Monday, December 01, 2008

Wealth as Biodiversity

I had a devil of a time getting through Econ 101 back in Iowa State, 1968 or so. I hated the moral and ethical implications of what I was being taught, specifically, the notion that prices should go up in times of scarcity — that, in fact, government storehouses should never, ever be used to give away free food to the starving.

Because, you see, the "hidden hand" of self-regulated prices prevents the richest of the petty bourgeoise poor from buying EVERYTHING ALL AT ONCE, en masse, and HOARDING for themselves, with the admirable result that "not as many" little people die from starvation. The subtext, that the very richest of the rich get even richer (and also live through hard times in ease and comfort), was unspoken and contemptible.

The only thing I carried away from that class, aside from an abiding disgust for the "Dismal Science," was contempt for Adam Smith and all economists, with the possible exception of John Maynard Keynes.

If I understand Keynes, it's that an economy is something like (maybe even remarkably like) a rain forest ecology. What does that mean? Well, just like the soils which support the huge rain forests of Brazil are thin, poor and unforgiving to conventional Western agricultural practices, the true value of wealth lies in the way it circulates through the economic system, the faster the better. Every part of the rain forest contributes to recirculation and benefits from it. There's a cheap metaphor in here about the howler monkeys who live high up in the canopy, where the fruits and sunshine are, but they die without recirculation, just like everything else.

I'm not an economist, yet. Or maybe never. IMHO, the hidden Hydra heads of Adam Smith need to pull back a dozen or so bloody stumps on occasion. But I can get my head around ecology, and provided you make a serious re-evaluation of the meaning of wealth, the rain forest analogy — with its emphasis on biodiversity — shines some light for me into the Scrooge-like gloom of greed that passed for Reaganomics in times gone by.



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