Basic Economics and the Money Illusion

Listen up, since this is one of the most important things you can hear. I've already said much of this in my discussions on the basic income, but it deserves saying again.

People don't understand economics - and I'll tell you why. It's because people see the world in terms of money. Doesn't money make the world go round? Sure; but it's only money. Money isn't wealth or anything else but a book-keeping tool. That doesn't mean I think money is bad - on the contrary, unless we reach a true 'post-scarcity' economy (if ever), having money is clearly better than not having it - no modern society has ever been able to do without some sort of money.

So if money isn't the answer, what is? What's it all about? The building blocks of the economy are production and consumption. That's it - and there is always a balance between them; money doesn't enter into it. Yes, there are durable goods, especially buildings and other infrastructure, but that's only a detail and could be accounted for with a slight modification to the definition of 'consumption'. So for the remainder of this essay, we will assume that no imbalance between production and consumption can persist.

What happens if we add one more person to the economy, whose production is much higher than his consumption? Everyone else is made, on the whole, better off, since they can either reduce their production or increase their consumption, whichever is preferable (and a sane economic system gives them that choice). The reverse is equally easy to see. Of course, we don't need to add a hypothetical person; we can isolate any one person - or even a group of people - from the economy and determine thus whether they produce more than they consume, and are an economic positive to strangers, or consume more than they produce, and oppositely are an economic negative. I've just assumed production and consumption can be compared, even though there are many goods and services - Is that justified? Yes. There is always in every economy a relative worth of all goods and services in demand, which is approximated by the money system; unless the market is significantly distorted, one can assume that X dollars of good A and X dollars of good B are worth the same and not run into serious error.

Now, if one doesn't produce anything, one can only be a negative (I'll from now on use 'positive' and 'negative' as short forms for the two possibilities). How many people don't produce anything? Many, many, perhaps a majority of all Americans! Almost all children, retired people, unemployed people, and those with sufficient wealth abstaining from productive work, to name the obvious. Housewives, that is women that do not engage in productive work outside the home, may produce something but almost surely less than their consumption; the same of domestic servants. Adding up all these categories surely is a majority of the population. And of these negatives, the most negative are those that consume the most, that is essentially to say, are wealthiest. So the 'bums' and 'welfare moms' that are widely disliked actually contribute far less a negative than the wealthier parasites. Who are these parasites? - A numerical majority are Fussell's 'upper middle class' ( ), and the jobs associated with this class; I especially refer to law and finance, of which most of the positions (at least those carrying six-figure and higher incomes) have negative worth, for we would all be better off if society were set up so as to have fewer lawyers, paper-pushers, and Wall Street 'geniuses' that make millions by bankrupting ordinary people. Despite their utility or lack thereof those people they consume much more than we do, and they get more and more over time because they control the government and all the power centers of our society; they are the 'money power' that controls both the Democrats and Republicans.

Nonetheless, despite that negative assessment, the existence of negative people is a certainty. Just as there is always a balance of production and consumption, there is always a balance of positive and negative persons. This is simply because people have differing productive capacities and differing opportunities for both production and consumption. It is not possible to enforce equality of the two; nor is it reasonable to, for it would imply that if you don't work, you starve and die - no retirement allowed, and so forth. It is not possible, the great libertarian affectation is a lie! It's a lie that people get ahead solely on their own work, it is bullshit! People can not complain, therefore, about having to support negatives, as it is almost sure that they have been, and will again be, a negative. But they should complain about those super-parasites mentioned in the last paragraph, the existence of which benefits no one but themselves, and causes the ordinary man (that is lucky enough to have a job) to have to produce more and consume less than he ought to in a just world.

Now we should all know how racial and sexual politics works in the modern world, shouldn't we? It always works to promote women and minorities regardless of justice and disadvantage white men; in every sort of job white men now face ludicrous difficulties compared to equally qualified women and non-whites (and sometimes other 'protected' groups). It means that for white men, the criticism in the last paragraph is multiplied; that the transfer of wealth (as that is what the difference between group production and consumption is) from employed white men in the working classes is much greater than it would be with only those conditions, as we further support the women and non-whites that, due to various forms of affirmative action, get more pay, and thus consume more, than equivalent white men (producing the same) would. Do I even need to mention the numerous 'diversity' positions with negative economic value? - They are merely a more 'in your face' illustration of the problem. Racial and gender divisions are a distraction from the real problem; the feminists have always represented the upper middle class (or perhaps we should say, the wives thereof) and the race artists those negroes and other minorities that want to get into it; class is the only division that matters to white men but we've let them pull the wool over our eyes. And the ruling classes have only increased their oppression by adding women and non-whites to their number.

And this is why I am a socialist and you should be too. The guaranteed income ( ) which I support recognises all this that I have discussed. It is made to allow people to be negatives to the extent necessary, but not farther. Universal single-payer health care has the same justification, except that the basic income provides for predictable needs while health care is primarily for unpredictable needs. A third such program, which I have not discussed yet and don't think anyone else has, would be the nationalisation of life insurance. While this is only a minor issue compared to the other two, there appears to be no argument against it; and, it has the benefit of allowing us to practically eliminate the chance that still exists of insurance being an incentive to murder, by disallowing anyone to carry more insurance than needed and by keeping the amount and the beneficiary secret (which does not affect the legitimate purpose of such insurance).

The main reason for supporting the basic income and universal health care is that it makes for a more just world. Indeed, it has been understood for some time that the wealthy should be compelled to aid the less wealthy by taxation; only the means are different from today. Besides the numerous and over-complicated direct transfers of wealth, public schools (why not subsidised day care? - same justification), toll-free public roads, and in fact all public services priced below cost or free, are indeed similar transfers of wealth. The basic income violates no principle that our society is now based on; only FUD prevents us from attaining it in the near future.

Economics isn't only an academic subject or something for super-geniuses running the world behind the scenes - it IS the world. And it's not hard to understand. And we can be free of the ruling classes' oppression, we can be free of wage-slavery, we can be free of the increasing precarity of the capitalist world. It can be done and it starts here!

This is an essay created by Andrew Usher. Please do not edit it; but only comment in discussion.

Also see the original Usenet thread in which this was posted:!topic/

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