On 10/5/08, michael perelman <[EMAIL PROTECTED]> wrote: > Citing a Greenspan interview: > ...But you will also get significantly reduced economic > activity and ultimately lower standards of living."
This quote is admirable in that it illustrates precisely the error that characterizes conventional economics. Standard of living is the CAUSE not the EFFECT of economic activity. Oh, I know that sounds somehow "upside down" to ears that have never heard anything but "a rising tide lifts all boats." The reason it sounds upside down is because everyone is used to hearing it the other way around. Well, remember Marx's line about turning Hegel on his head? Or the line in Chapter One of Capital: "But, so soon as it steps forth as a commodity... [the table] not only stands with its feet on the ground, but, in relation to all other commodities, it stands on its head, and evolves out of its wooden brain grotesque ideas, far more wonderful than 'table turning' ever was." This "standing on its head" stuff is serious philosophical business. I've started posting George Gunton's Economic and Social Importance of the Eight-Hour Movement to EconoSpeak. It develops Ira Steward's eight-hour theory and, sure enough, that explicates the correct order of priority between standard of living and economic growth. Production is governed by consumption. Labor income is governed by expenditure. Expenditure is governed by the standard of living, which is a habit acquired as the result of social opportunity. When one reverses the direction of causation, as Greenspan has, one arrives at the perverse conventional wisdom that debt -- and not social opportunity -- is the cornerstone of prosperity. Hey, you want to know why debt has to come first in the Greenspan universe? Because that makes bankers the heroes in the tale of prosperity. The fable would be a tragic if it was the first time it was told. It has become a farce. -- Sandwichman _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
