Re: The Foundation of Understanding

From: Les Cargill (lcargill_at_bellsouth.net)
Date: 07/05/04 

Date: Mon, 05 Jul 2004 12:36:04 -0400

Mark Monson wrote:

> First comes the foundation, then the building above. In economics, first we must
> understand the basics of production and distribution of wealth (goods), before we
> start with money and higher math.
>
> It's been over 100 years since Henry George published the 600 page book that barely
> mentions money and math, yet his explanation of the production and distribution of
> wealth remains concise, consistent, and timeless.
>
> "Progress and Poverty" http://www.henrygeorge.org/chp1.htm
> will never be outdated because economics will always be about producing and
> consuming the products of labor: the real goods and services made by human beings.
> The analysis is the same no matter how sophisticated the production tools. Money
> is never the object in itself. Rather, money is the means to an end.
>
> The Neo-classical school attacked George because he concentrated on real goods and
> showed how parasites were consuming the labor of producers. The Neos sought to
> make economics an exercise in mathematical formulae divorced from reality and man
> made law - hence the change from "political economy" to economics". They succeeded
> in making economics a confusing mess, and not by accident. Their paymasters are
> well pleased that students can't see the free-riders.
>
> MM
>
>

To review - George wishes to adjust definitions of property to
create some means of recovery of Ricardian land rent by the
"society" itself.

This leads immediately to three rather profound problems:

1) Present land rent systems seem to conform to values, preferences
and expectation of the population as it is. Changing this requires
positing the sort of "property rents are slavery" equivalenences
we've seen here. Even if it's true, the Georgists have a mighty job
getting the message out and convincing people. And it's a difficult
message.

2) The implementation implies some method of distributing the
land rent taxes that does not encounter the sort of corruption
we've seen with "redistributionist" schemes.

It would appear that examples exist where this has beeen done
in non-European cultures. The problem there is convincing us that
this'll work. Hong Kong and Singapore are hardly templates for
the world. They might, however, be templates for New York City.

3) There has been no work done to establish analytically that
some greater good is not served by this "lesser evil". IOW,
humans being what they are, how can we assert confidently
that land rents do not support *somehow* the better part
of human nature. It is easy to assume production is somehow
"better" than consumption, but with automation being what
it is, production will be a vanishingly problematic thing.

This last one's kind of vague, and I haven't worded it very
well. It's vaguely "things are as they are for a reason. What
are the reasons?" 

--
Les Cargill

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