Economic Possibilities for Our Grandchildren

When John Maynard Keynes wrote his essay Economic Possibilities for Our Grandchildren 79 years ago, he was thinking about us. In it, he boldly predicted that we would learn how to create a world over the next 20 years that “solved the economic problem.” Keynes was a remarkable visionary. One of the qualities that exemplified his brilliance was his capability to adjust his thinking as appropriate to the changing life conditions in front of him.

Thus, he was not only a towering figure in 20th Century economic thought, but also able to sufficiently distance himself from his own policies to foresee a world and economy wholly different from his own:

“I see us free, therefore, to return to some of the most sure and certain principles of religion and traditional virture-that avarice is a vice, that the exaction of usury is a misdemeanour, and the love of money is detestable, that those walk most truly in the paths of virtue and sane wisdom who take least thought for the morrow. We shall once more value ends above means and prefer the good to the useful. We shall honour those who can teach us how to pluck the hour and the day virtuously as well, the delightful people who are capable of taking direct enjoyment in things, the lilies of the field who toil not, neither do they spin.”

Robert Skidelsky offers a timely reflection on Keynes’ vision. It’s well worth a read.

What is Monetary Relativism?

“We are moving toward a dictatorship of relativism which does not recognize anything as for certain and which has as its highest goal one’s own ego and one’s own desires.” — Pope Benedict XVI

“[Relativism] claimed that all truth is culturally situated (except its own truth, which is for all cultures); it claimed there are no transcendental truths (except its own pronouncements, which transcend specific contexts); it claimed that all hierarchies or value rankings are oppressive and marginalizing (except its own value ranking, which is superior to the alternatives); it claimed that there are no universal truths (except its own pluralism, which is universally true for all peoples).” — Ken Wilber, A Theory of Everything

“In economic terms, relativism is clearly an absurd position, for the monetary tools and systems that we choose have profound consequences on social order and dynamics. A relativistic position that suggests barter is equally as ‘good’, ‘true’ or ‘worthwhile’ to use as, say, an international currency such as the Bancor put forth by John Maynard Keynes is utter madness when one takes into account the context of global complexities, capital flows and the instantaneity of transactions on which the international system now depends.” — Jordan MacLeod, New Currency

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In New Currency I briefly touched on the prevalence of philosophical and moral relativism in academia and Western culture. These positions hold that there are no absolutes in the universe, only relative claims. As Wilber points out, the problem with such ideas is that they themselves are absolute claims dismissing the possibility of absolute claims. Thus, they run into the fatal error of performative contradictions.

These unreasonable positions can only be understood as intellectualized protest against the status quo. When one cannot transcend or resolve the current problems related to globalization, it is apparently in the interest of many academics and activists to attack the systems that are “causing” these problems, as if that will solve anything. Relativism can therefore be understood to have an inherently nihilistic nature that presents itself as a serious roadblock to further economic and social evolution. It simply cannot discern between the shadows of current systems and cultures and their essence and totality. The enormous and indispensable contributions of, say, capitalism are thereby tossed out with its increasingly apparent shortcomings. The baby is thrown out with the bath water. Read more »

Welcome

Much has happened since publishing New Currency earlier this year. It’s been an uneven and tenuous financial recovery to say the least. Stock markets have rebounded to surprising heights, unemployment in the US has surged past 10% and there is a resurgence of talk about the dangers of a double dip recession. Perhaps, the most encouraging aspect of the crisis is the growing interest and awareness on Main Street about the future of our national economies and (un)sustainability of our current trajectories. Great concern has emerged over the future of the dollar, the increasing debt burden we’re leaving future generations, and questions about what to do with ever-increasing government spending.

This is a place where we will try to make sense of all of this. Naturally, we will be exploring the economy through the lens of New Currency. If you haven’t read the book and intend to follow this blog, I’d highly recommend that you do so. We’ll be applying innovative economic tools to our current financial and global problems, and as I argue in the book, these tools sometimes can only be properly understood by taking a leap into a new economic paradigm or mindset. This blog is an attempt to make this thinking even more solid, but the book remains an essential foundation.

Please email or post your questions and comments as they come up. I’ll do my best to weave answers into posts.