On Gaien Higashi Dori
Friday, October 3
Socrates an Idiot?
When Socrates said "Only one thing I know, and that is that I know nothing," all the boys back in Greece thought the man was on a cloud, up there. What possibly didn't occur to them was that the great Greek midfielder was just voicing his total confusion with the theory of economics.
While I'll never have the beard or the sandals to be a Socrates, I came aground on the rocks of my own complete misunderstanding of economics today, and decided, once again (I do this about once a week), to try to make it all sit peacefully in my head. Actually, "misunderstanding" is the wrong word, because that would imply that I have some version of what economics is about in my head, however wrong, but the thing is I don't. I have no idea about economics. As the Americans would say, I know Jack.
So, the mind began to wonder from my work, and into the realm of condensing vast tractor loads of theory into something comprehensible. I created an island, and had six people living on it, with the island's land divided up between them. One had livestock, another had fertile land, another was an artist, and so on. With this model in place, I was able to go from barter, to use of something precious to get around the time-space inconveniences of barter, to the establishment of a bank (although this one is still a bit hazy), to creation of a currency, based on the something precious, which they all gave their various amounts of to the bank in return for promissory bills. I worked out basic pricing, and from that I even got to a very very fleeting understanding of how inflation happens (nowhere near understanding its implications). Don't test me on this though, as I don't know if I could recover that moment of stunned realization.
All was going well. I sorted out the idea of national debt with the notion of a tidal wave completely destroying everything on the island, meaning that all they had left was their something precious. Let's call their something precious gold, to be conventional.
So they make a boat and take their gold, and head off to another island, where they trade their gold for sheep, seeds, implements, papyrus, whatever was destroyed. They use up all their gold. Couple of days later, Mother Nature grins manically (is this a word?) and fucks them over with another tidal wave. They go back, sheepishly, to the other island, where the evil other race have got wind of their misfortune and are sitting pretty, waiting for the boat to come. No gold, but they still want some sheep. They need credit, but they are clean out of gold. Before, on their own little island, when the sheep got BSE, they all lent some notes to the poor old decent skin sheep farmer, knowing he would be good for it in the end. Interest was never mentioned. Their religion banned the concept. But now, at the mercy of this other crew, they agree to a loan at exhorbitant interest, and money itself begins to make money. Capitalism is born.
I'm going to blatantly skip a few technicalities and a few thousand years now. Nothing to do with Socrates Syndrome at all. It's just getting late and I want to go to bed. Anyway, it's the modern world. 2003. All the religions have forgot about their teachings on the evilness of lending at interest, except for Islam. Well, they're new, anyway. Money is now a "producer good." Currency speculators can take down a continent almost in the blink of an eye. And, in my non-Greek understanding of things, it's all because, way back when, that second island didn't just say, "It's been a tough week gang. We've a few extra sheep. Pay us back when you can."