2 posts tagged “economics”

All this has a moral for our tale and provides a proper ending to it. In much of the West, and especially in our country, government is today much criticized and denounced. There is often good reason for the antipathy: governments can be – and perhaps always are – bureaucratic, slow-moving, inefficient, and irritating. They are not repositories of unsullied virtue, exemplary foresight, stirring vision.

What they are however, is the only means by which a body of people can provide itself with what it cannot obtain elsewhere: foreign policy and defense, law and order, the provision of public capital, and – crucial for our purpose – a counterforce against the unwanted effects that emerge from the private sector. That counterforce may not always be effective – there are plenty of unsolved problems in capitalism – but it is the only such capacity that exists.

In a word, no complex society can exist without government. That is why the public sector is as much a part of a capitalist order as is the private sector, which could not longer exist if government were somewhere to disappear. We should not forget, moreover, that he functions of government under capitalism are not only to provide defense and public capital and law and justice, but also to act as a kind of gyroscope or a steering mechanism when the nation needs a balancing counterweight or a hand on the steering wheel. (Where is the Invisible Hand of Adam Smith? Ed. comments) There will assuredly be such situations in the years ahead, as globalization and then global warming become even more insistent problems that require powerful guiding and containing forces.

Here, as so often, economic analysis goes just so far. In the end, large-scale changes require not just an adaptive revolutionary capitalism, but the elusive contribution of things that lie outside that framework, such as collective temper of peoples and the wisdom or folly of their leaders. Hence it seems proper to end this book with the admonition that we must come to understand our subject, not to achieve a Good Society, but to prepare ourselves for the really difficult problems that we will still face after economics is understood.

Robert Heilbroner and Lester Thurow in Economics Explained, 1982/1998

It would be foolish to propose a complete renunciation of the industrial comfort of the exosomatic evolution. Mankind will not return to the cave or, rather, to the tree. But there are a few points that may be included in a minimal bioeconomic program.

First, the production of all instruments of war, not only of war itself, should be prohibited completely. It is utterly absurd (and also hypocritical) to continue growing tobacco if, avowedly, no one intends to smoke. The nations which are so developed as to be the main producers of armaments should be able to reach a consensus over this prohibition without any difficulty if, as they claim, they also possess the wisdom to lead mankind. Discontinuing the production of all instruments of war will not only do away at least with the mass killings by ingenious weapons but will also release some tremendous productive forces for international aid without lowering the standard of living in the corresponding countries.

Second, through the use of these productive forces as well as by additional well-planned and sincerely intended measures, the underdeveloped nations must be aided to arrive as quickly as possible at a good (not luxurious) life. Both ends of the spectrum must effectively participate in the efforts required by this transformation and accept the necessity of a radical change in their polarized outlooks on life.

Third, mankind should gradually lower its population to a level that could be adequately fed only by organic agriculture. Naturally, the nations now experiencing a very high demographic growth will have to strive hard for the most rapid possible results in that direction.

Fourth, until either the direct use of solar energy becomes a general convenience or controlled fusion is achieved, all waste of energy – by overheating, overcooling, overspeeding, overlighting, et cetera – should be carefully avoided, and if necessary, strictly regulated.

Fifth, we must cure ourselves of the morbid craving for extravagant gadgetry, splendidly illustrated by such a contradictory item as the golf cart, and for such mammoth splendors as two-garage cars. Once we do so, manufacturers will have to stop manufacturing such "commodities".

Sixth, we must also get rid of fashion, of "that disease of the human mind", as Abbot Fernando Galliani characterized it in his celebrated Della Moneta (1750). It is indeed a disease of the mind to throw away a coat or a piece of furniture while it can still perform its specific service. To get a "new" car every year and to refashion the house every other is a bioeconomic crime. Other writers have already proposed that goods be manufactured in such a way as to be more durable. But it is even more important that consumers should reeducate themselves to despise fashion. Manufacturers will then have to focus on durability.

Seventh, and closely related to the preceding point, is the necessity that durable goods be made still more durable by being designed so as to be repairable. (To put it in a plastic analogy, in many cases nowadays, we have to throw away a pair of shoes merely because one lace has broken.)

Eighth, in a compelling harmony with all the above thoughts we should cure ourselves of what I have been calling "the circumdrome of the shaving machine", which is to shave oneself faster so as to have more time to work on a machine that shaves faster so as to have more time to work on a machine that shaves still faster, and so on ad infinitum. This change will call for a great deal of recanting on the part of all those professions which have lured man into this empty infinite regress. We must come to realize that an important prerequisite for a good life is a substantial amount of leisure spent in an intelligent manner.

Considered on paper, in the abstract, the foregoing recommendations would on the whole seem reasonable to anyone willing to examine the logic on which they rest. But one thought has persisted in my mind ever since I became interested in the entropic nature of the economic process. Will mankind listen to any program that implies a constriction of its addiction to exosomatic comfort? Perhaps the destiny of man is to have a short but fiery, exciting, and extravagant life rather than a long, uneventful, and vegetative existence. Let other species – the amoebas, for example – which have no spiritual ambitions inherit an earth still bathed in plenty of sunshine.

Nicholas Georgescu-Roegen: Energy and Economic Myths, in Southern Economic Journal 41, No 3, January 1975