Introduction<\/strong>
\nSo human beings are animals now. Darwin proposed it. Crick and
\nWatson proved it is so. So we must live with this embarrassing fact.
\nSo what happens to economic theory? It doesn’t seem to have anything to do
\nwith any of this. In fact it doesn’t seem to have anything to do with real
\nhumans at all. Of course, there was the Church. I mean, there was the
\nMiddle Ages…Do you realize that many people say that this modern age
\nbegan only very recently…like in or around the year 1922? And we think we
\nare so thoroughly modern…in actuality many parts of our lives are ensconced
\nin a medieval, dark age. Of course the real Middle Ages were so much more
\nsinister…Yes, there once was much death…little hope. Our only hope was
\nthat we weren’t animals. That is we were \u201cof God.\u201d So if there was little
\nhope here on earth…well, then for God’s sake there was hope in the baloney
\nthat the Church purveyed. I’m not saying there is no God…but that is a
\ndifferent minibook.
\nSo when universities emerged..science was mostly witchcraft at the
\nbeginning… the Church said that science was all well and good and fine…but
\nbe careful….leave humans alone…for God’s sake, we need some hope…for
\nsomething better…in some other world Thus economic theory was
\nborn…which has little to do with human beings.
\nI am an economist, economic historian and a philosopher…Let’s see
\nwhere all this imprudent thinking takes us.
\nThe Church and the Social Sciences<\/p>\n
\nThe science of man and woman, otherwise known as the social
\nsciences, comprises those disciplines related to the study of humans, to the
\naspects of their physiology that are unique to them…I mean, really unique to
\nthem…what we are talking about here is their exceptionally creative
\nminds…and the world their creative minds have, well, created.
\nAt the present, the science of man and woman is floundering. Since the
\neighteenth century, economic and technological revolutions have transformed
\nthe Western world…they have brought a dramatic improvement in the
\nstandard of living for people in one-third of the world. Now man and woman
\nare attempting to move farther, accomplish more for all of humanity…and
\nmonumental social problems are confronting them. These major social
\nproblems relate to the physical and psychological trauma of confining man
\nand woman to an artificial, urban world; they relate to the constraining force
\nof medieval institutions upon the explosion of their tools…and they relate to
\nthe increasing divergence between the rich and poor…These problems have
\nmetropolitan national, and global implications. Scientists say that humanity
\nhas only a fifty percent chance of surviving this century. Something must be
\ndone…It is difficult to do anything when the science of man and woman we
\nare utilizing still resides stubbornly in the Dark Ages.
\nThe social sciences have disturbing problems. Let’s look at one such
\nscience …economic theory… to see what some of these problems are and what
\nactions might be taken to solve these problems.<\/p>\n
<\/p>\n
What is Economics Theory?
\nIf man and woman are animals, then their behavior must be biological.
\nHumans are unique among animals in that they make and utilize tools…
\nroutinely,… constantly. However, humans do not make tools for their own
\nsake, they make tools in order to produce goods. The production of these
\ngoods and how these goods are distributed among members of a society is
\nexamined in the discipline of economics.
\nIn existing economic theory, it is assumed that man ad woman are
\ndifferent from other animals in possessing a more highly developed brain…
\nperhaps even a \u201csoul\u201d… which is separate from and separates man and
\nwoman from all else in the Cosmos. It is maintained that man and woman’s
\nactions cannot be predicted because the unique caliber of their intelligence
\n(as well as the other-world nature of their \u201csouls\u201d) defies the forces of
\ndeterministic tendencies. Consequently, economic theory rests upon
\n\u201ceternal\u201d, a priori laws, derived from what a hypothetical rational man or
\nwoman would do. Economic theory for humans as a whole is then derived
\nfrom an aggregation of what many rational people would do. Upon this
\nlargely non-empirical base, a superstructure has been erected in which some
\nempirical evidence has been incorporated. However, the entire theory has
\nbeen severely influenced by the unique perspective upon which it is based.
\nIt may be difficult for someone who is acquainted with economic theory
\nto imagine what relationship the existing theory has to biology, let alone how
\nit could be placed completely upon a biological base. The existing approach
\nis highly abstract and mathematical, and all calculations whether they are
\nrelated to ships, sails, or sealing wax, are computed almost exclusively in
\nmonetary terms. Neither the physicist nor the biologist is concerned with,
\nnor is scientific advance in general dependent, upon the examination of
\nmoney.
\nWhat has gone wrong here? What are we missing?
\nWhat is Money?
\nThe thing is…animals do not have money…and the examination of their
\nactivities is fairly straight-forward. Man and woman have money…which has
\nled to problems when their activities are examined.. So what is money? And
\nexactly how does its presence tempt economists into examinations which are
\nfraught with problems?
\nIn this minibook an exchange is defined to be a swapping of
\ncommodities between two producers which may or not result in both
\nproducers being satisfied. A transaction is defined to be an exchange or
\nseries of exchanges in which all producers involved are satisfied. To be
\nsatisfied means that a basic need is in fact met, and not merely that a promise
\nhas been given or that the means exists which guarantees that a basic need
\nwill eventually be met.
\nSo what is money? Money is a promise for a good. It can be used in a
\ntransaction when one producer does not have a good desired by another and
\nuse must be made of a medium of exchange.
\nWhat is a medium of exchange? In a series of exchanges of goods,
\ncommodities may be received by producers which they do not desire to
\nconsume themselves. The producer of corn could swap corn for wheat that
\nhe desires. The receiver of the wheat may not really need it, but he is certain
\nthat he can exchange the wheat for shoes that he does need from another
\nproducer. Media of exchange are used because it is easier to find a person
\nwho has what you need than it is to find a person who both has what you
\nneed and needs what you have.<\/p>\n
<\/p>\n
So money is a promise for a good. Why does one say that? Well,
\nmoney can be used in a transaction when one producer does not have a good
\ndesired by another and use must be made of a medium of exchange. Instead
\nof giving a producer what he does not want in exchange for wheat I need..I
\ncan give the producer a \u201cpromise\u201d that I will give a certain amount of corn to
\nany person who gives me the \u201cpromise\u201d in the future. This \u201cpromise\u201d is
\n\u201cmoney.\u201d Thus money is an interest free loan. A person must be
\ncompensated with additional goods, which are called \u201cinterest,\u201d if there is an
\nundue delay in the completion of a transaction. Money is an interest free
\nloan because the producer of wheat is not unduly delayed in receiving the
\nshoes he needs. In addition, the wheat producer is greatly convenienced
\nbecause he does not have to carry corn around until he can find a buyer for it.
\nMoney is not a good. It represents a loan, a good promised and a
\npromise is not a good. Always it is the availability of the commodity which
\nwill be given immediately to the bearer of the promise which makes the
\npromise valuable and enables it to circulate.
\nTwo Worlds…Goods and Money
\nAt any moment in time, a unit of money is related to a particular
\nincomplete transaction and is always related to a good. Money is not a
\nmedium of exchange. It is the goods the money represents, the goods which
\nare promised, which are the media of exchange. It’s kinda like there are two
\nworlds…one that is real and one that is just paper…moving in opposite
\ndirections.<\/p>\n
Let me break here for a moment. In all of the social sciences, there are
\ntwo worlds. There is the real world…of animals…of the animals, man and
\nwoman, which the Church does not allow people to meet square on. Then
\nthere is an imaginary world created entirely by human’s minds…that is more
\nthan an arm’s length away from that real world. Humans are like the Wizard
\nof Oz, trying to run a world with bells and whistles that are a long ways away
\nfrom the world humans are trying to make better. Economics displays these
\ntwo world very clearly…but every social science has these two worlds.
\nThis \u201ctwo world\u201d aspect is present in every part of our lives. Humans
\nhave created an artificial urban world that is not entirely compatible with our
\nbodies. The world of the jungle which our bodies long for unfortunately no
\nlonger exists for us. We live in an artificial world created by our minds.
\nScholarship has this dual nature also. When we work in the social
\nsciences…we are working in a virtual world..each social science has its own
\nvirtual world…what Jean Baudrillard calls \u201cSimulcra\u201d…\u201dSimulation is no
\nlonger that of a territory, a referential being, or a substance. It is…the
\ngeneration by modeling of a real without origins or reality: a hyperreal.\u201d
\n(Baudrillard, The Real and the Simulacra.) Baudrillard has announced that
\nmodern society is being controlled by corporations with their proliferation of
\ngoods…and the saturation of human’s consciousness with advertising has
\nerased any remnants of a real world…This has left modern man and woman in
\na world that is artificial and virtual.<\/p>\n
The same is true for humans’ scholarship. That is, one can continue
\nBaudrillard’s thoughts in another way. In the social sciences humans are not
\nanimals. The social sciences have methodologies that are radically different
\nfrom the natural sciences. The methodologies are different from each other.
\nEach social science possesses its own simulacrum…Because of these
\nsimulacra of knowledge and methodology…humans are kept powerless in the
\nface of immense world problems. The only way for this to be corrected is for
\nscholarship to place humans on earth where they belong, as real, physical,
\nanimal beings. The problem and the solution for all the social sciences are
\nvery clear when one considers economics.
\nIn a series of exchanges among four individuals (A,B,C,D), there are
\ntwo flows…one of money and one of commodities. A might swap money with
\nB for shoes, B might then swap the money with C for wood. C might then
\nswap that same money with D for clothes. Among the individuals money is
\nmoving in one direction and goods in the other.
\nThe money flow bears the same relationship to the goods flow as
\nfootprints do to a human. Footprints give an idea of where a person has
\nwalked, but they are not human. In the same way, the money flow is related
\nto the goods flow and it can be used to gain information indirectly concerning
\nthe goods flow, but it is not a part of the goods flow.<\/p>\n
Money supposedly makes economics more accurate.. It gives us
\nnumbers that apply to all commodities. Transactions are documented in
\nmonetary terms by banks and so totals are easy to come by…whereas physical
\nquantities are not so easily obtainable…However, there is a downside to using
\nmoney to describe economic interactions. The truth is… using money leaves
\nthe economist with a theory that is partial as well as static. Existing
\neconomic theory is partial because it focuses only upon individual exchanges
\ninvolving money for goods. The flow of money makes no sense…money
\nflows from the butcher, the baker, to the candlestick maker. In analyses of
\nmoney flows, knowledge concerning who produces what, where, when is lost
\nin the aggregation of money exchanges to reach a total which is meaningful
\nto us called Gross National Product (GNP). The GNP for the year can be
\ncompared with the GNP of previous years to tell, if inflation is deleted, to tell
\nif an economy is growing fast or more slowly. This number, the money
\nrepresented by GNP, seems to be accurate and meaningful, but the whole
\ninterrelationship of goods and their production and distribution in space and
\ntime is lost as well as the whole raison d’ etre for the exchanges which are
\nobserved.<\/p>\n
Second, existing economic theory is static. It stops the flow of goods in
\norder count up…money which changes hands during a certain time is
\ncompared with the amount of goods exchanged during the same period of
\ntime previously. Stocks of money must be compared with stocks of goods
\nbecause there exists no one-to-one relationship between a dollar bill and
\ngoods beyond one exchange between two people. Thus, existing theory is
\nlimited because it can only view the economy in snapshots, not in a
\ncontinuous, dynamic examination of commodity flows.
\nThis point of view which is primarily medieval in origin, separates
\neconomics from biology. It separates humans from power…power to change
\nthe world efficiently, directly for the better.
\nThe Science of Everything
\nWe must build a new economic theory. Well, all the social sciences
\nmust be rebuilt…and when they are they will all have the same methodologies
\nas the natural sciences….When all sciences have the same methodologies..we
\nshall have a Science of Everything…all the disciplines will be able to talk to
\neach other…help each other…plus the methodologies employed by the natural
\nsciences are more powerful to begin with.
\nSo exactly how can Adam Smith become Darwin?…Pretend that you are
\nan alien from outer space…you notice human habitation on earth as you
\napproach for a landing…How would you describe human society
\nscientifically as you descend? Well, first of all, one could not see money…nor
\ndoes one have to even know about money…You just look at trucks and trains,
\nsteel and hemp and young people in the mall. The major human
\nconfiguration on earth is that of the metropolitan area. Thus humans have
\nevolved backwards from the primal band of the ape, which they lived in until
\nthe great agrarian empires arose some 3,000 years ago. Thus man and
\nwoman with their tools have drastically changed the fabric of their lives. The
\nmetropolitan area can be compared to a multicellar organism such as a mold,
\nwhich grows outwards contiguously over time. The metropolitan areas from
\nthe perspective of a satellite grow outwards contiguously as population
\nincreases. The examination of man and woman in their cities can be made as
\na scientist would examine molds. Biologists are not developing indifference
\ncurves and isoquants in their study of ant hills. They are not counting money.
\nMuch description work regarding the structures of metropolitan areas and
\nactivities is presently being done in the field of economic geography.
\nIn order to test the power of a biological perspective upon the
\ninvestigation of man and woman’s economic behavior, I attempted to make
\npopulation projections in metropolitan areas utilizing the knowledge we have
\nmolds and how they grow and expand. For example, U.S.G.S. quadrangle
\nmaps were found for the Los Angeles metropolitan area in 1906. An
\nisochronic map was developed with lines depicting distances traveled in
\nevery direction from the urban core during equal periods of time. Population
\nfigures were available for every decade from the U.S. Census from 1910 to
\n1965 for the Los Angeles area. I calculated the area consumed by population
\nadded each decade to the area that population occupied in 1906, as indicated
\non the quad maps. Then I placed these areas consumed by population in a
\ncontiguous manner from the industrial core outwards in every direction,
\nutilizing the isochronic map. The expansion of the population projected for
\nthe year 1965 was then compared with what had actually occurred. Projected
\nresults were within five percent of what had actually happened. Analogies
\nfrom biology and the utilization of methodologies used in biology will be
\npowerful ways to examine man and woman’s economic behavior.
\nThe thing that unites the production and distribution of all goods is the
\nexpenditure of energy. Instead of counting up money…count up energy
\nexpended… in every activity. If you look at the United States at night from
\nthe perspective of a satellite…one see dots of light…the patterns of light show
\nthe metropolitan areas where most people live and expend energy…the
\npatterns of light show the expenditure of energy directly! Economic theory
\nshould be the study of these patterns of light…patterns of energy…these
\nmetropolitan areas and their interaction. Once the functioning of healthy
\nmetropolitan regions is understood, then diagnoses of disease can be made
\nand remedies formulated. More difficult may be phenomena related to the
\nfact that Homo sapiens is only a one part of the macro-organism…we are
\nenmeshed in our own tools; we are parasites in our own tool organism…
\nhowever, priorities within the organism must be ranked with respect to what
\nis most beneficial for man and woman. For example, it may be part of the
\nmetropolitan region organism’s normal functioning to have recessions, slums,
\ninflation, and other phenomena which may have tremendous adverse effects
\nupon man and woman embedded within it. If this is the case, behavior which
\nis normal for the organism may have to be altered to ameliorate the
\ndiscomfort of man and woman. Such amelioration may involve a trade-off
\nbetween short-run discomfort of human beings and medium and long-run
\ngains created by the cyclical growth of tools for these same human beings,
\nwhose lives are caught in these tools.<\/p>\n
The trend that is hoped for is for man and woman’s lives to be made
\nbetter every day; however, there are agonizing short-run problems such as
\nthose involving minorities, Third-World backwardness, as well as the basic
\nincongruity of man and woman living in a world that is incompatible with the
\nneeds of their bodies. Scientists can be biologists looking down from
\nsatellites as they would examine an ant hill…they can see what is causing
\nproblems and fix the situation…instead of just looking at a bunch of numbers
\nand curves and guessing wildly what the problems might be and attempting
\nto fix things in a monetary way. Problems will be more easily solved when
\nall disciplines are utilizing the same methodologies and can more easily work
\ntogether to change the world for the better.
\nThis brings us to the concept of the Science of Everything…as I say, if
\neach of the social sciences are placed on a biological base, they can talk to
\neach other. They can work together easily in solving world problems. Also
\nthe social sciences can then talk to the natural sciences easily, which will lead
\nautomatically to solutions for things like global warming. Instead of a theory
\nof everything which seems to be some sort of mathematical equation which
\nwill solve all problems on earth…which seems unlikely…we need a Science
\nof Everything with all disciplines…the science of man and woman in concert
\nwith all the biological sciences which in turn are consistent with the physical
\nsciences…all on the same page…addressing world problems in a concerted
\npowerful way.
\nHopefully, man and woman will be able to extricate themselves from
\nthe progeny of their minds…from their tools…within a generation or two.
\nThen they will be able to resume a lifestyle more consistent with their
\nphysiology, as humans and machines begin to occupy separate geographical
\nlocations…that is, soon cities will be fully automated and fully connected
\nsuch that only a handful of people will be able to run an automated city that
\nproduces all the goods for a given region. People then will be free to live
\nmore with nature and work more creatively in their living pods made from
\nmembranes fabricated by DNA. In the meantime, recognition of the fact that
\nthe activity within the metropolitan region is a biological activity, should
\nallow the science of man and woman to develop investigative procedures and
\nmedial remedies which will be effective in reducing the torment of this
\ntransition urban stage in human history.<\/p>\n
For a more detailed examination of this whole topic, see my book, Man
\nand the Cosmos…The Science of Everything…available from Amazon.<\/p>\n","protected":false},"excerpt":{"rendered":"
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