It's Stupid, Economics...

Protest, London 1930 - filched from the New Statesman article referenced here

This week's New Statesman carries a good piece by Paul Mason titled: 'How to imagine the death of capitalism' which pretty much encapsulates the bulk of my feelings and ideas about the future of economies; opinions that I've long held.

The current crisis has put macroeconomics' shortcomings front and centre, as evidenced by a Tory government madly implementing essentially Socialist ideas to mediate the effects of having to voluntarily close down much of the free market in order to protect the health and welfare of the population from the one thing that no-one has control of: pandemic disease.

It's either odd or no surprise at all, depending on your viewpoint, that macroeconomic flow diagrams seem to omit public services. These are things that essentially are, or should be, net-users of cash and borrowing, and that don't quite fit the supply and demand equation except in a once-removed sense. We're now only too painfully aware of the effects of trying to run these services as businesses competing in a wholly confected marketplace.

The problems with economic theories are principally that:  a) they largely attempt to abstract in overly simple terms (but couched in obfuscatory language and equations) from the globally-large and wholly organic feedback-loops that are real economies and that b) those theories are then re-imposed on those economies and the populations and transactions that are intrinsic to those systems, as 'rules'. A eugenic approach to money, markets and people's livelihoods.

Simplistic and rigid in approach, economic theory needs only to cast a glance in the direction of meteorology for a sober reflection on just how complex, real systems can confound our collective intellect and undermine our will to impose ourselves on the world. A modicum of humility in the face of something so much bigger than we are would be in order, as would a measure of relinquishment of power and privilege on behalf of those that have sought to usurp theory and politics for personal gain and aggrandisement.

The current crop of populist neo-liberals that are holding us to ransom would do well to mark that their wealth and prosperity is by no means guaranteed, either; a fact I think not lost on some of them, judging by the look of panic in their eyes now faced with the sudden implosion of their certitude of world-view. Privilege allows only so many places to hide both oneself and one's money, and if the latter becomes worthless, which it essentially has been since the removal of any base standard by which to measure it, having only whatever value is agreed under the general terms and conditions of those rules and theories of economics; those essentially arbitrary rules and theories; you will soon run out of options. A super-yacht needs a lot of it [cash] to fuel and crew and it can only carry a finite quantity of supplies; it must inevitably find port and face reality.

As Mason proposes in the title and substance of his essay, it is essentially a new way of thinking about how we do things as a people - our human race - that is needed to rescue us from the inevitable: the self-imposed and utterly selfish demise that surely awaits us if we continue on our present path.

Economics is not a science. It is politics disguised as science. To overlook that fact is folly.