It's About Investment, Dammit!

It's About Investment, Dammit!

. .

Reason Four

Why Today's Balanced Budget Discussions Are Ridiculous

..

By Bob Komives

but first

let me give you Reason 4a. 

Or, I should say, let Paul Krugman give you Reason 4a. He points to facts that march boldly but unrecognized through the daily news. They show why austerity-now does not work, and worse, causes countries to fail. In other words, my words, why today's balanced budget discussions with their emphasis on not-spending rather than investment are at best ridiculous and and at worst devastatingly harmful.

Here's Krugman (March 24, 2011) and (April 1, 2011).

-----------------------------------------------------------------------------------------------------------------
now my somewhat poetic approach


Partners in Economic Development

Where is the evidence
          that scarcity models work?
Where is the evidence     

          that doing the right thing costs too much

          that doing the wrong thing is affordable

          that nations who follow these models become rich?

Wealth is our preoccupation

          --not our invention.

We do not create economic development

          --we are its partner.

Economic development is an organized invasion

          --life invades the universe.

Let us strive to be knowledgeable partner

          --practice stewardship and equity

          --learn

          --share what we learn

          --organize ourselves to foster the biosphere.

Yes,
we must know that wealth can disappear

          --species, ecosystems, languages and cultures become extinct.
We must guard against the disappearance of life itself

          --for only in life does this sphere know to be wealthy.
Prevent the destruction of our species

          --for we can learn as we survive our poor judgment.
Stop exploiting one another

          --together we partake of more wealth more quickly.
Guard against the natural and man-brought disaster

          --that destroys knowledge

          --leaving machines that no one can use

          --books no one can read

          --science no one can remember.

Yes,
we must know that within abundance there is scarcity,
yet within simplistic, dogmatic models of scarcity lie falsehoods.
Within these falsehoods lie too many lessons in fiscal irresponsibility:

          Do not provide for the welfare of the many

          --because resources for the few are scarce.

          Do not clean and protect scarce resources

          --because, well, our resources are scarce.

Yes,
we must know that between the cataclysms

          (brought by meteor, plate, and super volcano)

          life prospers

          abundance patiently overwhelms scarcities

          abundant biosphere enables civilization.
Within biosphere and civilization lie truths.
Within these truths lie our lessons in fiscal responsibility:

          Well-being requires investment.
          Good investment nourishes and improves life.
          Poor investment risks disaster.

There is no evidence

          that doing the right thing costs too much,

          that doing the wrong thing is affordable?

Evident, indeed, is knowledge of abundance
embedded by life into biosphere and civilization.


As better we know this
as better we become

          partners in economic development.

-----------------------(c) 2011 Bob Komives-----------------------------

co-posted on Komivesian Poetics

Capture Broadly

Capture Broadly

Bob Komives

::

Headnote: Solidarity is but

 conscious expression

of inter-dependence

for inter-prosperity.

Capture broadly--
   as leaf captures sun,
      mill captures wind,
         and gatherer gathers grain.
Distribute deeply--
   as leaf sends oxygen,
      mill delivers flour,
         and parent feeds child
            that teacher educates.
Recirculate densely--
   as we bake for our miller,
      who rewards our harvester,
         who buries our excess
               to reward the roots
                  who will feed new leaves.
                     to nourish grains of life.
 

Footnote: Community is but

 subconscious expression

of inter-dependence

for inter-prosperity.

Bob Komives :: Fort Collins © 2007 :: Capture Broadly ::0703
-------------------------------------------
co-posted on Komivesian Poetics

3. Plum Local

Plum Local
Bob Komives
  ::

I had my first course in economics in college. I forgot most of it, except for the fascinating way that banks create money as they lend out most of the money that we deposit with them, then receive most of it back again in new deposits, and then lend most of this magically expanding cash out again, and on, and on. We see that bad banks fail, and we know that even good banks make bad loans.

Why only blame
—if our banks create money—
why only blame our government for inflation?

||

I turned my studies to art and architecture. Along the way I discovered a maverick named R. Buckminster Fuller. He stood among other heroes such as Louis Sullivan and Frank Lloyd Wright in describing the unity of design and nature.

Can projects designed
following principles of our biosphere
ever be too ugly,
ever be too expensive?

||

I got married, and we went to the Peace Corps near the Pacific Coast in Guatemala. I saw discrepancy between strategies for national economic development and realities of community development.

I had to ask
" Does it make sense
—for our poverty, our sickness, our exploitation—
that our cure
cannot come
with our economic development,
but only after?"

||

We moved to Little Rock Arkansas where I tried my hand at city planning in the Model Cities program. This was 1969, a time of large investment in troubled cities. Our successes were real but modest.

Is it not strange?
Even during prosperous times
since our era of generosity,
they say,
we cannot afford to budget for success.

Since Our Era Of Generosity

I went back to school to get my professional planning degree. There I discovered economics, learning its many applications to local public policy. It was elegant; it was beautiful. The curves conveyed information to me in ways that no other medium ever had.

One weekend, I took a rest from my studies and read a book by R. Buckminster Fuller. I believe it was Operating Manual for Spaceship Earth. There, I encountered for the first time his elegant formulation of the fundamental law of economics:

Wealth is a function of energy and knowledge.

Absent was any mention of scarcity, supply, demand. This was the economics of abundance. Fuller's economics made every bit as much sense to me as the crisp logic of market economics.

Humankind developed
laws,
traditions,
and institutions
to deal with scarcity.
At any point
in time and space,
scarcity is specific.
It is real.

We live scarcity,
but we come to live
and to thrive
through abundance.

Please do not misunderstand me.
I believe in scarcity.
I have lived it and seen
both its pains
and its benefits.

Yet, abundance is as real as is scarcity
and is even more fundamental.

Without scarcity,
the economist cannot draw
supply curves
and demand curves.
But these curves cannot anticipate
mathematics,
art,
democracy,
communities,
back rubs,
interplanetary exploration,
civil rights,
the popsicle,
or the yo-yo.
Nor could they have anticipated
the brown trout,
the monarch butterfly,
or the horned toad.
Each is part of our biosphere.
Each is our wealth.
And wealth must be the stuff of economics.

Today,
if we choose to love our wealth and our biosphere
we seem unable to seek the best for one
without harming the other.
Today, also,
sages preach to us of the evils in our economy.
They tell us to be more moral,
to separate pretension from wealth.
Let us heed such sermons.

Yet, the moral sage does not free us
from the choice between two loves.
Neither sage nor economist can free us
unless we know
how wealth and biosphere are one—
how we live scarcity,
but come to live
and to thrive
through abundance.

We Come to Live and Thrive

I lay sandwiched between a straightforward explanation of supply-demand-utility and Fuller's statement that wealth is a function of knowledge and energy. I found myself in that muddled layer of confusion and witchcraft called macroeconomics —including gold flow, balance of payments, balance of trade, inflation, and the like. The economy uses the biosphere's model of abundance, while conventional economics uses a model of scarcity. Beneath scarcity lies a supportive abundance —a macro-abundance. Beneath microeconomics, which specializes in scarcity, should lie a supportive macroeconomics specializing in abundance.

Microeconomics covers those situations in which flow of wealth mimics a traditional marketplace. People buy; they sell; they trade. The demand for a product in relation to its supply sets the price. Economists do not. Buyers and sellers do so, acting upon their needs and desires. One day, two chickens are worth two yards of cloth. The next day, they may be worth three yards in the morning but only one after lunch. Marketplace economics explains well the dynamics in this true marketplace and in myriad public and private markets in which goods and services are bought and sold. It can explain how the price for cloth changes as well as how the weaver decides how much to produce. It cannot, however, go on to explain how cloth came into existence nor how chickens were domesticated.

From graduate school I launched my planning career. I went to the island of Martha's Vineyard where I worked for five years to protect its resources and foster sensitive development. I moved as a consultant to Colorado, worked for a while in the analysis of socioeconomic impact from energy development. I went on to typical land-use planning. The gulf between my professional work and my struggle with the theories of economics seemed unnecessary, but enormous.

The economics of abundance remained a closet hobby until 1980 when I pulled together some of my notes in a hand-printed, ten-page document called Plum Local. It began with my apology: "Pardon my boldness ." I wrote, "The valid world economics will show the tie between genetic and economic evolution," and "Taxes, Bah!! Let's phase them out Let's balance our budget by investing communally (politically) in the growth of knowledge for mankind." I sent one copy to R. Buckminster Fuller. When I received his encouraging one-sentence response I felt some comfort.

The four-page 2nd Plum Local of 1981 took my ideas further: "Taxation is role playing. Monetary return as we have in the national income tax system has no role to play. If there is a utopia it will be found in a humanistic management of instability."

Now, as then, I find it hard to put forth theories of economics that disagree with the teachings and preachings of intelligent people who are economists by profession. However, I would find it harder not to share ideas that help me find some sense and science among a potpourri of confusing theories and popular maxims.

:: Bob Komives, Fort Collins © 2006 :: Plum Local IV :: 3. Plum Local ::
With attribution these words may be freely shared, but permission
is required if quoted in an item for sale or rent

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9. Ignorance and Economic Development

Ignorance and Economic Development
Bob Komives
::

Despite our ignorance,
we are fair instruments of economic development,
while often not fair to the biosphere which gave us life.
Remove more of our ignorance
and we may become consistent economic developers.

||

I see economists shackled to a model of the world based on scarcity —making it difficult for them to approach the plentiful world of economic development. The last time I checked in detail, this was quite evident in text books. For example, Paul A. Samuelson and William D. Nordhaus, in the twelfth edition of Economics, devoted section seven (of seven) to economic growth and international trade, chapter 36 (of 40) to the theory and evidence of economic growth, and only 3.5 pages out of about 900 to "The Sources of Economic Growth." In these pages, they described growth accounting as an attempt to measure the ingredients that contributed to past growth trends —for example, capital, labor, land, education, and technological advancement. They stated frankly that no theory seems to fit reality very well. As for growth accounting, they wrote that it is far from perfect, but it is about as good a guide as any in this imperfect world. I felt that to be a discouraging conclusion to find on page 799 of an introduction to economics.

More encouraging were theories relegated to the appendix. There I found Joseph Schumpeter's model emphasizing innovation, Harrod & Domar's emphasizing productivity, and Von Neumann's emphasizing a logical tie between the growth rate and the interest rate. These models apparently got relegated to the appendix because there is no unifying theory. Samuelson and Nordhaus expressed hope for a future synthesis that will integrate the neoclassical analysis of economic growth with some 300 pages of macroeconomic problems found earlier in their book.

Can economics be a mature science if its theories of economic growth do not mesh with what economists call macroeconomics? Other authors of other texts may organize things differently; I doubt that they improve much on the clarity and honesty of Samuelson and Nordhaus. The problem lies in economics, not Economics.

:: Bob Komives, Fort Collins © 2006 :: Plum Local IV :: 9. Ignorance and Economic Development ::
With attribution these words may be freely shared, but permission
is required if quoted in an item for sale or rent

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10. Buckminster Fuller's Elegant Law

Buckminster Fuller's Elegant Law
Bob Komives
::

Growth studies are integral to physiology. Construction is integral to architecture. Economic development should be integral to economics. Yet, economic developers and economists share little common ground. At least one economist, Paul Romer, works to change that by convincing other economists that knowledge and technology are part of economic growth. This seems obvious to a person on the street but revolutionary to most macroeconomists.

Depending on where I run into it, economic development still seems to be more in the kit bag of real estate developers, promoters, and financiers, as well as thought provoking generalists. Confusion among economists makes me no more comfortable with the developers and promoters who play on a simpler stage:

" I create jobs.
You want jobs.
Jobs make community rich.
Give me break.
I will make money.
Then, I will make you
a nice, rich community."

||

Pending some coherent understanding of economic development such a monologue plays well to many audiences.

I find more comfort with the generalist synthesizers who try to comprehend the complex world and take us along for the trial. They look beyond their narrow window on the universe to an ever-expansive view. This is not frivolous pursuit leading to nowhere. Some, such as da Vinci and Einstein left obvious legacies. Others do no less than help us think, create, and pursue our own synthesis. They are skilled people who are generalists and designers.

Generalists:
see pattern
where others see spots,
see hypothesis
where others struggle to see the experiment.
Designers:
see opportunities
where others see problems.

||

One generalist designer got me onto this economic tangent. R. Buckminster Fuller formulated the fundamental law of macroeconomics. Wealth is a function of the knowledge and the energy in the universe.

wealth = function of (knowledge & energy)

The amount of energy in the universe is constant. The amount of that energy that we can call wealth, however, is not constant. It varies as the biosphere grows and changes. According to Fuller's Law, then, knowledge is the only component of wealth that can cause wealth to grow or shrink. This makes sense if we adopt a broad concept of knowledge.

We know something about
food, clothing, shelter,
art, and human rights.
They know some things about us.
Each and all is wealth.
Food is energy
made palatable.
Clothing and shelter are energy
reformed into protection and image.
Art controls and molds energy
to please our senses.
Human rights let us control our own energy
(including our own bodies).
Lacking such energy,
and the knowledge to use it,
we are poor.

||

Buckminster Fuller's formulation for wealth lead him to make a simple prescription for economic development: Increase knowledge! Since the quantity of energy in the universe is fixed, we create wealth only by increasing knowledge. More important, when we increase our knowledge we cannot fail to increase our wealth.

My own formulation is incidentally different, but it leads to the same conclusions:

wealth = knowledge

On this alone I would like to rest my case. What else I have to say is not so clean and simple. I too need more designer synthesis. However, I believe I can argue well that economic development is inseparable from economics. I can lay down some of the bases for a conscious economic development strategy that equates with a sane use of the biosphere and discards the popular conception of a balanced national budget. The knowledge we need is within us, around us, and ahead of us.

:: Bob Komives, Fort Collins © 2006 :: Plum Local IV :: 10. Buckminster Fuller's Elegant Law ::
With attribution these words may be freely shared, but permission
is required if quoted in an item for sale or rent

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14. Biosphere: A First-Class Wealth Organization

Biosphere: A First-Class Wealth Organization
Bob Komives
::

In setting forth his Critical Path for humankind R. Buckminster Fuller made a distinction between class-one and class-two evolution. Class-two evolution assumes humankind runs the universe. It includes the events that seem to us to come from human initiative and control. We like class-two evolution.

I planted a seed

here somewhere, where
today there should be
(by my rights)
a seedling-

here on time, when
the packet guaranteed
(to my sight)
a sprouting-

if not now, then
it had better be
(as I hope)
by morning-

here somewhere, where
it might have been seen
tomorrow
(by evening).

Seeds And Rights

Class-one evolution transcends our vision, and (as one finds out waiting for seeds to grow) it often voids our class-two-right to have things happen as we told ourselves they should. Class-one evolution came first and will leave last. It put humankind on Earth. It is typified by "ephemeralization," by which we do more and more with less and less, and by "acceleration," by which the time between changes gets less and less.

The biosphere and humankind continually organize and reorganize. Life grew in complexity and robustness by organizing itself. Simple forms of life organized themselves into cells. Some cells organized their reproduction so that instead of creating totally new and independent creatures they created specialized organs within a multiple cell creature. The invention of organs exemplifies ephemeralization, because cells working in a multi-cell and multi-organ individual can often do more with available resources than can the same number of single-celled creatures.

Since we need old fashioned cell-into-cell reproduction to make and sustain our organs, we multi-celled creatures need some enhancement to reproduce our entire organized selves. Class-one evolution gave some of us sex. Sex became an unwitting accelerator of evolution as we mix and re-mix the gene pool (inclined as we are to attract strange mates). New species and communities of species could now evolve faster. Evolution is subject to its own class-one evolution. It accelerates as the gene pool diversifies.

I wish to emphasize the obvious; the word, organization, comes from the root-word, organ. We say that people get organized (into committees and such) while their bodies have organs (heart, lung, foot, skin). It sounds fine to say that the human body is organized, and it sounds only a little strange to say that the police department is an organ of the city government. At the edges of evolution, then, organs and organizations form. Through class-one organization the biosphere develops, reproduces, modifies, and discards patterned interactions.

Class-one organization,
first-class organization,
is biospheric economic development.
Unwittingly,
we participate.
Wittingly,
but ignorantly,
our second class efforts
often retard or threaten our wealth,
our biosphere's wealth.
Our species is organ to the biosphere.
We are organs to our species.
Looking inward,
we see our organs
as their cells and genes organize them.
Looking outward,
we see ourselves
as parts in several organizations:
. family,
. neighborhood,
. team,
. school,
. country,
. ecosystem,
. bioregion,
. species,
. biosphere.
Organs work neither perfectly nor forever.
(Such is the trial-and-error of evolution.)
Organized, imperfect, timed interaction
among species,
between species and their environment;
call it ecosystem.
Around the planet
call it biosphere.
Across space,
someday call it bio-universe.

Biosphere sustains life and culture,
changes as inanimate environment changes,
changes as life alters itself.
Energy captured by biosphere,
organized into life,
organized to support life,
reorganized by life,
this energy is biospheric knowledge.
Biosphere knows
to preserve,
create,
re-create,
to continue a habit of change.
Without such knowing,
life
into lifeless ignorance,

will end.

||

:: Bob Komives, Fort Collins © 2006 :: Plum Local IV :: 14. Biosphere: A First Class Wealth Organization ::
With attribution these words may be freely shared, but permission
is required if quoted in an item for sale or rent

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15. Capture, Distribute, And Recirculate Wealth

Capture, Distribute, and Recirculate Wealth
Bob Komives
::

I divide wealth development into three processes that interconnect in an evolving spiral. The three processes are: capture, distribution, and recirculation. The following diagrams help me see how wealth of biosphere and its parts can grow. Among the casualties of simplicity, I ignore backward steps such as death and disorganization.

I will describe these diagrams as starting at the origin of the biosphere, but, with simple changes in vocabulary, they could start today and look at one person, a tidal pond, a human community, an ant hill, a business, or a watershed. As the diagrams progress, more energy of the universe serves life, and life becomes more complex.












The number of creatures increased tenfold between diagrams 8 and 12. The amount of energy in the biosphere increased more than tenfold because energy captured from the universe gets distributed and recirculated before leaving the biosphere at a rate somewhat slower than it enters.

:: Bob Komives, Fort Collins © 2006 :: Plum Local IV :: 14. Capture, Distribute And Recirculate Wealth ::
With attribution these words may be freely shared, but permission
is required if quoted in an item for sale or rent

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18. Exploitation's Deceitful Attraction

Exploitation's Deceitful Attraction
Bob Komives
::

We know from experience that, despite all the good it does for us, at times Adam Smith's "invisible hand" needs to be slapped. We rise again and again in fits of moral outrage to knock down those who sacrifice common good to disparity—promote our loss for their gain. Do we do so often enough? We discuss that question frequently. Here is another question that we should discuss: do such struggles and knock downs pit morality against economics? To this second question I answer, no. Morality need not fight economics unless you equate economics with pursuit of personal gain. You should not. I do see these struggles as contests between good and bad; but between (good) morality and bad economics, between common good and bad science. Great disparity is a great clot in the arteries of development.

Great disparity between us,
great impediment among us.
Moral justice asserts
that our wealthy must distribute wealth
onward to our poor.
Economic development just begs
that wealthy just act
knowing their dependence upon the poor
—and upon more.
More wealth distributed
brings back more wealth recirculated;
today distributed,
tomorrow shared.
In abstract we speak
of wealthy and poor.
In concrete we speak
of butcher, baker, banker,
slave, master,
pitcher, raker, candlestick maker.
We distribute,
recirculate,
compete,
cooperate,
evolve,
to survive
to prosper
together.

||

Consider the economics of exploitation. Take an extreme example; consider the economics of
slavery. As species, as group, our wealth grows biologically with each birth; it decreases with each death—usually. Simply having more people may decrease our group wealth. Our increased population may overwhelm brain knowledge and artifactual knowledge that we use to harness resources. While this negative outcome may not be as likely as doomsayers often say, more people do not by their presence alone make the individuals in their group more wealthy. Yet, mistaken actions by fellow humans seem to stem from a belief that greater population brings wealth—if it is more of the right kind of population, the kind that makes us rich. When powerful individuals and groups enslave other people they increase the population that works at their service. A slaveholder feels wealthier holding more slaves.

We can exploit others in ways more subtle than slavery, but in all ways exploiters believe (if they are honest with themselves) that they become wealthier if they subjugate more people. Usually they do not try to increase overall population, just their controlled population. Unfortunately, history shows that from their narrow and short-sighted viewpoints they are usually right. Since we see our world having static resources, we find it selfishly attractive to exploit the minds and bodies of our brothers and sisters. These harnessed minds and bodies know how to gather wealth for us.
 
From the broad viewpoint of humankind exploitation is not attractive. It reduces opportunities for the exploited. That reduction inhibits the growth of brain knowledge and artifactual knowledge for our species, reducing species wealth and average per-person wealth. To the exploited it is painfully obvious that they suffer the burden of their exploiters. 

Unfortunately, exploiters are painfully ignorant that they suffer under the burden of their exploitation. This becomes tragically obvious when a lethal microbe flourishes in the impoverished ecology of the exploited and surges forth to kill exploited and exploiter alike. Yet the lesson is not learned. Here, economics has, first, much to learn and, second, much to teach.

Exploiter dreads that exploited would self-organize.
Old culture that slave might keep,
and new culture that slave might create,
destroyed, discouraged, undone.
Exploiter simplifies—
in
simple
organization
finds
control.
Biosphere complicates—
for in our complexity, it finds resilience;
for in its resilience, we find wealth.

||

:: Bob Komives, Fort Collins © 2006 :: Plum Local IV :: 18. Exploitation's Deceitful Attraction ::
With attribution these words may be freely shared, but permission
is required if quoted in an item for sale or rent

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31. Marketplace or Socialism: a Dynamic Choice

Marketplace or Socialism: a Dynamic Choice
Bob Komives
::

If a good or service is to be traded in a marketplace, its supply must be limited. The good or service must be identifiable. It must be unique or divisible so that buyer and seller believe they know exactly what they are transferring. We cannot trade most wealth in a marketplace because we cannot easily identify or divide it, or because it is too abundant. Neither the oxygen produced by the world's flora nor the bile working in our livers is apt wealth for trading under most circumstances.

Some wealth that we can identify and divide does not make it into our marketplaces simply because our communal tradition says it does not belong there. We do find wood-burning heating stoves and firewood in the marketplace. A well-designed stove is a storehouse of functional and aesthetic knowledge. We can buy it and its fuel. Yet, we tend to give away the heat they produce.

My stove knows how to burn its firewood,
how to respond
to me who knows so little of what it knows,
to me who does not know how to make a stove.
My stove knows how to send smoke up its chimney
and warmth into my room.
Its warmth can please,
or it can save a half-frozen life.
Such is its success and popularity
that I could sell tickets to my stove's proximity.
But, I do not.
I share its warm knowledge freely
according to communal tradition
among family, neighbors, and kindred strangers.
Those whom my stove knows to please,
those whom my stove knows to save
give back nothing in trade
-except,
to carry forward in common tradition
what we and a stove
must in-common know.

My Common Stove

No scientific standard tells us which identifiable goods and services should be owned and traded in the marketplace. During the Civil War in the United States of America many young men bought up their obligation to serve in the army. Government had made this military obligation a commodity, making such purchases perfectly legal. During later wars many people found legal ways to avoid military service and combat, but it became illegal and immoral to try to buy one's way out. Military service had become a duty; it was no longer a commodity.

Voting is a right in some countries, a duty in others. Individuals possess this right or duty. They could sell it, but law and tradition say we can neither sell nor buy a vote. Law and tradition try to keep votes out of the marketplace.

Law and tradition make businessmen criminals and criminals businessmen. Traders in alcohol went through these metamorphoses when U.S. America entered and later left Prohibition -when alcohol sales were made illegal and then again legal.

Necessity and changing styles can move goods and services into and out of the marketplace. A corporation chooses a new combination of socialism and marketplace when it discontinues the internal manufacturing of certain components in favor of buying them in the marketplace from independent suppliers. At one time, perhaps, there was a real advantage to socializing the production within the corporation. Back in the late-twentieth century, when automobile makers Chrysler, General Motors, and Ford recognized some of the hints that they had become uncompetitive because of their aging technology and stodgy managers, they transferred some design and production from their center economies to their edge economies. There they hope to take advantage of the technological and price competitiveness of independent suppliers in a dynamic marketplace.

A family faces similar dynamic choices. After rearing children under loving socialism many parents request economic support from adult children who work for outside income but stay at home. While this is not a pure marketplace transaction, food and shelter, once distributed to the child under central traditions, now get distributed under a family-socialized form of edge economics. The change recognizes new conditions which call for a new economic mix. The added income helps the parents care for the younger children or enjoy a little luxury. The working child learns the pride and responsibility of adulthood, gaining some independence from his parents. It is as if the edges of a new household (like a new cell) begin to form before it separates from the old. If the adult child becomes sick and unable to work, however, his family will reverse itself without hesitation. "Don't pay room and board now. We are your family; we want to help you recover." They return to pure socialism.

The marketplace always has and always will be adjusted by communal decisions, especially when the public finds a market to be distorted from what is just or sensible. If modified law and tradition do not correct such distortions, correction may come from war, or revolution, or massive government spending. During the depression of the 1930s the marketplace behaved as if there were little wealth to invest. Nevertheless, under the New Deal of President Franklin D. Roosevelt the Congress of the United States of America made massive communal investments to fight poverty, and then even greater expenditures to fight World War II.

While choices are dynamic, our leaders often choose to be dogmatic. From a great war and a great depression much of the world (winners and losers) emerged wealthier than before. Perhaps, if our politicians were less dogmatic and our economists more instructive about government's communal intervention in the marketplace, we could avoid great depression and great war.

:: Bob Komives, Fort Collins © 2006 :: Plum Local IV :: 31. Marketplace or Socialism: a Dynamic Choice ::
With attribution these words may be freely shared, but permission
is required if quoted in an item for sale or rent

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35. To Suggest a Framework

To Suggest a Framework
Bob Komives
::

What I have worked
is just forgotten.
What I have wrought
is but forgot.

Ought To The Participle

I end Part I suggesting that we might re-subdivide the science of economics. In the first Plum Local, I saw a need for a new name to cover an expanded economics -perhaps, "biosphere economics" or "world economics." Change in name, however, is less important than change in substance. The substantial changes I describe rely on distinctions between abundance and scarcity, between centers and edges. Here, I propose a framework to accommodate these distinctions. I propose to unite similar areas of study within economics and to help economics connect itself with the rest of science through a redefined macroeconomics.

Macroeconomics covers the broad scope of economics, its important connections with the rest of science, and the interrelationships among the centers and edges of microeconomics. It describes the work by nature and humankind that creates wealth. It describes the general rules of abundance and economic development. Some traditional macro and microeconomics belongs here, as does economic history. For the most part it is a new economic umbrella synthesized from other parts of science.

Microeconomics describes the work of wealth distribution and maintenance. It describes the special rules of scarcity. Microeconomics can be divided into two parts:

• Central Economics covers socialism, law, tradition, treaty, peaceful cooperation, money, stock issues, internal borrowing, corruption, and like subjects. Most of traditional macroeconomics belongs here, together with studies that have not traditionally fallen under economics.

• Edge Economics covers marketplace, trade, war, peaceful isolation, external borrowing, thievery, and like subjects. Most of traditional microeconomics belongs here, together with work from other social sciences.

War and marketplace are moral near-opposites. However, both belong under edge economics because they try to bring wealth across the friction of the edge between groups. A treaty does the same, however a treaty usually belongs under central economics because it can form the core of a new group. It is the center of a higher level communal system.

Corruption and thievery are moral kin. But corruption is central while thievery is edge. In corruption, a small group at the center of a larger group finds its communal way to subvert the larger communal wealth ethic. In thievery, an individual or group imports wealth snatched from others.

Socialism and marketplace fall in different divisions of microeconomics, not because they are rivals, but because they solve different problems in the way hub and rim of a bicycle wheel solve different problems.

I prefer this framework, but I believe that names and frameworks can be both problem and solution. I seek a framework that works better, but we should avoid excess concentration on the classification of fields of study. After all, subdivisions are artificial; there is only one science. We need only make sure that economics be an integral part.

I trim my beard;
you notice my hair.
You cut your hair;
I ask, "since when the beard?"
On sight of a dirty bath,
together we throw out the baby.
My,
what able eyes for change
and lame brains for attribution
have you and I, sir,
and Little Red Ridinghood.

You and I, Sir

:: Bob Komives, Fort Collins © 2006 :: Plum Local IV :: 35. To Suggest a Framework ::
With attribution these words may be freely shared, but permission
is required if quoted in an item for sale or rent

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