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Re: NAFTA, Capitalism and Alternatives, Debate, VIII/1
Dear friends who have been following the controversy:
Again, I hate to sound like the party pooper but creating a "straw man" from
standard economic analysis by attributing to it things that are NOT STANDARD
ECONOMIC THEORY and then destroying the straw man is not intellectually
honest.
Where does it say in any economics book that a higher standard of living
means access to a larger bunch of commodities, as you so boldly claim it does?
A higher standard of living means a higher state of hapiness, that's all and
you know it. Remember that economists talk not about baskets of commodities
but about baskets of goods. Now goods are not necessarily commodities. Family
company, being loved by somebody, feelings of pleasure derived from
altruistic behavior, and living in one's community are all economic goods.
The differences between an economic system where there is no "central planner"
who decides what is best for society and a system where individuals are free
to pursue happiness any way they see fit are obvious. In one, the decision is
made for the individual. In the other the individual is the master of its own
destiny. It is very illustrative that most dictatorships on the right or on
the left claim to be acting in society's best interest. But it is always the
same: A person with good intentions who thinks he knows what is best for
everyone. Why, if only people stopped acting foolishly and selfishly everyone
would be better off he thinks -if only they would listen to me.
Again, I dare you to produce a standard textbook or article that asserts
that, as you wrote "contemporary economics defines a "healthy" economy as a
growing one, one that produces more and more stuff to be sold in the
market --regardless of the makeup of the stuff, regardless of the negative
side-effects of both production and consumption". Whew, gosh, and golly!
First, most economist have long -very long, as way back as the American
Institutionalists and even back further to the agrarians- agreed that
measuring economic growth, with any degree of credibility, is practically
impossible and comparing economic growth between countries downright foolish.
Why? because different individuals value goods differently, however only
market prices, as opposed to true shadow prices, are discovered. Further and
more importantly, a plethora of goods are produce outside markets that can be
measured additively. Things such as family security, love, tradition, etc.
are all economic goods -they are scarce, we would like to have more of them-
and yet can not be measured in the aggregate (though they can be measured for
an individual through revealed preferences). Also, when a family member stays
at home and does laundy and cooking, or raises corn or chicken for
self-consumption, his production deos not enter into GNP or other traditional
measures of output. On the other hand if he buys his corn, chicken, or
laundry this enters into GNP and as every "standard economist" knows
this corrupts GNP or GDP as measures of growth.
In response to your question about the adobe house and the status of the
peasant (why insist on the patronizing use of the word campesino, senor
Cleaver?). Some people will prefer the warmth and charm of adobe, and some
will put up with the discomfort of the brick to enhance their status. The
point is that the ideal system allows them to make their personal choice. Of
course, to the extent that they are well informed their decision will be
better, that's why education is so critical for the good operation of a
system based on free-will. People buy cars which are not necessarily the
safest, or thriftiest, or most comfortable. Some buy the fastest, and others
the safest, and do so according to their will putting up with the
consequences. Let me ask you: Have you ever worn something that was
uncomfortable, just because you needed to look good? Maybe for that job
interview, or to get that hot date? If you are like most people you probably
had, and yet you did what was "rational" (A nice thing about economics is
the wide latitude to define "rational"), didn't you?.
Now you go about the concept of development. First, most mainline "standard
economic theory" economists regard "development economics" as quackery. So
you can kick that straw man as much as you want. Just don't call it
"standard economic analysis". You are right in your criticism of "developos",
but they are not "traditional" economists.
Horacio Soberon.