receiving energy from the Sun, then you don't have to call that input as an "exception", but something to be consciously accounted in our calculations.
If "Adam Smith posited that labor is the source of all value" as you mention, then again, that statement is *incomplete* - if he is referring to only human labor. Although a farmer creates value by preparing the soil, planting, watering, etc., there is obviously additional work done by the microbes, the nearby trees, earthworms, bees, etc., and of course the primary input is sunlight. So, saying that labor is the source of value falls into the capitalist trap - where labor is treated as an input and where everything is assigned a monetary value. Yes, such simplifications are necessary to decide who gets paid how much and what price to charge for a product - but it is a major simplification.
It is however an important factor to keep in mind when challenging the existing system. If labor is a primary factor in creating value, then obviously the compensation for various workers - right up to the CEO - has to be proportional to the value they create, and this is where a lot of fudging of numbers takes place. How do you apportion the value for the work of a marketing guy versus a production worker or a manager or a CEO? Just citing the marketplace - such as the availability of "talent" is once again a form of fudging. If a CEO is deemed so valuable simply because you cannot find someone with similar "qualifications", it should be questioned - by getting back to the basics - about what exactly the CEO is doing to be paid so much. And that is where you run into the concepts of property and profits. CEOs are paid so much precisely because they maximize the profits to the shareholders. But if you treat a corporation as a system, then profits are actually a form of "loss" - from the point of view of the consumer, as well as a worker, unless these profits are shared with the workers. Once again, the consumer will have to pay extra - to cover for this profit. (We need to distinguish between salary and profit - a distinction conveniently and too often omitted in arguments by the capitalists. In the health insurance industry especially, there can be NO room for profits, beyond salaries for those who work; any "surplus" should be used to reduce the risk premium, and not siphoned off as "profit")
One way to challenge the existing system is by voluntarily creating a cooperative system to produce competing products at a cheaper price. Here again, it will be necessary to expose all the "externalities" - things for which the current capitalists DO NOT pay - such as environmental pollution, military expenditure (which is precisely what allows them to get oil and other resources on the cheap), use of public resources - including the atmosphere and the waterways - as a sink to dump the waste products, etc. If it can be made a truly level playing field where such "externalities" have a cost, and if a corporation still creates superior products, then I think we should not grudge them making a profit. Even in the past - several centuries ago - a trader, such as those who used the silk route - putting in enormous labor and taking great risks, who buys some things not available back home, and selling things at a profit - did not threaten the stability of a society. How much profit he is allowed to make - now, that is the question. That is not difficult to address that question, if we get back to the basics. Anyway, I just thought I'd jump in a bit here.
As for jumping in... the discussion here between Classact and philandrel is a highly philosophical discourse stemming from points on conservation and perceptions of value that seems to miss the connection that any practical value actually perceived is given by the exchange of money, and ultimately the ascription of wealth that is measured in units of money. This then makes money an object subject to the laws of motion and conservation - which creates an even greater difficulty with the "science" of economics.
It is impossible to have a well-defined pure one to one relationship between money and the entire system of inputs and resources that would contribute value to any thing, and equally impossible to define the perceived value of every output and resource that would be "rearranged" by any force or combination of forces of action.
Simply put, the only thing we can know for sure is that money and wealth is a long term zero sum game - and economics the ultimate uncertainty principle.
Profit, as commonly defined to be an amount yielded greater than the amount used in production of a good or service, is a false pursuit. Even given the example here of a silk trader, there is no value assigned to the risk, energy, sustenance, opportunity cost or other resources the trader made use of or otherwise afforded in his quest for his profit. The only costs accounted for are the pocket costs versus the cash receipts. Such an older narrow self-serving view of "value" turned into "profit" has become quite costly to a global society that now faces population overshoot, resource shortages and degradation, likely monetary destabilization, and excessive elitism. In short, for economics to become a valid science, it must recognize there is no such thing as true long term profits.
That is not to say we cannot have development and progress. But we need to recognize the truth of conservation. When we utilize a resource, develop a product, provide a service, consume a good, or spend a dollar we are always doing so at some cost. We must learn to recognize these costs, to identify them and to be sure it is in our best long-term interest, something truly of greater good than just some greedy persons short term material gain.
cosmobilly, yes, I agree that assigning value to things using money often distorts the picture. I mentioned the silk route trader as an example where small profits may be acceptable. Another way to look at a 'small profit' is as a salary - paid by his village to go sell their wares and bring back things they needed. A great deal of uncertainty and distortion in exchange was inevitable back then because the transaction was taking place between two mostly closed systems. Exchanges were more predictable in other locations with easier access, so distortions might have been less. But the basic idea of such exchanges was to sell something that was in surplus and buy something that was needed or wanted, and it was still workable for long periods of time. It's when 'modern' capitalism reared its ugly head, that things totally got distorted and all kinds of unsustainable factors came into play. Whatever "system" was put together was unsustainable from day one, and the only way to maintain it was through an ever-increasing grabbing of resources and the exploitation of labor. I think older systems of production and trade were not so inexorably moving towards unsustainability.
Given the predicament humanity is in, if large scale violence, war and famine are to be avoided, the only rational way is to consciously move towards a system that can function based on the annual energy input from the sun. Of course, the sun doesn't shine for the humans alone - so obviously everything from conservation to a greatly reduced population will be needed. A species that arrogantly calls itself "Homo sapiens sapiens" should be able to work out some numbers without so much killing and destruction.
BTW, weren't you and I talking about fiat vs. commodity money in depth about a year ago?
"Adam Smith posited that labor is the source of all value, a notion endorsed also by Karl Marx "
Are you sure they said *value*? Value tends to be a question of subjectivity. I like apples, you like pears.
"it must be governed by the laws of thermodynamics, the second of which would prohibit the concept of profits"
Could you expand on this further? I don't understand it.
Thanks
Cheers.
The second law of thermodynamics states that it is impossible to derive more energy (labor) from a system than was input. If more labor is being derived from a system than was input, it implies that others are also making unattributed and unrecognized inputs; they are therefore victims of the systems and the profits arise not from the transaction itself but from the victims of the transactions.
The only offset to this rule is the effect created by the sun in its radiance to grow vegetation and creating secondary effects, predominantly in wind and tides. The greatest degree of victimization is borne by the mute victims without civil rights: the animals whose habitat is continually taken by capitalist society far beyond the ranges claimed by pre-capitalist societies. Other victims include villagers world-wide, workers, customers, suppliers, and the public ... I guess that pretty much takes in everyone except those who own intangible properties that extract profits -- which could not be done without the support of the state for their "property rights," a support for which they expect the public to pay and not themselves.
Sorry, but your "authoritative" account of the second law illustrates how physics is as nominal as economics. To what the second law comes is the analytic assumption of a universe of finite content (conservation of energy), and ability of any state of this fixed content to occur only once (the second law of thermodynamics). Economists assume infinite content (the substitution effect and abstraction), and ability of any state of this unfixed content to occur more than once (value). Both conceptions are definitional. Neither is objective, since their identity is a function of presuppositions--the parameters of the "experiment." Distinction between "hard" natural science, and "soft" social science, is a function of the unstated presupposition in social science of human free will. Otherwise, distinction between natural and social science is spurious. Methodologies of environmental biology and sociology are effectively indistinguishable. Methodologies of paleontology and human history are effectively indistinguishable. Methodologies of theoretical physics ("natural philosophy") and philosophy are effectively indistinguishable.
There are many strong renderings of the second law of thermodynamics, I just chose an easy version for the point of the argument. For the point of your argument a wording could be chosen that states that the product of a given reaction cannot be immediately used as an input to that reaction. Physics is that to which philosophy must ultimately adapt.
Relative to “Physics is that to which philosophy must ultimately adapt,” we have, Richard Feynman,
"It is also possible that scientific theories, because of the nature of scientific method, cannot specify the whole meaning of their concepts. There may be, and likely is, an irreducible metaphysical element to all physical concepts," [John Gribbin and Mary Gribbin, Richard Feynman, A Life in Science (Dutton, Penguin Books, 1997), http://www.friesian.com/feynman.htm.]
and Werner Heisenberg,
"the difficulty of separating the subject and objective aspects of the world. Many of the abstractions that are characteristic of modern theoretical physics are to be found discussed in the philosophy of past centuries. At that time these abstractions could be disregarded as mere mental exercises by those scientists whose only concern was with reality, but today we are compelled by the refinements of experimental art to consider them seriously." [Werner Heisenberg, The Physical Principles of the Quantum Theory, trans. Carl Eckart and F. C. Hoyt (Mineola, New York: Dover Publications, Inc., 1949) 65.]
Sorry, you’re out of step with the physicists.
And behind them all, we have Kurt Godel, who finds that no sufficiently robust system can fully and rigorously define its own terms. This, however, deals with meaning and not with the objects themselves.
In the quantum world (or through the quantum world as machines to exploit it are developed) the rules are very different. One wishes for strawberry ice cream, holds out one's cone, and it is filled with strawberry ice cream. Good luck, though, on getting your strawberry ice cream particle by particle ... because of one's inability to rigorously define strawberry ice cream.
Relevant to your comment, "This, however, deals with meaning and not with the objects themselves," Gödel asserts,
"Classes and concepts may, however, also be conceived as real objects, namely classes as ‘pluralities of things’ or as structures consisting of a plurality of things and concepts as the properties and relations of things existing independently of our definitions and constructions.
It seems to me that the assumption of such objects is quite as legitimate as the assumption of physical bodies and there is quite as much reason to believe in their existence." [Kurt Gödel, “Russell’s Mathematical Logic,” in The Philosophy of Bertrand Russell, ed. Paul Arthur Schilpp (Harper & Row: New York, 1963) 137.]
Left unclear is the location of these "real objects." Most plausibly he would concur with,
"We might describe Kant’s theory as a conceptualistic theory, since he holds that the objects of geometrical knowledge are real but have their reality only within the mind." [Stephen F. Barker, Philosophy of Mathematics (Englewood Cliffs, New Jersey: Prentice-Hall, Inc., 1964) 31.]
Now, either this "reality" is genetic as Kant would have it, or nominal as David Hilbert would have it. Considering the Cantor, Russell, and Buralli-Forti paradoxes, most mathematicians settle for it being nominal. As nominal, it is constituted in axiomatic theory. Advocates of the Copenhagen Variation incorporate this in quantum theory, concluding no explanation of data is possible independently of the experimental context. Declaring, "God does not play dice [statistics] with the universe," Einstein rejects this. Alternative Variations of quantum theory then attempt to provide such a "substance," but only in a hypothetical expression. Relevant to this entire enterprise, however, as indicated by the hypothetical character of alternate Quantum Variations, is the nominal character of physics.
This introduces a basic flaw in your depiction of social and natural science, a flaw philosophers of science have been investigating since at least the 1960s. Science is a social activity populated by human beings. If social scientific results are unnecessary, and physical scientific results are necessary, then an unnecessary entity produces necessary results. Probability of this is one in infinity. Unlikely as so, explanation requires a metaphysic to explain it. Advocates of a "soft" social science and "hard" natural science have provided no such metaphysic, leaving the distinction implausible.
Axioms must be expressive of physical reality or they must fail in the long run. One could nominally express "magic" as being the source of all phenomena, but its numeric correspondences would not be falsifiable. The statistical issue of quantum physics may not be relevant here because in larger physics, reliable, falsifiable results are obtained without reference to the states of the particles. I introduced no matter whatever regarding social sciences, but in this area statistical results are known to be reliable, advertisers use them constantly without regard to whether some are repelled by a particular message with full certainty that a statistical result will be obtained. Humans, too, are in an indeterminate state until they encounter some phenomena that compels a particular state from them. No person is indispensable it is said, therefore unnecessary, yet they produce the necessities of life, so there is no correlation between necessary and unnecessary properties.
Here's your problem with verification,
"I propose to say that a statement is indirectly verifiable if it satisfies the following conditions: first, that in conjunction with certain other premises it entails one or more directly verifiable statements which are not deducible from these other premises alone; and secondly, that these other premises do not include any statement that is not either analytic, or directly verifiable, or capable of being independently established as indirectly verifiable. . . . I confess, however, that it now seems to me unlikely that any metaphysician would yield to a claim of this kind; and although I should still defend the use of the criterion of verifiability as a methodological principle, I realize that for the effective elimination of metaphysics it needs to be supported by detailed analyses of particular metaphysical arguments." [A. J. Ayer, “The Principle of Verification,” in Classics of Analytic Philosophy, ed. Robert R. Ammerman (New York: McGraw-Hill Book Company, 1965), 129, italics mine.]
Importantly, Ayer never provides the requisite "detailed analyses of particular metaphysical arguments." This is because verification conditions are constituent of the axioms of any conceptual scheme. Being so, religion can be as verified on its verification conditions as any science you propose, including physics and, sadly, economics.
Where economics fails is indicated in the following passage:
“Different sciences have various explanations for why people do what they do. . . . Economists . . . argue that if we want an analysis that’s simple enough to apply to policy problems, . . . heavy psychological explanations are likely to get us mixed up. At least to start with, we need an easier underlying psychological foundation. And economists have one—self-interest. People do what they do because it’s in their self-interest.” [David Colander, Microeconomics, sixth edition (Boston: McGraw-Hill Irwin, 2006), 188.]
Accepting “heavy psychological explanations . . . get us mixed up” because considering more variables than the “easier underlying psychological foundation” of economics, it is difficult to understand how economic resolution of “policy problems” can be successful since considering fewer variables than apparently more accurate “heavy psychological explanations,” they must fail more often than not. This is a variation of assuming while behaving unnecessarily as a society, natural scientists discover necessary truths. Probability of the effect from the cause being null but one, the assertion is implausible.
The "self interest" paradigm is a tautology because people act against their interests all the time, and not always altruistically. (What's the matter with Kansas?) Perception of the self is different than the self and we have to fall back into the Buddha's observation that the self is conditional and cannot be determined by reference to anything else. The verification matter comes back to the post about Godel I made above. Language cannot validate its own axioms of meaning, as such ... no two persons are actually speaking the same language, yet communication appears to happen anyway, so long as we agree to avoid the self-referential hall of mirrors.
Alright, ClassAct, it's time to bring out the big guns. Colander integrates all of this discussion into perfect harmony, where after asserting, “People do what they do because it’s in their self-interest,” [David Colander, Microeconomics, sixth edition (Boston: McGraw-Hill Irwin, 2006), 188.] he explains,
“In all known economies, coordination has involved some type of coercion—limiting people’s wants and increasing the amount of work individuals are willing to do to fulfill those wants. The reality is that many people would rather play than help solve society’s problems.” [Colander, 5.]
Now where in this erudition can you find any inconsistency?
As for your siren call to a discussion of language, let us call a halt. Layout of this blog site is such that replies are becoming increasingly elongated, and if you get me discussing language, my responses will be no more than a letter wide.
All anthropologists I know of would dispute Dr. Colander's description of "all known economies." Remember the movie "The Emerald Forest"? When asked why he does not make the boy do as his extra-tribal father wishes, the chief says, "If I make a man do what he does not want, I will not be chief for very long."
"The "self interest" paradigm is a tautology because people act against their interests all the time, and not always altruistically. "
Don't we all know that already? When we ask why people bought or sold company xyz today, and ask if they were rational or irrational, or whether they did or did not "correctly" consider if the transaction was "right" for them, isn't the answer "all of the above in some mix that will likely be different tomorrow"?
It is true that Marx took over from Smith & Ricardo the concept of labor value, but, unlike them, he deployed the concept in a way that fits in with the 2nd law of thermodynamics. Marx argued that profits result from "surplus value," that is, value added to products by uncompensated labor. This is precisely what "exploitation" consists in: not all of the work that wage laborers do is covered by their wage; a portion is pure slavery. A complicated argument about "necessary" and "unnecessary" labor time informs Marx's analysis. But the point is: the hours that go into a making a product are reflected in its value, but some of that value is expropriated by the capitalist (when the thing is sold) as pure profit. What goes in ("input") is the same as what comes out ("output"), only the wage form and the price mechanism obscures this dynamic. Niether Smith nor Ricardo had an inkling of what Marx called "the secret of surplus value."
Of course, Marx's theory is controversial, but it does offer a credible account of "exploitation" and it does so in a way that does not violate the 2nd law.
Marx converts into a scientific-sounding formula the notion that it is unfair to profit by skimming off the productivity of others.
Thing is, he doesn't make an ethical or anthropological or sociological argument. His "surplus labor" argument is Physics-flavored, and thus, his epistomology is as pseudo-scientific as any other Modern school of Economics.
And equally messianic.
"What goes in ("input") is the same as what comes out ("output"), "
Only when quantified by the most simple of means. Your statement does not account for the dramatic changes in the form from input to output.
Just to be clear: solar input is not an exception to the 2nd Law. The sun's radiant energy is simply the source of nearly all energy in the Earth's systems. (A certain amount, relatively tiny, comes from processes inside the Earth.) We use this energy in myriad ways, and in every case we lose some of the input to heat (i.e. entropy). You always get less out than you put in, in terms of useful work.
But the thrust of this comment is right on. The only means of profit is to co-opt someone else's energy, and there will always be a diminishing return which requires further exploitation in order to maintain profit levels. This is a version of Marx's insights into the contradictions of capitalism, which should be painfully obvious by now -- even to an economist!
"You always get less out than you put in, in terms of useful work.
"
But it's of a different order, an order that is *valued* differently.
Marx and Smith seem to ignore Human Intellect and it's role in creating wealth, if you are correctly stating what they have said.
In classic capitalistic economics there were four inputs to production; labor, land (natural resources) capital and entrepreneurship. The input of labor received wages, the input of land received rents, the input of capital received interest and the input of entrepreneurship received profits.
Entrepreneurship was differentiated from labor in that labor was completely unskilled and one worker could be plugged into the duties of another worker with no change in output, while entrepreneurship was the intellectual organization of the various inputs most efficiently which generated profits when compaired to other enterprises that were less efficiently organized.
"entrepreneurship was the intellectual organization of the various inputs most efficiently which generated profits when compaired to other enterprises that were less efficiently organized."
Right, labor has to be directed towards some useful goal. Can't just dig holes everywhere and expect to get paid for it.
Human intellect can increase the efficiency of transactions, but it cannot turn transactions into over-energy deliverance of surpluses.
Really. This clapped out post modernist attempt at applying the laws of physics to human behaviour has been debunked so many times and so well I wonder that you have the chutzpa to post such nonsense at all.
Your use of scientific terms might intimidate an arts graduate and make you feel smart and beyond criticism but is doesn't impress me.
Try reading "Fashionable Nonsense"
http://en.wikipedia.org/wiki/Fashionable_Nonsense
and "The Limits to Entropy: the Continuing Misuse of Thermodynamics in Environmental and Marxist theory"
2008, Science & Society v. 72, No.1, 43-62.
http://www.redandgreen.org/Documents/Limits%20to%20entropy%20final.htm
In case the URL is cut off try http://tinyurl.com/ye732ou or hit reply to get full URL.
Gary
“The economy depends about as much on economists as the weather does on weather forecasters.”
-- unknown
Would you consider the possibility that there could be a genuine attempt to use the laws of physics (including thermodynamics) precisely to expose the fraud perpetrated by the current capitalist system? Or any system that attempts to fudge numbers by using *other* theories that are even less defensible? Personally, I think the best way (that I have found) to call the bluff of the economists and the free-market profiteers is by the use of physics, and even engineering principles. They can also be used as a basis to construct a more equitable and sustainable system or society. I don't want to enter into a lengthy argument here, except to point out that it could be a mistake to brush off any attempts to use physics or thermodynamics while discussing economic systems. These laws do not leave much room for obfuscation or fudging of numbers, and they don't permit the avoidance of natural laws - such as the finite nature of certain resources and the finite rate of certain processes (such as photosynthesis) - something that routinely takes place in the field of economics. Not only in economics, but these laws can be used to call the BS by politicians talking about jobs, green industries and so on - by forcing them to face numbers, instead of words.
I think physics can help explain a *part* of economics, but what about how different people value things differently? And what physics would explain the "rational" or "irrational" behaviour of those in the market? Those are areas you can fudge and I don't think there is any escaping that.
jakenewton, you can still use physics and physical limits to corner people into admitting that they consider some people as more deserving than others. Since it would then be a mental concept and not a physical reality, there may not be much that physics can do - which is what leads to different people valuing things differently. In a resource-constrained world, physics can be used to expose the exploitation done in the name of king, country, religion, etc. At least then it will be out in the open. It HAST TO BE - if there is an open debate.
At that point, a line will be clearly drawn - between those that think equitable sharing of resources is a desirable thing, and leaving a sustainable world for our children and grandchildren should be a priority, etc., and those who will essentially have to say, might makes right, winner takes all and makes the rules, short-term profit outweighs considerations of sustainability, and that some are more deserving than the majority. Physics cannot change their minds - but it can be used to draw this line. If you are in a ship with limited supplies, including fresh water, and a crew (+passengers) of a certain size, the only way that supplies can be used unequally is if there is a general agreement, and where this unequal 'sharing' is not life-threatening. Even a die-hard capitalist and free-marketeer will think twice before taking too much for himself, if he wants to make it to the shore safely
What people do with this exposure is a different matter. There too, physics can be of help - even right down to individual action, including non-violent, spirituality-based action, but I'll leave that for some other occasion :)
"they consider some people as more deserving than others."
*I* "admit" it's often the case, depends on what you are talking about though.
I'm simply talking about a world of finite resources. You can often get away with saying "some are more deserving" when you are on land - a big enough land, and you can even take what belongs to another, and still get away with it. But not in a small island, and certainly not in a ship - unless there are clearly two classes of people. But then it will be in the open. The situation today is that it's possible to pretend that it's a democracy, and people are not accepting the reality of finite resources - even ordinary people. This is a form of fudging, too. My hope is that physics can help remove this kind of an illusion and bring facts in the open, force people to think and act like they are in a ship with limited supplies, and where piracy (taking from other ships) is not an option anymore.
See: Spaceship Earth:
http://tinyurl.com/db83kc
>>In 1965 Adlai Stevenson made a speech to the UN in which he said "We travel together, passengers on a little space ship, dependent on its vulnerable reserves of air and soil". The following year, Spaceship Earth became the title of a book by a friend of Stevenson's, the internationally influential economist Barbara Ward.<<
Gary
"It is certainly no solution to evict the poor, replacing their squalid housing with much more expensive buildings which the original tenants can’t afford to reoccupy. Our society adopts many such superficial palliatives. Because yesterday’s negatives are moved out of sight from their familiar locations many persons are willing to pretend to themselves that the problems have been solved. I feel that one of the reasons why we are struggling inadequately today is that we reckon our costs on too shortsighted a basis and are later overwhelmed with the unexpected costs brought about by our shortsightedness."
-- R Buckminister Fuller, Operating Manual for Spaceship Earth (1969)
It is in the open nature of the ship or island example where you will notice the situation where someone doesn't pull their own weight. Maybe physics can be used to expose the case of those who are genuinely lazy and help inform us of whether they are equally deserving. I'm not at all saying that those who are lacking are always lazy of course.
Sure, that should be possible too. Everything will be in the open. Even the value of that produced by supposedly more productive people. The community will decide what is valuable and how much, and who gets to starve to death because he doesn't produce enough of value :)
If you had visited the links I listed, you would have seen that my position is not based on that of Georgescu-Roegen. The Science & Society article is a political attack based on simplistic readings of ecological economics by association with Malthus. It is a political piece that does not parse the applicability of the science. My approach is based on the recent book Joint Production and Responsibility in Ecological Economics by Malte Michael Faber, Johannes Schiller, neither of whom take Georgescu-Roegen's approach and certainly hold no truck with Malthus. Your rejection of a scientific approach might impress arts graduates, but I am learning better myself.
See my other post about "value". I am sure that plays a role in profit. If you are saying there is no free lunch, I agree, but matter and enrgy take different forms of order and these are valued differently.
Yes, both Smith and Marx used the term "value." A "market" prescribes the "value," however, participation in the market is in diminishing capacity for those without the universal, i.e. monopoly, commodity: money. (It is the state, of course, who must create this monopoly commodity in order to prevent counterfeiting, as the US discovered in the Jacksonian era.) The animals who bear the brunt of all expansion have no traffic at all in the market except as commodities; the villagers have only a minimal contact with the market except as they are deprived of their villages and turned into laborers (a process on-going throughout the world since the English Civil War and the establishment of the concept of "property" on behalf of the gentry and their successors); the workers from a diminished and passive capacity; and the employers from an active determination of the monetary price they wish.
"Yes, both Smith and Marx used the term "value.""
OK then.
"A "market" prescribes the "value," "
Don't you mean *price*? Value changes depending on the individual. That is, there is a competing subjective theory of value.
Value may change depending on the individual, but when stripped down to essentials, and under certain conditions, value need not be all that subjective. There are certain fundamental requirements such as food, clothing and shelter, etc. In India, for example, people in the cities get paid several times more than what a farmer in the village earns, and the city people can claim that they produce greater value. Because everything is monetized, they are able to buy food on the cheap (relative to their income), and enjoy luxuries, whereas a food-producing farmer can barely survive, because the value of what he produces is determined by others.
But what if the farmers are in a position to organize and say they demand a higher price (higher value), or even that they simply want to be left alone? Then the government's role will be exposed - where it takes resources from the villages and concentrates in the cities, while pretending that it's a fair exchange. That this is an unfair exchange is not acknowledged by those who control the power, and the villagers are probably not thinking along these lines either. They just want relief from their immediate problems.
I think it should be possible to show that the latest gadget which costs a couple of hundred dollars is of less value than a day's worth of food for a person - under the right conditions. And when these conditions are clearly defined, taking the finite nature of resources into account, then the "price" of a golf course, for example, in a place of limited water supply and limited farmland will be far, far higher than what the elite pay for its use currently.
When you look at individual transactions and assume that both parties agree to the transaction and that there is no coercion, then by definition both parties receive greater value as a result of how they value the assets/money/commodity differently from each other. Otherwise they would not have engaged in the transaction.
Good point. In the Indian context I used as an example, coercion is easy to show as very much part of the transaction. The pricing of what farmers produce gets decided in the "market" controlled by the elite. They can decide what gets imported, and they can also decide what they exchange in return for this import. What gets exchanged could be a natural resource or something produced using this natural resource. Except, technically, the resource belongs to all the people (as per the earlier law, which is being changed in bits and pieces, so ownership is slowly privatized). And the proceeds from exploiting these resource reach only a small number of people through well-controlled systems of exchange.
Coercion also takes a more direct form - where farmers are essentially evicted from their farmland, because that land is needed for some other activity, and the "compensation" paid to them is NOT accepted by the farmers as fair. This has happened in China, too. Since coercion happens in these cases in the present day, it's easy to see them as they happen. However, imagine the situation several decades from now - where the farmers thus evicted from their land are reduced to survival mode, where the value of whatever they produce - through physical labor - becomes even less, relatively speaking. And imagine also, that the descendants of these farmers do not know the history - about what happened to their parents or grandparents who were thrown out of their land. Not knowing the history, I think they are more likely to accept when someone says that what they produce is obviously of little value. Accepting that, they may even go along with a transaction with no "apparent" coercion - because they are only experiencing the effects of a coercion that clearly happened in the past.
Coercion can take place at some point in time, and the advantages and disadvantages as a result to the two parties involved (and their descendants), can get solidified and institutionalized, defended by law. In such a situation, the advantaged party (whose affiliates also control the market and the means of exchange) may feel he is somehow more productive and more gifted, and the other party is somehow lazy or less productive. There will be exceptions. Some from the disadvantaged class will manage to rise in life - which will be used as proof that the others from his class are not working hard enough or smart enough.
My point is that it's easy to fudge historical facts too, and say there is no coercion in the present day.
"Good point."
Thank you, and thank you for your response.
"In the Indian context I used as an example, coercion is easy to show as very much part of the transaction. The pricing of what farmers produce gets decided in the "market" controlled by the elite."
In such an example my tendency is to look closer and see why. I usually start with political leadership that fails the people because it is such a common occurance. Think of countries where payment bribes are routine. Remember too India has a caste system. And I wonder how the view and uphold contracts.
"Coercion also takes a more direct form - where farmers are essentially evicted from their farmland, because that land is needed for some other activity, and the "compensation" paid to them is NOT accepted by the farmers as fair. This has happened in China, too."
Political leadership that fails the people.
"My point is that it's easy to fudge historical facts too, and say there is no coercion in the present day."
Well, you don't hear me saying that, I was talking about a theoretical situation. Even in the best case it's not perfect.
This is an equivocation on the word "value." Smith begins from an abstraction regarding barter where peaches and pears would apply as value for exchange. It is when money is made the universal commodity, as Marx observed, that value becomes price when it is the universal intercessor in exchange.
Never mind money, in a simple example of bartering with fruit: We each *value* apples and pears equally. We each would also most value an equal number of each. I have ten of one, you have ten of the other. We each gain *value* by a simple trade of five for five. We are both better off after the swap.
This is all value in the sense of our own tastes and sensibilities, no need for any thermodynamics.
thank you for this post, classact...
In view of the recent pronouncement of the Supreme Court bestowing personhood on corporations, how can we even expect that things will change? My belief is that the President, Congress, and our Supreme Court aren't even interested in pursuing any change for the betterment of the citizens of the U.S. (who are as insignificant as ants)! They're pursuing a different track that involves the permanent installation of corporations as the ONLY citizens of the United States that matter and for only whom Congress should be legislating! Wealth and position are the only important assets for these "new" citizens!
We have been headed in that direction since candidate Reagan first stole Carter's debate papers and illegally made deals with the Iranians. It was not that difficult to see coming. I even made a career change because of it in the mid-80s. Now the US is perfectly positioned to create a world consistent with the darkest visions of SciFi writers of the 20th Century.
You "even made a career change in the mid 80s" and I even got a vasectomy in the mid 80s, realizing that a post-Reagan world would not be fit for human habitation (or habitation by many other living things). I wish we hadn't been right.
Economists' theories and conclusions are based on the interests of whoever signs their paycheck.