The New Economics: puzzle

So the new analysis of wealth has got stuck on an old question.

Let us define wealth as getting what you want. People feel poor when they can't get things they want, and rich people enjoy getting what they want.

But people have different wants. Some people want easy to get things like watching a sun rise, and some people want very hard to get things like a BMW.

Given two people who have everything they want then who is the more wealthy? The one with many things like the BMW and the house overlooking San Francisco Bay or the one who only wanted an apple.
To my mind at least the one with the apple is the more wealthy. The problem with the one with many things is that there is a lot that can go wrong. The car may break down, the house may get burgled. So there is an anxiety with having many things.

When we don't want things they become neutral. This doesn't mean we don't notice them. We can walk through a forest and not want to take any of the trees with us because they are neutral. But it doesn't mean that we don't have an experience. The forest will be owned by someone, and it doesn't have to be ours to have that experience. Some will say that we "own" our experience. But that experience is gone very quickly so what is there to own. We are however left with lasting memories, and perhaps photos and selfies etc. We can say we own these. But if someone sold their memories would we buy them? The value of memories is that we had the experience. The memories (as memories) are of little value without the original experience. And we can't own that experience.

What in fact happens here is very critical. If we like an experience, we often want to own it. Like going to a concert to see our favourite singer. Sadly the experience is quite short perhaps only a hour. When the experience is gone, we want to own it somehow. We have pictures, we buy the album if we didn't already do to at least re-experience the songs, we buy merchandise, we speak to other fans to share our memories and try and relive it. But the truth that we do need to sit down and accept is that it is gone. We have had that experience and it is gone. The fact we are sad, is actually a good thing, because it means that for that short 1 hour we were doing something we really liked. The sadder we are, the more it meant. But the only way to deal with this is just to feel that sadness. It is part of the ups and downs of life. If that sadness if unbearable what we are discovering is that we need to pay more attention to our life. It means that we do not like our life, we do not like our ordinary experiences and we want to run away into happy experiences like seeing our singer. Running away from what we are never works. At some stage we simply have to just sit down and start to take in the pain and unhappiness. In small amounts like letting water out of a drinking fountain. At first it may seem still full of unhappiness. But eventually letting little bits out we will empty all the feeling we don't like and find it easier just to feel what we feel. The point here about experience is that it cannot be owned. The truly happy people allow experiences to come and go in real time, both good and bad. When nice feelings end they don't go searching for them again (too much), and when bad feelings start they don't go running away (too much). They have some equanimity. This is the key to true happiness.

But memories can be like virtual reality and we like to experience them again. In Wordsworth's poem "I wandered lonely as a cloud" he ends:

For oft, when on my couch I lie
In vacant or in pensive mood,
They flash upon that inward eye
Which is the bliss of solitude;
And then my heart with pleasure fills,
And dances with the daffodils.

Here he is reliving his memories. He is not trying to go back to the say when he first saw them, that is gone, but he is able to re-experience that afresh through his memories. It doesn't have to be his memory. If he could buy that memory off someone then it would be just as good. This is pure aesthetisism.

So the person with the apple has no anxieties unlike the person with many things to worry about. But the person with many things has an extra thing that the person with the apple doesn't have and that is status. Living in the San Francisco Bay area means that they get respect from lots of people. People who cannot afford to live in this area may well want to do so, and those that can find that they are separated from the poorer people. Whether or not the rich people get what they want stops being the point, being distinct from poor people becomes a thing in itself. Now as discussed the person who only wants an apple will not live in the San Francisco Bay area, but the person who wants a BMW is much more likely to do so. Status separates people based upon only the physical material view of wealth, but as discussed if you need lots of things to be satisfied you may well be less satisfied than the person who is happy with just an apple.

If you go the San Francisco Bay you probably won't find people any more happy than anywhere else. But the opposite is not true. Being excluded by the rich and being viewed as low status is damaging on wealth and health. The person who is happy with only the apple, but also be happy with being low status (or at least low status defined by the people living in San Francisco Bay). Human and Animal societies have pecking orders and even if materially you are satisfied, you have the problem of surviving the status system. Everyone in the West is actually wealthy. No one in the West has any material reason not to be satisfied. Even the homeless person has every opportunity to get off the streets, and they have food charities around every corner. Unhappiness and dissatisfaction in the West is entirely generated by the status system. The UK has the most extreme status system in the West possibly with the exception of India (which the UK ruled for several centuries so is that a coincidence?). US also has some of the worst inequality in the world. The materially poor in both places, despite probably being materially satisfied are made to feel unworthy and poor. Discussed a lot in the blog that wealth is actually relative and this is why.

So the person with many things, at least within the society, will be better off not because they have many things, but because society will attribute them a higher status. Having the correct accent when speaking, having manners, a good family name, being the right race are some of the other things that affect one's status. This type of "wealth" is what makes life easy for upper class people, and harder for lower class people. The BMW then is not about the car itself but about the status.

In UK its more complex. The aristocracy will look down their noses at the BMW. That my great grandmother would have said was "vulgar." Any criminal or lottery winner can buy or steal a BMW. That possession means nothing in true upper class circles. Class is defined by your deference to the status system. You respect those above you, and you behave in a self controlled and knowing way. Nothing worse than embarrassing the upper classes by doing or saying the wrong thing. It is a game that knits actually respectful and desirable characteristics into a formal system that protects the aristocracy. My mother says of the UK gentry she knew how courteous and  respectful they were to everyone regardless of class. But they would never allow people to transcend class and they would never step down in class.

Animals are already adapted to their environment and know how to survive. Humans didn't add anything to this. What humans did was take basic material needs and turn them into a complex social class system. With the upper classes controlling the resources of the poor classes. When we talk about wealth in human circles we are talking about the system of control and status. Not the material value, but purely the social value of things. Humans know how to live the idea of a 3rd world is fake. People are in poverty because social structures have restricted their access to land and resources. Rich elites in 3rd world countries control the movement of resources and that is what causes poverty. Those rich elites include the Western Imperialists who first colonised those countries and set up the corrupt system that now flourish. Not least is the system on international finance that ensures that most of the wealth of countries is extracted into the Western financial system either as payment of debts, or through offshore accounts that hide the wealth of whole nations.

SO returning to the original question who is most wealthy depends upon what you mean. True wealth means simply the person who has what they want. It can be a sunrise or an apple or a BMW. But what I will call False Wealth is what other people think of your wealth. If I have a gold bath it is just a bath made of gold, it is of no value to me at all. But it demonstrates physical wealth which in a society that measures people by their material wealth confers status. But in UK aristocracy that would actually serve to lower ones status because it is "common", "vulgar" and ironically "cheap" to have a gold bath. True social value would be running a bank or having some award from the Queen. Demonstrating some worth that could not be simply bought by a lottery winner, and preferably some status that occurred over several generations. Class cannot be sold over the counter is how the aristocracy would like to view it. But which ever way status is a social phenomenon and not a material or personal one.

For me if you buy something for yourself because other people want it you are actually being dishonest to yourself. If it is for you, then buy what you want. But we don't live on an Island and rarely buy just for us. If you are buying with other people in mind, like buying the family car that your wife and children want rather than just thinking of yourself then that is actually the highest class there is. That is the kind of behaviour that gets noticed not just on Earth but also in Heaven. Thinking of other people is actually the path to true happiness. This doesn't mean not thinking of yourself, but it means treating others as you do yourself, so that you don't see a difference in the value of what other people want and yourself. This transformation is the way to be Really Truly Wealthy.

So in fact the initial assumption was wrong. Wealth is not getting what you want. Wealth is everyone caring that we all get what we want.

Now how do I add that into the economic models? Perhaps first I need be clear how this achieves a greater outcome that what Adam Smith's Invisible Hand (IH) achieves.

The IH says that in a free market then people buying what they want gives money to the producers and encourages them to make more which brings the price down. Conversely things that people don't want get less cash and so profits drop and encourage business to close or change to making what people do want. Producers seeking individual profit and consumers seeking lowest prices means that everyone gets what they want as efficiently as possible.

This is a pure material production machine. It ignores status obviously and it ignores people.

A common example is doing work for a friend. It is common practice to offer a friend a lower price. Cynically we might say this happens because we trust the friend and so expect to get savings ourself in return.

But importantly this is not the whole truth. Humans care about each other. Not entirely egalitarian, when running to someone's aid we will we place family and friends first. While this looks selfish we will often place family and friends before our self. We also have the heroes who place their own lives at risk to help complete strangers. This is actually normal human behaviour. To be celebrated but something we all have more or less. It is not present in Adam Smith or economics.

I may do overtime for a client who cannot afford but needs my help. I step aside from my "professional" capacity and work as an individual on a person to person basic. This is why I say that Capitalism actually puts a barrier between people because as a Professional we only do things for payment, not out of welfare for the client as a person.

I need to stop here. But the new question then is how, and what benefit is there, is adding to economic models person-to-person interactions outside the exchange system. In particular somehow measuring the wealth that arrives not materially but through caring for another.

New Economics: City Trading

A city trader once told me that they perform an essential service to the economy. It is via the rapid arbitrage of prices, and the speculating on news and views about stock that the market achieves such rapid efficiency.

That is by solely trying to buy things that are perceived as cheap (either because they have an existing customer who will pay a higher price i.e. arbitrage) or by speculating that such a customer will exist, or by deciding that dividends for a stock compensate for risk in owning; through any of these means buy and selling quickly means that prices reflect a "true" value.

However it occurs to me that this is rather self seeking. Why do we need an efficient market? It is so that prices reflect their underlying value. And why do we need that? It is so that we pay the correct amount for things. And why that? It is so that we do not end up paying too much for things. But is also means that we won't ever find a good deal either because all the good deals have been exploited by the city. Indeed the whole point of a free market is that everyone is looking for a good deal. If the city has already taken all the good deals and left us with an efficient market in fact we have lost.

A true economy does not leave all the trading to a specialist group of traders sitting in ivory towers, but rather includes everyone. An efficient market is one where we are all involved in the process of setting prices. Not as we have today the "real economy" of people going about their lives, and then a highly specialised "trading economy" living in the slack that is not exploited by the "real economy".

It is unstoppable that a niche like the City won't be exploited, but the argument that it is an essential part of the economy doesn't make sense. The City exists simply because it can, simply because ordinary people buying and selling as part of their lives and economy don't have the time to exploit every last opportunity. But it doesn't serve any "service" at all. In fact it is quite possibly a detriment to society as the city is very expensive if one looks at the amount of wealth that it extracts in bringing to economy towards efficiency.

What we could have equally is a very smart A.I. computer that works for the state. In bringing prices to efficiency it puts the money it creams off into the state treasury where it belongs, because at the end of the day all it has done is automate the process of people looking for a bargain.

New Economics: Initial Sims

Abstract
Simple market exchange simulations were modelled.

• Initial simulations show that Relative Sacrifice is the most efficient way for a market to benefit its participants. However Barter is also an extremely efficient method.
• Key features of markets are the minimum wealth. We do not want individuals to be sacrificed by the system. But also the maximum wealth and median. 

Aim
Which method of interaction between market participants (Traders) arrives at the "best" satisfaction.

Method
A game was modelled in c#

• Traders own things. Initial model gives everyone same portfolio size.
• These things have a fixed number of types.
• Each trader has a "Desire Profile". This is a number for each type of thing. The higher the number the more they want that thing. This could be measured in reality by asking people to give a number between 0-100 indicating how much they like something.
• Satisfaction is the total desire achieved.

Since we wish to arrive at a result quickly every entity was compared to every entity. The owners of the entities were then asked to decide what they wanted to do.

Interaction Types

Barter : If both participants will benefit from the exchange then the ownership was exchanged.

Relative Barter: Same as barter but the cost of the exchange is relative to what you have.

Sacrifice: If the other participant benefited then the ownership was given.

Relative Sacrifice: Same as sacrifice but the cost of the giving is relative to what you have.

Giving to Poor: Same as Sacrifice, but giving only where result didn't make other more satisfied than myself.

Max Exchange: Same as Barter, but comparing traders (instead of entities) and executing the most beneficial trade. Purpose to see if a more optimal solution was possible.

Initial simulation parameters:

• Number traders = 20
• Portfolio size = 20 (400 entities in market)
• Number of entity Types = 10
• Number passes = 3. All strategies actually achieve optimum in 1 pass.
• Monty Carly replications = 10

Results & Discussion

Barter

If you meet someone who has something you want, and you have something they want then swap. Barter is a solid system. Everyone improves, although some not as much as others.

Relative Barter

Exactly the same as Barter. Relative makes decision relative to existing portfolio. In barter portfolio size doesn't change (1 in 1 out) so relative makes almost no difference.

 Sacrifice

If you meet someone who wants something you have got more than you the give it to them. This system produces the richest and poorest individuals of all systems. That is the individuals with the greatest wants exploit those with lesser wants. This strategy differs from barter in that portfolio size changes, resulting in some individuals having almost nothing. This is more realistic as this is very much the problem in economics.

It appears then that we should introduce some measure of "neediness." Not everyone needs the same amount. Some are happy with a bicycle some unhappy even with a Ferrari. Wants is actually relative in reality. If you already have a lot, then you need more to make that difference.

Giving To Poor 

Same as Sacrifice, but we only give if the result of the transaction doesn't make me poorer than the recipient. This strategy is the most egalitarian resulting in everyone having the same. However everyone is also significantly poorer than the poorest in the Barter system.

Relative Sacrifice

Same as Sacrifice but cost of giving is weighted by current wealth. See Mark 12:42 Jesus says "Truly I tell you, this poor widow has put more than all the others into the treasury" referring to a poor widow who gave only two small coins.

This system results in both the second wealthiest and the most wealthy poor of any system here.

Maximum Exchange

Tries a different approach to comparison. Instead of each entity being compared with each entity, traders were introduced and they compared their entire portfolios and selected the exchange vector with the biggest magnitude. This made only a trivial improvement on Barter.

Following Studies

1. Need to look at portfolio size. The more successful strategies have flexible portfolios.
2. Need to look at neediness. How do we look at individuals with high desire profiles? Are the easier to please and things mean more to them, or are they parasitic as they win in exchanges because they want so much?
3. Rent. Introduce rental mechanism. Entity can be owned by one person, but possessed by another. Reference here to posts on John Locke and how ownership and possession must be different for rent and capitalism to work. The owner gets an income from the possessor, but the possessor gets the satisfaction of actually possessing.
   This underpins capitalism as employees effectively rent the company from the owners to do their days work. The salary corresponds to the satisfaction, and the profit corresponds to the rent.
4. Consumables. Production and Consumption. In reality entities are made, and consumed. So have "Machine" entities that reproduce something. Effectively if I own a "printing press" entity I can make "book" entities. If a press needs a worker, then the owner of 2 presses can only make 1 book as they are only 1 worker. In Capitalism I may own 2 presses, but I rent possession of one to a worker.
5. The system has inefficiency as exchanges may be very unequal so potential value is being lost from the system (check this). We split the exchange process into selling and buying for money. Exchanges can then be into and out of money.
6. Development of 5. I have an exchange class that takes bids and executes as many as it can. There was a problem in traders deciding which bids to make. Do I put a bid on everything I can in hope of good deal, or bid for the most desirable. And should I allow debt in case I create too many bids and they all execute. How to limit debt? Perhaps copy real world and lend proportionally to assets.
7. Desire is money. In the initial incomplete monetary simulation the desire profile became identical with the price. However in view of what has emerged here, perhaps desire must be relative to existing portfolio. If we own very little, then small things now become much more important. The question remains is this a good thing or a bad thing. If small things mean more, then the poor achieve the same as the rich with less. Regarding the environment, the economy as a whole becomes less demanding.

Project files: Github repository
Not threaded nor optimised. 

New Economy: Love and Non-Love

What is the use of economy if it doesn't help us get what we want. Am currently in middle completing simple models to see which economy does this best. But in meantime the central problem of life is getting what we want.

There are things we want like a meal. But in particular the issue is what we light call "love". Despite the Greeks having 7 works for love (viz. Eros, Philia, Storge, Agape, Ludus, Pragma, Philautia) none quite fit what I mean here. The Indians have 5 (viz. Kama, Shringara, Maitri, Bhakti, Atma-Prema). I think I mean closest to प्रेम or prema of which the highest form is Atma-Prema.

Prema as I mean here (probably not its correct sanskrit usage) is a deep connection with the object. It is when we have an experience and that feels to say something to use very deeply. We feel grounded, and peaceful and wanting for nothing more. We feel more profoundly that we have found what we are searching for, but we feel that we too have been found. We are finally still inside and no longer craving. If this experience is with someone then we can attribute the sense of being found to their "gaze" and point-of-view but if we find it in nature then it is less easy to explain "who" has found us. Never-the-less the experience is the same.

In Indian thought the "being found" is double sides. Finding what we want "in the world" is the same as "finding our self" because "self is world" or "Tat tvam asi." But we need to love more deeply than the usual confused "hunter" form where we believe that "we are seeking something." It is seeking us too! The deer may find this hard to explain, but when the hunter finds the deer the deer also finds the hunter. They are intimately connected. This goes back to the San people in the first post on economics. The world always obeys Newtons 2nd Law. It is made of nothing more or less than equal interactions. In contemporary economics consumers (inspired by Adam Smith's "Invisible Hand") believe that they need only hunt, and the producers only need to provide. This is in a way true. But consumers and producers have a more profound place in the world: they can both see that they form an inseparable bond. The waitress is not just the deer being hunted by the customer. While the waitress may do her job well, and the customer may pay and tip correctly this is not the whole transaction. These are people, and part of world. There is a whole universe not accounted for in contemporary economics. Whether this unaccounted for universe has a bearing on transactions is what I intend to find out.

But returning to Prema does not last long. Tho it can last many years or decades, and full enlightenment goes above the ocean of the impermanent world all together. But for lesser prema we can become obsessed about the experience because we want to hold onto this peace. The world outside this experience or person now seems unwelcoming and of no interest to us, because here is where we belong and here is where we can be peaceful.

A few things more. Prema is extremely important. I have this problem with women. You may experience prema with a woman, but she does not have the same level. She may be involved in non-prema relationships that are not so profound. In fact I now believe you should pursue prema because it is important, and if it means obstructing non-prema relationships then so be it.

Another example might be the natural world, and this captures probably the biggest conflict been contemporary economics and conservation. As Joni Mitchell sings "paved paradise and put up a parking lot" though I've always heard "pay paradise and put up a parking lot" because payment cannot replace what is lost. A parking lot we might say is expedient, it enables people to drive into town and park nearby so they can easily go out socialising and shopping. But no-one has any love for a parking lot itself. Meanwhile an area of woods and open fields can be prema to many people. For this reason just like the lover feeling that they are being insulted by their partners causal behaviour, so people who experience areas of nature with prema feel they are being insulted by market forces.

This is not a simple matter of economics, and this ends up being mediated in the political, legal and spiritual realms. The question is whether a more inclusive economics exists that can mediate more deeply between people. I note here how inappropriate it is when politicians base their decisions on economics, when so many people look to politics to overcome the injustices of economics! Any politicians quoting economics is ignoring their responsibility and a mediator of power in themselves.

But we can't blame economics or the world. The experience of Prema while important is up to us ultimately. In Buddhism the experience that the world is like a badly fitting suit is called Dhukka. Prema as I'm using it here are those fleeting experiences where suddenly the world seems to fit.

What Buddha warns us is that experience is always dhukka at some level. No suit can ever fit right all the time because both it and us are always changing. It may have fitted perfectly when the tailor made the last adjustments. But there after every time we go to the wardrobe we have gained or lost weight and nothing fits quite right again. What fits now, won't fit for long. The only way for it to fit all the time is to change with it. But that is easier said than done. At its root economics is not that important to life, and much of the macro-economics like growth and micro-economics like rational agents is built on extremely weak foundations.

So I conclude here just to note the importance of what I will call Prema. This is not casual getting what you want like a new pair of shoes, or a meal. It is when you have that deep connection with something or someone that stops you and gives you a moments peace. It is the support of these experiences that a good economics will promote, and discourage the robotic satisfaction of wishes that is characterised by fast food, bingeing and window shopping. I'll call this for now Aprema.

If Capitalism has one deep criticism it is that it promotes aprema over prema.

New Economics: Is a Good Economy a Good thing?

This is just a corollary to the previous posts.

The best economy is the freest economy. In other words if we allows the drug trade, sex trade, slavery and basically removed all restrictions then the economy then it would boom.

Obviously then a booming economy is not always a good economy. Like nuclear power, technology like economics, does not tell you how to use it. You can use it for good as well as bad.

I am reminded of the British Navy's first foray into A.I. A program was developed to work out the optimum battle strategy. The results were impressive. It out played all the Navy's top strategists.

When they analysed the battle strategies though it was not so impressive. The rules of the game had dictated that a flotilla of ships travels at the speed of the slowest ship. This meant that when a ship was damaged the whole flotilla was slowed. The winning innovation of the A.I. was to turn its guns on the weakest ship to keep the flotilla at maximum speed, thus out manoeuvring its "human" assailants.

Economies similarly are unintelligent, and we do not know what emergent patterns may occur. Adam Smith, like the entire Enlightenment, was unaware of non-linear dynamics. For them small things had small effects, and big things gave big effects. The idea that systems could suddenly show big effects from small over looked dynamics is a very new observation. It means we can never be sure what a system will do. It means that economics is potentially very dangerous, and politicians blindly looking at macro economic metrics like GDP can easily miss what is really going on just as Naval strategists did in the early says of A.I.

New Economics: some more basic things

Having done a fairly comprehensive analysis of the way things are, taking apart clunky metaphysics, there is still no obvious way forward. I'm in no hurry to change the world. If there is one problem with "activism" its the desire to tinker with things without knowing what the impact will be. Dramatic changes to economics and the status quo are going to be dangerous. So time for some real basics first.

The commonest view of life is that we need to do things in order to live. This becomes the idea of "making a living." We look at birds foraging, or making nests, and mice creating store houses for the winter and we see the kind of activity that people are involved in.

All would be good in an infinite world like the US. After the colonists killed off the Indians there was enough land for all (the colonists and more). The system used there was similar to the Mediaeval system where about 120 acres (1 hide) was given to each family. That was considered enough to sustainably feed a family on.

The ability of people to gain access to a means of living is the logical requirement of an economy, although societies (as analysed already) aren't really based on this. But if we were to design an economy from the bottom up and from scratch this is where we would begin. It is a completely hypothetical postulate though. In reality people gain income from lots of means, and pay off people in lots of way too. For example as discussed you can have kelptoparatisism where people subsist by stealing from others, opportunistically as criminals, or systematically through protection rackets, rents and taxes. But then this cannot necessarily be classified as theft as it may be willingly done, in the case of a tenant farmer feeling safer after paying off his knight, and it depends upon how you classify ownership. Capitalists claiming dividends is a theft from the workers, who despite  generating the income, do not own any of the company and so are not due any of the profits. It is a complex and fluid soup of connections, and the idea that someone has the direct ability to "make a living" is a myth. If nothing else the plough that they use has been stolen without compensation from the genius who first invented it and put it into the public domain. If an eternal patent had been set up on the plough most of the human race would have starved, and one family would own everything.

But more or less sustenance must make its way from producers to consumers. Free market is a good system from ensuring this happens.

Problems with this is that it does presuppose ownership of produce by producers. And in Capitalism producers for the most part don't own anything, but capitalists do, and give a salary in compensation. Profits are protected for the rich, while the employed subsist on market force based salaries. But this then entails that consumers must produce themselves so as to have something to exchange in the market place. Market activity is thus actually limited by supply and demand. There may be a very high demand for something and even ample raw materials, but without funds to pay for production, the industry will stagnate. Capitalism then greases the wheels of industry frozen by exchange with the wealth of the rich but at a cost. So the cost first introduced by exchange is alleviated by exchange providing income for the wealth at every step. The system of giving does not suffer from this. Much frowned upon but Command economies have the upper hand here.

This also means that producers are always needing to make and push produce in order to raise funds to buy things. As industries become more efficient, markets must grow. This is perhaps the biggest cause of the drift away from the San people. The need for exchange, where someone may make stickers for cars in order to get money to feed their child, leads to economies where really unnecessary activity gets exchanged for essential activity. In San society your relationship with nature the producer is optimal. You just take what you need. [todo: I need to find video clip of amazonian indian talking about his relationship with the jungle. Is is quite different from workers in industrialised countries having to make money to pay for everything.]

Producing is not the only way to make money. There is theft as mentioned. Criminal but also legal in the form of taxes, rents and dividends. I posted recently the enormous cost of just the dividends and interest payments in the UK. The rich here are more demanding for free hand outs than all the poor combined! The take home message is that long ago the connection between production and consumption has been broken in the West. 40% of GDP is the system of free handouts to various people (both public and private mechanisms). The idea you need make a living is most definitely a romantic myth.

One key feature of modern economies is machines. A quick energy calculation showed that 99.98% of all the energy in the British economy goes to powering machines. Humans, perhaps because they are more efficient, only use 0.02% of the economic energy. Imagine the vast productivity of this system compared with pre-industrial systems where animals provided the labour for heavy work, but humans were the main machines. The productivity of post-industrial systems is inconceivable, and yet there is not surplus. If the insect apocalypse is one wake up call that economics is not working, the other is that we are not swamped in surplus. Or to be precise most of us are not swamped in surplus. There is a very small group of ultra-elite who are swamped in unimaginable surplus. But for the majority of the planet life remains hard and precarious. Why is this when there is already food to feed the planet?

I considered the case where land was infinite. But like many commodities it is limited. Once it is all owned then society is split into owners and non-owners. This is the origins of the class system, and property. That is well handled in previous posts. The result is parasitism by the owners on the non-owners. This is Capitalism's genesis, and the origin of inequality. Free markets don't work when there are limited resources, because like in the game Monopoly the markets becomes controlled and non-free. And that means that Adam Smith's economics doesn't apply.

So next up is a more detailed analysis of Capitalism and how it has led to growing inequality, starvation across history and is leading to the destruction of life on the planet.

The official data says that the world is growing wealthier. But this I suspect is inspite of capitalism rather than because of it. It remains to be analysed.

todo: supply/demand. benefits land tax vs others + dividends. giving (uncoupling supply/demand). Also offshore havens hiding the true vast inequality of Capitalism.

New Economics: Law, Freedom, Democracy & Emptiness

If there was a Truth then there would be a Law. All societies would be the same, and we would learn just one set of rules on how to live.

But this hasn't happened.

All societies have a Law but they differ. Laws are intricately bound in with Gods who are the Law makers and enforcers of Law. Yet there are many Laws and many Gods.

Even in the Middle East despite there being one God there are many Laws. And people have done battle over this God and his many versions of the Law throughout history. Christians for example say that He is a God of Love, and a forgiving God. While the Jews say that he is a Jealous and Angry God.

A key feature of Law is suffering. If you disobey the Law you will suffer. This has two levels. There is the punishment that comes from God and there is the punishment that comes from Man.

In Buddhism the Law is the law of cause and effect. Essentially what we find in modern science, that where there is a phenomenon then there must be a cause and correct conditions for it to have manifested. So when you experience suffering it has been caused in the right conditions to manifest. The Law then in Buddhism, and science, is that certain actions will lead to suffering and certain actions will lead to happiness. The Law is prescribed not by a God but in the workings of the universe. Buddhists like to remind the Hindus that even the Gods are not beyond this Law of Karma.

It would appear then that in Buddhism there is a definite way in which the world works. You go one way you suffer, you go the other you are happy. And these laws are quite absolute. Buddha gives his 8 fold noble path as a guide to the correct life. There are 5 precepts, and 8 precepts and hundreds if you ordain which are little rules that you agree to obey. All designed and developed over the millennia to encourage harmony in the Buddhist community and progress people toward enlightenment. It is thought as you become wise these laws become apparent and you don't need to be reminded of them in written laws.

But Buddha also says that if you try my way and it doesn't work then go else where and try something else. Central to Buddhism is emptiness. The non fixed caused and conditional nature of reality.

One famous solution to the balance between Universal Law and Conditional Law is Democracy. Things of Universal value are enshrined in National Law and then "choice" is given to individuals to decide their own personal rules in life. This is the meaning of "choice": the recognition that at least some part of Truth is conditional. Choice in the West has become bloated with metaphysics about the individual but that is unnecessary. It is sufficient just to recognise that truth may be dependent upon your local conditions and so cannot be judged more generally.

So when a state says you are "free", it means that it recognises your personal circumstances. No one is absolutely free, that is nonsense: free from what? So it falls to Law makers to decide only what applies to all people, and what is locally dependent.

Property is a part of Law, so what has been said of Property applies to Law. Who is the Law for? It can be seen as a way for ruling classes to control the country in their favour, or it can be seen as a social contract where we all agree to accept the restrictions because it benefits us all.

In both cases when the Law breaks down then chaos ensues. This chaos can be explained as people no longer being controlled, that is the Hobbesian view which has little value I think. Or, it can be seen as a break down in trust: if you are going to steal from me then I'm going to steal from you. This latter one I have seen in the UK youth and blogged about some years ago. The problem the children of the UK see is that because they are too young to be put in prison it means that there is nothing to stop other children attacking them. I asked some who were plotting a battle why not go to the police, and they say because the police can't do anything. So children in the UK are forced to defend themselves and so there is a breakdown of order. I asked a child once after they stole my bike, what it felt like to be stolen from. He said it felt bad, and he knew because kids are always stealing. As a result he just stole himself. But I said remember that it feels bad, and don't do it and then gave him the bike. It seems to me (and I hope to eventually bring out of this analysis) that people and principle are more important than property. But for order to be maintained we must be willing to take "the slings and arrows of outrageous fortune" for the sake of everyone. The problem with the current culture (from USA) is that everyone is always looking for compensation and this is endless and only deteriorating. Western society has declined to the "eye for an eye" logic of the Iron age!

Now some believe that there is no need for law. Law only works if there is power behind the law, and if we give up power to the law then that power will be used against us. An African idiom: if you mend a man's testicles he will use them on your wife. In America fighting for freedom is everything, and giving power to central authority is as good as building your own prison. I imagine this mentality is born of the battle to escape the authority of the British Monarch. Of course as with all conflict the hatred been US citizens and the British Monarch was fuelled by people who themselves wished to seize power in the US. This is why warfare is such folly. If one power beats another then you have just been subjugated by an even more powerful power. You ask a devil to help rid you of a devil and you end up still plagued by a devil, but now a stronger one. Never fight for anyone but yourself would be an important universal Law! Or better just don't fight.

But this idea that central power is our foe ignore social contract. Like the Magna Carta we can all agree on a central power which has its wings heavily clipped, so that while we now live under enforced rules so does everyone. This is the central idea in the evolution of Western Law. Centuries later such solutions to conflict would be studied further by John Nash. We can arrive at a stable agreement that is never-the-less not the best for any of us.

So if we combine emptiness with social contract we have a very good idea how Law works, and how it should work.

To ensure that Law does not become draconian power should be devolved. Local law makers should be able to make judgements for their local regions. And then escalate issues higher as they become more significant. This way the law remains sensitive to individual circumstances.

Now the problem with this is precedence. The Law by one definition needs to be the same in all times and places to ensure justice for all. It is no good giving a murderer 10 years in prison in one county court and 5 years prison in another for exactly the same crime. However no two crimes are the same. How to balance the needs of the specific with the practical requirements of the general. Perhaps with modern databases and AI more tailor made law may be possible in the future.

But this leads again on to the great issue of Law and emptiness. It seems that before Plato there was a general view from Socrates backwards that the Truth was extremely particular. As Heraclitus said: you cannot dip your toe in the same river twice. The world is ever changing, and time infiltrates everything continuously. The idea of fixed forms independent of time is a myth. This is why Socrates never recorded anything. Truth was discovered between people in dialectic and never otherwise.

Plato respected the dialectic by recording Socrates and others in discussion to discover Truth, but he completely binned the idea that truth could not be recorded. He then went further to argue that the particular things of this world have similarity by virtue of sharing qualities with what he imagined were Perfect Entities in some heavenly realm accessible only by the Mind. One imagines that the Perfect Forms are themselves a Perfect Form somewhere up there, and so Imperfect Forms must have a Perfect Form somewhere also. It stems from his analysis of recognition in the Theaetetus and others. He imagines that we have a wax tablet into which an impression is made when we learn something, and when we meet it again and it fits the impression and we have recognition. This same idea survives even till today 2400 years later except now it is Neural Networks and not wax tablets that record the impressions (how slow the world works!) From this he imagines that all cups are cups because there is a master cup impression that roughly fits all cups. Truth for Plato is these ultimate impressions that we can discover by dialectics and thought.

This sculpture by Rodin is Platonic. Its even in Classical style despite its subject. You will not arrive at universal truths by solitary contemplation in Socrates and before but through conditioned interaction with other people and the world. It is thought to be Dante considering his choices, and indeed he was alone so I am slightly unfair, but the image has taken on a life of its own as the archetype, the Platonic Form so to speak, the Meme even, of enquiry.

What emerges in history as probably the right way is the middle. There are 2 extremes. The Chaotic where there are no truths that last more than a moment, through to the Platonic where there are truths that are eternal. In reality truths are conditional, but they have staying power as long as those conditions last. This why revolutions happen and the old certainties change. How if there is one truth did mankind not just discover it long ago and be settled?

The point that emerges from history is that truth is something that gains its validity by being current. Our lives are a mix of truths some still ancient and some very new and personal. I love this girl would be a truth which is very compelling but only of value within the limits of my life. Killing is wrong is a truth which has been generally accepted by almost all people. There are huge caveats to the latter: some say it is correct to kill in battle, some say it is correct to kill for food, some say it is correct to kill the unborn child if the parents do not want it, some say it is correct to kill the suffering if they want it. Something so absolute still have many variations depending upon conditions.

So the New Economics faces a problem. I may discuss the value of property, but I cannot make an absolute pronouncement about whether it is correct or not. I am in a dialectic with my times and this enquiry here to be successful needs to work with the conditions. I began the enquiry with this sentiment but have given it more flesh here. The future of Property and Capitalism depends very much on conditions that prevail.

Communism did very well in its day because the world was turning against the Feudalism that gave such obvious benefits to a small minority that could no longer justify their superiority. Christianity did a lot to make all people equal. Judeism makes Jews superior but Jesus battled with that and realised that he was teaching a law greater than just for the Jews. That equality between people has been growing since then and has spread to topple systems of injustice around the world. It is a new truth, not obvious to people in the Past. Just as Jews think they are superior, so the Nazis thought they were superior, and so the White Americans thought they were superior to Black Slaves. Even to this day this truth of equality has been growing. It is not a universal truth, we still have to see whether animals can gain some equality in the future. I believe they should along with all being. This is where the primitive San people killing their Kudu are actual superior to ourselves. In fact perhaps via property and race we have travelled from a wisdom that we are now returning to.

It would be very nice if the New Economics was a return to ancient truths, a return to a Home that we once knew and have travelled from. I will bear that in mind, but I suspect the river is also long a while it bends it has a direction to travel and the New will be in many ways New.