The Wastefulness of *Economics* requires labels

The Wastefulness of *Economics* requires labels

No doubt there are a number of other labels from systems of ‘economic thinking’ leaping up for your attention right about now – ‘Capitalist’, ‘Socialist’, ‘Marxist’, ‘Communist’, ‘Fascist’, etc., – which we’re all expected to get into the game and favor or oppose, but… is there a value in that for you?

What is that value?

No, I’m not asking for the arguments for why one of those labels is better than the others – though I’m pretty familiar with each of their arguments for those, that’s not what I’m trying to bring to your attention here. Also keep in mind that I’m not in favor of any form of anarchic, minarchic, syndicalist, etc., system, I’m simply asking you to consider what value there is for you, in a system that seeks to manage ‘an economy’?

Again, I’m not looking for your opinion on the various labels within the system of ‘Economics’, neither am I trying to dismiss the many valid principles of economics (‘good money drives out bad’, ‘no free lunch’, ‘inflation is a tax’, ‘quantity theory of money’, ‘uniformity of profit’, and the more technical ones too…), what I’m drawing a bead on is the ‘Economic System’, as a system.

When you peak beneath the surface of their arguments, what you begin to notice is that these labels that we are expected to pick and wear, are less about conveying an understanding of either the terms themselves or of the individuals being labeled by them, than with drawing us all into positions within the system where we can be more easily manipulated in a much larger game that’s being played (think MLB, rather than the Dodgers or Yankees). In that larger game, each label adds to the contradictory turbulence that’s generated within the whole (think Dodgers vs Yankees), and does so within the ‘unquestionably’ legitimate category of the modern’s most favored label of all: Economics.

So to see what that larger game is, let’s start with the usual basic answer given for what ‘Economics’ is, from a site that’s appropriate to the subject, Wikipedia (yes, that’s snark), which says:

“Economics (/ˌɛkəˈnɒmɪks, ˌiːkə-/) is a social science that studies the production, distribution, and consumption of goods and services.”

Which is true enough – especially as it identifies ‘Economics’ as a Social Science, which is a field that was devised and defined by utilitarians and positivists who believed that ‘experts’ should be given the ‘might to make right’, as the basis of their ‘scientifically’ measuring ‘social actions’ through a lens which excludes philosophy & morality (what they meant by ‘science’, is very likely not what you mean by Science), and focuses instead on particular quantitative details of narratives that are especially suited to support their perspectives on how to ‘fix’ Society. Meaning: You, me, and everyone we know.

If you were to overlook both the source and lens of ‘Economics’, you might conclude from Wiki’s sentence that its meaning is similar to how ‘economics’ is identified by some of the better economists, such as Thomas Sowell, who define the subject as:

“Economics is the study of the use of scarce resources which have alternative uses.”

, but that sense is more reflective of the limited purposes and scope of the field of Political Economy (which we’ll get to below) which preceded ‘Economics’, and which became focused upon studying and identifying what conditions and circumstances most promote or interfere with individuals’ ability to produce value, from the bottom up, and the intended and unintended consequences of political efforts to aid politically useful aspects of that process, from the top down.

The wiki meaning, OTOH, embodies the top-down ‘systems view’, in which the unstated presumptive ends of ‘Economics’ institutional purpose, is, as expressed here as ‘Applied Economics’ from Investopedia, beginning somewhat vaguely as:

“Applied economics is the application of economic theory to determine the likely outcomes associated with various possible courses of action in the real world….”

, and more revealingly in its conclusion, that:

“…As a result, applied economics can inform a “to-do” list identifying steps that can be taken to increase the probability of positive outcomes in real-world events.”

, which is justified as being for the ‘Comon Good’.

Maybe it’s just me, but I notice that whatever the “… probability of positive outcomes…” it is that they’re betting on, the reality of playing the odds with their ‘to-do list’, is that at least some of us living here in the real-world are going to suffer the negative ‘outcomes’ from those actions they take, and those imposing these ‘economic policies’ will offer no further concerns or assurances to those of us living in ‘their economy’, than to say: ‘may the odds be ever in your favor‘.

Just sayin’.

So then, considering that there’s a 100% probability that the economic policies implemented by those in positions to impose them upon us, will follow from the advice given to them by some economists – never all economists, of course, because ‘economics’ is less a science than a means of playing dice in our lives with – on how best to manage ‘their’ economy. And since it’s true that they will implement their policies, despite the fact that neither of those parties – state or economist – have first-hand knowledge of those conditions affecting your day-to-day decisions on how best to ‘manage scarce resources’, and despite the fact that they are not the ones who will bear the brunt of the scarcity of resources you may encounter as a result of the unintended (?) consequences of those failed policies that they imposed (do you remember when store shelves used to be well stocked?), and despite the fact that they will bear nothing more than token political responsibility for those policies at some point long after the effects of them have been felt by you in your life…the question I’m asking you, is, where is the value in that system, for you?

I’m not singling one of those labels out here – try not to get sucked into defending the positions you associated with the particular label you favor – look at the systemic thinking that all of the labels are a part of. What I’m talking about are the consequences of utilizing government power to implement systems “…to determine the likely outcomes associated with various possible courses of action in the real world…” which will force you to try to manage your own scarce resources by juggling time, bills, profits, and losses, within ‘their economy’, and then ask yourself: Where is the value in having that system imposed upon you, and me, and everyone we know?

Adam Smith was a pioneer, rough around the edges, got some things wrong, but the essence of the concept he first brought to light for all to see, which is a concept that has unfortunately become alien to us today, is that the ‘Natural Liberty’ he described did not involve creating or managing ‘an economic system’ of government policies (he did not propose ‘Capitalism’ as a system, Marx did that). What he observed instead, was that by eliminating those governmental policies that interfered with the individuals’ ability to manage their own scarce resources, would enable them to better earn a living for themselves, and is what ultimately serves to increase ‘The Wealth of Nations’.

Whatever else he may have gotten wrong, what he got right was that the society which values ‘Natural Liberty’, is one that respects what you value, and enables you to be productive for yourself, and for those you engage with, and for your entire community, which encourages people to seek after living lives that are worth living.

A system which looks at what you value, as a means to sustain its ‘economy’ for the ‘common good’, is one that is fundamentally wasteful towards what you value, and towards you yourself, because you and what you value, are not what that system values, which is reflected in the lives of those living within that ‘their economy’.

What I want to show for you, and me, and everyone we know, is that ‘Economic Systems’ are inherently wasteful – some moreso than others – but they are all inherently wasteful to all but those favored few which the system itself must cater to, and no, that’s not (necessarily) the ‘richest 1%’, and no, it’s not ‘the jooos!‘ either. Who is it the system caters to? For now, let’s just call them ‘they’, and we’ll gradually see who ‘they’ are, as we go along.

Once you begin to consider our ‘economic system’ from that perspective, you begin to realize that the nature of those ‘economic policies’ that ‘they’ are managing ‘their economy’ with (no matter which ‘they’ currently makes up ‘their’), have the very real potential to become as 100% relevant to your life right here & now, as those living in our Founders’ generation felt the exceedingly real and very unintended consequences which followed from Adam Smith’s advice to Lord North, that to solve the revenue issues of Britain’s mercantile system, he only needed to raise taxes on the colonies.

One of the least bad economists that there has been, Henry Hazlitt, wrote a famous little book entitled “Economics in One Lesson” (which I highly recommend), whose one lesson he stated could be summarized in one sentence, as:

“The whole argument of this book may be summed up in the statement that in studying the effects of any given economic proposal we must trace not merely the immediate results but the results in the long run, not merely the primary consequences but the secondary consequences, and not merely the effects on some special group but the effects on everyone.”

, and while that is very true… it is not the whole truth, and taking that as a complete answer, diverts us from the much more fundamental questions that should be asked first, and when we fail to ask them, we’re subtly led into making every one of the fallacies that his book exposes so well, and make no mistake, ‘they’ encourage it.

Obviously I’ve poked at quite a bit here involving these labels, positions, and systems, and we’ll dig into every bit of it, but before doing so, let’s first look at one of the better efforts that people recently began to identify with, ‘Classical Liberalism’, in order to escape from the existing systems, and why it is that it can’t fully succeed in that.

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