Assistant to United States Congressman Cincinnatus Smith
Assistant to United States Congressman Cincinnatus Smith
Human adaptation is necessary for SURVIVAL of an economy:
(CWL 21, 42-43) our inquiry differs radically from traditional economics, in which the ultimate premises are not production and exchange but rather exchange and self-interest, or later, exchange and a vaguely defined psychological situation. Our aim is to prescind from human psychology that, in the first place, we may define the objective situation with which man has to deal, and, in the second place, define the psychological attitude that has to be adopted if man is to deal successfully with economic problems. Thus something of a Copernican revolution is attempted: instead of taking man as he is or as he may be thought to be and from that deducing what economic phenomena are going to be, we take the exchange process in its greatest generality and attempt to deduce the human adaptations necessary for SURVIVAL. (CWL 21,42- 43) Continue reading
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 objective, normative, 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]
.1. Concomitance and Correlation in Macroeconomic Field theory
Concomitance is, I would claim, the key word in Lonergan’s economic thinking. [Philip McShane, [Fusion 1, page 4 ftnt 10]
All science begins from particular correlations, but the key discovery is the interdependence of the whole.…its basic terms are defined by their functional relations. [CWL 15, 53, 54, and 177]
As we said at the beginning of our entry “Centesimus Annus; The Hundredth Anniversity of Rerum Novarum”,
“This website focuses on the technical aspects of Lonergan’s macroeconomic dynamics. However, we have also pointed out that the science of economics must accept its rightful place within the broader culture consisting of technology, economics, and politics. And this culture itself stands within a hierarchy of values. Further, we have emphasized the need to achieve The Good of Order. (Also, Click here; and see CWL 12, 496-7)” Continue reading
Preliminary note: In this section we are addressing the proper understanding and management of the economic process in normal, non-pandemic times. We affirm that the recent pandemic called for extraordinary measures.
Unwittingly, first out of ignorance, more recently as necessitated by a pandemic, and most recently out of continuing ignorance, some nations, including the U.S., have wandered into the ultimate menace to the financial system, the spending without constraint blessed and recommended by unscientific. so-called Modern Monetary Theory. (Click here and here) The systematic result of MMT’s unconstrained printing of money, unjustified by corresponding, concomitant production of goods and services, is rampant inflation in prices for a) goods and services and/or b) financial assets. (Continue reading)
.1. THE STUDY OF ORGANISMS – ANIMAL AND ECONOMIC: (Continue reading)
The economic process always is “the current process” constituted by current interdependent velocitous flows of so-much or so-many every so often.
The productive process is, then, the (current) aggregate of activities proceeding from the potentialities of nature and terminating in a standard of living. Always it is the current process, and so it is distinguished both from the natural resources, which it presupposes, and from the durable effects of past production. [CWL 15, 20]
The goal of scientific analysis is explanation of the objective economic process, i.e. to discover the abstract immanent intelligibility which explains any particular configuration of flows of products and money in any instance. Such immanent intelligibility would be always relevant and universally valid. (Continue reading)
This website focuses on the technical aspects of Lonergan’s macroeconomic dynamics. However, we have also pointed out that the science of economics must accept its rightful place within the broader culture consisting of technology, economics, and politics. And this culture itself stands within a hierarchy of values. Further, we have emphasized the need to achieve The Good of Order. (Also see CWL 12, 496-7)
On the hundredth anniversary of Pope Leo XIII’s Encyclical, Rerum novarum, Pope John Paul II issued the Encyclical, Centesimus Annus, treating The Good of Order, the dignity of humans, the dignity of work, the right to private property, the right to freedom, the evils of Marxist totalitarianism, and the foundation of society in truth..
John Paul II (1991), Centesimus annus, (Encyclical Letter on the hundredth anniversary of Rerum novarum), Vatican
Centesimus Annus should be read by all economists who seek to be open-minded thinkers having broad perspectives, a hierarchy of values, and thus an understanding of the difference between the concepts of liberty and totalitarianism, morality and immorality, right and wrong. (Continue reading)
Restricted to persons with solid backgrounds in mathematics and the natural sciences