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Economics: The Extended Version

First Things.

OK, so you really want to know more about economics, but since you are reading this, you expect a radical, that is, going-to-the-roots, point of view.

That means that instead of just lambasting economists for their biases and pretensions, we will have to take a rather more nuanced view.

What Is Economics? Going to the roots means, first of all, asking just what economics is. If you were to ask that question about, say, physics or astronomy, you could come up with a nice, clear, simple, and fundamental answer. Not so with economics. Economics is many rather different things pretending to be just one thing. At the simplest level, it is ideology pretending to be science. Or rather it is both science and ideology, but almost always denies the ideology part. Which makes it deceptive and confusing. We have to take a step back.

Ideas, and systems of ideas—systems of thought, religions, sciences, philosophies, metaphysics, etc.—never come out of nothing. They evolve; they have ancestors. Economics has two very different sets of ancestors. The simplest and most obvious is science. We live in an age that reveres science, so you are almost certainly aware, at least somewhat, of the history of the development of modern science.

The Second Ancestor. The other ancestor is less obvious—indeed, it is quite obscure. To understand it we are going to have to take a long detour that will seen to have little to do with economics. Please be patient; we will return with better understanding.

This ancestor is not something that is openly discussed like religion or philosophy, although it has interbred with those systems of thought throughout the ages. It is not talked about because its purpose is always to deceive. It does not even have a name.

It does not have a name because its creators cannot imagine its contrary. We have all heard the cliché about a fish being unaware of water because it does not know a world without water. In effect, the fish has no name for water. Water is just The-Way-Things-Are.

Having never interrogated them on the subject, I do not know if fish are really unaware of water, but it is certainly true that human beings can be utterly blind to things that they do not want to see, even things right in front of their eyes. In particular, they are blind to anything which, if acknowledged, might tend to diminish their well-being and comfort. Conversely, familiar ideas that are believed to support their well-being and comfort are simply seen as unquestionable facts. Not theories, not hypotheses, not possibilities, but unquestionable, obvious facts: The-Way-Things-Are.

Just-So Stories About Inequality. As far back as historians are able to see, human societies have been unequal. There have been those who have power and those who do not. Let us not mince words: power means the ability to force others to serve you. Power means that certain people get to ride on the backs of others. Power also means the ability to decide exactly what constitutes The-Way-Things-Are. The people in power create stories that explain why it is right and inevitable that they should be riding and others should be ridden upon.

Power, however, has constantly shifted throughout history. Consequently the story about The-Way-Things-Are has constantly changed, so part of the story has always been “We were previously lied to, but now we know the truth.” Note that it is never “This is our current theory,” but always “This is the Truth.”

Cracks In the Stories. When power shifts, certain very smart people become “elected” to write the new story about The-Way-Things-Are. The blindness to ideas inimical to one's comfort and well-being which we talked about earlier produces some interesting inconsistencies. A well-known example is Thomas Jefferson's being able to write “that all men are created equal” while himself owning slaves.

A less known example, but equally important because it comes from a justification for the right to private property, which forms a pivotal place in the current story of The-Way-Things-Are, is from John Locke's Second Treatise of Government [Chap. V. Sect. 28]:

Thus the grass my horse has bit; the turfs my servant has cut; and the ore I have digged in any place, where I have a right to them in common with others, become my property, without the assignation or consent of any body. The labour that was mine, removing them out of that common state they were in, hath fixed my property in them.

Locke is regarded as having provided some of the major intellectual foundations of capitalism. What is interesting is that he bases the right of property in labor. One's labor is clearly one's own, and is thus, he assumes, natural. But he obviously thinks he owns the labor of his servant as well. Of course, if one looks at the reality of the society in which he lived, virtually all of the labor that was done was the labor of servants, and it is that labor on which he bases the right of the masters to their private property. He is utterly unconscious of any contradiction.

Naming the Nameless. So perhaps now we are in a position to give a name to these nameless systems of thought. Let us call them theories of class justification.

[Next: Class Justification, Then and Now.]

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