The two “heavy balls” of economic theory are retail sale and cost accounting. Don’t allow any costs post retail sale and require a forensic examination of every business’s books to discover who is arbitrarily and anti-socially raising their prices.
P: I agree with Gerald. Well expressed.
This approach – stylized theory – is the approach of science. Science has been stunningly successful. Economics is harder than physics because to match real-world concepts and relationships to the idealised concepts and relationships is more difficult. So its success is not so stunning. But it does work to some extent.
Compare with the other social sciences which do not do the stylized theorising. They have nothing. No body of theory. Perhaps the fields of law and linguistics are partial exceptions but elsewhere in social science (psychology, sociology, anthropology, political science): zilch. Scholars in those fields do not have the sort of conversation that takes place in economics. They cannot.
So I think that economists should be glad to have a winning approach and that to attack the basic method is misguided. I say it is not the method but the premises which need attention. The basic premise of self-interest is not wrong but is incomplete. It seems to me that for economics to advance, working out stylized theoretical relationships premised on other social assumptions is necessary.
Altruism, for example, is as genuine a human motivator as self-interest. Economics ignores it. Yet it exists and has economic consequences. So the task would be to theorise altruism in the stylised way. I think that until this happens economics will not break out of its theoretical stasis.
Me: Precisely. And what is a more altruistic concept than Monetary Grace as in Gifting? The real problem isn’t just the fallacious theoretical assumptions of neo-liberal economics it’s the current problematic monopolistic monetary and financial paradigm concept that hasn’t changed for the entire course of human civilization.
Neo-liberal economist’s models are flawed alright, but so are libertarian’s models. They ‘re both afflicted by the same thing that Ptolemaic cosmologists were perplexed about before helio-centrism was found to be the actual reality. In other words all of their calculations were inaccurate because they operated within the current paradigm…instead of recognizing and confronting the new one.
Economists and economic pundits on both/all sides have to be willing to drop their orthodoxies, be willing to integrate certain of their beliefs with those of their critics and be willing to embrace the third-ness aspect of the dialectic. That’s because conceptual opposition is the hallmark of imminent paradigm change and the willingness to integrate is the hallmark of accomplished paradigm changes.
To resolve economics’ major problems change the current monopolistic monetary and financial paradigm of Debt Only to Debt and Strategically Direct and Reciprocal Monetary Gifting at the point of retail sale. That would enable both greater individual and commercial monetary abundance while simultaneously implementing the impossible so far as orthodox theory is concerned, that is beneficial price and asset deflation.
“Economists assumed that the economic process happens in an abstract, no-space and no-time historical void.”
Real world temporal universe fact: Retail sale is the terminal ending point of the economic process, that is, it is where production exits the economy and becomes consumption. That economists have missed this shows how overly abstract and theoretical they have become. It also explains why they have not recognized the incredibly powerful potential for policy at that point. Thirdly, it explains how they have failed to see how private for profit money creation is a wholly exterior, parasitical, incredibly expensive POST retail sale set of costs and hence logically not a legitimate business model.
Empirical fact: Up to 97% of our money is created by accounting entries, i.e debits and credits. As Steve Keen has correctly bemoaned, “Economists can get their PhD in economics without taking so much as an elementary course in accounting.” This shows how ignorant they are of the most significant fact about money creation, namely it is most BASICALLY accounting
Given these facts, it is not surprising that economists and economic pundits are missing the temporal universe problem resolving and efficacious accounting implementation reality of a 50% Discount/Rebate policy at the point of retail sale.
Economists and economic pundits can run from/refuse to confront, confirm or engage these facts, but they cannot hide from them.
$5,000,001- 6,000,000 5 %
$6,000,001-and up 0%
Me: I have dropped Graeber’s name here numerous times. Why? Because the problem in economics is money, private debt and banking. In other words everything surrounding finance. That is the paradigm that hasn’t changed since Sumeria and is begging us to consciously awaken to. What is a debt jubilee? Monetary Gifting. What is a UBI? Monetary Gifting. What are (or should be) fiscal deficits? Monetary Gifting. What is a 50% discount/rebate policy at retail sale? A completely integrated, direct, continuous and virtually universally beneficial Monetary Gift that utilizes and perfectly mimics the debit/credit accounting process of money creation. Direct and Reciprocal Monetary Gifting, the policy essence of the new paradigm that will enable us to rejuvenate economics and effectively confront climate change.
T: As with my post above, what happens when fiat currency ends up being exchanged for real assets like mined minerals and fiat’s value is diminished by piles of it in the hands of the miners outside of the fiat issuing country and the recipient can find no party to accept? Then the hard assets end up in the hands of the financiers/rentiers. Then what? It seems like we end up with the same results that happened with The Enclosure?
Me: The obvious answer here is to create a true publicly administered national bank which, aligned with the new monetary and financial paradigm, is free to distribute credit in a socially beneficial way. Private money creation is a monopolistic, problematic business model which is the only business model allowed to extract costs post retail sale thus violating the consumer sanctity of retail sale. A public bank would innovate private money creation out of existence and it would make private money creation the shite picker upper occupation after the creation of the internal combustion engine.
Science is important, wonderful and necessary, and it exists as a wholly contained set within the broader mindset of wisdom/paradigm perception which is the ability to simultaneously perceive particularity and essence of operant factors so as to solve problems that appear to be in even inevitable conflict.
Chaos is likely an apparency ultimately resolved by contemplating the aspects of the natural philosophical concept of grace, like for instance unity and dynamism.
The outrage is spot on of course, but how many outraged speeches does it take to change things? The answer: A zillion with palliative reforms, or one more with the correct set of policy solutions to the most underlying problem because they align with the new paradigm concept that changes the operant conditions of the entire pattern under investigation.
The keys to paradigm perception are an integration of depth of knowledge, discernment of primacy of problems and willingness to embrace conceptual simplicity…because paradigms are single and singularly efficacious ideas which paired with aligned policies…change everything.
Let us perceive and act. The Martians are laughing and the earth and its inhabitants are moaning.
KZ: The full cultural and political implications of the neoliberal critique would not be felt until the demise of the Keynesian system of macroeconomic management, which emerged around 1968, and gathered pace with the end of the Bretton Woods system of fixed exchange rates in 1973. That model had included an ample role for public investment and planning, which combined comfortably with post-war modernist visions of social housing, expanded higher education, public service broadcasting, publicly funded arts, and so on. This may not have been driven by modernism in an avant-garde sense, but it represented what Mark Fisher has called ‘popular modernism’, as represented by mass literary culture and rising social mobility. Keynesianism cultivated a sense of progress as a collective temporal experience, most explicitly and coarsely represented by that symbol of macroeconomics, GDP growth. For Franco Berardi, neoliberalism involves the retreat of individuals into virtual and imaginary spheres of political transformation, combined with a terrible sense that dominant political institutions are now permanent. As a symptom of powerlessness, depression is the consummate neoliberal disease. Getting high and tuning out becomes a necessary techno-political fix in a society that has lost its capacity for collective reinvention but has rendered individual ‘creativity’ an economic obligation. It is living people in a dead society. And its many other symptoms fill our media daily. Inequality, exceptional and routine cruelty, hatreds by the dozens, failed families, governments, religions, schools, etc.
We need to kill this monster we’ve created before it destroys our species. We do this by first wiping out the price system, then neoliberal markets, and finally money. Since economics as practiced today is built around sustaining these institutions, with their end there is no more need for this economics. Then we could look to building anew.
Me: I would say we need to innovate/evolve the price and money systems first with the new paradigm of monetary grace as in gifting because it resolves the deepest flaws of finance capitalism (individual monetary scarcity, systemic monetary austerity and chronic price and aset inflation) while, with the 50% discount/rebate policies at retail sale and at note signing for green and big ticket items, also enables us to proceed directly and forthrightly toward a much saner industrial and ecological policy.
As the concept behind both the new monetary and financial paradigm and the next zeitgeist is the natural philosophical and epistemological concept of grace as in love in action, and active love/graciousness is recognized as both the highest ethical and spiritual value and hence the most evolutionary concept of self actualization…the further evolution you’d like to see ought logically proceed within that new infrastructure.
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If after taking a mandatory course in human relations and healthy child rearing, and 2 years of no domestic disturbances your $250/mo. reduction in dividend may be rescinded.
Couples who finish a course in human relations and healthy child rearing before getting married and at least 9 months before having a child will receive an additional $250/mo.
If more than one domestic disturbance occurs in a marriage and remediable counseling is refused the $250/mo. may be rescinded.