Three professors write

Their understanding of economics:

The old order in economics is about the allocation of scarce resources. This is what it says it is about, what it claims and what it does. The new order is about the allocation of scarce resources. This is what it says it is about, what it claims and what it does.

Yes, I too see that this is a revolution. Changes the world entirely.

47 thoughts on “Three professors write”

  1. There are times when ‘Oh, for fuck’s sake!’ are the four most useful words in the English language.

  2. Sometimes you think there must be a God

    “Technically I was made redundant at City, and I knew that was going to happen but it was emotionally harder than I expected”

    That really cheered me up

  3. @Diogenes. I saw that too and laughed out loud and praised the almighty. I did wonder, however, what Capn Spud meant by “technically”. Either he was made redundant or wasn’t. No technically about it. Or, perhaps they thought he was a massive cunt and told him to fuck off because he was an embarrassment to even them.

  4. They aren’t equivalent – there’s a large gap in the ‘new order*’. Both orders address the allocation of scarce resources. The old order tells us that we may not have enough money to do both A and B and must therefore choose one or the other, and in making the choice the cost of A and B will be a significant factor.

    The new order tells us that we can’t do both A and B because that would break Gaia (how this is to be ascertained is left as an exercise for the reader). But it doesn’t help us to choose between A and B, because however much they cost, we (the curajus state, at least) can simply print the necessary money.

    * do we think Spud’s aware of the historical significance of Neuordnung? Nah, probably not.

  5. The old order chart is a straw man. Nobody thinks that the Earth’s resources are infinite. Some of it effectively is because things like metals can be melted down and re used an infinite number of times. With regard to the other stuff, what is the difference between being unable to use a resource because we used it all and not using it because it isn’t sustainable so we stopped using it even though we didn’t need to?

  6. “Technically I was made redundant at City

    You either were or you weren’t. “Technically I was pregnant”.

  7. “what is the difference”

    We leave it for next generations to use is up. Because we love them more than ourselves. And because we believe they aren’t capable of finding their own substitute.

    So we quit using petrol cars, and the world runs out of petrol in 2525. Instead of 2465.

  8. Bloke in North Dorset

    “Technically I was made redundant at City”

    We’ve been through this before. Jobs are made redundant, not people. If he was an employee then they should try to find another similar job, if they can’t then the contract kicks in and you leave at the end of the notice period. Usually employers offer more, especially if they want you to leave quickly.

    However ISTR that the post was paid for by EU grant so it is likely that he will have been on a fixed term contract and all that happens is you leave when the FTC is complete, unless they mutually agree a new contract.

    Alternatively, he could have been on a rolling contract, but then he’d have been in IR35 territory and I’m sure we’d have some sanctimonious posts on that issue.

    As Rob says, there’s no technicality about it.

  9. “Nietzsche is dead, signed God”
    Who is not Richard Dawkins – whom I remember claiming omniscience until someone pointed out in the FT letters that one cannot simultaneously claim omniscience and be an atheist.

  10. Cf everything he’s ever done. Restate the problem using different terms, then mock anyone who dares to use the original terms. All the while, pretending that what he’s done is somehow novel, interesting, relevant or useful.

  11. Back to the original subject – there *is* a difference – Gosplan, in accordance with the Labour theory of value, attributed no value to natural resources and permitted horrendous ecological damage while capitalists attribute value to natural resources [NPV of sales less cost of sales less tax] and some individuals choose to attribute subjective value to nature so that they will refuse to sell to the capitalist and/or contribute money and/or time and effort to maintain/restore it.
    You cannot eat money (unless it grows on mulberry trees and you are a silkworm) so an unlimited supply of money does not, per se, solve anything.
    As Tim says, economics is only about scarce resources – it does not worry about resources that are in excess supply as John bull or Joe Soap can just pick them up off the ground when he wants them.
    Murphy seems to believe that the old order was Communist and the new order is Green.

  12. @ BiND
    So the UK has to fund future costs of things agreed on the mainland (or Malta or Cyprus) agreed prior to 2016 but Brussels will not continue to fund professorships at Islington Poly post Brexit. One of the many examples of the EU spending in the UK that does not benefit us.

  13. “So we quit using petrol cars, and the world runs out of petrol in 2525. Instead of 2465.”

    I have to concede that you are correct. Unless our descendants refuse to use unsustainable fuel too. Cars do continue to get ever more fuel efficient though, my wife’s Hyundai i10 uses about as much fuel as the Honda 90* that I had in the 1970s.

    *Basically a moped with ideas above its station.

  14. Slaves purchased in Sierra Leone were marked up by a factor of 8 to be sold in the Caribbean where a standard herd of human cattle would lose about 8 in 100 every year and require new stocks at that rate.
    The old order, would clearly include continuing with this practice which remained profitable as evidenced by the continuing reliance of the vast Textiles trade in the UK on slave cotton.
    Both utopian Marxists in green drag and low church market puritans omit this kind of problem from their analysis. One does not understand what the slavers did wrong, the other cannot understand that rapacious capitalism is conducted by people,within a culture, not by atoms bouncing around according to economic rules .

  15. @ Newmania 8% gross or 8% net? – African reproduction rates would more than replace losses from 8% gross.
    The UK textile trade used cotton grown anywhere, not just in the USA. The UK’s Caribbean colonies mostly produced sugar (until the EU demanded that we eat beet sugar instead) and bananas.
    As a low church market-oriented individual who finds icons regrettable and saint-worship offensive I can inform you that I am quite, nay utterly, capable of comprehending that rapacious capitalism can *only* be conducted by individuals whereas the rapacious stateism in totalitarian states like China, Venezuela, Angola, Russia, Hitler’s Germany, can be conducted by both individuals and the state. I should like n apology, but do not expect to receive one.

  16. Go on, Newmy, show us where economics of any variety refuses to take in moral precepts. Give us a reference. Enlighten us. Or we will just continue to ridicule your pretensions to knowledge

  17. ‘So we quit using petrol cars, and the world runs out of petrol in 2525. Instead of 2465.’ Actually the Germans learned how to make petrol over 90 years ago. So we already have a perfectly functional substitute.

  18. My family were serfs until 1600’s when they moved slightly to west but was it easy under the Swedish rule until 1809? Heck, no! 1809 it was back to the Mother Russia’s rule. Do I keep banging on about this oppression? Actually I do, constantly. Fuck Russians! Fuck Swedes too! I demand reparations!

  19. Perhaps I need a fucking holiday from the internets. Lately I’ve felt very aggressive. I try to hide it behind jovial banter. Come friendly bombs and blow us up into smithereens, the earth exhales…

  20. Jussi, you are not alone. Three months ago I was saddened to see so many, friends or strangers, given over to irrational fear, people who hitherto I had thought level-headed. But I thought then, this Great Panic cannot go on, people will come to their senses, lockdown cannot hold for more than a couple of weeks. But still it goes on, I am beyond despair, I am angry at the stupidity of the world — what a pity it hasn’t (and won’t) blow us to smithereens…

  21. Bloke in North Dorset

    An idle thought:

    If a professor can be in two minds, is a three professor in 6 minds or 8 minds?

  22. Stonyground, could you give us an example of a resource that has been completely depleted?

    Generally as one depletes its price goes up, and so we use less of it or we replace it. And we tend to discover fresh sources, so supply goes back up. Gold would be the mineral that we have consistently attempted to deplete — going back millennia, and we’re a long, long way off yet.

    There are no elements that we will run out of that were ever abundant in the first place. It’s a Malthusian and Green (but I repeat myself) myth that running out of the earth’s bounty is likely to seriously impede us.

  23. BlokeInTejasInNormandy

    BiND

    Depends. If it’s a quantum professor group the answer is rather large, but fuzzy, perhaps like the corpse of a mega whale infected by penicillin like things.

    If it a patate, it’s a zero-valued singularity. Which is, I believe, rate – but observably true.

  24. It was reckoned that a slave owner with 100 slaves would have to buy a further 8 per year to maintain the number. Since you mention it, I suppose that would be after their “breeding programme” was taken into account.( From Niall Ferguson- How Britain made the modern world )
    Diogenes -Market Economics claims to provide an account of the world. If it is unable to do so without being informed by moral philosophy religion, history and any number of ad hoc phenomenon then I am surprised that even a twerp like you is so impressed? Off you fuck please.
    My point about the abolition of slavery was the extent to which it was acting directly against the profit motive which created it. Slavery was an ancient institution but global capitalism re -invented it new scale and inhumanity, driven by the spectacular profits available.
    Those profits were still available long after abolition but the religious revival in Britain was a stronger force.
    There has been economic theory that has attempted to incorporate reality ( Weber) but Adam Smith, and thinking derived from him, would not be easy to reconcile with the Christian values, their historic rise in 19th century Britain, and the abolition of slavery.

  25. “Cars do continue to get ever more fuel efficient though, my wife’s Hyundai i10 uses about as much fuel as the Honda 90* that I had in the 1970s.”

    Thank your wife for balancing me out. Filled up my GT350R yesterday – 12.2 mpg. 93 octane.

    I ain’t leavin’ no oil for nobody. Git your own.

  26. “My family were serfs until 1600’s”

    My family were minding their own business in the Lowlands when King James had ’em rounded up and sent to Ulster. They managed to get out and head to America. When they got to America, they KEPT ON GOING. My great, great grandfather was a tavern keeper in 18th century Kentucky.

  27. The Meissen Bison

    But Gamecock, you’re in Charlotte, NC, aren’t you? So you’re slowly heading back to us.

    A question which troubles me is this: if, as we are told BLM, why is it that B people stick knives into other B people disproportionately to stabbings in the wider population? If BLM, why do B men impregnate women and leave their unborn offspring to take their chances in the world without a father in their lives?

    The answer seems to be that BL are of little consequence if at the hands of B people.

    This can’t be correct, obvs

  28. As technology developed, slavery actually became *unprofitable*, the greed of capitalism directed profit-seeking towards non-slave economics. Probably the major turning point was the invention of the horse collar that made horsepower cheaper than human power.

    But natural human greed also wanted to be protected from competition from people using more competative technology, as time went on slavery only persisted through protectionism to artificially preserve an economic environment where it could continue to be more profitable than alternatives – because the alternatives were banned or blocked. Still happens – who’s going to buy Jamaican cane sugar at 50p per kilo when we can ban it and ensure the only option is European beet sugar at 100p per kilo to the benefit of European beet farmers.

    While the 100-year campaign of the British Navy to smash the slave trade and break the slave economy was based on very sound humanity, it also had the not unintentional consequences of smashing open protectionist economies where slavery could remain cheap enough to be profitable, but sticking in the British crowbar resulting in British free labour produce undercutting the slave labour produce.

  29. So Much For Subtlety

    jgh June 14, 2020 at 1:53 am – “As technology developed, slavery actually became *unprofitable*, the greed of capitalism directed profit-seeking towards non-slave economics. Probably the major turning point was the invention of the horse collar that made horsepower cheaper than human power.”

    Again there is ample evidence that slavery at its peak was not remotely unprofitable. In fact the collapse of the economies of the Caribbean after slavery was abolished strongly suggests it was highly profitable or at least free labour could not compete.

    The horse collar? Seriously? Slavery started to be unprofitable some time in the Middle Ages before Columbus even set sail? You don’t think there is something wrong with that picture?

    “But natural human greed also wanted to be protected from competition from people using more competative technology, as time went on slavery only persisted through protectionism to artificially preserve an economic environment where it could continue to be more profitable than alternatives – because the alternatives were banned or blocked. Still happens – who’s going to buy Jamaican cane sugar at 50p per kilo when we can ban it and ensure the only option is European beet sugar at 100p per kilo to the benefit of European beet farmers.”

    Beet sugar is produced by slaves? What the ….?

    “protectionist economies where slavery could remain cheap enough to be profitable, but sticking in the British crowbar resulting in British free labour produce undercutting the slave labour produce.”

    In the United States the South stood for free trade, the North for tariffs. I wonder why.

  30. “Technically I was made redundant at City”

    In the city it’s more efficient to make people redundant rather than firing them. We have terms like “termed”, “letting them go” and “RIF (Reduction in Force)”. You basically filter out all those you want to get rid of and pay them a good tax efficient redundancy severance payment so the don’t sue for unfair dismissal and they can put “made redundant” rather than the less appealing “fired” on their CV.

  31. Post disappeared. I’ll try it in pieces:

    “But Gamecock, you’re in Charlotte, NC, aren’t you?”

    South of there, in the amazing state of South Carolina. Where I have lived on and off since 1953.

  32. “A question which troubles me is this: if, as we are told BLM, why is it that B people stick knives into other B people disproportionately to stabbings in the wider population?”

    It’s all completely fake. Blacks are TWENTY EIGHT TIMES more violent than whites.

    The cure for racial violence is to get rid of the blacks. THEY are the problem.

    [link deleted – maybe that’s the problem]

    ‘As for interracial violence generally, blacks disproportionately commit it. Between 2012 and 2015, there were 631,830 violent interracial victimizations, excluding homicide, between blacks and whites, according to the Bureau of Justice Statistics.

    Blacks, who make up 13 percent of the US population, committed 85.5 percent of those victimizations, or 540,360 felonious assaults on whites, while whites, 61 percent of the population, committed 14.4 percent, or 91,470 felonious assaults on blacks.

    Regarding threats to blacks from the police: A police officer is 18.5 times more likely to be killed by a black male than an unarmed black male is to be killed by a police officer.’

    The whole George Floyd deal is a joke. Blacks are the problem. We have the data. It’s not even close. The difference is outrageous.

    Pelosi takes a knee, and can’t get up, wearing an African rag, in support of violent people.

  33. Link out worked. Tried to post it here alone, and it went off to the ether.

    Is nypost.com on the banned list?

  34. “Stonyground, could you give us an example of a resource that has been completely depleted?”

    No. I suspect that the reason is that, though supplies of stuff are obviously finite, we are nowhere close to using up the existing supply of anything. As you say, we either find more of it or use an alternative.

  35. “Again there is ample evidence that slavery at its peak was not remotely unprofitable.”

    Yes, *at* *its* *peak* – when using humans was cheaper than using horses, when the only technology available to use horses killed them quicker than they could be used.

    So, the “cost” of using slave labour – no wages, a bit of food now and then – *was* cheaper and more profitably than not using slaves. Once you could use a horse to plough a field without killing it, *then* horses were cheaper than slaves, and compartively, slaves were less profitable than slaves. Plough several hundred acres with one horse that costs a few bags of feed and can be “housed” in a field is cheaper than a hundred slaves to do the same work, and you have to feed them more, and you have to put them in some sort of shelter.

    Once you get a “horse” that will plough a thousand acres and you only need to “feed” it a lump of coal, even horses are unprofitable.

    You are trying to hold out against the undeniable fact that improving technology makes old methods unprofitable, the horse collar made slaves less profitable than horses, the steam engine made horse less profitable and slaves extemely unprofitable.

    *At* *its* *peak* using firewood for energy was not unprofitable, but using coal, and then oil, and then atoms were *more* profitable, making firewood *un*profitable. Using firewood is only profiable when you have no alternative, either due to circumstances or due to human malignancy prohibiting your access to alternatives. Using slaves is only profitable when you have no access to free men, or your access to free men is prohibited.

  36. “In the United States the South stood for free trade, the North for tariffs. I wonder why.”

    Because the South were the ones paying the tarrifs. Pure self-interest. The North were an industrial economy and net exporters, the South had (essentially) no industry and had to import all their non-agricultural produce. Even the shackles needed to hold their slaves were imported. Tariffs were crippling the South’s economy.

  37. And along comes Lincoln supporting the Morrill tariff, which would triple the tariffs.

    The South said, “We are paying for this happy horseshit, and you won’t even enforce the fugitive slave act. We’re outta here!”

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