On 9/30/2011 11:23 AM, Jim Devine wrote: > John Vertegaal<[email protected]> wrote: >> How is "net worth" defined? When frequencies enter the economy, to >> be worth something they need returns from the already existing >> economy; (i.e.) debit entries made by others that in turn require >> returns to have been "worth"while. Assets=Debts; there is nothing >> economically (exchange-value) "net". As I see it, the "net worth" >> you have in mind is meta-economic and exists in terms of use-value >> only. > > In standard accounting, a government's net worth = estimated market > value of assets (to the government) minus estimated market value of > debts. > We've been over this before, but standard accounting is based on the assumption that worth is realizable. Accounting wouldn't make sense if it didn't. This kind of worth isn't a fait accompli but depends on defining future activities, that themselves will become determined at a later time. The economy is a dynamic process that eludes any kind of static determination of its components.
You not only assume what still needs to be proven, but use that as a basis for extended reasoning; i.e. your "net worth" is axiomatic. It's beyond logic and both impossible to "understand" and persuade anyone who doesn't already hold the same belief. Furthermore, by stating that "net worth should be emphasized instead of debt", how do you avoid the trap of thereby assuming that the economy is statically in equilibrium and Say's Law rules? > NW is not calculated in terms of use-values, though of course those > are important, too. > _Nothing_ is, nor has been, economically worthwhile unless somebody somewhere takes the pertinent (cost+ embodied) output beyond the economy, because it's considered (by that someone) to have a use-value. > Also, NW could be calculated from other points of view, but those are > not relevant here. > Whatever > The estimated market value of the frequencies would be the present > discounted value of the net revenues expected to be received by the > government in the future if they are rented to the private sector. > This is likely much greater than the price of these frequencies if > sold to the private sector as assets, since pressure from creditors > (and their agents at the IMF and the European Central Bank), the > aftermath of the recession, and the corrupt nature of the Berlusconi > gang encourage the charging of "fire sale" prices. Likely, these > prices are below the present discounted value of the net revenues > expected to be received by the private-sector purchasers of these > assets. That was my point. I understand your point and sympathize with it. The communication industry is extortionate, because it already extracts way more income from the economy than it injects; which is only going to get worse, in the above scenario. But your reasoning is misguided because it concerns a statically determinate economy, with capital generating its own revenue. Those frequencies are bought with to be resolved debt, _not_ assets as these are commonly understood; either recently created or withdrawn from previous rounds of economic production. Debt that a sovereign government can create out of thin air. The exchange-value of those frequencies, like any form of capital asset is indeterminate, because it is unrelated to the frequencies themselves. Instead the revenue comes from myriad economic production processes that disburse personal income; so that airtime can be bought and thereby presumably enhance the buyers' standard of living. By not re-injecting that income through its own disbursed personal income, firms in other sectors go broke; as the debit expenditures of the latter are operationally indifferent from debt that isn't resolved. Apart from your axiomatic "net worth", the difference between our modes of analysis is that mine is exact, while yours has to rely on here and there thrown in "likelihoods". But I would suggest that both indicate the cure of this illth to be a nationalization of the communication industry. Given their oligopolistic control, a targeted taxation of capital assets will just be billed in yet additional airtime charges. John V _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
