Net National Wealth vs Consumption

This is a fairly short posting. The point is just to point out the difference between Gross Domestic Product, that contains all sorts of consumption “goods” vs Net National Wealth creating activities. Things that make the “pie” bigger instead of smaller.

It is not a complete thesis, just a sketch. There will be lots of things folks will want to argue are NOT consumption, but are instead creation, or things that span more than one column. The point here is not to make a perfect distinction, but rather to illustrate that the distinctions need to be made and that not making them leads to the decay of our economy.

GDP takes all forms of economic activity and treats them as equal. It holds that the same value accrues to creating a new home with new windows as accrues to replacing broken windows. This is often talked about as the Broken Window Fallacy in economics.

It is well recognized that replacing broken windows does not create an increase in wealth. Yet GDP makes no distinction between a window manufactured to be placed in a new home, vs one placed in an old building due to destruction. This leads to all sorts of broken behaviour, especially by our Political Class, who seem incapable of remembering the difference. They can spend $Billions (oh, sorry, now we’re spending $Trillions…) on schemes that do “economic stimulus” and “job creation” that really amount to breaking windows and replacing them.

This is at the core of why most government “stimulus” plans do not result in the world being a better place at the end of them. So, for example, a National Park might tear down an old entry station and build a new one, employing some folks in the process and spreading some money around, yet at the end of the day we still have a national park with an entry station. ( I saw this at The Pinnacles where they were proudly touting their new greeting station built with ‘stimulus money’.)

Private companies must pay close attention to what is a consumption good, what is simple maintenance, and what is a net wealth creation. If they do not create more wealth than they consume, they go out of business and cease that consumption. Government does not. It simply raises tax levels and continues to consume in the name of higher GDP. This taxation, though, takes resources from the hands of net wealth creators and puts it into the hands of net wealth consumption. The “end game” is a bankrupt country and economic collapse. (Currently in the middle stages in Greece and Spain).

So, as a ‘first cut’ illustration, I would sort things into buckets rather like this:

Wealth Creation

Mining and extractive industries.
Refining and upgrading.
Materials fabrication.
Oil and Energy extraction and refining.
Nuclear power facilities.
Electrical generation facilities (that create more value than they consume…)
Parts Manufacturing.
Chemical and Paint Manufacturing.
Assembly (cars, computers, cameras, toaster ovens, etc.)
Shipping and haulage.
Home Construction.
Industrial Construction.
Machine Tools and Tooling.
Work Computers and Communications.
Industrial R&D.
Farming and Agriculture.
Agricultural Products processing to final products.
Retail Distribution ( a very fine sort of hauling and shipping, in essence. The ‘scatter’ part of the ‘gather / scatter’ that happens on each side of manufacture and assembly.)

And similar such things that result in more wealth at the end of the process than entered at the beginning.

Maintenance

A fair amount of effort goes into just fighting entropy. Pushing the rock up hill each morning so that the work day can happen. No net wealth is created, but it needs to be done to avoid loss of wealth or loss of wealth creation ability. This is valuable work, but it does not create net national wealth.

Cleaning & Janitorial
Maintenance and Repair of facilities and tools.
Vehicle Maintenance. Tires, batteries, carwashes, auto parts stores.
Painting and roofing repairs.
Plumbing service.
Electrical repairs.
A/C Maintenance and HVAC repair.
Gardening Services and related.
Medicine and Medical services.
Home Repair.
Clothing (basic).
Driving to work.
Insurance (it rearranges the wealth, but does not create it)
Financial Services. (more wealth rearranging).

Education. (It might have been wealth creation before we had more degrees than needed, now it’s just maintenance and to some extent entertainment…)

MOST Academic Research. (Yes, some leads to improved productivity later, but frankly most of it is for the amusement of the particular researcher. Study of different kinds of ladybugs may interest an entomologist, but much of it is just self interest. I put the ‘package’ here as some IS good for production increases, but some is also just personal consumption / entertainment, so net it’s about a wash. Frankly, that’s likely over generous as I suspect far more is ‘playing with themselves’ than actually creates value. Pretty much all of Sociology and various Philosophy “research” for example.)

Legal Services. (One could similarly make the case that much Legal activity is just ‘consumption’. At the end of a Tort process, for example, much money has been spent, with at best a rearranging of who owns the wealth. So I’m going to toss Torts in the consumption side with liability practices. A corporate lawyer may well preserve the value in the company so is ‘maintenance’.)

Consumption

As a reminder: Calling these consumption is NOT to disparage how much we like them. In many ways, they are the end point of WHY we indulge in all the wealth creation and maintenance. We want the consumption part.

That does not mean we can have more consumption than we have creation of wealth.

Similarly, we might well be able to trade some consumption goods (like a fine dinner, for example) for a set of machine tools. It still has worth, it just is not a creator of net wealth.

Some items are ‘arguable’, so for example, a movie is essentially a consumption good. People waste their time watching it and at the end of the process there are more worn seats, a somewhat worn projector, and a load of resources consumed in making the movie. Yes, it’s a fun process, but does not create more wealth in the watching. Yet you could make a case that the object itself, the movie, was an object of value, so was ‘wealth’. It might make sense to have “creation of art” in the ‘wealth creation’ step, yet ‘beauty is in the eye of the beholder’, which means that there is no way to really say that a given book or movie is “wealth” vs “trash”. I could also see, perhaps, a 4th category that would divide “fundamental physical wealth” from “intellectual wealth”, but that opens a Pandora’s Box of false claims of wealth creation. IMHO it is better to call them “consumption”, and just recognize that they are valuable consumption goods.

Movies and entertainment.
Restaurants & Dining.
Fashion Clothing. (We LIKE it, but overalls are the functional part…)
Makeup.
Cosmetic Medicine.
Driving for pleasure / vacations.
Vacation Resorts and Theme Parks.
Air Travel.
Personal Care products and services.
War and Military Spending.
Home computers.
Tort and Liability law.
Sports events and recreational facilities.
Housing in excess of that needed to maintain life and modest comfort.
SOME amount of “research” that is mostly to make the researcher happy with little other benefit.

All of these things are things we could live without with no net decrease in our ability to produce (and often a net increase). We consume these things as we want them, for personal pleasure, or because we are pushed into that consumption by others (war, for example).

The Problem

The basic problem is that we have a LOAD of money being spent in the last two groups with ever less being spent on the first group. Most of the first group is being moved to China or various 3rd World Counties (with honorable mention of Canada and Saudi Arabia as other destinations).

We in the USA have focused on a “service based economy” – Movies, entertainment, vacation destination, financial services, and a whole load of spending on wars and military hardware. That’s fine, and all, unless, of course, the “banker” in China decides they don’t want to pay for the movies, or don’t want to loan us the money for a little war in the Middle East. We simply MUST either find some net national wealth to trade to them, convince them to consume our consumption products, or have them agree to give us the wealth we want. So far, we’ve been mortgaging our Net National Wealth for the money to do maintenance and consumption. That can not go on much longer.

China, in comparison, has concentrated strongly on things in the first group. Mining, energy plant, materials and manufacturing, shipping and haulage, refining and upgrading, assembly, and even increasing amounts of agricultural product processing to finished goods.

Normally this imbalance would show up as a shift of currency exchange rates. China has followed a mercantilist policy of a currency peg (and more recently a very slowly drifting peg). The “end game” of these Mercantilist Policies is that net national wealth creation moves to China. That is clearly visible in the dramatic growth of their economy (variously 8% to 12%) and the stagnation or shrinkage of their ‘trade partners’ (visible in the recession / stagnation in the USA and EU zones). Eventually we reach a point where we have nothing left to trade to them that they want, and they no longer care to loan us the money to buy their goods at a discount for our consumption. At that point the transfer of wealth is pretty much completed and we enter a relatively impoverished state. Essentially we can provide personal services and maintenance to them. We become the maids, butlers, and janitors.

A further point is just to point out that to the extent we do things like encourage tort via liability laws, or fund “education” to have a lot of gratuitous “research” into non-productive topics, or conduct unnecessary wars, we are reducing our ability to create net national wealth and spending more time on wasted consumption. Do too much of that, you fail at the maintenance tasks needed to maintain your economic productivity or erode your National Wealth to the point of decay. I would assert that we are already well into that phase. By about the $Trillion per year which we must borrow just to hold where we are. Europe is a bit further ahead.

What’s worse, to the extent the maintenance fails, we can enter a rapid and accelerating decay into collapse. The process of wealth creation, and the creation of the economically productive facilities to create wealth, is very slow. The breakage of it is much more swift. That can be seen in Greece where tourism ground rapidly to a halt once riots began. Nobody wants to spend a lot of their wealth to look at broken windows and littered streets. The transition from ‘net gain’ to ‘net loss’ may not be noticed at first, as most economies grow in the 1% to 3% range. But once the decay sets in, the rate of shrinking can be 10% to 20% a year. (Even faster during wars. Germany essentially went to zero in about 4 years of W.W.II). Even a couple of percent increase in consumption or maintenance can turn an economy from growing to shrinking.

It is imperative to the maintenance of a free and prosperous people that the first group of activities be maximized, while the last group of activities is minimized. Eventually the increase of wealth becomes so large that an even larger amount of consumption can be indulged without a large impact on wealth creation. Compound growth works that way.

This is the thing that is understood by business creators, and substantially missing from the understanding of most folks in politics and government. It is the self discipline of the “Protestant work ethic” we hear about as important to our early economic growth.

In many ways, the nutty nature of PC projects can be easily seen by comparing them to this paradigm. The “Return On Investment” metric is widely used in businesses to decide what projects to fund. Sometimes in government you will see the same ROI idea used, but with wildly inflated numbers for “return” and strongly reduced numbers for “investment” costs. The ‘return’ may well be measured in very fuzzy terms like “self esteem enhancement” or “validation”. Not wealth. Desirable outcomes, but NOT economic goods.

Similarly you will hear the word ‘investment’ corrupted to mean “things I like”. It is not an “investment” to build bridges to nowhere or to educate a citizen in some non-economic field (such as a degree in Sociology or Liberal Arts). They may well be desired outcomes, but they are NOT an investment and do not increase net national productivity of wealth.

Being able to appreciate a Picasso is valuable, but creates no new wealth; whereas a farmer at the end of the day creates a few bushels of corn and a miner makes several tons of useful coal to keep the lights lit so you can see that Picasso… To talk about the ROI of “investment” in liberal arts degrees is to make an error. It would be more accurate to say that we desired more consumption of liberal arts understanding. (And we do! Movies are great fun, and a day at the museum is one of my favorites.)

Realize, too, that there are “bads” in addition to goods. One of the worst is the loss of a species that might have some future economic benefit. Once an extinction happens, ALL the future wealth that might have come from that species is lost as well. Dumping toxins into a river that makes the fish inedible is also an economic “bad”. We need to reduce these “externalities” as much as possible while preserving net wealth creation. This is where the EPA, in the early days, had a large benefit. Getting smog down to where sickness was reduced and the consumption of medical care reduced was a great benefit. Now not so much. We long ago past the point where benefit was realized. Removing a couple of ppm of NOx at this point does effectively nothing, but consumes a great deal of wealth. In an ideal world we would balance things to have the largest net national wealth creation net of externalities.

In Conclusion

There you have it. To the extent a party advocates for real investment in wealth production, mitigation of “bads”, and reduction of losses to natural causes, it will prosper. To the extent a party advocates for more consumption than there is wealth creation, or mitigation of “bads” at higher cost then their damage, the net national wealth will diminish. To the extent a party advocates an economy based on the maintenance and consumption industries they are creating a dependent state; one beholden to real wealth creators for the largess of their wishes to consume.

We simply must be in the wealth creation business to thrive, otherwise we become the serfs of those who do.

Economics answers the question “Who makes What for Whom?” (“How” is engineering and “How Much” is Operations Research. “Why” is politics. “When” and “where” are for business managers, while “with what money?” is finance. When politics strays into ‘for whom’, when, where, and how much, and especially into ‘with what money?’; it goes off the rails and fails.) We can either make wealth for ourselves, or we can do maintenance for others, or we can be consumed by others.

Others will not make wealth for us. It really is that simple.

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About E.M.Smith

A technical managerial sort interested in things from Stonehenge to computer science. My present "hot buttons' are the mythology of Climate Change and ancient metrology; but things change...
This entry was posted in Economics - Trading - and Money and tagged , , , . Bookmark the permalink.

20 Responses to Net National Wealth vs Consumption

  1. John F. Hultquist says:

    As an entry under “Consumption” you include Tort and Liability law.

    I own a 1980 Chevy PU with saddle bag gas tanks. Here’s the history:

    http://www.autosafety.org/history-gm-side-saddle-gas-tank-defect

    Under “The Deal” are 3 items – the third starts:
    The deal was the very first defect settlement in which no remedy
    was offered to owners of the defective vehicle.

    They did offer a few hundred bucks off on a new GM vehicle. Bless their hearts!

  2. E.M.Smith says:

    @John F. Hultquist:

    That kind of thing, and the Ford Exploding Pinto issue, are a good part of why I drive a Mercedes and why I can’t work for some kinds of companies. Just let the Engineers do the engineering… and keep lawyers, financial / marketing types, and politicians out of it…

  3. adolfogiurfa says:

    Wealth creation=Work. If wealth creation becomes “virtual” “consumption” will remain being “real”, though expenses may be “virtual” for a while….until someone knocks at your door…..
    Things are worse if wealth creation becomes “virtual” and “consumption” stubbornly remains “real”….then only HUNGER knocks your door.

  4. Mark Miller says:

    Pretty well said. I’ve come to the same conclusion, that GDP doesn’t really tell us where we are economically. What matters is what value is generated from the economic activity. In economics it’s called “value-add.” Using a crude analogy, if you create jobs where people dig ditches and then fill them back in again (without putting anything in them, like pipes or transmission lines), that’s not adding value. Sure people get paid, but no one is really enriched by it. In fact, I’d argue you’re destroying value, because nothing of value was accomplished, but you’ve just shelled out money for it–paying money for nothing. I’d say our huge numbers of dependents on federal largesse is an example of this. We’re transferring money from productive people to unproductive people, for no real return. The Democrats like to say it boosts consumption, and consider that a return, as it supposedly encourages production, but that’s not really a return in value. It’s not a return on productivity.

    I wouldn’t establish this as an absolute rule in a moral sense. Some people can’t be productive for a time, because they’ve run into a spate of bad luck, but it’s getting ridiculous with the way things are going.

    If on the other hand, you dig ditches so that farms can grow crops (like an irrigation ditch), that’s adding value, so long as there’s an adequate supply of water in the case of irrigation. The smaller economic activity enables a much larger economic activity, which likely enables more people to eat. That enriches all concerned.

    I make a caveat about research. It depends on the area. I think scientific and engineering research is of value. It’s not necessarily immediate, because it can take time for people to figure out how to apply it to create a value-add from it, but I think we’ve seen ample evidence that this kind of research is an economic good. It’s not as tangible, but it’s still very important. I guess I’d use the analogy of “potential energy.” It’s not energy itself, but the activity creates its potential. Increasing the knowledge base enables new products to be created that were previously not conceivable.

    What you said about this brought to mind a series of blog posts I’ve been working on from time to time, called “A history lesson in government R&D.” I’ll include them here:

    http://tekkie.wordpress.com/2011/06/21/a-history-lesson-on-government-randd-part-1/

    http://tekkie.wordpress.com/2012/02/04/a-history-lesson-on-government-rd-part-2/

    Oddly, in writing these I was put in the position of defending Barack Obama… I think what he said about government funding of research was correct, though I have no idea if he’s been successful in implementing everything he espoused in this area, though I’ve heard he’s succeeded in raising the funding to some science labs. He has a tendency to speak eloquently but execute horribly, or not at all. So I can say that on some rare occasions he’s had a good idea, but I have yet to see if he’s of any use. Perhaps a good analogy is a broken clock happens to tell the correct time twice a day?

  5. Pascvaks says:

    Thoughts-
    Government ‘creates’ nothing but social order and discipline at great cost, consider the ‘cost’ before going to government for any service.

    The Hundred Years War (1912-2012): It’s still going strong and costing taxpayers BIG TIME. The Law of Unintended Consequences covers WAR. War ain’t cheap; it usually costs everyone more than they were ever willing to pay (or spend). Critical and Essential National Interests are not always ‘critical’ or ‘essential’ as the folks making the lists are prejudiced by ‘current’ interests and ‘political’ wants and desires. Want to save money on defense, appoint younger, less experienced managers and give them half the budget.

    National Service as an elected or appointed Federal employee (and all elected Federal office holders are employees) is hard and exhausting work. People place themselves at Great Risk by reelecting or reappointing Federal office holders to any position more than once. Burn-Out is the biggest danger. Want good, fresh government? Elect and appoint good, fresh ’employees’. (I’m more and more of the mind that Federal Judges should be limited to appointment to 10 terms and subject to only one reconfirmation to a second 10 term.)

    National Anything, except stratigic defense, can be administered better and at greater return for the cost at the State and Local Levels. National, One-Size-Fits-All programs are a tremendous waste. Better to have a mish-mash of programs in the States than one Soviet-style “This-Or-Nothing-Our-Way-Or-The-Highway”.

    Now that The Greatest War of All Time is behind us, it’s time to demobilize and repeal a bunch of programs, tell the Fed’s ‘Thank’s for everything!” and “See ya next time!”, and get back to be united States.

    It sure wouldn’t hurt to reinvent education, industry, and 100 other areas of everyday life. Wonder what states will come out on top in this horse race?

  6. Pascvaks says:

    PS: (Ref. last)
    Gettin’ Old and Daft- forgot to put my “years” on –
    (I’m more and more of the mind that Federal Judges should be limited to appointment to 10 year terms and subject to only one reconfirmation to a second 10 year term.)

  7. adolfogiurfa says:

    @Pascvaks: That “getting´old” it´s too a Sun´s business, we usually do not last more than a Gleissberg cycle….

  8. E.M.Smith says:

    @Mark Miller:

    Yes, there’s a mix of valuable and wasted research from government. The problem, as I see it, is that it is impossible to tell which is which. Industrial research (some of it ‘basic research’) generally gets much stronger internal scrutiny and filtering. That’s why I sort them as I do.

    It would be better if there were a better way to sort them, but at present there isn’t. Blindly tossing $Billions at pet projects of government Ph.D. Lackeys doesn’t work well… See the “climate science” fiasco.

    @Pascvaks:

    I think you need to modify your first statement to:

    GOOD Government ‘creates’ nothing but social order and discipline at great cost.”

    BAD Government can create a load of disorder and havoc. See most of the European history of rampant monarchies and empires, along with the USSR and Nazi / Fascists / Axis…

    So at best, with great effort, you can get a GOOD government for a little while. At great cost.

    That, IMHO, is why the “limited government” of the USA was so important. It minimizes the damage from bad government and it minimizes the cost from ‘good’ government…

  9. adolfogiurfa says:

    Any government is expected to apply what the society has agreed beforehand to maximize common good, as such, government officials are the peoples´employees. Any changes of society agreements could not be allow to be made by them, as it happens when some institutions/agencies replace the people´s will. This is what has been so successfully achieved in the USA that it has been promoted in the rest of the world, through the UN´s binding agreements. A particular example of this is the establishment of “Ministers of the environment” all over the world, and using this “trick” is the way to impose the will of a minuscule foreign elite illegally over peoples´will.
    So the successful example of your EPA has been already applied in the majority of countries.
    Then, Global Governance it´s already in place and working. Who cares if Copenhagen was not signed or whatever international agreement, they are already meddling in your private life, in your house and in everybody´s life without any legal permission from us at all. And this TRICK is what we should strive to abolish everywhere.

  10. E.M.Smith says:

    @Adolfo:

    That pretty much sums it up. Well done!

  11. Mark Miller says:

    @E.M.Smith:

    Blindly tossing $Billions at pet projects of government Ph.D. Lackeys doesn’t work well… See the “climate science” fiasco.

    That’s an idea with which I’ve struggled. In order to really advance knowledge, the promoters of the activity have to be able, and care, to recognize science for what it is, but there is no way to insure that. The CAGW fiasco in climate science, from what I can tell, is caused by pseudoscience. It doesn’t promote new knowledge. It’s a religion calling itself “science.”

    The Bible says, “By their fruits you shall know them,” and that’s more or less the filter I apply to it, but even that alone won’t do the trick, because people can look at the promoters of CAGW and think, “These people are moral. That’s good enough for me.” Never mind that I don’t find them that moral, but others do. They promote a morality, but not one that values human life, liberty, or the search for truth, all things that I consider virtues. Of course, humans being humans, people can disagree about those virtues.

    I guess I could say this is one reason why I find atheism in the sciences destructive. The atheists I know about all claim that atheists are capable of being moral people without religious teachings. They can be taught ethics. This has always seemed like a weak rationale to me. Without some kind of moral teaching that includes the concept of something beyond one’s self, ethics are just an abstraction. It’s really up to the individual to give it meaning. Some do. Some don’t. Without a sense of something beyond yourself that matters, what’s the point of morality? If morality does not profit you, at least in the time horizon you think is important, and since it doesn’t always do so, then doesn’t it appear to pay to have situational morals, to just adopt those that seem to profit yourself in amongst the people you wish to curry favor?

    Science has a certain morality about it. Criticism and opposing argument must be considered, though not always accepted, and the filter is rational thought, and observation of the thing being discussed. It demands introspection, and self-reflection, because what we perceive is governed by our own thought processes and experience. In order to get closer to understanding what something really is, we have to be conscious of our own biases and desires. Religion can be a vehicle by which this capacity to understand one’s self is developed, and to understand that one is part of a larger whole, which benefits by their behavior which is considered “good,” because all good religions promote this idea of looking at your own behavior so it can be judged. Bad religion promotes this idea of “I am virtuous and righteous because I believe in, or am a part of X.” I see this among CAGW alarmists a lot… The one good thing I see in the CAGW religion is it promotes this idea of “looking beyond humanity.” It regards traditional religions as having limited our scope of awareness to just humanity, and not the rest of Nature as well. Even so, it has a pretty shallow view of all this. It seems to be so easily manipulated through fancy PR to false ends.

    I suppose that psychology and anthropology could be substitutes for religion in serving this introspection, because they address why we do what we do, but they still don’t address the issue of capricious choices in how people govern themselves, and the tendency of people to want to benefit themselves at the expense of others.

  12. Mark Miller says:

    @E.M.Smith:

    I should say as well that I’ve occasionally picked up another strain of religion in the alarmism, which is vaguely known to me as “Gaiaism,” belief in the Earth as “god,” or some such. I’ve heard a few climate scientists obliquely refer to this as “an interesting perspective.” (How clever. Perhaps they really believe this, no?) What I don’t get is one would think that if the earth is “god” that they would see humanity as part of earth’s creation. Yet what I see again and again among the alarmist malthusians is this view of humanity being a “virus,” a disease that is hurting the planet.

  13. Mark Miller says:

    @adolfogiurfa:

    What I’ve seen is the way this gets enforced socially is the abuse of science as an imprimatur of authority. “The scientists have spoken. We must do this. You cannot question it.” Carl Sagan didn’t talk about this in this context (I suspect he was talking about Creationism), but I think it applies well (even though he believed in CAGW…along with nuclear winter). He said in his final interview about science and technology:

    if we don’t understand it–and by “we'” I mean the general public–if it’s something that–“Oh, I’m not good at that. I don’t know anything about it.”–then who is making all the decisions about science and technology that are going to determine what kind of future our children live in? Just some members of congress? But there’s no more than a handful of members of congress with any background in science at all.

    [T]he second reason I’m worried about this is that science is more than a body of knowledge. It’s a way of thinking, a way of skeptically interrogating the Universe with a fine understanding of human fallibility. If we are not able to ask skeptical questions, to interrogate those who tell us that something is true, to be skeptical of those in authority, then we’re up for grabs for the next charlatan–political or religious–who comes ambling along.

    He said, further, in his last book, “The Demon-Haunted World,” of which he spoke in this interview,

    One of the great commandments of science is, “Mistrust arguments from authority.” (Scientists, being primates, and thus given to dominance hierarchies, of course do not always follow this commandment.) Too many such arguments have proved too painfully wrong. Authorities must prove their contentions like everybody else. This independence of science, its occasional unwillingness to accept conventional wisdom, makes it dangerous to doctrines less self-critical, or with pretensions of certitude.

    When we shy away from [science] because it seems too difficult (or because we’ve been taught so poorly), we surrender the ability to take charge of our future. We are disenfranchised. Our self-confidence erodes.

    The values of science and the values of democracy are concordant, in many cases indistinguishable. Science and democracy began–in their civilized incarnations–in the same time and place, Greece in the seventh and sixth centuries B.C. … Science thrives on, indeed requires, the free exchange of ideas; its values are antithetical to secrecy. Science holds to no special vantage points or privileged positions. Both science and democracy encourage unconventional opinions and vigorous debate. … Science is a way to call the bluff of those who pretend to knowledge. It is a bulwark against mysticism, against superstition, against religion misapplied to where it has no business being. If we’re true to our values, it can tell us when we’re being lied to. The more widespread its language, rules, and methods, the better chance we have of preserving what Thomas Jefferson and his colleagues had in mind. But democracy can also be subverted more thoroughly through the products of science than any pre-industrial demagogue ever dreamed.

    In all uses of science, it is insufficient–indeed it is dangerous–to produce only a small, highly competent, well-rewarded priesthood of professionals. Instead, some fundamental understanding of the findings and methods of science must be available on the broadest scale.

    It is tragic in my mind that Sagan came to believe in pseudoscientific ideas, since he so clearly enunciated the principles of science. It seemed like, from the limited reading I’ve done of his work, that he was skeptical of hopes based on faith, but not of fears. It seems like he bought into fears about our modern industrial civilization, but never thought to question them. I suspect it was because he found a moral justification to believe in this quackery, that we do indeed live in a “demon-haunted world” filled with people who have not developed the skills to think straight about reality. He saw our civilization “blowing up in our faces” as we exponentially used up resources, never thinking that part of technological innovation is the development of efficiency–using less of something to achieve the same end, and so he found it valuable on some occasions to dabble in myth, to abuse his position as a scientist, because most simply wouldn’t understand him on critical issues otherwise. As he would say, no one is infallible, hot even him.

    I think his concern about science and technology “blowing up in our faces” is something to pay attention to, but interestingly not for the reasons he thought. Nevertheless, I will be eternally thankful to him for his efforts to spread scientific thinking far and wide. He was one of my “teachers from afar.”

  14. pouncer says:

    Hello again.

    Ben Franklin insisted the US Constitution make provision for post “roads”. One of his many brilliant inventions. It’s profitable to both that folks in South Carolina should be able to exchange news (the man was a printer, after all) with folks in New Hampshire. The Sears, Robuck company was built on post services.

    Not that roads need be government projects. Apart from UPS and FedEx, the New York Subway system was built over the objections of government. The first tunnels were dug as (post-like) pathways for pnuematic message tubes. BIG freakin’ message capsules, the size of railroad cars. Leave it to government to approve the paperwork without doing the math … Anyway, there were three separate and competing subway systems in place when the government took over that road system.

    Phone lines and telegraphs and clipper ships and internet links and cell phone towers and the late lamented Motorola constellation of Iridium NEO satellites are roads of one sort or another. There is a role for government in the process but when government gets too deep into a road project it turns into money losing mush. Canals and the over-abundance of 19th century rail and air-mail and NASA…

    I wander. But your topmost list includes “shippage and haulage” which I think refers to the cargo and freight but seems to me to omit the routes, roads, common carriage and time-tables that allow trade.

    Everybody has a “theory of value”; Marx one of the worst, but in my view the least-worst is a “trade value” If I dump/divide a bag of M&M’s between a son and daughter, and they wind up sorting and their piles so at the end he has all the green ones and she has traded for all the orange ones, they are both richer from the trading exercise. They’ve added value; neither cheated the other. If Ben Franklin’s road put one sort of fanatic monomaniac in New Hampshire into contact and trade with the only other comparable idiot in the original 13 states, who happened to be in South Carolina, the whole nation saw an infinitesimal increase in net worth from whatever joy the pair derived from arguing with each other.

    Uhura, open hailing frequencies.

    Anyhow, I’m suggesting road building is “wealth creation” — provided mostly the government isn’t in charge of the route.

    Next, ask me about sewers …

  15. Eric Barnes says:

    Mark Miller said:
    “I guess I could say this is one reason why I find atheism in the sciences destructive. The atheists I know about all claim that atheists are capable of being moral people without religious teachings. They can be taught ethics. This has always seemed like a weak rationale to me. Without some kind of moral teaching that includes the concept of something beyond one’s self, ethics are just an abstraction. It’s really up to the individual to give it meaning. Some do. Some don’t. Without a sense of something beyond yourself that matters, what’s the point of morality? If morality does not profit you, at least in the time horizon you think is important, and since it doesn’t always do so, then doesn’t it appear to pay to have situational morals, to just adopt those that seem to profit yourself in amongst the people you wish to curry favor?”

    I disagree Mark. Ethics and morality are very real regardless of religious belief. If a person acts immorally or unethically towards me, I will judge them based on their actions and what they profess will matter little. To do anything else would be bigotry.
    I was raised catholic and am agnostic now. While I’d say it might be more common for people I’ve known who are religious to be highly ethical and moral, some atheists/agnostics I’ve known are the most ethical and moral people I know.
    I have no animosity towards the church, or those in it. I just have no faith.

    PS, I very much enjoy your thoughtful comments.

  16. Mark Miller says:

    @Eric Barnes:

    Using my supposition as a model, when I spoke of someone having “situational ethics” I envisioned someone who would act according to your morals on one day, and according to someone else’s the next, but which someone outside their circle of friends might view as immoral. The condition being that this person gains some advantage from pleasing your sensibilities and that of others, but may end up on the whole doing something destructive. To you, this person appears moral, but the net effect of their actions may be insidious to the larger community. This isn’t a reflection on your morals. I’m thinking more along the lines of unanticipated causes and effects.

    I’ve been making a realization lately that any social structure, whether it be a society, or an organized activity, like science, has its own intrinsic morality that isn’t based on a religion, but on some philosophy, and if that morality is not adhered to by enough people within that structure, it decays. If it goes on long enough, the structure no longer resembles what it once was. It loses its integrity and becomes something else. This isn’t necessarily bad (though it could be), but this effect becomes destructive for sure if no one really identifies what the structure is changing into, and continues to try to operate within it as if the structure still operates according to the old morals, and assumes it will continue to have the same qualitative outcomes.

    What I was getting at was that religion may help create this sensibility that adhering to the morality of a system is important, and creates the benefits that flow from working within that framework. They may not be conscious that the system’s continuation is contingent on them and others continuing with it.

    The point that I think religion makes clear is that a morality isn’t worth a hill of beans if it does not at times, under certain prescribed circumstances, compel a person to act against their own self-interests in the interest of maintaining the integrity of the larger whole. In my own conception of this, I don’t like the idea of someone else doing the compulsion. Rather it’s something that comes from the person. The morality they’ve adopted compels them. They make the decision to do this in the interest of the other.

    As for me, I have some faith. It’s just not organized. :) I’ve found that taking a more agnostic approach to faith (my sense of feeling that there is something beyond myself, but I don’t think any one religion explains all of what it is) is more enlightening in my life. It does not lead to certainty, but a sense that things and people come into my life, and happen to me, to teach me something. And if what I do is good, it will ultimately have a good outcome. There will be some compensation for it, though I know not what, or where it will come from. That faith could be totally false, but I need to have it, or else I’d give up what I’m doing.

  17. Eric Barnes says:

    @Mark

    Thanks for your thoughts. :)

    I wouldn’t consider myself unusually moral or ethical. I am more fat dumb and happy and haven’t been faced with any dillemas lately. I’d like to think that given time, I’d always make the right choice. :)

  18. Pascvaks says:

    Thoughts-
    The Oldest Profession is the Priest? After all, who said what the ladies were doing was wrong? Or who gave it a name? Priests are people who think they have the answer to something that other people have problems with. Priests come in all sizes, shapes, both genders, and know that they know that they have the answer to certain very important questions someone will willingly pay to ask them. The oldest profession is the priest. In the modern world, a fail estimate is that there are at least 500M-1B priests on the planet. The hard part is finding one in a church that you like to listen to.

    Basic Human Character (or, as some say, Basic Human Nature) is the unspoken, unwriten, common “Code” any majority in a group of people live by. It is the foundation stone of the majority of all interaction. It is the basis for the majority of all Customs, Rules, and Laws. VIP, note that ‘laws’ come after ‘customs’ and ‘rules’, you cannot make a law to change basic rules and customs that will stand the test of time; at least not for the majority of cases.

    Among the hardest things is accurately determining your location in time and space. If you’re in the midst of a storm, it’s nearly impossible. When people get in the midst of storms, regardless of type, they are hesitant to move, participate in causes, make decisions, judge the actions of others, take reasonable precautions, eat reasonably, vote reasonably, speak up, stand up, raise their hand, and sometimes they even fail to protect their young. People who make storms are trying to get what they want while everyone else is distracted.

  19. adolfogiurfa says:

    It´s the “chosen ones” known from old tale. There are no chosen ones but mad ones and common, hard working and sane people, who are by nature impeded to rationalize such a disproportionate eagerness for power and money way in excess of what it is needed.

  20. Pascvaks says:

    PS:
    make “a fail estimate”… “a fare estimate” (sorry;-)

    Human chaos seems most likely during periods of great want (famine, natural disaster, deep ice ages, etc) and during periods of least want, like today for example. Ever wonder where all the pot heads are getting the money to get their next joint, hit, trip, etc? But it does seem that the actual number of ‘priests’ skyrockets during periods of great least want. Hummmmm… gotta’ think about that some more.. least want = more ‘priests’… now that’s dangerous..

    Obviously, I should have added to my last thought last line: “People who make storms are trying to get what they want while everyone else is distracted, and they frequently use ‘priests’ (of many and various ‘religions’) to muck things up to a level of chaos that best fits their objectives. Never trust a priest any farther than you can throw them, especially the ones who aren’t talking about Life after death. It’s a dangerous world out there fellow Cavemen.”

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