' Both you and Foyle are displaying a creationist superstitious belief that is merely circular.'

Actually Jardine he is arguing like a bigoted evolutionist who can not possibly back their faith with reason. You really are a bit mixed up.

Aidan

Inflation rates, of themselves, are not a criterion. They can vary from 0% to thousands of percent.

What we need is something that will tell us whether the particular intervention is justified or not.

You seem to be having trouble understanding the very idea of providing a reason, that does not consider of begging the question, or appeal to the authority of someone else which is just begging the question at one more remove.

Runner
I suggest you read Origin of Species, and The Selfish Gene.

*After* you have understood the arguments and can correctly represent them, feel free to start a thread telling us how you say you disprove them. Note: the book of Genesis is not a disproof.

' the book of Genesis is not a disproof'

Oh I see Jardine observing creation requiring a Creator, design demanding a Designer, laws requiring a Lawmaker I would of thought is far more rational than the idiotic big bang theory and the evolutionist ever changing fairy tales. Instead of requiring me to prove a rational faith you should really be able to explain your totally irrational faith. No doubt you will continue to be vague quoting such a fairytale as the origin of species. Really a document that any true scientist should be totally embarrassed by.

Jardine,

Inflation rates certainly are a criterion, just as (to use your previous example) price is a criterion when buying a car. Now be honest here: everything has a temperature, so do you think temperature can't be an objective criterion when deciding what to wear?

Not all criteria are boolean. Even making boolean criteria by setting cutoff values can be inappropriate when balancing competing objectives. But I did mention that the RBA's cutoff values of 2 and 3 percent was usually adequate, and what the exceptions were. If you want me to derive those rates from theoretical principles, forget it; I can't and AFAIK nor can anyone else. I deem them appropriate based on the observation that the inflation targetting policy has been a success, keeping inflation low and Australia's economy growing for the last quarter century. But if you think we should ditch it in favour of a different objective, I'm willing to discuss it.

What power is it that you think there's a possibility, which I refuse to consider, of the government not having?

Regarding the economic calculation problem, are you saying it ISN'T the problem of how to allocate resources to production? If so, what would you say it is? I don't want to waste time on speculation at cross purposes.

Aidan

"If you want me to derive those rates from theoretical principles, forget it; I can't and AFAIK nor can anyone else."

Thank you for conceding what is in issue between us in this thread, and admitting that there is no justification for government intervention in the supply of money or credit, apart from mere arbitrary opinion which varies from person to person, and from time to time, and which therefore has no more basis in economics than any true or untrue statement about anything.

Temperature, inflation or interest rates, *of themselves*, do not provide a criterion of action. The existence of temperature *itself* does not tell you whether you should take your jacket off. It is when temperature reaches a certain value or range, that you decide to take it off. However this example concerns only one individual subjective value.

The same does not apply to the gumment’s manipulation of the supply of money or credit, both the benefits and costs of which are dispersed throughout, and knowable only through, the subjective evaluations of zillions of people.

Citing the State’s inflation target only begs the question whether and how they know whether the State intervention in question is too much, too little, or just right. You have provided no objective way of demonstrating the competence of the intervention vis-à-vis the relevant values of the populace, and admit you don’t know, thus proving my point.

“Regarding the economic calculation problem, are you saying it ISN'T the problem of how to allocate resources to production?”

Yes, not exactly. The problem of how to allocate resources to production also inheres in a barter economy, and also where man acts in isolation. But the economic calculation problem concerns the use of money to calculate how best to allocate resources to production in terms of prices.

Therefore you have not been able to correctly represent the economic calculation problem, and therefore we are entitled to the conclusion that you do not understand it and are therefore not qualified to make your argument about monetary policy.

Jardine,

I dd not concede what's in issue between us. The fact that you thought I did highlights a serious defect in your reasoning, which I think you need to address before you continue, otherwise it makes you look incredibly stupid.

Just because we don't have a definitive formula for calculating the optimal value doesn't mean we can't say with certainty that a certain value ISN'T optimal. For instance, we don't need to know what the optimal tax rate is to know that the rates of zero and 100% are not optimal. Similarly with the money supply, we can tell from its effects that the do nothing option is inferior. It's worth noting that "do nothing" could be interpreted in more than one way: it could involve keeping interest rates constant (which would lead to much bigger booms and busts); or refusing to lend money at all (which would result in almost permanent depression). Both options are much worse than the status quo.

You criticise me for your own failure to comprehend exactly what "criterion" means! It's the standard by which things are judged, not necessarily the value they have to meet.

Worse still, because of some minor discrepancy between our understandings of what the economic calculation problem applies to, you unilaterally conclude me to not understand it, and therefore make the huge non sequiter of declaring me to be not qualified to make my argument about monetary policy – even though my argument neither relies on nor contradicts the economic calculation problem's implications!

Well, two can play at that game! When you have understood, and can correctly represent, sectoral balances, you will be intellectual qualified to express an opinion on this topic, and not before. Until then, you simply don't understand what you're talking about. For sectoral balances are far more relevant to fiscal policy than the economic calculation problem has ever been or will ever be.