Tuesday, 26 January 2010

Obama's "sensible" economics

I try to keep this blog as active as I can manage because I cannot abide the filth spewed out into the "newspapers" by total fucking spanners like this 'Barry Eichengreen' in the Taipei Times. I'll get around to fisking it later... I'm off home to cook and play with my dog before work.

"His [Obama's] US$787 billion fiscal stimulus was good.....[it] gave the economy a necessary shot in the arm. "
My basic objection to this assessment lies with its' macro-economic premise alluded to with the sick patient metaphor. In order to begin to see clearly what it is I am objecting to, consider the following question:

Where does one economy end and another one begin?

Any lightbulbs lighting up out there? Given the existence of international trade between people of various nations and regions, what makes the U.S. economy specifically "U.S." and what makes Taiwan's economy specifically "Taiwan's"? When goods are exported from Kaohsiung to San Francisco, what part of that trade "belongs" to the economy of Taiwan and the economy of the U.S.? There is a simple one word answer:


The sole motive for identifying an aggregate of trade as "belonging" to a particular nation's "economy", rather than belonging exclusively to the particular buying and selling parties making up this aggregate, is to measure it for the purpose of deciding how much of it to subtract in taxation.

The common sense point of view is to regard trade between two freely consenting parties as exclusively their business and nobody else's. The use of a veiled threat of violence to extort a portion of that trade by a third party, for example a gangster, is commonly known as theft - or pimping. The facts do not change just because the third party happens to be the State, rather than a local pimp. Each particular trade between two parties truly belongs exclusively to them - any subsequent extortion of value from this trade by the State is a violation of economic activity and therefore to identify any given aggregate of economic activity as "belonging to" a region (i.e. the State exercising power over that region) is to make a very serious error. It is an error of great consequence as it commits one to a perspective from which subsequent errors cannot be identified as such.

So, when this Barry Eichengreen tool asserts that the U.S. President's policy of spending a vast sum of just such extorted value is good because it gave the State's measurements of "the economy" a tilt in the right direction, it is because he is trapped within his epistemic error of misidentifying traded values as necessarily belonging to a third party. According to this point of view, all economic value rightfully belongs with the State and what is left over is that which is necessary for common sustenance and an elastic degree of privilege.

Now I could be wrong, for there is another possibility.

Perhaps I am being generous in labelling Barry Eichengreen as a tool - perhaps, in his case, it was never a matter of "misidentifying" and he knowingly commits himself to this error on purpose. That is a horrible thought - pregnant with the implication that it is men like this who believe not only that their values do not belong to them, but that yours do not belong to you either.

Take a good look at the things you prize the most and weigh this thought carefully against them.

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