Econ 101

In Memory of the Curious Time

When We Two

Were Millionaires for Ten Days


 

First principle of economics: nobody willingly makes an agreement by which they end up losing out. People can get hoodwinked or coerced, sure, but nobody wants to lose. There are only two kinds of cases that people try to cite as exceptions, which are altruism and spite. Cursory examination reveals that both are attempts to win along alternative vectors: the former for a greater good, and the latter as a way to not lose so badly. (For the attentive: the difference is between intrinsic and extrinsic valuation.) This is the most important rule.

 

Corollary of the first principle: whenever anyone enters an agreement with you, they are winning from it. You aren’t powerful enough to coerce or smart enough to hoodwink. The only thing you can do is make sure they’re winning in the right way.

 

Second principle of economics: in a monistic system, there is only one vector of winning and losing. This means the only kinds of trading left require forcing or duping, or both.

 

Third principle of economics: every interaction, emphasis on the etymological split of the word, is economical in that these principles apply to it. Mathematics might not apply cleanly, but that hardly matters. What does matter is that you can interact with entities like companies and society at large.

 

Fourth principle of economics: in a strong enough system, interactions cease to be with other people and start to be with the system itself. And compared to that system, you are powerless.

 

Final principle of economics: you can’t beat the house. Not now, not ever.

 

Imagine you’re the house. Just like mentioned above, in order to make effective deals, you need to dupe people or force them into obedience. The best way to do both is to introduce a representation of the vector, an image of the real substance, and focus the attention of others onto it: the illusion over the reality. Then they will strive and strive and strive for it and keep wondering why, even when they try so hard, the mists keep slipping between their fingers. More importantly, you don’t even have to try in order to trick people this way. Like good little Delians, they’ll do it to themselves.

 

It’s easy to misconstrue income inequality in America and elsewhere. The argument people want to be true is that because some people have higher income, therefore they are more powerful. Momentary thought reveals it to be the exact reverse. This is why income redistribution is even a talking point, when it should be clear that it doesn’t matter how much the money gets moved so long as the ability to make the money stays in the same hands.

 

“So you’re saying there should be a redistribution of wealth instead? Like, shifting ownership of the means of production?” Very original, like that T-shirt of Che. Incidentally, Zimbabwe tried something like that. The people there had been ruthlessly subjugated by white “settlers” for a long time, rebelled, and redistributed all the farmland to native Zimbabwean ownership. At last count, their economy wasn’t doing so hot. No, this isn’t a “haw haw black people” line. This is a serious question: why did this go so badly when it looks exactly like what you’d want to do in their position? Why did redistributing the means of production not result in an immediate escape from poverty and strife? There’s only so far that blaming the global conspiracy of white people can get you (and they really just want you to buy Coca-Cola anyway). Or how about we reframe the question: if you woke up tomorrow as the CEO of Exxon, what would you do? If you answer with anything other than “flounder,” then you have delusions of grandeur. No, that’s not a diagnosis, that’s an observation of fact. The diagnosis costs extra.

 

Incidentally, the Zimbabweans have one serious advantage over the rest of us: at least they fucking tried.

 

The game is: power isn’t about what you have, it’s who you are. This is, of course, what people are not allowed to believe, because if they believed it, they wouldn’t just sit down and accept their place. Yes, you read that right. The old way of keeping people in their place (read: their class) was divine right: certain people are just better by nature, and therefore they ought to rule. Sure, after monarchy fell out of favor, the name of the game switched over to race/genetics/fill in the blank, but the core idea remained the same. The problem with that model is that it left an opening for anyone who managed to upend the class allotments. Achieve power, and you logically must have already been part of the higher class, an exception by nature – but that illusion is harder to maintain. Anyone from a lower class could secretly already be from a higher class, which means they lose their defense against the withering scorn of all Creation for their failures. So, to keep people sane, the explanation shifted: since everything is determined, therefore the people who have it good must have it good because of external factors (luck in birth, luck in associations, luck in timing). Believe that, and everything stabilizes. It’s no longer your fault that you’re a loser. Reality itself conspired against you. In contrast, any victory is logically yours alone.This works for everyone, except those who are supposed to have an advantage and find themselves still coming to nothing. Ever wonder what the deal is with white men these days, and why the loserest of them need so desperately to be oppressed by something? In today’s America, land of equality, they’re just like everyone else.

 

Meanwhile, the people who actually wield power simply focus on their work, which is wielding power, and wonder vaguely but not seriously what’s wrong with everyone else. If there ever was a master-slave morality, this is it.

 

Well, that’s assuming there even are people who wield power any longer. I assume there are at least a few. Putin comes to mind, and probably Xi. Possibly a few CEOs. Generally, though, the people in positions of relative power are wielded by the power of their position. Consider the CEO of your average publicly-traded company: what is their primary responsibility? To make “shareholders” money. Now, let’s not fall prey to the notion that there’s some malicious mob of pandaemonic shareholders that go to meetings and insist on more money. If it were actual people, the CEO could just say no and lean his or her authority to force through some plan of action. This isn’t the case; hence they are acting in service to something more powerful than they are, which in this case can reasonably be summarized as the Dow Jones Industrial Average. No, not the people behind it, like some nefarious cabal, but the Average itself. Society itself is on the other end of this exchange.

 

So, when you negotiate your pay with your boss, what precisely is happening? You try to push your pay up; your boss tries to push it down. If you’re at a small business this at least makes some sort of sense, but those are the places you’re least likely to get pushback (barring the boss being an idiot) since there’s much, much more value out of someone who doesn’t feel exploited. Typically, though, this phenomenon happens in larger corporate structures. It’s not your boss’ money that’s being given away, so why does it matter so much? Well, if they give up too much they might be fired by their boss, who’s worried about getting fired by their boss, and so on and so forth until the Dow comes into the picture. “So it’s about profit?” Not quite, since other sources of waste exist in excess of what the raises cost, in external deals/internal investment/etc. The point is that you are weak, those other powers are stronger, and that means you lose. Your boss feels the most pressure to keep you down, because letting you get your way is a sign of weakness – a failure to keep you in your place. And, for your part, you will play the role of the powerless: you rebel in insignificant and unnoticeable ways, gripe and complain, but fastidiously avoid trying to take any real power yourself. Because that would make you like your boss. Get it?

 

This is how society rolls along. In ten million ways, people play their assigned roles, eschewing any personal responsibility in exchange for taking everything personally. They seek out money so they can waste it, explain their failures as not their own, and lose any chance of ever having successes. In case you can’t tell, that’s you in there, too.

 

Marx had his heart in the right place, but was utterly hoodwinked by that which he tried to rebel against, which is precisely why he was so popular. (Compare Bernie Sanders.) Even if the workers seize the factories, they won’t know the first damn thing about running them, because if they did know, the system would use them to run the factories. This is because the factories were never the means of production that needed to be seized. How can you ever own anything if you don’t even own yourself? And yet we go through life, day by day, as slaves to the machine, owned by our work, our clothes, our politics, and even our identities. Yes, it’s possible to be owned by your self, and it’s called narcissism. The space there is intentional. How is it surprising that we’re powerless? That everything about our lives is painful and unfulfilling? Maybe it’s the Four Noble Truths, or maybe it’s that we don’t even have the least leverage over the one point there is to stand on. (Extend the Archimedean metaphor, and it gets vulgar.)

 

Ownership over the self is the start. It means leaving childhood behind, and taking on the mantle one was meant to take. It means simply being, without having to be something, and that brings us to:

 

Final principle of economics: the one who has control over currency is the one who determines its value.

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