What IS money?

 

The rationale for macroeconomic central planning to replace microeconomic extended order via constitutional civil rights as the sociological infrastructure [aka social credit system] for America was revealed in a 1960 memo titled "Growth through Taxation" by Nobel prize winner, former Federal Reserve Governor and member of JFK's Council of Economic Advisors, James Tobin : "Can we as a nation, by political decision and governmental action, increase our rate of growth? Or must the rate of growth be regarded fatalistically, the result of uncoordinated decisions and habits of millions of consumers, businessmen and governments, uncontrollable in our kind of society except by exhortation and prayer?" 

The strategy to implement this planning was an old one well known to historians ... financial manipulation ... fully fiatize the common currency ... but this time it would be done with a new twist by

• detaching the currency from the natural and obvious constraints of reality [which Nixon did by executive order in 1971]
• then delegating the constitutionally mandated congressional responsibility for [aka control over] the fully fiat currency to the new science of econometrics which would be
• theoretically articulated by government funded academics with computers,
  
• officially enabled and macroprudentially supervised by an unelected Federal Reserve owned by a few TBTF private banks and
  
• tactically executed by a greedy gang of Wallstreet wizards with computers
• all under the watchful eye of an autocratic but enlightened Fed chairperson
• who would periodically report back to a completely clueless Congress.

What could possibly go wrong? But as the plan unfolded, the Federal Reserve quickly showed itself to be a serial shape-shifter that will go down in history and legend as without parallel:

• from "the lender of last resort" charged with harshly disciplining speculative fractional reserve lenders which got themselves [and their depositors] into trouble
• to "the great moderator" that would tactfully lead economic actors away from speculation and seamlessly deliver them from illiquidity
• to "the whatever-it-takes master of the universe" that would
• indiscriminately flood the world with fiat currency ["money from helicopters"]
• force the prudent to speculate and
• turn fiat money into real wealth, liabilities into assets, risk into reward and social evil into civic duty.

Money is the key ... and it is organic

Today America is awash in rapidly growing trillions of fiat money and credit, but things are not working out as the planners hoped. Everyone who has studied American history senses

• that the American dream [based on what FA Hayek called "the liberal ideas of the 19th century"] has become [some would say always was] a cruel delusion and
• that "the young are right if they have little confidence in the ideas which rule most of their elders".

But very few understand and appreciate the organic role of money ... a common currency ... in those original liberal ideas, because that role was obscured then declared inorganic [as noted above] in order to construct the financial, totalitarian ideas which now control us. The reason for this pervasive monetary ignorance is that we permitted economics to be divorced from philosophy ... which led to regarding money

• as a purely quantitative conversion formula used by experts instead of
  
• as an essentially qualitative ontological dialogue engaged in by citizens.
  

Or to put it in a single, dense phrase: Money IS civil rights ontology [MICRO] ... and we must see it clearly [with 2020 vision] ... then rescue it from the haunts of the quants by

• revealing its implied presence in the Declaration of Independence,
• restoring it to its rightful place in the US Constitution along side just weights and measures and
• reincluding it in the great conversations among the thinkers across the ages.
  

Civil rights "exist" as money

Had he lived, the thoughtful MLK Jr. might well have gone on from addressing the evils he first saw in the Republic as racial prejudice ... then increasingly as economic injustice ... to be rooted in financial totalitarianism. For MLK understood that the world is organic ... all parts touch and are touched by each other [directly or indirectly via various media] ... implying that social, economic and financial observations are merely different facet-views of the same real entities.

Our approach to the evils we face in the Republic must be equally insightful and courageous ... specific and organic ... scientific and religious ... analytic and moral. As two great thinkers put it:

"Philosophy frees [us] from the taint of ineffectiveness by its close relations with religion and with science, natural and sociological. It attains its chief importance by fusing the two, namely, religion  and science, into one rational scheme of thought." AN Whitehead, Process and Reality, 1929

"Man should not follow a scientific analysis with a plea of moral impotence." R Weaver, Ideas Have Consequences, 1948

For many the thought of money as the form through which civil rights come into being and exist will be completely foreign. But, as we hope to show, money is deeply embedded in the liberal ideas which flowed so strongly from Europe to England then across the Atlantic to America where it became a formal article in the constitution of the new Republic ... then, from the very start, a vehicle for the subversion of that Republic.

Money has always been prone to philosophical neglect [and thus exploitation] due to its immense and seemingly sociologically neutral but arcane quantitative functions. How could numbers subvert ideas ... how could the nominal alter the real? And yet, that is precisely what has been and is still happening.

Inflating economists

This blog is first intended to rescue the idea of money by inflating the collapsed perspectives of economists who are unthinkingly purveying an inherited adulteration of half-truths. This rescue will take the form of a series of challenges for economists to step back from their computers and graphs in order to read and think again ... clearly and generally ... in other fields like ethics, ecology and sociology. As AN Whitehead said:

    "The field of a special science [like economics] is confined to one genus of facts, in the sense that no statements are made respecting facts which lie outside that genus. ... The special sciences, therefore, deal with topics which lie open to easy inspection and are readily expressed by words.

    "The study of philosophy is a voyage towards the larger generalities. ... Thus one aim of philosophy is to challenge the half-truths constituting the scientific first principles. The systematization of knowledge cannot be conducted in watertight compartments. All general truths condition each other; and the limits of their application cannot be adequately defined apart from their correlation by yet wider generalities. The criticism of principles must chiefly take the form of determining the proper meanings to be assigned to the fundamental notions of the various sciences, when these notions are considered in respect to their status relatively to each other. The determination of this status requires a generality transcending any special subject-matter."

An older example will be examining John Locke's idea Of Power from his 1690 Essay Concerning Humane Understanding and his idea Of Property from his Second Treatise of Government in the same year and relating them to the ideas inherent in modern economics including the macroeconomic manipulation of fiat money and credit.

A more recent example will be searching for links between the economic potential that arises from fiat money and credit and the socio-psychological potential that arises from the family which Maxine Eichner attempts to do in her book The Free-Market Family: How the Market Crushed the American Dream (and How It Can Be Restored).

Of course, these are only two instances of the types of broader correlations that could and should be attempted as we rejoin economics to philosophy.

Deflating social rhetoric

However, the blog will also attempt to deflate the highly charged but usually illogical and incoherent social rhetoric that resists reconciliation by revealing the organic role money plays in establishing and maintaining social order and the destructive force money becomes when treated as an inorganic compound that can be safely manipulated by a financial and corporate elite.

Measuring success ... or courage?

How will we know whether this blog is in any way successful?  We may not. As one prominent economist explained in justifying the acceptance of flawed ideas:

"One must decide whether to continue quibbling over definitions or push for even better monetary policy. I have opted to do the latter. I fear that efforts to do the former are wasted, as no one listens."

Who can doubt the frustration expressed or the seeming wisdom of this approach to error? And yet the obvious problem is that without definitions policies are incoherent and results incomprehensible ... which is what we have today and what philosophy has always been charged with rectifying.

 

Another economist saw it differently ... and seemed willing to accept being ignored as a sign of goodwill:

"The bigger picture is that individuals [especially broad organizations] can suggest incremental policy improvements along with more fundamental reforms. Wasn’t it M. Friedman who said that he wanted to have policy options ready so that when conditions changed they were ready to be tried?"

Who can argue with "readiness"? Even Hamlet said, "The readiness is all." And conditions are certainly changing ... fast. Unfortunately there is little evidence that the elite establishment is "ready" to repent [or whatever other words you may wish to use to soften the blow they face] ... indeed, they are doubling-down again and again at every sign of trouble.

Perhaps, what we are missing is something more important than knowledge, policy or reform ... something that precedes and then enables them all. And, perhaps, Hayek glimpsed it when he described what he saw looking back as post-WWII Germany reached the end of the road ... the road to serfdom:

"It is at least doubtful whether at this stage a detailed blueprint of a desirable internal order of society would be of much use - or whether anyone is competent to furnish it. The important thing now is that we shall come to agree on certain principles and free ourselves from some of the errors which have govererned us in the recent past ... to free ourselves of that worst form of contemporary obscurantism which tries to persuade us that what we have done in the recent past was all either wise or inevitable. We shall not grow wiser before we learn that much that we have done was very foolish. If we are to build a better world, we must have the courage to make a new start."

So it is with courage that this blog is begun ... and courage that it will hopefully contribute to others ... for we desperately need great men and women in America again.

The alternative to courage

I will close this introduction to the 2020MICRO blog with a thoughtful but chilling observation and warning recently sent to me by a friend who has also been frustrated and tempted to give up speaking out when nobody listens:

I don’t know about you, but I have found myself asking the question where have the giants gone? Where are the "great men" who once bestrode the earth, the real Titans?

For myself, one answer – though certainly not the only possible answer – can be found in the history of the nations found in scripture. Isaiah 3 is particularly enlightening. In a word it is judgment. We read: “I will give children to be their princes and babes shall rule over them. The people will be oppressed, everyone by another and everyone by his neighbor; the child will be insolent toward the elder, and the base toward the honorable.” Is 3:4-5. Commenting upon Isaiah 3, Calvin observed: “Whenever it shall happen that we are governed by men who are of no estimation, and who are more insignificant than children, let us acknowledge the wrath of the LORD, if we do not choose that we be charged with the grossest stupidity.” Calvin further said; “When we are deprived of good shepherds, let us acknowledge God's wrath, and let us know destruction is not far off.”