Category Archives: Philip McShane

The Einsteinian Context: Curvature and Relativity

Albert Einstein, Steven Weinberg, Lillian Lieber, Douglas Giancoli, Raymond A. Serway, Bernard Lonergan, Philip McShane, Peter Burley,

.1. Introductory

Graduate students seeking a thesis topic may expand this treatment of the Einsteinian context of Functional Macroeconomic Dynamics.  It should be of special interest to those having a strong background in theoretical physics and, thus, able to appreciate the analogies from physics.  “Similars are similarly understood.” (CWL 3, 288/313)

Philip McShane alerted us to the resemblances between Lonergan’s context of general macroeconomics and Einstein’s context of general relativity.

(Part Two entitled Fragments) belongs almost entirely in what I call the Einsteinian context of Part Three, in contrast to the Newtonian achievement of Part One; … [CWL 21, Index, 325]

A new science has emerged.  Lonergan has elevated conventional macrostatics to a macrodynamics explaining economic accelerations. (Continue reading)

The Notion of Organic Unity; Macroeconomic Field theory as a Unified, Systematic Whole

.1. Introduction

Lonergan’s treatment of the intelligibility of the plane circle provides to us a clue.  In the basic insight defining the plane circle, – that all radii are equal – all the interrelated concepts tumble out together in an intelligible unity.  The all-together intelligibility points to a template for explanation in the macroeconomic field; it fore-casts a singular unified intelligibility of the dynamic, organic economic process.  In the sweeping comprehensive act of understanding, all the abstract explanatory conjugates explaining the dynamic economic process are “yoked” together by their functional relations to one another.  The interdependencies of the flows which constitutethe whole dynamic system are grasped in a solidary whole.  And the patterns of the formulation are isomorphic with the patterns in the objective, unitary economic process.  The principle of unity and wholeness is a single, comprehensive intelligibility. (Continue reading)

Pointers to the Philosophic, Mathematical, and Scientific Bases of Lonergan’s Functional Macroeconomic Dynamics

Being is the objective of the unrestricted desire to know.  Being is intrinsically intelligible and one. Apart from being there is nothing.

Intelligibility is the very essence of unity.  Intelligibility is intrinsic to being and, at the same time, it is the essence of unity.  Formal intelligibility is form; it is the unity of unification or of correlation.  Correlation is abstract; it constitutes the implicit definition of explanatory terms by their functional relations among themselves.

“Functional” is for Lonergan a technical term pertaining to the realm of explanation, analysis, theory;  … Lonergan (identified) the contemporary notion of a “function” as one of the most basic kinds of explanatory, implicit definition – one that specifies “things in their relations to one another” … [CWL 15, 26-27  ftnt 27]

The economic process is an aspect of being.  The immanent intelligibility of the dynamic economic process is the essence of the process’s unity.  (Continue reading)

John H. Cochrane’s Article in The Wall Street Journal, Thursday 8/25/2022

The Wall Street Journal of Thursday, 8/25/2022 featured John H. Cochrane’s commentary entitled  “Nobody Knows How Interest Rates Affect Inflation.”  We would say, “In order to understand how interest payments from Smith to Jones should circulate in order to achieve price stability, continuity, equilibrium and realization of the economy’s potential, one must have a unified theory explaining the whole, organic, dynamic, pretio-quantital,economic process.  Then, within that theory one can know How Interest Rates Might Affect Inflation.”  (Click here, and here)  We would also assert that manipulation by the Fed of the rental price of money – the interest cost – can be counterproductive. (Continue reading)


Elizabeth Warren’s Advice to Jerome Powell; Sentiment Without Intelligence

The Wall Street Journal of 7/25/2022 featured an article by Senator Elizabeth Warren:  “Jerome Powell’s Fed Pursues a Painful and Ineffective Inflation Cure.” Because she lacks an objectivenormative, abstract, explanatory theory and, thus, fails to understand the functional interdependencies constituting the organic economic process, particular arguments in her article are a) sometimes contaminated by psychopolitical wishful opinions, b) often ignorantly one-sided because she is unaware that some policies have double edges, c) sometimes contradictory of her other arguments, and d) in at least one case, supercilious.

E. Warren suffers from the same plight as Thomas Picketty. To satisfy her responsibility to the public, she needs to achieve a scientific understanding of the organic economic process; she needs to get a “grip.”

We are at the heart of Picketty’s plight: he has no clue of the needed grip on the grounds of the inequality in history.  So, what else can he offer but a centralist solution, taxation, to history’s drunken careening. (McShane, Philip, Picketty’s Plight, 53)

In equity (the basic expansion following the surplus expansion) should be directed to raising the standard of living of the whole society.  It does not.  And the reason why it does not is not the reason on which simple-minded moralists insist.  They blame greed.  But the prime cause is ignorance.  The dynamics of surplus and basic expansion, surplus and basic incomes are not understood, not formulated, not taught….. [CWL 15, 82]

(Continue reading)

More re Picketty’s Plight and Centralist Modern Monetary Theory

In his blog entitled “Picketty in Brief,” dated Sunday, July 24, 2022, N. Gregory Mankiw asks what might be Thomas Picketty’s present thinking about inequality. Has it changed?  If so, how and why?  Also see on this website “Picketty’s Plight.”  in which we quote Philip McShane’s claim that, unless one has a normative explanatory theory yielding precepts as to how enlightened participants in the economic process should adapt and conduct themselves, one can only helplessly and hopelessly suggest harmful bureaucratic centralist solutions – such as disequilibrating taxation and intrinsicallyinflationary deficit spending. Continue reading

Alan S. Blinder re Transitory But Not Permanent

… the prime cause (whether it be of inequity or inflation) is ignorance.  The dynamics … are not understood, not formulated, not taught….. [CWL 15, 82]

man as external agent has not the systematic guidance he needs to operate successfully the machine he controls. [CWL 21, 109]

Academia’s failure threatens economic liberty.

Lonergan realized that failure to understand correctly what is needed if the economic process is to perform well is gravely threatening to democratic liberty.  That is why he undertook his serious study of economics. [CWL 15 Editors’ Introduction, xxx] Continue reading