[Iaato]

Yes, Tyler, those are great ideas that work as incentives at the individual level. Individuals respond to policies that address their self-interest, yes. Economics works on a micro scale, I agree. And I'm all in favor of policy manipulation to constrain damaging behavior to the environment.

What I am objecting to here is the use of economics as a tool to further consumption capitalism and now fascism. Using the thinking that got us into this problem will not get us out of it. I don't think that it is in anyway possible in the current climate to ameliorate our progress towards overshoot using economic theories. The problem with the developing fascism is that there is no chance that incentives can be brought to bear on corporate behavior due to imbalances of power; basically the corporations have all the power and will not do anything that does not further the interests and gains of the corporate executives. As Seldom said, the name of the game is to privatize profits and socialize costs; not only of environmental problems but also economic ones. It's about the very human problem of greed and how civilization breaks down when resources get scarce.

Economic theory has only existed during the current period of resource abundance, massive growth, and growing wealth and higher standards of living for almost everyone. Let's see how well these economic theories hold up on the downslope of peak oil. I give them a year at most.

To reiterate what many of us have said on this thread, economic thought which considers the environment to be something totally alien to our civilization is a big part of our problem.

[hornofhubris]

I know we are very hard on economists but in my past corporate
experience and in observing Presidents and congress in my life, I have to admit that no matter how brilliant the economists in place have been, they have mostly been ignored to a large extent anyway.

What we do get is the voodoo witch doctor economist thats the
fat cats trot out to baffle us with circular conundrums before they
lay the wood to our fannies. Like Greenspan, who has now
regained his shaman like, macro money vision in retirement.

Singling out economists is not fair, because leadership in almost
every discipline that I am aware of are looking at the current trends
and waxing poetic about the good old, tried and true, textbook,
solution for a phenomena that has never been experienced before.

When Hollywood remakes the Grapes of Wrath and you identify
with one of the sexier pickers and the mobile lifestyle, you can
guess the leadership has snapped out of it and is pointing
the way forward again. I'll be busy riding my donkey to the water
war with three lizards drying for jerky on my hat and a bag of
rattlesnakes to use as grenades.

[BigTex]

$this->bbcode_second_pass_quote('Tyler_JC', 'I')'ll try again.

An externality is an effect that is not readily apparent to the two people involved in a transaction.

[KingDavid]

The cap and trade system of controlling carbon dioxide emissions in Europe is a perfect example of this

Come on ! This is an hoax. Belgians buying Russian air doesn't change shit.

[Mastodon]

Anyone here a trained practicing economist??

Hands up...

[Tyler_JC]

$this->bbcode_second_pass_quote('KingDavid', '[')i]The cap and trade system of controlling carbon dioxide emissions in Europe is a perfect example of this

Come on ! This is an hoax. Belgians buying Russian air doesn't change shit.

[MrBill]

Iaato, Mastodon's original post sheds no light on 3D economic relationships (as you wrote) or tries in any shape or form to describe post peak oil depletion. It is simply a crude attempt to insult all economists by selectively misquoting them. I find that offensive and it has nothing at all to do with post peak oil depletion economics.

Several medical doctors can look at the same signs and symptoms and come to different diagnoses as well as prescribe different cures. Do I then infer that they are all quacks?

If you or anyone else do not like my responses then I would warn you to stay out of Depletion Economics on this site. I for one have spent a lot of hours trying to expand on these topics. Go post in the Open Forum if you do not like it! Who needs you? Equating personal choice (micro economics) as leading inevitably to fascism just shows how divorced from reality your opinions are in any case.

Every non-trained undergrad tries to explain the world (or not) using a simple supply and demand graph. Sorry, but that was in the first semester of your first year of Economics 101. Am I to ignore physics and all physicists because they have been unable to join particle physics and quantum physics in one simple to understand grand unififying theory? Duh!

It is quite usual to isolate variables in an experiment, so that you can state with confidence when A happens then this will happen to B. Or to state it another way, you have a H1 hypothesis and a H0 hypothesis. A supply and demand curve does exactly that. It does not state that supply (or growth) in unlimited. We are talking about 'available supply' against 'potential demand' where 'price' is the equilibrium.

No where in any credible economic journal will you find that higher prices lead to unlimited supply. Your lack of understanding of economics (and finance) is not my problem. It is yours!

[MrBill]

$this->bbcode_second_pass_quote('mmasters', 'E')conomics is mixture of science, art and bullshit.

[CrudeAwakening]

I think it's important to distinguish between "positive" and "normative" economics. Normative economics is value-laden and certainly does not exist in an intellectual vacuum.

What most people here rail against, I think, are the normative aspects of economic theory.

What MrBill refers to when he says that economics "just is", is positive economics. It seems to me that people are arguing about different, though related, aspects of economic thought.

A thought-provoking book on the belief systems underpinning economic theory is "Economics as Religion" by Robert Nelson, himself an economist.

$this->bbcode_second_pass_quote('', 'I')s economics a form of religion? Alas, it depends on what you mean by religion. According to the 1990 edition of The Dictionary of Christianity in America: "If belief in a god is necessary to define a religion, secular humanism does not qualify. If on the other hand religion, or a god, is defined as one's ultimate value, then secular humanism is a religion."

The US Supreme Court has tended to follow the second definition. Mainstream economics is undoubtedly a form of secular humanism. I should prefer to call it an ideology. But it is foolish to argue over definitions and the best recent study of the subject by Professor Robert H. Nelson is entitled Economics as Religion: From Samuelson to Chicago and Beyond (Pennsylvania State University Press, $35).

I was myself brought to see that economic teaching involves an over arching stance, more than it does hard scientific results, when some years ago I conducted a questionnaire study based on multiple choice questions given to students. Nearly all the correct answers involved a policy stance and very few a simple prediction akin to that in elementary physics. Nelson came to this realisation when he worked as an economist for the US Department of the Interior and he found much of his time taken up by a "theological" battle between economists and environmentalists. The economists were certainly prepared to give some weight to environmental effects, but nevertheless espoused economic growth. The ultra-environmentalists, such as Bruce Babbit, Secretary of the Interior under Clinton, saw the world as an ecosystem in which every single species had to be preserved, as an instance of God's creation.

When I mentioned this subject to some of my colleagues, they had no doubt that economics was a form of theology. By this, they had in mind the heresy hunting, fierce insistence on doctrinal purity and anathematising of dissenters so characteristic of religious argument. Prof. Nelson, however, takes theology seriously and does not use it as a term of abuse. His main point is that the overriding beliefs that have guided economic thinking in the second half of the 20th century are losing their potency. But a new foundation has still to be found.

He starts off with a paradox. Economists of varying stripes assume that individuals will pursue their self-interest in the market and that this can be made to work to the general good. But there is a problem. "The pursuit of self-interest should not extend to the various forms of opportunism, such as cheating, lying and other types of deception, misrepresentation and corruption within the market place." Nor should it extend to political opportunism, that is attempts to use government to extract benefits from others, to protect a particular firm or groups of workers. Moreover property rights, contracts and other legal arrangements need to be fairly and consistently enforced. We hardly need reminding of these caveats after recent corporate scandals, let alone the disappointing attempts to introduce a market economy into the former Soviet Union. But how can we produce a faith which will approve of self-interest, yet observe all the surrounding conditions and qualifications?

[Mastodon]

$this->bbcode_second_pass_quote('MrBill', '
')Every non-trained undergrad tries to explain the world (or not) using a simple supply and demand graph. Sorry, but that was in the first semester of your first year of Economics 101. Am I to ignore physics and all physicists because they have been unable to join particle physics and quantum physics in one simple to understand grand unififying theory? Duh!

It is quite usual to isolate variables in an experiment, so that you can state with confidence when A happens then this will happen to B. Or to state it another way, you have a H1 hypothesis and a H0 hypothesis. A supply and demand curve does exactly that. It does not state that supply (or growth) in unlimited. We are talking about 'available supply' against 'potential demand' where 'price' is the equilibrium.

No where in any credible economic journal will you find that higher prices lead to unlimited supply. Your lack of understanding of economics (and finance) is not my problem. It is yours!

[MrBill]

Quoting others demonstrates a mastery of copy & paste and not that of the subject matter.


I have made over 4000 posts. Roughly two-thirds of them were about economics, finance, banking and markets. At no point did I ever state or assume growth or supply were unlimited or that we could somehow ignore physical reality. Quite the opposite.


Physical Reality > Economic Consequences > Social Reaction > Political Response > Feedback Loop > New Reality > Etc.

I like CrudeAwakening's post above. A new insight. Thank you. Now if you will forgive me I have no further desire to participate in this discussion. Cheers.

[Doly]

$this->bbcode_second_pass_quote('MrBill', '
')Several medical doctors can look at the same signs and symptoms and come to different diagnoses as well as prescribe different cures. Do I then infer that they are all quacks?

[BigTex]

$this->bbcode_second_pass_quote('MrBill', '')$this->bbcode_second_pass_quote('mmasters', 'E')conomics is mixture of science, art and bullshit.

[wisconsin_cur]

I'm trying to sort through this also and I think I have one insight.

If economics is the study of what people do, than its conclusions or dependent upon the type of people we are. The system we have is built and maintained upon our values. That there is not an economic cost to ecological destruction is that we do not value ecological conservation. Whether this is a fault of the genetic makeup of the species or learned, it is what it is.

The thing is we do not ask where our coal came from because we do not care, either that or we hope that ignorance will save us from needing to try to do something if we find mountaintop removal mining objectionable.

We are a species whose genius really is at exploiting our environment for max. benefit over the course of a (human) lifetime, that is how we have occupied most of the landed globe. That success has a cost. Economics is, if I am correct, the study of how we exploit resources. If we do not like the answer, than we should not blame the study but the subject of the study (i.e. ourselves).

We do not need to change economics (except where it claims to be universal and immutable) we need to raise our children to be a different kind of people and we ourselves need to model that behavior at whatever the cost.

[Ludi]

I'm not convinced that it is "confusing" to try to determine where certain attitudes behind economic theory come from...

[wisconsin_cur]

$this->bbcode_second_pass_quote('Ludi', 'I')'m not convinced that it is "confusing" to try to determine where certain attitudes behind economic theory come from...

[Ludi]

$this->bbcode_second_pass_quote('wisconsin_cur', '[')
Still, isn't the root of the problem us? ?

[Iaato]

$this->bbcode_second_pass_quote('MrBill', 'I')f you or anyone else do not like my responses then I would warn you to stay out of Depletion Economics on this site. I for one have spent a lot of hours trying to expand on these topics. Go post in the Open Forum if you do not like it! Who needs you? Equating personal choice (micro economics) as leading inevitably to fascism just shows how divorced from reality your opinions are in any case.

[threadbear]

$this->bbcode_second_pass_quote('MrBill', ' ')

If you or anyone else do not like my responses then I would warn you to stay out of Depletion Economics on this site. I for one have spent a lot of hours trying to expand on these topics. Go post in the Open Forum if you do not like it! Who needs you? Equating personal choice (micro economics) as leading inevitably to fascism just shows how divorced from reality your opinions are in any case.

[Kaj]

$this->bbcode_second_pass_quote('MrBill', '
')BigTex, you like many other posters like Threadbear and Ludi are just confusing economics with philosophy. Economics just is. It is not moral or immoral. Your failure is to try to make economics something that it is not. It is a system of allocation. Pure and simple.