ECONOMIC BASICS
Despite what one might assume from casual observation, economics aren't
fundamentally about money. Rather, it is in the human sphere of things about
*choice* and *comparative value* and, more fundamentally, it is about
natural flow.
Thus economics isn't really something we can avoid, no matter how hard we
try. And it isn't anything inherently bad either, no matter how devastating
the effects of old civ economic systems might be.
We make choices constantly in our daily lives, consciously or unconsciously.
Typically the choices are about getting the most of what we find desirable,
giving up as little as possible of something else we find desirable. We
measure the relative values of our options and we choose the one that seems
to maximize the value we'll experience.
If I go to the supermarket and there are several lines by the cash
registers, I will choose which one to stand in based on what optimally fits
my criteria. Most likely I will choose the line where I have to spend the
least time to get the result I want: checking out my groceries. I might
have more complicated criteria and make a different choice that optimizes
what I want. E.g. I might like the clerk at one stand better than the
others and be willing to spend some extra time to be served by her.
That's economics. Most decisions we make are economic. We give up one thing
for another. Even if what we do is "free" or if it is noble and self-less.
If I decide to go to the park and look at the trees, I have at the same
time, whether I think about it or not, decided *not* to do many other
things I could have done instead. I have decided that it is more valuable
to me than sitting in my backyard looking at trees, more valuable than
mowing the lawn or watching TV.
Most people will act rationally within the context they find themselves in
and with the information that is available to them. OK, many people don't
have the right information and they might not be paying attention, so they
might make dumb choices. It doesn't change the fact that most people will
try to do they best they can with what is available to them.
Even in a completely cash less society there would be economics. Everybody
would be making choices based on value. Not necessarily material value, not
necessarily value towards personal greed, but value nevertheless. And those
choices would determine how things would flow.
If person A is doing something I find very useful and person B is doing
something I find less useful, or even destructive, I would naturally choose
to support person A with my time and energy. Unless maybe person B is more
fun and interesting to hang out with. Or unless there's some negative
consequence involved in supporting person A. Which still adds up to the
same thing - a choice of maximizing the values I most care about and
minimizing the values I don't care about.
In a totally free market economy, whether it uses a currency for exchange
or not, those who do what is found desirable will be most supported and
rewarded. Those who don't will be less supported. Beneficial activities
will be supported, undesirable activities will be weakened. Other values
might come into play and those who are so unfortunate to not have anything
desirable to offer anybody might be supported based on a general valuing on
human life.
Supply and Demand is the equivalent to the self-regulating properties of
nature. If there's too much of some factor in an ecosystem, like too many
mosquitoes, some other factor will tend to move in to even it out, like a
species of birds will start proliferating that will eat the mosquitoes. In
an unhindered economic system, if something is desirable, but scarce, it
will get valued higher and somebody will therefore be more motivated to
produce it. If there's too much of something it gets a lower value, gets to
be less desirable to produce, and things will balance themselves out.
There are, unfortunately, hardly any free markets on planet Earth. Native
cultures probably had something like it. Some intentional communities might
have it.
The major economic systems on the planet like Capitalism and Communism have
very little to do with free markets, whatever they might pretend. Both are
based on aggregation and monopolization of power, money creation and rule
making. All designed to skew economic factors in the favor of elite groups.
Supply and Demand are often manufactured artificially by misinformation or
manipulation of resources.
A centrally controlled debt-based money system skews the factors people
make choices about. People will still tend to make the best choices they
see themselves able to within the constraints they find themselves in. But
the system is rigged so that material consumption is valued more than it
naturally would be, personal greed is rewarded, environmental conservation
is under-valued.
Laws become a factor in influencing economics as well. But not always in
the expected ways. Making something illegal will make it a less valued
choice in some circumstances, but a higher valued choice in others. Making
drugs illegal creates a huge market for illegal drugs that wouldn't exist
otherwise. The right kind of "businessman" will find that he can charge
much higher prices for products of lower quality.
Many behaviors that might be considered socially undesirable exist exactly
because the prevalent economic system is rewarding them. A car thief is not
stealing cars to be mean to people. He simply notices that little effort
produces great paybacks - the potential rewards outweigh the potential
risks. It is an economic choice more than a moral one. Of course a person
with a higher value on what he considers moral behavior will choose
differently.
Whole systems thinking is about looking at all the factors of a system at
the same time, noticing how the adjustment of one value will affect he
natural behavior of the rest of the system. The task is to find the layout
of the system that will maximize the desirable outcome for most
participants.
Systems tend to be based on a principle of the path of least resistance.
Nature works that way. Water flows downhill pulled by gravity, naturally
selecting the "easiest" path, based on the obstacles that are in the way.
Water doesn't seem to have a choice of doing anything different.
Humans, as compared to many other parts of nature, have the additional
faculty of being able to make choices based on abstract criteria. But
otherwise humans do pretty much the same thing. They tend to flow in the
way that feels most optimimum given the forces and obstacles that they
perceive. Their abstract values and criteria are just part of the landscape.
We don't easily change the world by just telling people what would be the
"right" things to do. To really engage large numbers of people in positive
change we need to ensure that the choices that are the most obvious, easy
and attractive also tend to be the ones that serve the whole.
One way of assisting people in making choices more in alignment with what
the whole world needs is to provide better information, better feedback
about the results of our actions.
An often-quoted experiment in systems thinking consisted of providing half
of the residents in a certain all-utilities-paid housing community with
electricity meters placed very visibly in their entrance hallway. The other
half had electricity meters hidden away in the garage where they were
rarely seen. Otherwise everybody lived under similar circumstances and
nobody were given any special instructions. The people who had visible
meters ended up using on the average 30% less electricity than the ones who
couldn't see their meters. Why? Because they had feedback on the result of
their actions and their natural tendency would be to make the best choices
they could based on what they knew about.
Establishing economic systems that reward social behavior and that aid
people in seeing the results of their actions might be instrumental in
growing a new civilization.
Noticing and understanding the fallacies in economic structures that are
rigged to materially enrich a small elite and to discount many human,
spiritual and environmental values, might produce insights in how to
leverage those systems towards something more generally empowering.
You can't avoid economics, even if money is of no concern to you. Sure, you
can choose to use your energy without any regard to whether it is producing
what you really want or not. But what does that prove? Not paying attention
to the feedback doesn't get the economic factors to go away. The fact
remains that you're more likely to find or build what you really want if
you pay attention to the circumstances you're in and you deliberately
choose the approaches that are in alignment with them or that are leveraged
on them.
- Flemming
Recommended reading: "Hidden Order - the economics of everyday life" by
David Friedman.
o o
/ \------------------ Flemming A. Funch -------------------/ \
/ * \ New Civilization Network / Synchronicity Networks / * \
/ * * \ ffunch@newciv.org / * * \
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