KZ: Economics as you describe it is just one of the “results” of a movement in
knowledge, political standardization, and social organization that began in the
18th century and expanded rapidly after WWII. Where science flourished the
appeal of numbers, which could be and were converted into objective facts
allowed the construction of civilizations where decisions could be made
scientifically and endorsed democratically. Such decisions appeared fair and
impersonal and thus impartial. So while democracy ensured all had a voice,
science in numbers ensured certainty about the actions needed to carry out
democratically made decisions. In the words of Theodore Porter, “Quantification
is a way of making decisions without seeming to decide. Objectivity lends
authority to officials who have very little of their own …. Knowledge, then does
not diffuse uniformly outward from the place of its discovery. It travels along
networks to new nodes, and what appears as universal validity is in practice a
triumph of social cloning.” After WWII science is the most powerful, admired,
and envied way of life on earth. So economists wanting to copy it is not
surprising. Historians, sociologists, psychologists, and even that staunch
member of the humanities, Anthropology took the leap as well. Now after 60
years History, sociology, and the others have reached a balance so that
numbers and “objective facts” are only parts of diverse fields of knowledge.
Economics did not reach such a balance. It is wholly and fully dominated by the
cult of numbers and objective facts. For those of us who study science, including
economics the research is focused on answering why economics remains
situated so. One explanation offered is the limited understanding of mathematics
by economists. Another is the desire of economists to distinguish themselves
from the other sciences which seemed to already cover everything proposed for
inclusion in economics. My own view is that the prime motivation was the same
as voiced by the 1960s founders of quantitative history (cliometrics), “…to establish history
as a social science dedicated to the rigorous, consistent, and precise application
of social theory and social scientific methods in the study of past human
Me: Science has been applied, albeit primarily to human consciousness, for over 7000 years. It and technology have arisen as the primary thrust over the last 300 years, that is true.
The most subtle and consequently unperceived problem of economics is its mistaken notion that either private or public finance can be harnessed and made to serve humanity….unless the domination of its paradigm of Debt Only is integrated into and primarily replaced by Monetary Gifting….which is an aspect of the natural philosophical concept of grace….which being nothing more dogmatically and certainly nothing less than love in action in the temporal universe where we all exist….is therefore the supreme expression of ethics, and so the only concept able to balance the supreme power of the economic factor of money.
Resolve this philosophical and ethical problem and utilize the well known simplifying concept of Occam’s Razor to create a publicly administered national banking system guided by the above concept of grace instead of the destabilizing coterie of dominating and ethically conflicted private banks….and the leading edge economic insights of Keen’s financial instability, Hudson’s financial parasitism and MMT’s money mechanics will fall back into and fit seamlessly within the new paradigm theory of Wisdomics-Gracenomics and the philosophical concept behind it.
C3000: Banks must increase their loans exponentially in order to have sufficient money in the economy to pay interest on the loans. The only other sources of money to pay loan interest is senioriage spending by the government which has been systematically reduced over the past five decades and open market operations by the Fed…
Me: “The only other sources of money to pay loan interest is senioriage spending by the government which has been systematically reduced over the past five decades and open market operations by the Fed…”
Presently, yes….and that’s the problem because deficit spending still won’t resolve the problem….only a new monetary and financial paradigm that intelligently, insightfully and specifically applied at the point of retail sale inverts the realities of chronic price inflation, systemic austerity and individual monetary scarcity into abundance and painless and beneficial price deflation.
P: Many a wag has noted grinning that correlation does not imply causality. Two points:
1. It is no accident that correlation is displacing multivariat analysi like ANOVA notwithstanding this.
2. Time has an arrow. Events in the future cannot affect (cause events) in the present.
Combing these, if there is a high cross correlation with time lag as a parameter, the leading factor pretty much has to be causing the lagging factor directly or indirectly.
Last I looked excel offers no cross correlation macro as a standard function. They should.
Me: As the person you often refer to here, Steve Keen, has shown…it’s a monetary economy not “a veil over barter”, and the three things DSGE doesn’t get right/ignores are money, debt and banks. It’s apparent to anyone who looks that the current paradigm for the creation of money and sole form for its distribution of Debt Only controlled and enforce by the private banks IS THE PRIMARY CAUSATIVE ECONOMIC PROBLEM.
As I have posited here before the mental problem inhibiting the full realization of this fact is that macro-economics is a new body of knowledge which consequently has a very short cultural horizon combined with the fact that the paradigm of Debt Only has not changed….since the beginning of human civilization and hence has become ingrained in human culture and thinking.
De-constructing and changing the paradigm of Debt Only via an analysis of the signatures of imminent and actual paradigm change, AND AN EXEGESIS OF THE OPERANT CONCEPT BEHIND EVERY HUMAN PARADIGM CHANGE, namely the natural philosophical concept of grace….is precisely what is required….NOW.
DT: Craig summing up: “Abstraction reigns in economics and direct present time observation has atrophied in same”.
What I’ve contributed is an abstract version of Blaug’s map showing Ken’s network. Craig is rightly pursuing an integrative wisdom, but his Blaugian imagery and seeing it in accountancy and “morals also known as ethics” shows why he hasn’t found it. He doesn’t understand it lies in learning to read abstract maps (Graph Theory) and taking in the implications of the abstract Four Colour Theorem (that only four colours are needed in a map for all adjacent areas to be of different colour). He doesn’t understand the difference between ‘generalisation’ (leaving arbitrary characteristics out) and ‘abstraction’ (leaving everything out).
As the process of wisdom is the INTEGRATION of truths etc. how can I be anything but advocating the integration of the abstract and the temporal? And if the natural philosophical concept of grace is the pinnacle integrative truth/concept of wisdom how can its aspects expressed in policy not be the object and goal of economics and undoubtedly every other of humanity’s systems?