Economics Is Not Natural Science
Edge, August 11, 2009
Edited by Andy Ross
The marketplace in which most commerce takes place today is a product of
engineering. Thinkers are less likely to provide us with genuinely
revolutionary axioms for a more highly evolved marketplace than reactionary
responses to the technical innovations that threaten to expose the
marketplace for the arbitrarily designed poker game it is.
particularly treacherous to limit economic thought to the game as it is
currently played. This widespread acceptance of the current economic order
as a fact of nature ends up compromising the impact of new findings. Write
books that business likes, and you do better business. But just because it
pays the mortgage doesn't make it true.
Most of these concepts end
up failing to accurately predict the future. Instead of 25 years of
prosperity and eco-health, we got the dotcom bust and global warming.
Immersion in media is not really good for us. The decentralizing effect of
new media has been met by an overwhelming concentration of corporate
The economy in which we operate is not a natural
system, but a set of rules developed in the late Middle Ages in order to
prevent the unchecked rise of a merchant class that was creating and
exchanging value with impunity. Feudal lords, early kings, and the
aristocracy were not participating in this wealth creation. They needed a
mechanism through which to maintain their own stature.
Their first innovation was to centralize
currency. Central banks issue the currency in the form of a loan to a bank,
which in turn loans it a business. Each borrower must pay back more then he
has acquired, necessitating more borrowing. An economy with a strictly
enforced central currency is ruled principally by the debt structures of its
lenders and borrowers.
Their second great innovation was the chartered
monopoly, through which kings could grant exclusive control over a sector or
region to a favored company in return for an investment in the enterprise.
This gave rise to monopoly markets. The resulting economy encouraged people
to accept employment from chartered corporations rather than create value
Like artists of the Renaissance, most scientists,
mathematicians, theorists, and technologists today must find support from
either the public or private sectors to carry on their work. This support is
not won by calling attention to the Monopoly board most of us mistake for
the real economy. It is won by applying insights to the techniques through
which their patrons can better play the game.
The rules of the
economic game as it is currently played reflect neither human values nor the
laws of physics. We must stop perpetuating
the fiction that existence is dictated by the immutable laws of economics.
We must reveal economics as the artificial construction it really is.
It is not a natural science. It is game theory.
By Douglas Rushkoff
Edge, October 25, 1999
Edited by Andy Ross
Sports spectacles today are rallies designed to promote our allegiance to
corporations. I went to a Jets game where a chain of steak houses handed out
small signs to every fan. When the Jets sacked the opposing team's
quarterback we were supposed to hold up the sign, which read "Sack Attack."
On the back of the sign, however, facing each fan was the name of the
restaurant chain. They took the most aggressive, most carnivorous moment of
a football game, where we sack the opposing quarterback, and used it as an
opportunity to program us with their name and logo, So now we're going to
associate the steakhouse with "Ah, we killed them!"
Meanwhile, everything else going on at a sports game is still based on
ancient Roman techniques. The Roman games were intended to demonstrate class
mobility by showing that slaves could become regular citizens. If a slave
really won enough gladiatorial contests, he would be elevated to the status
of citizen. What's happening in sports today is very similar, except it is
an inner-city kid who gets out of the ghetto because he has talent, and has
chosen to spend his energy on entertaining, rather than mugging us.
Successful gladiators were permitted to commit terrible crimes, even rape,
without fear of being punished. Same way here. No matter how many times a
sports hero is arrested, we'll still forgive him.
Look at the
scoreboard. A corporation has
paid for that scoreboard to be there. Its name is right on top.
AR I saw that economics was not a natural
science back when I was an undergraduate already.