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I have been working on a twelve step program to introduce the laws of thermodynamics to economists, here are the first few steps: # 1. The candidate economist must go to a library. There he or she will notice spheres sitting on wooden stands. These represent the planet we live on: Earth. Spheres like Earth are by definition finite — they only hold just so much stuff. Economists are required to memorize this key point and say it over and over, “The Earth only holds just so much stuff because it’s a sphere. The Earth only holds just so much stuff because it’s a sphere. The Earth only holds just so much stuff because it’s a sphere. …” Economists are required to say it over and over until he or she can remember it without peeking at notes. Next, the economist is ready for his or her very first BIG scientific experiment! The economist is advised to stay calm, and be sure to get a good night’s sleep before attempting the experiment. # 2. Put a piece of cake on a plate. 3. Eat the cake. # 4. See if you still have the cake. Economists aren’t used to empirical science and will have to do the experiment (#2 through #4) a few times before the implications finally sink in. Well kids, that’s the First Law (the Conservation Law). Isn’t science fun!!! Can any economist tell the rest of the class what he or she has learned? …Anyone… Nobel Laureate Friedman… Professor Nordhaus… Nobel Laureate Solow… Nobel Laureate Samuelson… Anyone… Well perhaps we should just move on to the Second Law (the Entropy Law). Gee kids, guess what happened to that cake…
MAXIMIZING UTILITY
Once upon a time, Daddy Economist, Mommy Economist, and a litter of little Economists were in a mountain cabin, sitting in front of a small coal-burning stove to keep warm. Although most people know that when coal burns, it’s gone forever, Daddy Economist isn’t worried because he was trained — like a mindless robot — to believe that when the coal is gone, a substitute will magically appear. So when the coal is gone, he looks around, and his furniture pops into view — just like magic! So Daddy Economist decides to maximize his utility by breaking up his furniture and burning it in the small stove. Now the Economists must sit on the floor, but heck, it’s better than the alternative: dying. Then one day, SURPRISE!!! All the furniture is nearly gone. But Daddy Economist isn’t worried because he believes a substitute will magically appear. So when the furniture is gone, he maximizes his utility by ripping the boards off the walls of his cabin and burning them in the stove to keep warm. Now the Economists must sit on the floor very close to the stove, but heck, it’s better than the alternative: dying. Then one day, SURPRISE!!! The Economists’ cabin is completely burnt up. But Daddy Economist was trained not to worry. He decides to maximize his utility by pulling the clothes off his family and burning them in the stove to keep warm. Now the Economists are forced to stand right next to the stove and constantly turn, but heck, it’s better than the alternative: dying. Then in a few hours, SURPRISE!!! All the Economists’ clothes have been burnt in the stove. But Daddy Economist isn’t worried because he is going to maximize his utility by… ( The Sunday Times (London); 1-3-99 CLUTCHING her baby to her, Kim Soon-Hee shuddered as she described the desolation she had escaped in North Korea, a country so severely afflicted by famine that some people have been reduced to eating children to survive…)
RIVETS FOR SEX
by Jay Hanson Once upon a time there was a spaceship in which “rivets” were used for currency. Why rivets? Because on this particular spaceship, one could trade rivets for sex! SPACESHIP POLITICS Those individuals who were best at pulling rivets out of the spaceship hull — the “Pullocrats” — had the most political power because they controlled the most sex. As might be expected, “pulling rivets” became the most-talked-about and most-envied measure of personal worth. GOD REVEALED IN EACH TRANSACTION Unsure of their moral justification, the Pullocrats employed “Pulling Priests” (or “PPs”) to search Holy Scripture for the truth. A careful re-read of the Scripture by the PPs discovered that “pulling rivets” maximizes “utility”. Although no one has ever seen or measured “utility”, the PPs say that God reveals his preferences in each transaction thereby proving that “utility” is maximized. So with the circular blessing of the PPs, the doctrine of continuous and unlimited “rivet pulling” became the organizing principle of the entire spaceship. Indeed, nothing else mattered to anyone. A TINY BIT OF A PROBLEM In the real world of a spaceship, a tiny bit of air leaks out after each rivet is pulled out of the hull. And while the air supply system was designed to stay ahead of normal leakage, so many rivets have been yanked out of the hull, that at the present rate, the ship’s atmosphere will be unable to support life in 12 hours. A rescue ship is on the way, but it will take 24 hours to reach the ship. The Pullocrats must #1. Organize to ignore their PPs, stop pulling rivets out of the hull, and start pounding them back in, Or #2. They will die.
ECONOMIC STUDENTS REVOLT!
From: post-autistic economics newsletter To: pae news Sent: Tuesday, October 03, 2000 6:43 PM Subject: post-autistic economics newsletter, No. 2, October 2000 sanity, humanity and science post-autistic economics newsletter No. 2, 3 October 2000 Subscribers in 36 countries
FRANCE
“It was in the beginning,” opens the Le Monde article of September 13th, “a modest initiative, almost confidential. It has now become a subject of important debate which has put in a state of effervescence the community o f economists. Should not the teaching of economics in universities be rethought?” The first issue of this newsletter reported on the events leading to this “effervescence”. Briefly, they were as follows. In June a small group of economics students put on the web ( www.respublica.fr/autisme-economie ) a petition protesting against economics’ “uncontrolled use of mathematics”. This indulgence, it said, creates “a true schizophrenia” because the mathematics has “become an end in itself” resulting in an “autistic science”. The petition called for an end both to this and to the repressive domination of neoclassical theory in the curriculum. The students called instead for a pluralism of approaches with emphasis on engagement with economic realities. Within two weeks the student petition had 150 signatures, many from France’s most prestigious universities. The students publicized these results. On the 21st of June Le Monde picked up the story. It featured a lengthy and sympathetic article on the students’ call for reform. Other French newspapers and magazines, as well as TV and radio, soon followed with the result that the number of signatures on the economics students’ petition reached 600.The perceived seriousness of the controversy increased when at the end of June some professors launched a petition of their own,, backing the students and offering further analysis and evidence supporting the need for reform. The French minister of education announced that he was looking into the matter. Then in July everyone left for “the long vac”. Now they are returning and Le Monde has reopened the public debate. So too has the national radio network, “French Culture”, which on 21 September carried a program on the controversy, featuring two students and a professor from the post-autistic camp. Nor has the government forgotten about it. Le Monde reports that Jack Lang, the minister of education, has informed it that soon he will be announcing “the formation of a commission charged with making an evaluation of the situation and submitting to him some proposals. An economist of renown has been approached about leading this investigation.” Meanwhile the students and the reformist academics are regrouping in preparation for the next stage of the campaign. A meeting of the petition signatories, now 800, is being held at the Sorbonne on October 4th. Student leaders, Olivier Vaury and Gilles Raveaud, report that following the Paris meeting the pluralists will organize and conduct debates in universities throughout France. (The movement which began in the capital is now nation-wide.) These debates will continue through mid-November. Then in December a big national meeting is being planned for Paris. This will include both students and teachers committed to reform and will develop detailed, concrete criticism and proposals. Speaking for the students, Raveaud adds, “and we will claim our place” in the governmental commission that is being set up. The post-autistic economics movement in France is also looking forward to more coverage in periodicals, including economics journals. The national newspaper Liberation, which featured a full page on the crises in economics in its July 31st issue, is planning another such feature for late October. Vaury reports that “we will have some important articles in TElErama (2.5 million readers) and there will be articles on this issue in L’Economie Politque (November edition).” Another article is scheduled to appear in the journal Alternatives Economiques. Student leaders report, that when last summer it began to appear that the reform movement in France was not about to go away, some neoclassicists tried to dismiss it as a Trotskyite conspiracy which included Le Monde. This convinced no one, and since then things seemed to have moved on. For example, the week before last there was a conference at the Sorbonne, celebrating the 50th anniversary of the mainstream La Revue Economique. Attendees report that discussions spontaneously diverged to issues that have been raised by the reformists.