A surplus expansion calls for saving, and a massive surplus expansion calls for massive saving. In contrast, the basic expansion calls for ever-increasing consumption. So the practical wisdom cherished in the surplus expansion (save and invest) has to give way to a quite different practical wisdom (employ for consumption) in the basic expansion. … Now to change one’s standard of living in any notable fashion is to live in a different fashion. It presupposes a grasp of new ideas. If the ideas are to be above the level of currently successful advertising, serious education must be undertaken. Finally, coming to grasp what serious education really is and, nonetheless, coming to accept that challenge constitutes the greatest challenge to the modern economy. [CWL 15, 119]
Here’s a brief take on some inherent problems with communicating Lonergan’s economic theory. I’ll be general and brief:
Some rightly want to identify the theoretical components and dynamism of capital flows . . . as can only be understood from having developed a theoretical consciousness and applied it to the field of economics; but they wrongly overlook the dialectical facts:
Yes, Lonergan develops a pure theory of those flows; and economics people would benefit from that knowledge, not to mention from having developed theoretical consciousness.
However, in the concrete, the dynamics of those flows are influenced and even controlled by one or both of two factors: (1) Peoples’ ignorance of and so mis-directions of elements and relationships that can be identified in the theory; and/or
(2) bad actors who can be either (a) also ignorant of the theory/flow and just don’t know how to use it for their benefit or take short-terms and good luck as their criteria for making judgments; OR (b) very smart people who, nevertheless, are morally unsound and so intentionally manipulate the markets with a good knowledge of the theory, but for their own nefarious desires and fears.
So, when some say “NOOOOO it’s not about greed!” In fact, economics is a human science and so, in fact and as concretely applied, it can be about greed, based on the above analysis.
Catherine Blanche King