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Archive for the ‘Economics’ Category

It really boils down to a bit of magical thinking.

I am sitting under tall trees, with a great wind boiling like surf about the tops of them, so that their living load of leaves rocks and roars in something that is at once exultation and agony. I feel, in fact, as if I were actually sitting at the bottom of the sea among mere anchors and ropes, while over my head and over the green twilight of water sounded the everlasting rush of waves and the toil and crash and shipwreck of tremendous ships. The wind tugs at the trees as if it might pluck them root and all out of the earth like tufts of grass. Or, to try another despearate figure of speech for this unspeakable energy, the trees are straining and tearing and lashing as if they were a tribe of dragons each tied by the tail.

As I look at these top-heavy giants tortured by an invisible and violent witchcraft, a phrase comes back into my mind. I remember a little boy of my acquaintance who was once walking in Battersea Park under just such torn skies and tossing trees. He did not like the wind at all; it blew in his face too much; it made him shut his eyes; and it blew off his hat, of which he was very proud. He was, as far as I remember, about four. After complaining repeatedly of the atmospheric unrest he said at last to his mother, “Well, why don’t you take away the trees, and then it wouldn’t wind.”

Nothing could be more intelligent or natural than this mistake. Any one looking for the first time at the trees might fancy that they were indeed vast and titanic fans, which by their mere waving agitated the air around them for miles. Nothing, I say, could be more human and excusable than the belief that it is the trees which make the wind. Indeed, the belief is so human and excusable that is is, as a matter of fact, the belief of about ninety-nine out of a hundred of the philosophers, reformers, sociologists, and politicians of the great age in which we live. My small friend was, in fact, very like the principle modern thinkers; only much nicer. …

The man who represents all thought as an accident of environment is simply smashing and discrediting all his own thoughts – including that one. To treat the human mind as having an ultimate authority is necessary to any kind of thinking, even free thinking. And nothing will ever be reformed in this age or country unless we realise that the moral fact comes first.

For example, most of us, I suppose, have seen in print and heard in debating clubs an endless discussion that goes on between Socialists and total abstainers. The latter say that drink leads to poverty; the former say that poverty leads to drink. I can only wonder at their either of them being content with such simple physical explanations. Surely it is obvious that the thing which among the English proletariat leads to poverty is the same as the thing which leads to drink; the absence of strong civic dignity, the absence of an instinct that resists degradation.

— G.K. Chesterton, “The Wind and the Tree,” Tremendous Trifles, 1909

The man who represents all thought as an accident of environment is simply smashing and discrediting all his own thoughts – including that one. To treat the human mind as having an ultimate authority is necessary to any kind of thinking, even free thinking. And nothing will ever be reformed in this age or country unless we realise that the moral fact comes first.

For example, most of us, I suppose, have seen in print and heard  in debating clubs an endless discussion that goes on between Socialists and total abstainers. The latter say that drink leads to poverty; the former say that poverty leads to drink. I can only wonder at their either of them being content with such simple physical explanations. Surely it is obvious that the thing which among the English proletariat leads to poverty is the same as the thing which leads to drink; the absence of strong civic dignity, the absence of an instinct that resists degradation.

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The essence of theological modernism is the denial of the supernatural (miracles, Christ’s divinity and resurrection, Heaven and Hell, the Second Coming, and the divine inspiration of scripture). These fundamentals of the faith are labeled “fundamentalistic”—modernity’s other F-word. Modernism reduces religion to morality, morality to social morality, and social morality to socialism.

In fact, its instinctive gravitation to socialism is natural. For socialism and religion are the only two answers to a problem Lewis poses in The Abolition of Man: the problem of the Controllers versus the controlled, the Conditioners versus the conditioned. To see this, we must first review his argument in that book.

Lewis’ argument in chapter 3 is absolutely stunning, both in the sense of intellectually brilliant and in the sense of emotionally terrifying. It is that “man’s conquest of nature” without the Tao must necessarily become nature’s conquest of man. For “man’s conquest of nature” must always mean, in the concrete, some men’s power over other men, using nature as the instrument. Lewis’ examples of the wireless, the airplane, and the contraceptive show this: some men wield the newly-won power over others as its patients. Perhaps they are its willing patients, but they are its patients. Now as long as both the agents and the patients of these powers over nature admit and work within a common Tao, or moral law, they have the same interests, rights, and values. Monarchy is not oppressive if the king and the people are working for a common goal under a common law and share a common dignity. But if the power elite, whether king, voting majority, or media elite, cease to believe in an objective Tao, as is clearly the case in our society, then they become Controllers, Conditioners, Social Engineers, and the patients become the controlled. Propaganda replaces propagation. Propagation is “old birds teaching young birds to fly.” Propaganda is programming parrots. Propagation is the transmission of tradition. Propaganda is the invention of innovation. Which of the two is piped into our brains daily by our media?

— Peter Kreeft, From “Darkness At Noon: The Eclipse of the Permanent Things,” Chapter 2 of C.S. Lewis For The Third Millennium

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There is as much to be learned about the present day by reading what was written years past as there is by reading today’s punditocracy. Case in point:

It is not the specter of totalitarianism which raises its Gorgon’s head in our midst. What we have to fear is a development  which, like inflation, is a creeping process and, as will be shown, is indeed closely connected with the creeping inflation of our times. Security and personal comforts are rated more highly than freedom, law, and personality. That which still goes under the name of freedom is, as often as not, license, arbitrariness, laxity, and unlimited demands. Free people today attach to the word “freedom” any clear meaning which might put them on guard against its demagogic abuse. The individual means less and less, mass and collectivity more and more – and so the net of servitude which hems in personal development becomes ever denser, more closely meshed, and inescapable. The center of gravity of decisions keeps shifting upwards: from the individual, the family, and the small, compact group up to anonymous institutions. The power of the state grows uncontrollably; yet, since powerful forces are at the same time eroding its structure and weakening the sense of community, there is less and less assurance that administration and legislation unswervingly serve the whole nation and its long-term interests. Demagogy and pressure groups turn politics into the art of finding the way of least resistance and immediate expediency or into a device for channeling other people’s money to one’s own group.

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“The measure of a thing’s worth is what you can purchase with it.” “Or what can a man give in exchange for his soul?”

Many believe that economics is the dismal science. Daniel Abraham, thankfully enough, did not get the message. In “The Cambist and Lord Iron: A Fairy Tale of Economics” Abraham builds a fantastic tale around a cambist, i.e., one who is an expert in foreign exchange, and a degenerate Lord who destroys anyone unfortunate to fall into the Lord’s orbit. This “fairy tale of economics” takes readers on a memorable journey of exchange and economics so as to discover that which imbues exchange between persons with true value.

Olaf Neddelsohn is the Cambist. His passion is the exchange of foreign currency. He is known, in the city in which he practices his trade, “as a man of few needs, tepid passions, and great kindness.” Olaf lives a modest life, working in the Postal Authority office exchanging currencies from one to the other. His home is a room in a boarding house where he entertains himself with “men’s adventure books.” On days off he visits the zoo, or a “fourth-rate gentlemen’s club that he could afford.” And “[o]n Sundays, he attended church.”

Edmund Scarasso, Lord Iron, could not be more different. Lord Iron’s estate and wealth rivals the king’s. He spends his time in a 200-room home in the city. He lives a debauched lifestyle and destroys lives without a thought. “Violence and sensuality and excess were the tissue of which his life was made.” When Lord Iron learns about Olaf’s exchange practice he decides, on a lark, destroy him.

Given a seemingly impossible task, to exchange notes that have no recorded monetary value, Olaf provides Lord Iron with a lesson in economics. Daniel Abraham’s description of how currency exchange works is masterfully brief and instructive. It is a pleasure to read the exchange between the simple cambist, devoted to his vocation, and the wretched nihilist, devoted to his animalistic passions. Unfortunately, it puts Olaf in Lord Iron’s sights and forces the mild postal authority employee to prove the exchange between things that should never enter an exchange system.

The story reminded me of Wilhelm Ropkë and Wendell Berry, and what Ropkë called the “Humane Economy.” It is an incredibly engaging tale that explores how market economies work, how value between disparate goods is determined through the interaction of one individual with another, and, in the end, how wealth is generated. The stories depth, however, comes from its exploration of the human persons engaged in trade and the “wealth,” or lack thereof, their individual trade generates. The final “exchange” moves the reader beyond the mundane trading of one good for another and into the realm wherein one discovers that which invests the most important “object” a person has with value.

The story can be read at the link above or it can be listened to at PodCastle.org. It is not often that one finds a story about economics imbued with such affection for vocation, a simple life, that which provides ultimate value. Please read or listen to the story and, above all, share it with your friends.

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If the middle class is sufficiently desperate, it will vote the demagogue into power. And when the demagogue comes to power, he will find that his “age of Plenty” is not so easy to provide. At tat point fascism is born. At that point the demagogue, threatened with a breakdown of the whole economic system, turns to the Lords and Masters whom he has been abusing, and makes a deal. The demagogue stays in office and keeps the people quiet. The Lords and Masters stay in power and run the economic system just the way they always wanted to run it. The corporate State is monopoly-capitalism made safe, monopoly-capitalism with the whole power of society behind it. One of the first steps is to destroy the labor unions. Then the plan man is fobbed off with subsistence wages, patriotism, and a uniform. If he is still restive, it is not hard to fling him some racial minority on whom to work off his spleen.

–Herbert Agar, “But can it be done”, Who Owns America: A New Declaration of Independence

“But,” I can hear the opposition saying, “the President isn’t destroying the labor unions! He’s a tool of the unions doing whatever they want!” What is it when the Union goes from representing the workers to representing the corporation as a part owner?

“But,” they retort, “the President is a minority himself. He’s not going to ‘fling … some racial minority’ to the masses!” On that they have a point. He’s not going down that despicable path. Instead he flings them “greedy Wall Street” and “right wing extremists.”

Right wing extremists? Like these dashing fellows?

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There was a time, in America, where many were worked and lived as follows:

At the heart of the place stand a group of buildings, connected with the hightway by a gravel road. There is a manager’s house (for this place is owned by an absentee landlord) with hardwood floors and steam heat; a plantation store, neatly painted and filled with canned goods; an electric gin with a private siding for freight cares; a large modern barn for the mules (or a garage for the tractors). Around this group of buildings, which constitutes the main office of the establishment, lie the fields, perhaps trim and efficient-looking, but more often run-down, unpainted, lacking shingles, with chimneys leaning at an angle to the house wall. Almost invariably they are without adequate yards or shade trees or outhouses. A garden – so wisdom runs here – would remove from use land that might be planted in cotton. Trees, if allowed at tenant houses, will occasionally shade the ends of cotton rows nearby, stunting the growth of as many as two dozen plants! Barns are not needed, for the landlord owns all the mules – if he is still old-fashioned enough to use them instead of tractors; and he keeps them all at the big modern barn near the manager’s house. Front yards are generally small and unfenced: small because the landlord does not want to sacrifice any of his land, unfenced because there are no woodlands on the place from which to get fence palings. Here is the tenant farmer’s house; to call it a home would be impious.

That was the environment for those who worked the land for a subsistence wage. You could say that this was their office space. It was a dreary place, that denied creativity, pride in one’s work and ownership of the product of one’s labor.

Over 100 years later I am hard pressed to see how we have advanced from the conditions described above. In the 21st century we have gone from the Tenant Farmer to the Cubicle Farmer.

Cubicle Farm

The latter as indebted to the Lords and Masters of the corporations as the former were indebted to the absentee landlords. How can anyone say that the employee, working in the environment pictured above, is “progress” from the condition of the farmer working someone else’s land, for a wage that barely kept him and his family out of poverty?

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