Tuesday, December 08, 2009

Wanderers 2009.12.8

The geezers have gathered (sorry guys), to learn about economics.

Cascadia Wild's Maid Marian brought some marionberry pie last night and didn't tell anyone, so I'm gnoshing on a slice, sipping wine brought by Jeff Goddard, our computer systems guy with a Masters in international management from Portland State. He's in the process of turning himself into a hacker.

We're also graced with Joe Arnold the psychiatrist, Barry Redd the retired bank examiner and operations guy, Maris the electronics engineer, more of the usual suspects.

Our guest tonight is Cay Hehner, Director of Education for the Henry George School of Social Science. His dad commanded a German minesweeper during Second World War. His grandfather flew with the Red Baron.

He's glad the fascists lost and that we're not all goose-stepping, dead, or in camps.

He's studied the History of Ideas at the University of Berlin. He's been running the Henry George School in New York for the last six years, had a career as an investigative journalist before that.

His school offers free adult education classes in the basics of economics, cutting through a lot of the BS (economics is a topic especially hard to speak truth about).

The NYT business section announced the end of business as usual back in January. The Wall Street Journal has echoed with similar sentiments. In 2007, the housing bubble burst, leading to a credit crisis of a magnitude not before seen on the planet, followed by an election year.

Truth about the real depth of the recession started coming out in 2008. Given we're almost to 2010, the semantics would suggest the term "depression" is not out of line (recessions are short term).

The old world order of five worlds has crashed. 1st world: capitalism (LAWCAP); 2nd world: USSR, others behind the "Iron Curtain"; 3rd world: non-aligned nations (Brazil, India...); 4th world: breakaway regions falling outside the established nation-states (incipient states, like Basques, Kurdistan... Texas); 5th world: counter-cultural movements that challenge the first four (think anti-WTO groups at the Battle of Seattle, anarchists, buckaneers etc.).

Cay was one of the journalists covering the fall of the Berlin Wall.

Given the 2nd world has disappeared as of about 20 years ago, this five-worlds house of cards has fallen apart. The Russians are busy being capitalists while the USAers are nationalizing their industries to an unprecedented degree.

The Chinese are "free market communists" which would make Karl Marx "rotate in his grave" -- it's like turducken (one system inside another, or like Russian dolls). Basically, it's all just a lot of word salad these days.

The old framework (way of thinking) is just crap. Even if there's no "new world order" that people agree on, we at least know it's no longer the old one.

The new wars for world domination will be fought in cyberspace, in the virtual world. The theme is still resources of course (the preconditions of human life) but the edges are psychological and in the realm of computer science.

Resources are what satisfy the base of Maslow's Pyramid (like a food pyramid) and therefore have intrinsic value (whether or not they involve work, human labor).

The scientific consensus is there are sufficient resources to take care of humanity's primal needs, provided we make full and appropriate use of our know-how (technology, smarts). The oil is running out though i.e. this isn't about perpetuating bad habits developed around fossil fuels. Lifestyles will need to change, but that doesn't mean "for the worse". "More with less" means more quality of life, not more mindless wastefulness. If everyone tried to live like a currently well-off USAer, even ten Planet Earths would not suffice.

Cay sees Malthus as a "contract writer", a shill for the British aristocracy anxious about the USA and French revolutions (1776, 1789) and hired to write something to justify the enduring authority of a ruling class (1798). The world population was under a billion at the time, and he was already pushing the panic button. Per Fuller, and with the wisdom of hindsight, we see that canned food and refrigeration would greatly change his equations.

Wealth and money are not the same thing. Confusing the two is a source of a lot of craziness.

Way back in 1894, Henry George provided some analysis that might help us out of our spasmodic throes, our awkward responses to the breakdown of "first world" lawyer-capitalism. Per Ricardo's Law of Rent, you get high and low pressure areas (land values) like the weather. These fluctuations result in "financial winds" that might power the equivalent of energy-harvesting windmills.

Taxes from speculation that exploit these ever changing differentials, channeled to public good, leaves people free from taxes on their own labor ("income tax" = "highway robbery" in this system). These differentials are often societal to start with (land values go up because of an added subway line, or because the minerals were there in the first place -- no thanks to property owners -- or simply because of increasing population density) so it stands to reason that society should reap the benefits of its own public investments.

Cay and his colleague Jeff Smith, the Henry George experts in the room, applauded my last two paragraphs as an apt summary, so I'll take a bow as a perspicacious blogger.

Speaking of economics, I should probably just drop my health insurance, as it's all premiums for no benefits beyond a huge deductible. I can't afford normal health care because I'm gambling on getting hit by a bus or having a heart attack. Do other countries know how to provide? On math-teach I wrote:
I'm paying a huge premium for a huge deductible, think I should be allowed to shop overseas for better plans, with the local system (e.g. Providence) getting reimbursed from say Sweden or Russia (if that's where I buy my care).
Tara is healthy and I'm switching to a more vegan diet. If I opt out, it may be hard to opt back in again, even minus pre-existing conditions, but there's no USA-based solution on the horizon anymore (the USA seems effectively dead in that respect). Citizens making under $100K per annum have been effectively dispossessed, walled away from their heritage. Besides, my favorite family physician is fed up with my insurer. What's the point anymore?