The National Forum   Donate   Your Account   On Line Opinion   Forum   Blogs   Polling   About   
The Forum - On Line Opinion's article discussion area



Syndicate
RSS/XML


RSS 2.0

Main Articles General

Sign In      Register

The Forum > Article Comments > Fundamentals of capitalist economic life > Comments

Fundamentals of capitalist economic life : Comments

By Peter Gilchrist, published 10/12/2008

Now is a good time to examine the corpse of the unregulated market.

  1. Pages:
  2. 1
  3. 2
  4. 3
  5. 4
  6. 5
  7. 6
  8. Page 7
  9. All
(cont.)

(Mil_observer's last post assumes that the price of money in private transactions has got nothing to do with government's manipulation of price of money it supplies to the market.)

First, obviously perfection is not an option for human beings. Theory puts the cart before the horse when it gives policy prescriptions intended to approach perfection, before it has done its primary job of explaining the facts in the real world.

Secondly this state of perfection in theory - perfect knowledge, perfect competition etc - is a state of equilibrium. In this state the market is at rest: no-one can get an advantage by making an exchange. But the task of economic theory is to explain human action in the real world, not to prescribe the conditions of inaction in a hypothetical perfect stasis.

Thirdly, the original problem is in optimising economic activity. It is not permissible to simply presume that people acting as governments, more closely approach a perfection that people acting as markets do not. Government is also made up of human beings with all the same imperfections and motivations as people generally. But if the assumption were true, there would be no need for private action whatsoever: the entire task of economic activity could be optimally delegated to government.

Talk of ‘true’ value, ‘distortions’ of prices, ‘unequal’ power, ‘incomplete’ information, ‘irrational’ expectations: - these are not self-proving, self-evident. They presuppose propositions of economic theory which are themselves both
a) problematic in terms of epistemology, and
b) implicated in policies which led to the current economic crisis.

There is a need to strike to the root and the root is epistemology. The issues you raise cannot be resolved without first resolving the underlying epistemological issues.

But the mainstream economic theories: Keynesianism, neo-classical, monetarism, don’t even recognise the underlying issues.

They assume that what makes economics scientific is positive measurement. But the assumption is wrong, because human action is based on subjective valuations that cannot be measured so all their mathematical models and statistical aggregates are based on a fallacy.
Posted by Diocletian, Monday, 15 December 2008 2:41:36 PM
Find out more about this user Recommend this comment for deletion Return to top of page Return to Forum Main Page Copy comment URL to clipboard
Oh yes, brilliantly obfuscated Giles..."in terms of epistemology": absolute truth is unknowable, ultimately, therefore we can postulate our liberalist indoctrination and aloofness as woolly-headed, wishy-washy, indecisive and impractical creatures who, er, never have to work - or even think - for a living. How terribly refined and far-removed from the masses, proof of "leisured" status.

At least the flatulence becomes transparent after its initial smokescreen effect. Not just a waste of bandwidth, but a waste of school fees, and HECS too, probably! Or were the uni fees paid up front at a discount?
Posted by mil-observer, Monday, 15 December 2008 4:32:24 PM
Find out more about this user Recommend this comment for deletion Return to top of page Return to Forum Main Page Copy comment URL to clipboard
Diocletian et al
Hereunder is the barest outline of how I introduced epistemology in parallel with teaching orthodox economics. If you can get a copy of Economic Realism (Halstead Press), do so. It is more complete.

Underpinning epistemology is the notion that some statements are inherently logical (rationalism) and some reflect close observation (empiricism) but nothing is true just because someone said so (authoritarianism).

Orthodox economic teaching is not based on those foundations. Just ask yourself if supply and demand analysis is rational, empirical or authoritarian. (So called ‘economic rationalism’ is at best empiricism and at worst authoritarian!)

I support a conceptual framework for the subject that has three components: language, method and content.

Language
Students should become proficient with the appropriate use of: everyday language, technical terms, maths, diagrams, statistics and accounting concepts.

Method
The basic method of learning is to develop and consider propositions and the appropriate ways to test them. The basic tests are rationalism, empiricism and ethical prerogative.

Content
Content is a set of hierarchies of propositions in each topic. There is no reason why we should not each have our own personal sets as a basis for discusssion and for some cocsensus to emerge.

That would be better than the current interchange of slogans.

Peter Gilchrist
Posted by Wedgetail, Tuesday, 16 December 2008 8:53:23 AM
Find out more about this user Recommend this comment for deletion Return to top of page Return to Forum Main Page Copy comment URL to clipboard
Unless you want to see falsehoods passing as truths, and such lies thus unchallenged deceiving your audience, then you must deal with this thread's authoritarian lunacy around the "free trade" myth. Such mythology continues to appear in OLO threads where its adherents seem to enjoy its aura, as if the "free trade" badge confers some exalted status and privilege on the wearer.

The "free trade" (or laissez faire) cult is an influential remnant of a profoundly corrupt mythology as sponsored most energetically by the British East India Company (BEIC), especially via its Haileybury School. After the Venetian-sponsored ideologue Francois Quesnay, Adam Smith propagated "free trade" in direct support of BEIC ventures - specifically those in the trading of human slaves. The essentially mystical quality of Smith's musings is most obvious in his "invisible hand" notion, but cultists regard that cliche too with equally uncritical awe, reverence, or fetishization, just as the BEIC valued such a "cloak of invisibility" for its own criminal and immoral conduct. In this sense, other BEIC ventures were no less relevant and no less disgusting i.e., opium dealing and the commercial resort to large-scale plunder, extortion and terrorism via the BEIC's private mercenary armies.

Therefore, whenever someone mentions the likes of Adam Smith, David Ricardo or Thomas Malthus, remember the imperialist-commercial, racist and even misanthropic origins and purpose of their lives, and the life of the entity that created their Haileybury School - the vile East India Company, an entity that still has its many admirers, propagandists and emulators today.
Posted by mil-observer, Wednesday, 17 December 2008 1:17:01 PM
Find out more about this user Recommend this comment for deletion Return to top of page Return to Forum Main Page Copy comment URL to clipboard
  1. Pages:
  2. 1
  3. 2
  4. 3
  5. 4
  6. 5
  7. 6
  8. Page 7
  9. All

About Us :: Search :: Discuss :: Feedback :: Legals :: Privacy