Economics from a people first point-of-view

Blow away the dreams that tear you apart
Blow away the dreams that break your heart
Blow away the lies that leave you nothing but lost and brokenhearted
(“The Promised Land”)

Part 1 “What cased the financial crisis?”

I’m an optimistic person. I see a lot of things in life to love. And I also know that sometimes you have to face unpleasant realities. The more I read about the financial situation today, the more I see a  situation that can’t be fixed unless there’s a major change.

People blame various things for the financial crises:

• Banks
• Subprime Mortgages
• Fannie Mae and Freddie Mac
• Investment Banks
• Insurance Companies
• Derivatives
• The Shadow (private) Banking System
• The Global Conspiracy of The Rich
• The World Bank
• Sovereign Debt
• National Deficits
• Republicans
• Democrats
• Ignorance
• Greed
• Corruption

Pick your favorite one!
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Yes, a face can launch a ship, but it’s words that cause wars.

Example 1: Nature means two mutually exclusive things

A conflict between PETA and Park Service rangers can be traced back to a 19th century British philosopher, John Stuart Mill. Mill wrote a book called On Nature. In it Mill noted that we use the word “Nature” to mean two mutually exclusive things: (1) everything except “man” and (2) everything including man (i.e., we too have a human “nature” so we’re a part of Nature).

The confusion begins, said Mill, when people using the word switch back and forth between meanings of the word “Nature.” The conflict starts when people use the same word, “Nature,” to mean two mutually exclusive things.
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Money, as Karl Marx spent thousands of pages in his book titled Grundrisse trying to convince us, is not a “thing.” In modern economics this idea is expressed more succinctly. Money, we are told, is “a medium of exchange.” But an exchange of what for what?

Even though they say money is about exchange, economists usually talk about things in connection with it. “You sell me one thing. I give you money. You take my money and buy another thing. That person takes your money and buys more things, etc.”

Marx’s view of money as an medium of exchange was quite a bit more profound. Marx viewed money as a “social compact.” When the society that created and agreed to use a certain kind of money no longer functioned, neither did its money.
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