Economics a Sham Science?

Economist Julie Nelson Says Much of Economics is a Sham Science

We undermine our survival if we continue to imagine economics as a ethics-free and care-free sphere

It is a little over 40 years ago that I was in the first undergraduate class on the planet to be taught the theory of plate tectonics. 4 weeks ago I lived through a magnitude 7.8 earthquake nearby my home in Kaikoura. For me the experience was a first hand confirmation of Wegener’s theory, and other than being tired from the amount of things there are to do in getting basic infrastructure (roads, water, sewerage, ports, power, communication, drainage, etc) functioning again, I am functioning normally because I expected the event (even though I had no accurate idea of when, I had a 90% probability of it being in the next 25 years sort of expectation), whereas for most in town it came as a terrifying and unexpected curse from god.

I am not fundamentally a geologist, I am fundamentally trained as a biochemist, ecologist, and evolutionary biologist, but with a sound practical background in animal husbandry, engineering, electronics, computers, law, politics, education and psychology; and with more than a passing interest in complexity theory and generalised paradigm spaces.

People are really complex – from the atomic level all the way up through some 20 levels of complex systems to the highest levels of abstract thought that some people manage to operate on for various periods of time.

It is clear that any exploration of complex systems must start from simple assumptions and work from there.
This must happen at every level, from the personal in terms of our individual intellectual development to all levels of thought within various schools and disciplines to the outliers operating individually beyond the boundaries of agreement about such things, that work essentially alone for most of their time.

So we see much missed communication happening, as the adepts within particular disciplines critique what are the obvious shortcomings of the basics of other disciplines they are less familiar with (while the similar failings in the introductions to their own disciplines are so far back in their own intellectual history as to be almost forgotten).

It seems to me that every individual in every discipline, must logically go through a process metaphorically equivalent to Wittgenstein’s Ladder – we must believe things to be true, in order to get to a place where we can grasp the concepts that allow us to see that the assumptions we used to get to where we are were false, but the place we are at has a utility that surpasses the notion of truth we once believed.

The idea that things are either true or false is the simplest of all possible logic sets, and is therefore the one that most people encounter first in their experience of being. If they are able to question it, and see beyond it, they will discover an infinite set of possible logics, from trinary to higher state sets and all the way to the purely probabilistic.
Yet most brains establish a habitual relationship with the certainty of binary logic that is hard to break at all levels (especially if such logic is promoted past puberty, as most educational systems do).

Anyone with more that a passing acquaintance with complexity theory, with Wolfram’s “New Kind of Science” (NKS) will understand that reality has many levels of systems that are not predictable, as they are already maximally computationally complex (and that is entirely leaving aside the question of if the fundamental nature of this reality we live in is “causal” or “constrained stochastic” – to me the evidence of my existence overwhelmingly favours the latter).

So there is an understandable gulf between adepts in different disciplines, if they stick strictly to the complexities they are familiar with in their own discipline, while at the same time looking only at the foundational simplicity of introductions to other disciplines.

Complex systems are capable of infinite complexity, and any exploration of any infinity always looks infinitely longer than the path already explored (however long that path is) – one of the truly humbling aspects of infinities. There is much truth in the old Buddhist saying “for the master, on a path worth travelling, for every step on the path, the path grows two steps longer”.

So in this context, of potentially infinite levels of awareness, both within and between domains, some things do become clear, and some become more uncertain.

One thing that is clear, is the exponential technological trend of being able to do more with less computationally, which is exponentially increasing in its influence on our ability to do more with less in terms of manipulating matter and energy (at all levels).

Yes there are hard limits on things like energy output from the sun, and the amount of matter in the solar system, and these are not limits that are of immediate concern. We have other limits that are much more pressing.

One limit is the very notion of markets and exchange, and of the encapsulation of the value so measured in the concepts of money and capital.

Markets are all about supply and demand. The exchange value of anything for which supply exceeds demand in all cases, is zero – evidence air. Air is arguably the single most important thing for every human being, yet in most cases it has no economic value because it is universally abundant.

What most people have not yet realised, is that automation is moving towards supplying most goods and services in similar abundance to air.
When that happens, markets fail as a useful measure of value in most cases.

Economics, as a field that uses markets to measure value, has entered a phase of exponentially decreasing utility for individual human beings.

If we take the older and deeper meaning of economics, as an exploration of the systems we use to manage our household (using the broadest sense of household, being the population of all sapient entities in this universe), then it has the potential to expand into disciplines and conceptual fields far beyond markets (which will have markets being but one of an infinite class of possible value systems).

It seems clear to me that biochemistry is moving us rapidly towards being able to deliver on universal indefinite life extension.

Such a possibility requires a major rethink of systems predicated on limited life.

Creating a stable evolutionary path to the new paradigm of universal security, universal empowerment and infinitely extensible diversity, presents many interesting and ongoing challenges and opportunities for creativity at all levels.

All such systems must be, by definition, beyond strict centrally controlled rule based systems. They must involve flexible, context sensitive and infinitely extensible, boundaries characteristic of complex systems.

About Ted Howard NZ

Seems like I might be a cancer survivor. Thinking about the systemic incentives within the world we find ourselves in, and how we might adjust them to provide an environment that supports everyone (no exceptions) - see www.tedhowardnz.com/money
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