Debt: The First 5,000 Years, by David Graeber, is a fascinating and astounding look at the ubiquity of debt in human affairs. It replaces many “accepted” theories on the origins of money and debt and disproves the Myth of Barter by studying the anthropological record. From my own experience, economic theories and models are almost never based on actual historical observations, only upon assumptions about human behavior and interaction that I personally find naive. Just look at the Efficient Market Hypothesis or the idea that humans are rational decision makers — these ideas or their assumptions quickly fall apart with a simple analysis. People can lie and manipulate; they can be greedy or ascetic. It is nice to finally have a down-to-Earth study of actual historical accounts of human interactions without forcing the current paradigm on the past. Graeber’s book provides a wake-up call for people to see a more realistic view of the interactions of humans, debt, markets, government and money.
Category: economics (Page 1 of 7)
Tragedy and Hope by Carroll Quigley narrates and analyzes world history from the late 1800’s to 1964. Throughout Quigley’s narration he mentions details of individual people who welded enormous power and influence over events; it would be naive to suggest that they were “all powerful” – some of the time they successfully shaped history while at other times they failed. It is simply the nature of the hierarchical system of organization of society which encourages and allows such influence.
I would agree with G. Edward Griffin that conspiracy is an important force in the formation of history and is critical to understanding why events progress in various ways. However, we must be careful with attributing full power of determination to such forces. We should qualify with Bismarck’s comment that: “The statesman’s task is to hear God’s footsteps marching through history, and to try and catch on to His coattails as He marches past.”
It is humorous that most people on the far right recommend Quigley when he mentions several times in the book that he despises them and their motives. For instance on page 1244:
The second most numerous group in the United States is the petty bourgeoisie, including millions of persons who regard themselves as middle class and are under all the middle-class anxieties and pressures, but often earn less money than unionized laborers. As a results of these things, they are often very insecure, envious, filled with hatreds, and are generally the chief recruits for any Radical Right, Fascist, or hate campaigns against any group that is different or which refuses to conform to middle-class values. … They form the major portion of the Republican Party’s supporters in the towns of America, as they did for the Nazis in Germany…
This attitude is reflected in various forms throughout the book. On the other hand, Quigley greatly supports conservatism of an interesting type; on page 1232 he says:
… we might say that the whole recent controversy between conservatism and liberalism is utterly wrongheaded and ignorant. Since the true role of conservatism must be to conserve the tradition of our society, and since that tradition is a liberal tradition, the two should be closely allied in their aim at common goals.
He reflects on the underlying power relationships and how they function when he continues: “So long as liberals and conservatives have as their primary goals to defend interests and to belabor each other for partisan reasons, they cannot do this.” The traditions of society cannot be conserved because the power held by special interests opposes unification.
Far right people are the first to tell you about grand conspiracies like the Trilateral Commission or the Round Table groups as mentioned by Quigley. In fact, it was from a clip of Alex Jones that I learned about Quigley’s book. In my own experience both the far right and far left maintain ridiculous and unrealistic outlooks and understandings of power.
The Western Tradition, which Quigley mentions extensively, exists in his mind, if not in the real world, as a basis for all the progress and success of the people who self-identify as “Western.” He states on page 1229 that Western Traditions consist of six core fundamental ideologies:
- There is a truth, a reality.
- No person, group, or organization has the whole picture of the truth.
- Every person of goodwill has some aspect of the truth, some vision of it from the angle of his own experience.
- Through discussion, the aspects of the truth held by many can be pooled and arranged to form a consensus closer to the truth than any of the sources that contributed to it.
- This consensus is a temporary approximation of the truth, which is no sooner made than new experiences and additional information make it possible for it to be reformulated in a closer approximation of the truth by continued discussion.
- Thus Western man’s picture of the truth advances, by successive approximations, closer and closer to the whole truth without ever reaching it.
However, Quigley is no idealist, and his thoughts help to provide a realistic understanding of the nature of power in the hierarchies which control and function on various levels in nation-states. And he does this through a narration and analysis of “history in our time.”
After watching Chris Hedges’ interview with Sheldon Wolin, I desired to read Wolin’s books. Democracy Incorporated provided a creative perspective with which to interpret recent American political and social events. Upon completion, I had an urge to continue extracting the political ideas of Wolin and I concluded that the best way to do this would be to jump into the deep end and open his book, Politics and Vision. Not only do I now have incredible respect for his ideas but I also feel that he has broadened my personal awareness of my place in society and history. There are criticisms I have toward the content (exclusively focused on “European/American”), but they are rather minimal in scope compared to the benefits any reader would gain by reading it thoroughly. I would say that Politics and Vision, as time progresses, will turn out to be one of the most important books I have ever read.
The End of Certainty by Ilya Prigogine provides insight into the natural processes which give rise to the novelty of life. Despite being published in 1997, there are so many great quotes and concepts which are still applicable today, that I will just say, “Read the book!” It will also help to read Stuart Kauffman’s book, Investigations, either before or after reading Prigogine’s book. Approaching from a different angle, Kauffman explores biological processes of nature which give rise to novelty and creative adaptive structures. Both books talk heavily about the dynamics of equilibrium and entropy. In the words of Prigogine, on page 67, “…matter at equilibrium is ‘blind,’ but far from equilibrium it begins to ‘see.'” Thus, non-equilibrium systems can think and observe the world, whereas systems in equilibrium are ignorant of all outside processes.
The approach of Prigogine lies in understanding the importance of Poincaré Resonances on dynamics and the construction/destruction of correlations at the microscopic level. How these resonances and these correlations behave leads to macroscopic features and the breaking of time symmetry. He deals with solving these Large Poincare Systems outside of the Hilbert Space; this is a concept which is important to biology and human social sciences. Because in these fields, we are always dealing with a system (human beings) which is far from equilibrium and behaves in novel and creative ways.
In other words, life, as a non-equilibrium dissipative structure emerging from the non-living world, needs to be studied under the auspices of “The End of Certainty.” Irreversible processes and long range correlations are critical to understanding the development of self-organization and the novelty of life.
All social sciences deal with a biological organism (humans), which is a product of non-equilibrium processes. Even Prigogine and the book itself are correlated with the mass of knowledge produced by humanity in the 20th century. In other words, his ideas and those of all scientists are subject to the same non-equilibrium dynamics which Prigogine talks about in his book. Resonances and correlations in the social sphere can lead to amazing discoveries or a lack thereof.
One subject that I think could see development from Prigogine’s ideas is economics. Economics should be considered: “The study of non-equilibirum dissipative structures created by the self-organized social species known as homo sapiens, to reproduce and adapt in the biosphere called ‘Earth.'”
What I thought about the most was the concept of correlation creation and destruction. In terms of self-organizing systems and financial markets, perhaps crashes are correlation destruction events, while bubbles are correlations spreading through time. And after a crash occurs, correlations can be created which makes a crisis even worse.