What Keynes actually said and meant.
Azizonomics
In The Long Run We’re All Dead
John Aziz
Here is another Keynes quote about "the long run."
When the accumulation of wealth is no longer of high social importance, there will be greatchanges in the code of morals. We shall be able to rid ourselves of many of the pseudo-moral principles which have hag-ridden us for two hundred years, by which we have exalted some of the most distasteful of human qualities into the position of the highestvirtues. We shall be able to afford to dare to assess the money-motive at its true value. The love of money as a possession — as distinguished from the love of money as a means to the enjoyments and realities of life — will be recognised for what it is, a somewhat disgusting morbidity, one of those semi-criminal, semi-pathological propensities which one hands over with a shudder to the specialists in mental disease ... But beware! The time for all this is not yet. For at least another hundred years we must pretend to ourselves and to everyone that fair is foul and foul is fair; for foul is useful and fair is not. Avarice andusury and precaution must be our gods for a little longer still. For only they can lead us out of the tunnel of economic necessityinto daylight.• "The Future", Essays in Persuasion (1931) Ch. 5, JMK, CW, IX, pp.329 - 331, Economic Possibilities for our Grandchildren (1930); as quoted in "Keynes and the Ethics of Capitalism" by Robert Skidelsy
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Will humanity make out of this morass by 2030? Or was Keynes being overly optimistic?
15 comments:
I honestly don't give a fuck about having a shitload of money neither goods (well, I been quite a bit of a record collector I can admit that much).
I also believe a lot of people are this way, and are good enough with having a "reasonably" comfortable life.
But there is a part of our species which is made up of hoarders, which accumulate all they can and more and never have enough. How do we deal with this? I cannot think of much 'non-coercive' solutions to this problem, I also believe is, partially a genetic problem (with a heavy environmental component though).
But the biggest problem right now is not that this class of individuals exist, is that they are in power and control of the social fabric. They have created a narrative around it and they have entrenched at their positions, and won't let it go easily. Lucky for us, this is a political problem, and (almost) all political problems have solutions.
Avarice and usury and precaution must be our gods for a little longer still. JMK
Did Keynes mean ALL interest charges, not just "high" interest charges?
But Keynes was mistaken. Common stock is a perfectly ethical form of private money that would have permitted just as much or more economic growth as the government-backed credit cartel and without the waste and misery of the boom-bust cycle.
What a wondeful quote.
Keynes, like Marx, realized that the way to progress is paved with capitalism. We have to to through this phase as a species, if we can last it out long enough to get beyond it to a sustainable steady state system.
Don't you mean fascism? Why does "capitalism" necessarily need a government-backed usury for stolen purchasing power cartel? Why does progress require injustice and oppression? It doesn't.
I think we have to discard the word "money" to begin with...
Apostle Paul warned Timothy about 'argurion' which was SILVER, ie THE METAL, in the somewhat famous scripture which is typically mistranslated like Keynes does here 'love of money'...
There was another human created 'device' which was referred to by the Lord and Aristotle as 'nomisma' of which Aristotle informs us:
"Nomisma by itself is a mere device which has value only by nomos (law) and not by nature; so that a change of convention between those who use it, is sufficient to deprive it of value and its power to satisfy our wants." — Aristotle, "Politica."
'nomisma' is "pro-law, anti-metal"...
I guess Keynes was referring to 'argurion' or 'metal' when he used the metonym "money" here as he probably wrote this before we went back off the metals... then he is technically correct as this is exactly what the Apostle was referring to.
So to understand what is really going on today you have to use the two words separately and not mix them up by using the metonym "money" which the corrupt-moron academe of economics today uses all the time...
The term is imprecise, our intelligent and civilized and non-barbarian and non-libertarian Greco-Roman ancestors didnt even have an equivalent word in their vocabulary.
If you discard the word "money" and instead use the two terms (or some modern equivalent) "nomisma", which is of the civilized; and "argurion" which is of the barbarian, you HAVE to acknowledge the two systems and the significant socio-economic differences that they represent...
Once the people realize this foundational difference between the two systems, then we can start to get the citizens to figure out which side they are on and vote accordingly...
Again "money" another epic fail by the academe of economics...
rsp,
Ignacio,
Paul warned about two things separately there... one was "pleonexia" which means "more-having" commonly translated as 'greed' and doesnt mean "more money" per se, like your 'hoarding' you have here imo..
and also "philarguion" which is 'fondness for silver' which is an entirely different thing which implies "pro-metal, anti-law" imo...
I think we may want to look at these two things as separate human maladies...
rsp,
Matt, the fundamental basis and mechanisms for both are IMO (with he empirical evidence we have right now), the same. The preference over currency may be a matter of fungibility and comfort/convenience. We are not worried about hoarding of gold or silver, but you may say this behaviour comes from the misunderstanding of an old system of scarce commodity money.
However it's not, the fondness for 'units of account' (is like if we wanted to hoard 'meters' or 'litters' kinda hilarious tbh) in general is because of social status. It was an adaptive function, byproduct of evolution (see similar behaviour has been observed in other mammals!), where the importance of this function is about the relative position of the individual compared to the rest of collective (social hierarchy), more than about material scarcity (in absolute terms)!
You see it from a systems point of view (ie. 'nomisma'), but shifting perception of the type of money we are using, wouldn't change much regarding hoarders. Because the fondness is not a fondness for one qualitative type of money or good or other, but a fondness for social status DERIVED from the accumulation of 'units of account' in relative terms to the rest of the society as a comparative measure.
Summing up, greed is not the ultimate cause for the hoarder mentality, is just a consequence. hence making distinctions between the types of greed is not going to make us understand better the problems we have. The causality goes back to a more primary sentiment of desire for power, control (you can tell a lot of the hoarders are control-freaks) and ultimately, a need for social status and primacy in the social hierarchy.
Some food for thought.
But people dont even realize that we have a 'nomisma' system again today so how can they be accused of wanting to "hoard" it?
But from the way I look at it, yes, "more-having" can apparently apply to anything... and I suppose some could be led to hoard balances of state currency... but at this time, I submit that nobody who is hoarding "money" doenst really understand what it is they are led to want to hoard in this case ... which is interesting... like you say they are actually wanting to hoard "liters" or the equivalent...
If they could understand that is what they are really doing, maybe they wouldnt want to do it anymore???
Or maybe as Warren says they are operating as if we are still on the metallic standards, ie "the gold standard mentality" and somehow are mixing up this association between "money" and the metals and that is leading them to hoard it (as they think it has some sort of metallic association?)
We certainly cannot hoard "liters" as you point out so I wonder if people really understood what they are doing, if they would continue to do it?
rsp,
Well, currency is a tool for measuring subjective value. But it's also a tool to acquire that value you are measuring. Problem comes with the difference between micro behaviour and macro utility of currency management.
At micro level, currency can buy you out 'stuff' (from cars to political influence, sadly); at macro level it's function is mainly (but not only, specially when we get to international relations and trade) an accounting tool.
Most people only need to understand and act at micro level. The problem is when people who has authority translates their own individual 'micro' behaviour to 'macro' policy. There you may have a point, and it's what I was talking about in the last paragraph of my first post.
As long as people in power refuse to conduct fiscal & monetary policy from a 'systems' point of view (accounting & flows) and translate their own personal obsessions with hoarding mentality to actual policies, it's hard to even start to change anything.
Most (not all) people in authority are of two classes, zealots and cynics. Zealots can't transform their ideas, they are incapable of rational analysis. And cynics are... well, cynics; they will make anything to advance their own personal agenda however misguided it is, in the medium they operate in (example. "I know... but I can't say that in public.").
But this is all politics, so the right individuals must be put in charge by the people. I don't think we can do much about hoarders right now (because after all, they operate according to their own 'micro' behaviour and interests). But I don't think the majority of society has a extreme hoarder behaviour (if it did, we wouldn't operate at all, we would live in chaos).
So if we can shift public perception away from the 'money scarcity' and 'debt doomsday' narrative, responsible people could be promoted to positions of authority, and even cynics could promote policies that are helpful for the majority for the population (even if not perfect), at least better than the current state of affairs.
Ignacio is correct and so was Marx. Economics, which deals with resources, is a consequence of politics, which deals with power, and politics is a consequence of psychology and sociology, which deal with personal and social dispositions, and psychology is a consequence of the level of conscious, both collective or social and individual, which is determinative existentially, cognitively, volitionally and affectively, therefore, ontologically, epistemically, ethically, and aesthetically. Human beings collectively still much closer to being primates than being truly human in the sense of living up to the potential of human nature, and so the "angels of our better nature" are not much in evidence much of the time in many cases, and these are often the cases that count owing to distribution of power.
Good points all...
But I would perhaps re-emphasize the fact that those at the macro level really dont understand what they are doing.... they are as Warren says in the "gold standard mentality" and are completely lost... so this is hard to understand..
I made this comment the other day:
"Warren made a funny analogy a while back where he likened this to how back in the day (I remember these things) where the child car seats sometimes had a little steering wheel on them and the child could turn the wheel and think they were driving the car...
So he said these morons were like the kid in the car seat who thinks he is steering the car..... which was funny!.... but if you think about it, these morons ARE ACTUALLY DRIVING THE CAR.... so we have to realize this and watch what is REALLY GOING ON with them and perhaps anticipate what they are really doing.... if we want to make better predictions...."
So perhaps to your greater point here we indeed need people who "know how to drive the car".. or some equivalent...
rsp
"still much closer to being primates"
Perhaps not even there Tom (sadly) as with the monkeys who use the stick to get ants on the stick and then lick the ants off for a protein source, the monkey's "academe" that is responsible to teach the next generation how to use this tool (ie "the stick or twig") gets the job done...
We had state currency established via "law not nature" according to Aristotle over 2500 years ago probably and then it was lost...
so the "lesser" primates have a better academe than we humans apparently....
rsp,
Matt, don't understand it or don't want to understand it. And some do understand it but don't let on publicly, as we know from Warren.
And to Ignacio's point about relative wealth, I recall having a argument with someone at Bill's place in the comments. He understood MMT perfectly and opposed it. He finally admitted that the reason he opposed it was because he would be relatively worse off although more wealthy in absolute terms. But he would not feel as wealthy, because the relative difference would not be a great. I responded that he had to be kidding. He assured me that he was very serious about this and it was his bottom line.
Tom,
Now THAT person is a candidate for an ankle bracelet and surveillance imo....
;) rsp
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