A B C of ECONOMICS

PART I. II Chap. I.
Chap. 2
Chap. 3
Chap. 4
Chap. 5 Inflation, deflation.
Chap. 6

PART II. Chap. I. On Volition
Chap. 2
Chap. 3. Objections
Chap. 4

Part III. Chap. I. Costing
Chap. 2. Time is not money
Chap. 3 "Free Trade"
Chap. 4. Malthus
Chap. 5. Self Help

Part IV. Politics, a necessary digression.

The aim of this brochure is to express the fundamentals
* of economics so simply and clearly that even people
of different economic schools and factions will be able
to understand each other when they discuss them.

After about 40 pages I shall not " descend " but I shall
certainly go into , " go down into " repetitions and
restatements in the hope of reaching this clarity and
simplicity.

for various reasons, apportioned to a very considerable number of people. This is not absolutely necessary but it is advisable.

It is not necessary, because a few million slaves or temperamentally busy human beings could indubitably do the whole work for the lot of us. They did it for the Roman empire and nobody objected save an occasional slave.

4. Objections to slavery are in part ideal and sentimental. But slavery is not Openly avowed. Openly avowed slavery has nevertheless gone out of fashion.

5.

It is pure dogma to assert that an adult human being should be ready to do a reasonable amount of work for his keep. It is empiric opinion that a man who is constantly trying to sponge on others and who is unwilling to do anything whatever conducive to the general comfort or to the maintainance of civilization is a mere skunk and that he ultimately becomes a blasted bore not only to others but to himself, his own blasted self.

6. I assert a simple dogma : Man should have some sense of responsibility to the human congeries.

7. As a matter of observation, very few men have any such sense.

8. No social order can exist very long unless a few, at least a few men have such a sense.

AND ALSO those who know where things are or who discover new and easier means of getting them " out ", coal from the earth, energy from an explosion of gasoline.

Makers, transporters, facilitaters and those who contribute to their pleasure or comfort or whom it pleases them favour ..... usual sequence of children, if they have or want children, aged parents, who have earned their affection.

All of which we seem to perfectly simple and idyllic, but then we come to the jam.

Some of these people who work or who could and would work are left without paper tokens.

Someone else has got all the tokens; or someone else has done all the work " needed ".

CURIOUSLY ENOUGH, despite the long howls of those who used to complain about being oppressed and overworked, the last thing human beings appear to wish to share is WORK.

The last thing the exploiters want to let their employees divide is labour.

IT IS NEVERTHELESS UNDENIABLE that if no one were

At some agreed ratio the certificate must function.
From 1914 to '24 bar chocolate remained, as nearly as
I can remember, stationary in respect to gold.
Nations rose and fell, currencies and commodities
became dearer or cheaper. We have had 15 or more
prime years for empiric observation. Nobody remembers the
1830s (Eighteen thirties), anything men learned then
in America has been long since forgotten. The civil
war wiped it out.

## Chapter V

### Inflation, deflation.

I am all for controlled inflation, if by that you
allow me to mean that more certificates must be granted
when more goods are produced.

All the inflation wangles and all the official
schemes for inflations leave out the question of
control. That is to say the place the control is
a dark room back of a bank hung with deep purple
curtains. No one must see what happens. What happened
in the bank of the U.S.A. before Mr VanBuren set up
an Independent government treasury ?

Inflation for the benefit of the few.

## Chapter VI.

Every economist has to start somewhere. I start
on the proposition that every man who is decent enough
to be willing to work for his keep or that of

PART TWO

Chapter I. On Volition

It will be objected that I am trying to base a system
on will, not on intellect. And that is one of the
main reasons for my writing this pamphlet.

The criminal classes have no intellectual interests.
In proportion as people are without intellectual interests
they approach the criminal classes, and approach
criminal psychology.

No economic system is worth a hoot without " = good will ".
No intellectual system of economics will function
unless people are prepared to act on their understanding.

People indifferent to the definition of liberty
= as "le
droit de faire tout que ne nuit pas aux autres"
will not DO anything about their economic knowledge
whatever degree of that knowledge.

People with no sense of responsibility fall under
despotism and they deserve all the possible
probable castigations and afflictions that the
worst forms of despotism provide.

No economic system can be effective until a reasonable
number of people are interested in economics,
interested, I shd. say, in economics as part of the

SAY, IF IT WERE ONLY FOR THE EXTRAVAGANCE OF THE HOTEL, IT COSTS NO MORE TO COOK A DINNER WELL THAN TO COOK IT BADLY. YOU CAN, I ADMIT, MAYBE, PAY MORE FOR A GOOD DINNER THAN FOR A BAD ONE, BUT WHAT YOU GET IS DUE TO YR. KNOWLEDGE AND NOT TO THE CATEGORY OF THE HOTEL.

THE ARTS OF COMMERCE ARE BUILT UPON PERSONAL APPLICATION OF THE LAWS OF VALUE (MARXIAN METAPHYSICS AND THE "PSYCHOLOGY" OF AMERICAN BUSINESS BALLYHOO).

YOU WILL GET NO FURTHER WITH ECONOMICS" AS A SCIENCE" UNTIL YOU ARE READY TO MARK OUT THE SCOPE OF THAT SCIENCE, AS YOU DO IN THE STUDY OF CHEMISTRY, PHYSICS, OR MATHEMATICS.

GOODS IN THE WINDOW ARE WORTH MORE THAN GOODS IN THE BASEMENT.

THE ART OF COMMERCE, AS WHEREBY THE PROPRIETOR OF ONE CAFE acquires a clientele and his neighbour does not.

THE LUXURY OF THE POOR, THE LUXURIOUSNESS OF THE POOR WHICH HAS BEEN SANCTIONED BY THE SMALL SHOP AND THE MIDDLEMAN. THE SAVING OF STEPS. I BUY MY COFFEE AT MY FRONT DOOR, NOT AT THE LARGE SHOP 40 YARDS OFF.

THE SAME APPLIES TO MY TAILOR, COBLER AND BUTTER MERCHANT.

over=market ( dump ).

In politics <u>the</u> problem of our time is to find the border between public and private affairs.

In economics : to find a means whereby the common=
carrier may be in such way kept in circulation that
the individual's demand , or at any rate his necessary
requirement shall not exceed the amount of common=carrier
~~in~~ in his pocket at any moment, or at his ~~proximate~~ disposal.

A new school of economists says it should be put into his
pocket ( every week , every morning , every six months ???)

An old type of mentality asks whether this ~~would~~ maintain
~~the~~ the said individual's sense of responsibility ,
and answers the question very emphatically in the negative.

I fall back onto a profession of faith. The simplest
<u>starting point</u> appears to me to be the individual's
willingness to work 4 hours a day between the ages
of 20 and ~~35~~ 40.

There are doubtless in modern industry various directive
jobs etc. that need more prolonged attention
but very few in which an equivalent stent wd. not serve.
Ten years at 8 hours a day , as proportionate.

Freedom from worry, inherent in the reasonable certainty of keeping one's job must be worth at least 25% of ANY income.

NOTE that this reasonable certainty can only exist when the necessity of progressively shortening the working day is generally recognized.

No arbitrary number of hours set for 1932 will be valid in 1987. let alone in 2043.

Over and above which we come upon Maj. Douglas' equations re/ supersition in costing.

PART THREE
Costing

I don't quite see how anyone is going to doge (forever)
the Major's equations.

There are various verbal manifestations and various terminologies
and various approaches to the problem.

I have begun with distribution of work. A point at which the
Douglasites dislike to begin. I have gone on to the
demand for justice in the distribution of credit slips,
but that does not invalidate the Major's contention that
under the present system there are never enough credit
slips to deal with the product; to distribute the product;
to purchase the product; to conjugate ANY of the necessary
verbs of sane economics or of a decent and agreeable life.

The Major has been pointed out the superstition in the
computation of costs. The reader can look up the
details in a number of contemporary works.

He will not find a simpler statement than Douglas' :
You pay for the tree every time you buy a bit of the
fruit.

Obviously the tree has to be maintained, some fraction
over and above the worth of the fruit must be added
but the computation of that fraction can and should
be free from gross error.

Gross error here cd. undoubtedly undo the good effects

Objections to this system are raised and are conceivably raisable on the score of national greatness etc....

Nevertheless we are told that Holland has maintained decent standards of living etc. by not over populating herself. The system is supposed to work for a small nation and not for a large.

It would work. The only objection to it is that curtailment of the philoprogenitive instinct may not be necessary. Or possibly on practical grounds, that the present state of bigamy and idiocy and the inadequate progress of education is not able to achieve it.

Yet Sparsely populated districts are not necessarily the most prosperous. The remedy is to be recommended only at close range for the individual family living in a bad economic system. It can not be made the backbone of enlightened economics on the grand scale. Such economics, now, being little more than a study of how we can USE our resources, not how we can refrain from employing them.

Until we have decent economics the sane man will refuse to overbreed. And pity for the large poor family that will continue to be pity for idiotic lack of provision.

It may be that all, or most, sciences start from suffering or from pity; but once started

This is not mere nihilism, or mere in-vain ism or mere
quietism, nor is it so far off the subject as it might
seem, the point is that NO ONE in any society has
the right to blame his troubles on any else. Liberals
and liberal thought so-called have been a mess of mush
because of this unacknowledged assumption, and a tendency to
breed this state of mind.

The law of nature is that the animal must either
adapt itself to environment or overcome that environment, ==
soft life and decadence.

Decline of the american type, often bewailed! First the
pioneer, then the boob and the soft-head! Flooding
of peasant type, without peasant perseverance and peasant
patience in face of low return!

Ability to think part of the adaption to environment!

///

Laziness of whole generations, all the back bone of
Jefferson's thought and of VanBuren's forgotten! Benefits
of latter, lost in civil war and post civil war finance!

All of which is not wholly alien to my subject.

All questions of how measures can be taken, how enforced,
are questions of politics.

ECONOMICS is concerned with determining WHAT financial measures

Politics

a necessary digression

or lack-of= system
Science or no science an economic system is bound to
be affected by the political system in which
beside which it exists, and more especially by the
preconceptions or prejudices or predispositions and
attitudes implied in the political system.

The preconception of democracy, let us say at its
best, democracy as it existed in the minds of Jefferson
and VanBuren, is that the best men, kaloskagathoi etc.
will take the trouble to place their ideas and policies
before the majority with such clarity and
persuasiveness that the majority will accept their guidance
i.e. "be right."

The preconception of let us say the Adamses, or
aristodemocratic parties is that privilege, a little of
it, will breed a sense of responsibility.

The further Toolysm is that the best sind be served.

In practice it is claimed that the best get tired or
fail to exert themselves to the necessary degree.

It seems fairly proved that privilege does NOT
breed a sense of responsibility. Individuals, let us
say exceptional individuals, in privileged classes
maintain the sense of responsibility, but

to arrange these things in his own mind in an orderly fashion, or shirk coming to conclusions about them. i.e. as man living per force among other men, affected by their actions, and by his affecting them.

To separate ideas that are not identical, to determine their relations.

As to the history of the subject, a fig for that history save in so far as it applies to the present and to the day after tomorrow.

A democracy, the majority which "decides" in a way, is not necessarily a democracy functioning as such.wd. presumably choose sound economics shortly after it had learned to distinguish the sound from the unsound. Subjects of an autocrat wd. obey, and continue obeying the economic as long as the orders were economically decisions of their ruler or rulers for a considerable period after those orders were unsound. Various durations of patience in intermediate forms of government.

A break, revolution, chaos need not imply any new discovery or ambition or new form of soundness; it is nevertheless usually engineered in the name of some form of justice, or some social belief with economic implications.

The point is that the orders of an omniscient despot and of an intelligent democracy wd. be very much alike in so far as they affected the main body of the country's economics. Whether as independent citizens, individuals etc., or as pack animals, the nutrition

There have been so called systems based on not on
any sound thought or equation but on nothing more
than a temporary accident, as say the chance of
swapping glass beads to the heathen, or the monopoly
of a trade route, or the willingness of indians to
swap forty square miles of land for a rifle.

Some of these systems have lasted for at least three
hundred years. Nile tolls are at the beginning of history.
Chengis under stood paper currency. The Mantuan's considered
a cloth pool on the lines of Hoover's government
buying of wheat. There is probably no inventable scheme
or measure that can't be upholstered with historic
background.

Chapter

IN 1932 where we are we ?

I. For civilized countries the problem of production is solved. They are doubtless particular products not producible in particular geographic areas, and in particular uncivilized areas where industrialization, improved methods of production wd. solve the local troubles, but for the " great powers " etc. the problem is not production.

2. The shortening of the working day ( say to 5 or 4 hours ) would so aid the general distribution in all civilized countries that they cd. carry on without other change

40

One man asleep at a switch can very greatly discommode
quite a good railway.

In a world of Kreugers and Mellons you might say the
switch boards are enveloped ( on purpose ) in darkness.

What I am getting at is, that with all the solvable
problems solved, clear and in the open, there will
still be " opportunity " there will still be need to
use wits.

## Chapter III
Inflation (Science as distinct from art in economics)

Inflation was said to be " understood " in Germany after
the war. There are now almost universal cries for
inflation (Germany, U.S.A. and elsewhere).

There are very few demands for control of
inflation.

Inflation is perhaps the ambiguous or模糊ly can be flagging
homonym for a dozen or more manoeuvres.

Dissociate what we can. For many people it means
merely abandoning the gold standard. Merely having
certificates for something other than precious metal.